OFFCN EDUCATION TECHNOLOGY CO., LTD. First Quarter 2020 Report Stock Code: 002607Stock Abbr.: OFFCN EDU April, 2020 Chapter I. Important Notes The board of directors, the supervisor committee, the directors, supervisors, and senior management of thecompany shall hereby guarantee the authenticity, accuracy and completeness of this Q1 Report also withoutmisrepresentations, misleading statements, or material omissions, and bear individual and joint legal liabilities.This report is prepared and published in Chinese version, and the English version is for reference only. Should therebe any inconsistency between the Chinese version and English version, the Chinese version shall prevail.All directors attended the board meeting approving the First Quarter 2020 Report.Wang Zhendong, the Company’s legal representative, Shi Lei, the person in charge of accounting work, and LuoXue, head of the accounting department, hereby declare that the financial report in this report is authentic, accurateand complete.Non-standard audit report □Applicable √ Not applicable Chapter II. Corporate ProfileSection I. Key accounting information and financial indicators Does the Company need to adjust its financial information retrospectively or restate its previous year accountinginformation? □ Yes √ No | During the Reporting Period | Same Period of the Previous Year | Increase/Decrease Over Same Period of the Previous Year | | Operating Revenue (RMB) | 1,230,102,270.48 | 1,311,632,662.04 | -6.22% | | Net profit attributable to shareholders of the listed Company (RMB) | 116,303,799.91 | 106,193,482.28 | 9.52% | | Net profit after deducting non-recurring profit or loss attributable to shareholders of the listed Company (RMB) | 77,685,654.82 | 107,644,815.54 | -27.83% | | Net cash flow from operating activities (RMB) | 2,564,218,312.85 | 2,422,743,973.91 | 5.84% | | Basic earnings per share (RMB/share) | 0.02 | 0.02 | 0.00% | | Diluted earnings per share (RMB/share) | 0.02 | 0.02 | 0.00% | | Weighted average return on net assets | 3.33% | 3.52% | -0.19% | | At the end of this reporting period | At the end of the previous year | Increase/Decrease over the end of the previous year | | Total assets (RMB) | 13,358,747,832.48 | 9,960,705,427.94 | 34.11% | | Net assets attributable to the shareholders of the listed Company | 2,081,123,850.37 | 3,431,545,903.82 | -39.35% |
| The total share capital of the Company as of the previous trading day before disclosure（share） | 6,167,399,389 |
| Dividends paid for preferred shares | 0.00 | | Fully diluted earnings per share calculated using the latest share capital (RMB/share): | 0.0189 |
Items and amounts of non-recurring profit or loss: √ Applicable □ Not applicable Unit: RMB | Item | Amount from beginning of the year 2020 to end of the reporting period | Notes | | Profit or loss on disposal of non-current assets (including the offsetting amount for the provision of impairment of assets) | 12,208.74 | | | Tax refunds, reductions or exemptions without approval or formal approval documents | | | | Government subsidies included in the current profit and loss (not including subsidies enjoyed in quota or ration according to national standards, which are closely relevant to the Company’s business.) | 57,122.37 | | | Capital occupation fees charged to non-financial enterprises included in the current profit and loss | | | | The Company can obtain the differences when the investment cost of an enterprise's acquisition of subsidiaries, associates and joint ventures is less than the income derived from the fair value of the identifiable net assets of the investee | | | | Profit or loss from non-monetary asset exchange | | | | Profit or loss from entrusting others to invest or manage assets | 30,110,485.43 | | | Provision for impairment of assets due to force majeure factors, such as natural disasters | | | | Profit or loss from debt restructuring | | | | Enterprise restructuring costs, such as expenses for relocating employees, integration costs, etc. | | | | Profit or loss in excess of fair value resulting from transactions where the transaction price was significantly unfair | | | | Net profit or loss for the period from the beginning of the subsidiary to the business combination date resulting from a business combination under the same control | | | | Profit or loss from contingencies unrelated to the Company's normal business operations | | |
| In addition to the effective hedging business related to the Company's normal business operations, profit or loss from changes in fair value of the holding of financial assets held for trading, derivative financial assets, financial liabilities held for trading and derivative financial liabilities, and profit on investments from disposal of financial assets held for trading, derivative financial assets, financial liabilities held for trading and derivative financial liabilities and other debt investments. | | | | Reversals of the provision for receivables and contract asset that are individually tested for impairment | | | | Profit or loss from external entrusted loans | | | | Profit or loss from changes in the fair value of investment in real estate that are subsequently measured at the fair value model | | | | The impact on the current profit and loss resulted from a one-off adjustment in accordance with the requirements of tax and accounting laws and regulations | | | | Trustee fee income from entrusted operations | | | | Non-operating income and expenses other than the above | -74,901.22 | | | Other profit or loss items that meet the definition of non-recurring profit and loss | 17,714,961.47 | | | | | | Less：Influenced amount of income tax | 9,201,731.70 | | | Impact on minority shareholders’ equity (after tax) | | | | Total | 38,618,145.09 | -- |
Section II. Tables on the total number of shareholders and shares held by the top 10shareholders at the end of the reporting period 1. Table on the total number of common shareholders, number of preferred shareholders with restoredvoting rights and shares held by the top 10 shareholders Unit: share(s) | Total number of common shareholders at the end of reporting period | 24,555 | Total number of preferred shareholders with restored voting rights at end of the reporting period (if any) | 0 | | Particulars about shares held by the top 10 shareholders | | Name of shareholder | Nature of shareholder | Shareholding percentage (%) | Shares held | Number of shares held with sales restrictions | Pledged or frozen | | Status of shares | Amount | | Lu Zhongfang | Domestic natural person | 41.36% | 2,550,549,260 | 2,550,549,260 | Pledged | 400,000,000 | | Li Yongxin | Domestic natural person | 18.35% | 1,131,415,121 | 1,058,718,560 | Pledged | 738,150,000 | | Wang Zhendong | Domestic natural person | 15.61% | 962,471,418 | 962,471,418 | Pledged | 107,100,000 | | Beijing Aerospace Industry Investment Fund (Limited Partnership) | Domestic non-state-owned legal person | 4.33% | 267,353,171 | 267,353,171 | | | | Beijing Guangyin Venture Capital Center (Limited Partnership) | Domestic non-state-owned legal person | 2.89% | 178,235,447 | 178,235,447 | Pledged | 30,000,000 | | Beijing Kerui Technology Innovation Investment Center (Limited Partnership) | Domestic non-state-owned legal person | 1.44% | 89,117,723 | 89,117,723 | | | | Beijing Offcn Future Information Consulting Center (Limited Partnership) | Domestic non-state-owned legal person | 1.30% | 80,000,000 | 0 | | |
| Zhou Xiayun | Domestic natural person | 1.28% | 78,848,640 | 0 | Pledged | 37,148,845 | | Zhou Hui | Domestic natural person | 1.17% | 72,277,920 | 0 | Pledged | 17,792,000 | | Zhou Li | Domestic natural person | 0.78% | 48,185,280 | 0 | | | | Particulars about shares held by the top 10 shareholders without sales restrictions | | Name of shareholder | Number of shares without sales restrictions held | Type of shares | | Type of shares | Quantity | | Beijing Offcn Future Information Consulting Center (Limited Partnership) | 80,000,000 | RMB common shares | 80,000,000 | | Zhou Xiayun | 78,848,640 | RMB common shares | 78,848,640 | | Li Yongxin | 72,696,561 | RMB common shares | 72,696,561 | | Zhou Hui | 72,277,920 | RMB common shares | 72,277,920 | | Zhou Li | 48,185,280 | RMB common shares | 48,185,280 | | Hong Kong Securities Clearing Company Ltd. | 43,495,739 | RMB common shares | 43,495,739 | | China Citic Bank Co. Ltd.- Bank of Communications Schroeder New Vitality Flexible Allocation of Hybrid Securities Investment Fund | 25,345,974 | RMB common shares | 25,345,974 | | National Social Security Fund Combination 102 | 16,500,276 | RMB common shares | 16,500,276 | | China Construction Bank Co. Ltd.-Bank of Communications Schroeder Kernel-Driven Hybrid Securities Investment Fund | 12,532,021 | RMB common shares | 12,532,021 | | National Social Security Fund Combination 414 | 11,492,724 | RMB common shares | 11,492,724 |
| Explanation on the related relationship and concerted actions among the above-mentioned shareholders | The controlling shareholders and the actual controllers of the Company Lu Zhongfang and Li Yongxin are mother and son. Lu Zhongfang, Li Yongxin and Beijing Offcn Future Information Consulting Center (Limited Partnership) are acting in concert. Zhou Xiayun and Zhou Hui are father and son. Zhou Xiayun and Zhouli are father and daughter. The Company does not know whether the other shareholders are related parties or whether they are acting-in-concert parties. | | Explanation on the top 10 shareholders’ participation in margin financing (if any) | N/A |
Chapter III. Significant EventsSection I. Cases and reasons of main financial data and indicators fluctuation during thereporting period. √ Applicable □ Not applicable Unit: RMB | Balance Sheet | Closing Balance | Opening Balance | Growth | Statements |
| Cash and cash equivalents | 1,149,021,038.61 | 2,724,335,001.58 | -57.82% | The decrease is mainly due to the optimizing of fund management and timely purchasing of financial products. | | Financial assets held for trading | 5,931,135,332.29 | 1,754,396,227.54 | 238.07% | The growth is mainly due to increase in payment collection from training business in this period, increase in purchasing of financial products, and the cumulative impact of the part of financial products that have not been redeemed at the beginning of the period. | | Account receivable | 8,414,291.79 | 2,721,638.09 | 209.16% | The growth is mainly due to the increase in rent receivable of retained assets in the major asset restructuring plan for external lease. |
| Prepayments | 3,259,770.00 | 2,461,009.00 | 32.46% | The growth is mainly due to increase in prepayment to travel agency for air tickets for employees’ business trips. |
| Other receivables | 464,762,227.06 | 255,013,296.96 | 82.25% |
| Other current assets | 186,411,240.41 | 97,336,600.16 | 91.51% | The growth is mainly due to the increase in prepayments for rented properties during this period. |
| Deferred tax assets | 10,982,832.13 | 21,482,832.13 | -48.88% | The decrease is mainly due to the payment of employee compensation accrued in previous years during this period. | | Other non-current assets | 440,810,338.01 | 325,967,628.34 | 35.23% | The growth is mainly due to the prepayment for decoration of the learning centers at branch schools during this period. |
| Short-term borrowings | 3,717,000,000.00 | 2,867,000,000.00 | 29.65% | The main reasons of the growth are the following ones. 1. Acquisition of Shanxi Guancheng Learning Center and prepayment for cooperation |
| | | | construction fund of Liaoning Offcn Shenfu Learning Center 2.Policy support from financial institutions during pandemic period 3.Reserved funds to cope with uncertainty of offline courses start time. | | Accounts payable | 31,879,174.21 | 236,481,990.86 | -86.52% | The decrease is mainly due to settlement and payment of accounts payable at the beginning of this period. |
| Receipts in advance | | 2,634,276,203.88 | -100.00% | The decrease is due to adjustment of "advance receipts" carried forward within one year to the "contract liabilities" and "other current liabilities" based on the new revenue standard. | | Contract liabilities | 5,471,543,237.02 | | | It is due to adjustment of the part of "advance receipts" carried forward within one year without tax to "contract liabilities" based on the new revenue standard. By comparable caliber, it grows by RMB 2.914 billion from the beginning of the year with a growth rate of 113.94%, and it grows by RMB 1.238 billion from the same period of last year with a growth rate of 29.25%. The reason is that during this reporting period, the Company made great efforts to efficiently conduct Online-Merge-Offline(OMO) courses with effective whole-staff marketing strategy, and eventually achieve substantial increase in receipts from training. | | Employee benefits payable | 213,784,491.96 | 411,475,636.03 | -48.04% | The decrease is mainly due to calculation and payment of last year’s salary during this period, and deduction of social insurance carried by the Company during the pandemic period. |
| Taxes payable | 58,604,750.12 | 184,306,027.84 | -68.20% | The decrease is mainly due to actual payment of corporate income tax of fourth quarter last year and VAT in December during this period. At the same time, the Company enjoys corresponding national tax relief during the pandemic. It results in decrease of tax payable. | | Other payables | 1,514,376,992.94 | 88,693,411.98 | 1,607.43% | The growth is mainly due to accrued profits payable to shareholders in 2019 but not actually paid during this period. |
| Other current liabilities | 164,146,297.11 | | | It is due to the adjustment of tax on “advance |
| | | | receipts” carried forward within one year to be transferred to “other current liabilities” based on the new revenue standard. | | The Income Statement | January-March, 2020 | January-March, 2019 | Growth | Statements | | Total operating revenue | 1,230,102,270.48 | 1,311,632,662.04 | -6.22% | The decrease is mainly due to the pandemic, offline courses cannot be carried out on a large scale in February and March. Meanwhile, due to impact from delay of some recruitment and qualification exams, some training payment collections do not meet income recognition criteria by the end of first quarter. It results in lower income than the same period last year. | | Total operating cost | 1,167,262,125.00 | 1,212,555,458.51 | -3.74% | The decrease is mainly due to the pandemic, cost on courses opening, business travel, marketing and social insurance during this period decreases from the same period last year. | | Taxes and surcharges | 3,265,783.95 | 7,017,678.96 | -53.46% | The decrease is mainly due to tax relief during pandemic period. | | Financial expenses | 55,032,787.52 | 37,721,220.70 | 45.89% | The growth is mainly due to increase of short term loan from financial institution during this period. | | Other income | 36,688,536.72 | 33,195.73 | 110,421.86% | The growth is mainly due to VAT relief during the pandemic period. | | Investment income | 49,118,685.21 | 32,216,225.92 | 52.47% | The growth is mainly due to increasing scale of short term financial products. | | Non-operating income | 100.00 | 337,999.26 | -99.97% | The decrease is mainly due to VAT relief being listed into “other income”. | | Net profit | 116,301,251.23 | 106,193,482.28 | 9.52% | The growth is mainly due to large growth in other income. | | Cash Flow Statement | January-March, 2020 | January-March, 2019 | Growth | Statements |
| Cash receipts from the sale of goods and the rendering of services | 4,268,644,542.62 | 3,787,712,684.29 | 12.70% | The growth is mainly due to increase in training fees collected in advance from students during this period. | | Other cash receipts relating to other operating activities | 3,552,880.40 | 226,068.58 | 1,471.59% | The growth is mainly due to government subsidies and increase in interest from bank deposits. | | Cash paid to and for employees | 1,090,339,239.09 | 801,689,160.29 | 36.01% | The growth is mainly due to increase in salary paid to employees. |
| Cash received from return of investment | 9,555,548,985.25 | 2,817,530,000.00 | 239.15% | The growth is mainly due to redemption of financial products. It is the cumulative redemption amount of short-term financial products. | | Cash received from investments | 31,375,210.42 | 16,682,775.57 | 88.07% | The growth is mainly due to increase in income from financial products during this period. | | Cash payments to acquire or construct fixed assets, intangible assets and other long-term assets | 812,081,033.98 | 8,436,483.33 | 9,525.82% | The growth is mainly due to the acquisition of Shanxi Guancheng Learning Center during this period, the prepayment of the construction fund of Liaoning Offcn Shenfu Learning Center, and the payment of construction and decoration. | | Cash paid to acquire investments | 13,732,288,090.00 | 5,708,470,000.00 | 140.56% | The growth is mainly due to optimizing of capital management and increase in financial products purchasing during this period. It is cumulative purchase amount of short term financial products. | | Cash received from loans | 1,660,000,000.00 | 360,000,000.00 | 361.11% | The growth is mainly due to increase in borrowings from banks. | | Cash repayments of loans | 810,000,000.00 | | | It is mainly due to repayment of bank loan due during this period. |
| Cash payments for distribution of dividends, profits or interest | 32,099,556.25 | 16,945,425.00 | 89.43% | The growth is mainly due to increase in interest of bank loans during this period. |
| Commitment | Type of commitment | Content of commitment | Time of commitment | Period of commitment | Performance | | Lu Zhongfang, Li Yongxin, Wang Zhendong, Guo Shihong, Liu Bin, Zhang Yongsheng, Yang Shaofeng, Zhang Zhian | Performance commitment and compensation arrangement | 1. The profit forecast and compensation periods are the years of 2018, 2019 and 2020. 2. Performance commitment: The compensation obligors confirm and promise that the net profits attributable to the shareholders of the parent company after deducting non-recurring profits and losses under the consolidated statements of Offcn Ltd. shall not be less than 930 million RMB, 1.3 billion RMB and 1.65 billion RMB in years of 2018, 2019 and 2020 respectively. 3. The parties agree that the certified public accountants employed by Yaxia Automobile shall review the actual net profits of Offcn Ltd. after the end of each of the three fiscal years. The difference between the actual net profits of Offcn Ltd. and the net profits committed by the compensation obligors shall be reviewed and a special audit report shall be issued. At the end of the third fiscal year, an auditing agency with qualifications for executing securities and futures engaged by Yaxia Automobile will conduct an impairment test on Offcn Ltd. and issue an impairment test report, within 90 days after the certified public accountant issues a special audit report. 4. Compensation measures: (1) If the certified public accountant confirms that the actual net profits accumulated by Offcn Ltd. fails to meet the aggregate committed net profits as of the end of each of three fiscal years, each compensation obligor shall assume the compensation obligation according to the proportion of the shares to the total shares of Offcn Ltd. held by all the compensation obligors before the transaction. All compensation obligors are given priority to conduct compensation with shares. When the total amount of share compensation reaches 90% of the total number of shares issued for purchasing assets, all compensation obligors shall conduct compensation in cash. The formula for calculating the amount of compensation payable by the obligors in the current period is as follows: compensation amount for the current period = (aggregate committed net profits as of the end of the current period - accumulated net profits as of the end of the current period) ÷ the sum of committed net profits of years within the compensation period × the price of Offcn Ltd. in this transaction - aggregate compensated amount. In the application of the above formulas, it should be as follows: ① “As of the end of the current period” | May 4, 2018 | Years of 2018, 2019, 2020 | Performance commitments of the year 2018 and 2019 have been fulfilled. |
| | by other legal means. In order to avoid ambiguity, the compensation obligors shall not bear joint liability for the above compensation obligations. ②Yaxia Automobile shall notify all compensation obligors in writing within 5 working days after the date of announcement of resolution by the shareholders’ meeting. All compensation obligors shall transfer their compensation shares of the current year to the designated account set up by the board of directors of Yaxia Automobile at a total price of 1.00 RMB within 5 working days after receiving the aforementioned notice, and cancel the repurchase of aforementioned shares in accordance with relevant laws and regulations. (If there are changes in relevant laws and regulations and/or in regulations of relevant authorities at that time, the cancellation shall be completed in accordance with the relevant regulations at that time) ③From the date on which the number of compensation shares of each compensation obligor is determined until the cancellation of these shares, these shares are with no voting rights or rights for dividend distribution. ④ If the compensation obligor needs to compensate Yaxia Automobile in cash in accordance with the stipulations of the Profit Forecast Compensation Agreement, each compensation obligor shall pay the compensation amount to Yaxia Automobile within the period specified in the notice. In case of overdue payment, the compensation obligor shall pay the late payment interest to Yaxia Automobile on the overdue portion at daily interest rate of 5?, with the continuity of obligation of compensation. | | | | | Yaxia Industry, Zhou Xiayun, Zhou Hui, Zhou Li, Phase I employee stock ownership plan | Letter of commitment on lock-up period | After the completion of the transaction (starting from the date of the listing of shares issued in this transaction), the company/I/the plan shall not transfer the company's shares in Yaxia Automobile within 36 months . After the completion of the transaction, the shares held by the Company/I/the plan, derived from Yaxia Automobile shares due to the distribution of stock dividends and the transfer of the capital reserve to share capital shall also comply with the above-mentioned arrangement of restricted sale of shares. If the China Securities Regulatory Commission and/or Shenzhen Stock Exchange have/has other provisions for the above-mentioned lock-up period arrangement , the company/I/the plan will adjust and implement the above-mentioned lock-up period according to the latest regulations of the China | May 4, 2018 | Jan. 31, 2022 | Normalcy |
| | Securities Regulatory Commission and/or Shenzhen Stock Exchange. If violating the above commitments, the company/I/the plan will bear all losses caused to Yaxia Automobile. | | | | | Li Yongxin | Letter of Commitment on lock-up period for subscription of shares | 1. The shares of the listed Company subscribed by myself in this transaction shall not be transferred or dealt with in any other forms within 36 months from the date of the listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for consecutive 20 trading days , or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue price, the lock-up period of consideration shares acquired by myself is automatically extended for 6 months. (If dividend distribution, bonus shares, transfer of capital stock, or allotment to the listed Company occurred during the above period, the aforementioned issue price is calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) 2. As the transferee of 72,696,561 Yaxia Automobile shares held by Anhui Yaxia Industry Co., Ltd., I shall not transfer them within 36 months from the date of registration in my securities account. 3. The aforesaid arrangement of share lock-up does not affect the implementation of profit compensation for this transaction, that is, when I need to make profit compensation, the listed Company has the right to relieve the lock-up of shares in corresponding amount in advance for profit compensation. 4. I promise to abide by the following provision: if the transaction is investigated by judiciary authorities or the China Securities Regulatory Commission on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 5. After the completion of this transaction, my increased shares due to bonus shares and transfer of capital stock of the listed Company shall also comply with the foregoing requirements. 6. If the aforementioned lock-up period arrangement does not match the latest laws and regulations and the latest regulatory requirements of the securities regulatory institution, the enterprise agrees to implement the latest laws and regulations and the | Apr. 27, 2018 | Jan. 31, 2022 | Normalcy |
| | requirements of the regulatory agency. 7. After the lock-up period expires, it will be implemented in accordance with the relevant regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange. | | | | | Lu Zhongfang | Letter of commitment on lock-up period for subscription of shares | 1. The shares of the listed Company subscribed by myself in this transaction shall not be transferred or dealt with in any other forms within 36 months from the date of listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for consecutive 20 trading days , or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue price, the lock-up period of consideration shares acquired in this transaction by myself is automatically extended for 6 months. (If dividend distribution, bonus shares, transfer of capital stock, or allotment to the listed Company occurred during the above period, the aforementioned issuance price is calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) 2. The aforesaid share lock-up arrangement does not affect the implementation of profit compensation for this transaction, that is, when I need to make profit compensation, the listed Company has the right to relieve the lock-up of shares in corresponding amount in advance for profit compensation. 3. I promise to abide by the following provision: if the transaction is investigated by judiciary authorities or the China Securities Regulatory Commission on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 4. After the completion of this transaction, my increased shares due to bonus shares and transfer of capital stock of the listed Company shall also comply with the foregoing requirements. 5. If the aforementioned lock-up period arrangement does not match the latest laws and regulations and the latest regulatory requirements of the securities regulatory institution, I agree to implement the latest laws and regulations and the requirements of the regulatory agency. 6. After the lock-up period expires, it will be implemented in accordance with the relevant regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange. | Apr. 27, 2018 | Jan.31, 2022 | Normalcy |
| Kerui Technology Innovation | Letter of commitment on lock-up period for subscription of shares | 1. The shares of the listed Company subscribed by the enterprise in this transaction shall not be transferred or dealt with in any other forms within 36 months from the date of listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for consecutive 20 trading days , or the closing price of the stock at the end of the 6 months after the listing of the stock is lower than the issue price, the lock-up period of consideration shares acquired in this transaction is automatically extended for 6 months. (If dividend distribution, bonus shares, transfer of capital stock, or allotment to the listed Company occurred during the above period, the aforementioned issue price is calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) 2. The enterprise promises to abide by the following provision: if the transaction is investigated by judiciary authorities or the China Securities Regulatory Commission on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 3. After the completion of this transaction, the shares that the enterprise owns increased due to bonus shares and transfer of capital stock of the listed Company shall also comply with the foregoing requirements. 4. If the aforementioned lock-up period arrangement does not match the latest laws and regulations and the latest regulatory requirements of the securities regulatory institution, the enterprise agrees to implement the latest laws and regulations and the requirements of the regulatory agency. 5. After the lock-up period expires, it will be implemented in accordance with the relevant regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange. | Jul. 27, 2018 | Jan.31, 2022 | Normalcy | | Aerospace Industry, Guangyin Venture | Letter of commitment on lock-up period for subscription of shares | 1. The shares of the listed Company subscribed by the enterprise in this transaction shall not be transferred or dealt with in any other forms within 24 months from the date of listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for 20 consecutive trading days , or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue price, the lock-up period of consideration shares acquired in this transaction is automatically extended for 6 months. | Jul. 27, 2018 | Jan. 31, 2021 | Normalcy |
| | (If dividend distribution, bonus shares, transfer of capital stock, or allotment to the listed Company occurred during the above period, the aforementioned issue price is calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) 2. The enterprise promises to abide by the following provision: if the transaction is investigated by judiciary authorities or the China Securities Regulatory Commission on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 3. After the completion of this transaction, the shares that the enterprise owns increased due to bonus shares and transfer of capital stock of the listed Company shall also comply with the foregoing requirements. 4. If the aforementioned lock-up period arrangement does not match the latest laws and regulations and the latest regulatory requirements of the securities regulatory institution, the enterprise agrees to implement the latest laws and regulations and the requirements of the regulatory agency. 5. After the lock-up period expires, it will be implemented in accordance with the relevant regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange. | | | | | Wang Zhendong, Guo Shihong, Liu Bin, Zhang Yongsheng, Yang Shaofeng, Zhang Zhian | Letter of commitment on lock-up period for subscription of shares | 1. The shares of the listed Company subscribed by myself in this transaction shall not be transferred or dealt with in any other forms within 24 months from the date of listing of the shares. Within 6 months after the listing of the shares, if the closing price of the listed Company stock is lower than the issue price for consecutive 20 trading days , or the closing price of the stock at the end of the 6 months after the listing of the shares is lower than the issue price, the lock-up period of consideration shares acquired in this transaction by myself is automatically extended for 6 months. (If dividend distribution, bonus shares, transfer of capital stock, or allotment to the listed Company occurred during the above period, the aforementioned issuance price is calculated based on the price adjusted by factors as ex-dividend and ex-rights, etc.) If Offcn Ltd. fails to meet the committed net profits as stipulated in the Profit Forecast Compensation Agreement in either 2018 or 2019, the lock-up period of the shares of the listed Company I obtained in this transaction will be extended to 36 months. At the | Jul. 27, 2018 | Jan.31,2021 | Normalcy |
| | expiration of 36 months from the date when the aforementioned shares are registered to my securities account, if the performance compensation obligations under the Profit Forecast Compensation Agreement have not been fulfilled, the above lock-up period will be extended to the date when the compensation obligations are fulfilled. 2. The aforesaid share lock-up arrangement does not affect the implementation of profit compensation for this transaction, that is, when I need to make profit compensation, the listed Company has the right to relieve the shares in corresponding amount in advance for profit compensation. 3. I promise to abide by the following provision: if the transaction is investigated by judiciary authorities or the China Securities Regulatory Commission on suspicion of misrepresentations, misleading statements, or material omissions in regard to the information provided or disclosed, the shares of the listed Company acquired in this transaction shall not be transferred until the conclusion of the investigation is clarified. 4. After the completion of this transaction, my increased shares due to bonus shares and transfer of capital stock of the listed Company shall also comply with the foregoing requirements. 5. If the aforementioned lock-up period arrangement does not match the latest laws and regulations and the latest regulatory requirements of the securities regulatory institution, I agree to implement the latest laws and regulations and the requirements of the regulatory agency. 6. After the lock-up period expires, it will be implemented in accordance with the relevant regulations of the China Securities Regulatory Commission and the Shenzhen Stock Exchange. | | | | | Offcn Partnership | Letter of commitment on the lock-up of shares | Within 36 months from the date of the transfer of 80,000,000 shares of Yaxia Automobile held by Anhui Yaxia Industry Co., Ltd. to the enterprise, the shares shall not be transferred. The lock-up period of the shares increased during the above period due to bonus shares, transfer of capital stock or allotment of shares by Yaxia Automobile, shall also comply with the foregoing requirements. If the company violates commitments listed above, it will bear all losses caused to Yaxia Automobile. | Apr. 27, 2018 | Jan.31,2022 | Normalcy | | Li Yongxin and other 10 counterparties | Letter of commitment on the lock-up of Offcn | Within 36 months from the date of the transfer of 80,000,000 shares of Yaxia Automobile held by Anhui Yaxia Industry Co.,Ltd. to Beijing Offcn Future Information Consulting Center (Limited | Jul. 27, 2018 | Jan.31, 2022 | Normalcy |
| Partnership’s contribution shares | Partnership), I or the company shall not in any way transfer the shares of Beijing Offcn Future Information Consulting Center (Limited Partnership) or withdraw from the partnership with Beijing Offcn Future Information Consulting Center (Limited Partnership), nor do we transfer, assign or authorize other entities in any way to fully or partially have the rights and interests indirectly related to the shares of Yaxia Industry Co., Ltd. held by Beijing Offcn Future Information Consulting Center (Limited Partnership). | | | | | Li Yongxin, Lu Zhongfang, Wang Zhendong, Offcn Partnership | Letter of commitment on maintaining independence of the listed Company | 1. Guarantee the independence of the listed Company’s personnel (1) It is guaranteed that after the completion of transaction, the labor, personnel and salary management of the listed Company shall completely independent from myself/Offcn Partnership, and from other related parties, such as companies, enterprises or economic organizations, controlled by myself/Offcn Partnership. (2) Ii is guaranteed that after the completion of transaction, senior executives shall work as full-time employees and receive remuneration in the listed Company. They shall not hold any positions other than directors or supervisors in other companies, enterprises, or economic organizations controlled by myself/Offcn Partnership. (3) It is guaranteed that after the completion of transaction, the official powers of the shareholders’ meeting and board of director on personnel appointments and dismissals shall not be interfered. 2. Guarantee the independence of institutes of the listed Company (1) It is guaranteed that after the completion of transaction, the listed Company shall build a sound structure of corporate governance and develop an independent and complete organizational structure. (2) It is guaranteed that after the completion of transaction, the shareholders’ meeting, the board of directors, and the board of supervisors shall independently exercise their powers in accordance with laws, regulations and company’s articles. 3. Guarantee the independence and completeness of the assets of the listed Company. (1) It is guaranteed that after the transaction, the listed Company shall have independent and complete assets related to production and operation. (2) It is guaranteed that after the completion of transaction, the business premises of the listed Company shall be independent from myself/Offcn Partnership, and other related parties, such as | Apr. 27, 2018 | Long-term | Normalcy |
| | Company shall not hold part-time positions in other related parties, such as companies, enterprises or other economic organizations controlled by myself or Offcn Partnership (4) It is guaranteed that after the completion of transaction, the listed Company can make financial decisions independently. I/Offcn Partnership shall not interfere with the use of funds by the listed Company. (5) It is guaranteed that after the completion of transaction, the listed Company will pay taxes independently according to laws. I/Offcn Partnership shall be liable for all losses caused to the listed Company and its subsidiaries due to my/Offcn Partnership’s failure in fulfilling the above commitments. | | | | | Li Yongxin, Lu Zhongfang | Letter of Commitment on avoiding horizontal competition | 1. As of the date of signing this commitment letter, myself, my close relatives and other companies, enterprises or economic organizations controlled by myself, and my close relatives. Except for Beijing Offcn Online Education Technology Co., Ltd. (hereinafter referred to as Offcn Online), controlled by my relatives Xuhua and Lu Yan, and its affiliated schools which are involved in the same or similar businesses conducted by Offcn Ltd., other related parties are not involved in any same, similar or related businesses conducted by the listed Company, Offcn Ltd. and its affiliated companies and schools.. Except for serving as a director in Kunming Wuhua Offcn training school, which is affiliated to Offcn Online, Li Yongxin neither holds any full-time or part-time positions nor provides consultancy at any companies or enterprises, which conducts competitive businesses with the listed Company, Offcn Ltd. and their affiliates. I also hold directly or indirectly no any stock rights(shares) of companies or enterprises conducting the same, similar or related businesses as the listed Company, Offcn Ltd. and its affiliates. 2. As of the date of signing this commitment letter, Offcn Online and its two subordinate training schools’ disposals are as follow: Offcn Online conducts no education businesses(to be canceled after subordinate schools transferred). Kairuier Training School in Haidian District of Beijing is to be transferred to an unrelated third party and the transfer agreement has been signed. If the transfer is not completed within 24 months since the date of signing this commitment letter, I will urge Offcn Online to cancel the Kairuier Training School in Haidian District of Beijing. Kunming Wuhua Offcn Training School, associated with Offcn Online, has been closed and it will be transferred to an unrelated third party or will be canceled within 12 months after the revised | Sept. 20, 2018 | 1. The transfer of Kairuier Training School in Haidian District of Beijing: within 24 months from the date of the signing of this letter of commitment 2. The transfer of Kunming Wuhua Offcn Training School : within 12 months after the revised Regulations of Implementation officially promulgated and implemented and supporting regulations formulated by relevant local education authorities in accordance with the revised Regulations of Implementation comes into effect. | As of the end of the reporting period, Kairuier Training School Haidian District of Beijing had been transferred to an unrelated third party. Other commitments are under implementation normally. |
| | Company and its affiliates. 5. I promise that if I, my close relatives and other related parties, such as companies, enterprises or other economic organizations controlled by myself and my close relatives obtain any business opportunities from any third party, which can or may compete with the listed Company and its affiliates in the future, I will notify the listed Company and its affiliates in writing within 5 working days. After obtaining the third party’s promise, I will attempt to transfer these business opportunities to the listed Company and its affiliates. 6. I guarantee that I would never use my knowledge about and the information I’m aware of the listed Company and its affiliates to assistant third parties to engage, participate, or invest in businesses or projects that compete with the listed companies and its affiliates. 7. If I violate the above commitments, the benefits obtained by the violation of commitments shall belong to the listed Company and I shall be liable for all losses caused to the listed Company and its affiliates. Within 30 working days since receiving the writing notice from the listed Company, compensation will be made in cash. 8. I will disclose relevant information in a timely manner if commitments fail to be fulfilled or to be fulfilled on schedule because of objective reasons, such as changes in relevant laws, regulations and policies, or natural disasters. Except for the above-mentioned objective reasons, if the commitment is anyhow unable to be fulfilled or fulfilling the commitment is not conducive to safeguarding the rights and interests of the listed Company, I should fully disclose the reasons and either provide a new commitment to the listed Company and related investors to replace the original one, or propose an exemption from fulfilling the commitment. 9. The commitment is valid from the date when the commit letter is signed to the time when I cease to be the actual controller of the listed Company. | | | | | Wang Zhendong, Offcn Partnership | Letter of Commitment on avoiding horizontal competition | 1. As of the date of signing this letter of commitments, I, my close relatives, related parties, such as companies, enterprises or other economic organizations controlled by myself and my close relatives, Offcn Partnership and related parties, such as other enterprises or economic organizations controlled by Offcn Partnership, participate in no businesses which are the same, similar o or related to businesses competing with the listed Company, Offcn | Apr. 27, 2018 | Long-term | Normalcy |
| | Company and its affiliates. 3. I/Offcn Partnership promise that if I, my close relatives and other related parties, such as companies, enterprises or other economic organizations controlled by myself and my close relatives, Offcn Partnership and related parties, such as other enterprises or economic organizations controlled by Offcn Partnership, obtain any business opportunities from any third party, which can or may compete with the listed Company and its affiliates in the future, I/Offcn Partnership will immediately notify the listed Company. After obtaining the third party’s promise, I will attempt to transfer these business opportunities to the listed Company and its affiliates. 4. I guarantee that I would never use my knowledge about and the information I’m aware of the listed Company and its affiliates to assistant third parties to engage, participate, or invest in businesses or projects that compete with the listed companies and its affiliates. If I/Offcn Partnership shall be liable for all losses caused to the listed Company and its affiliates due to my/Offcn Partnership’s failure in fulfilling commitments. | | | | | Li Yongxin, Lu Zhongfang | Letter of Commitment on regulation and reduction of related-party transactions | 1. After the transaction is completed, during the time of being the actual controller of the listed Company, I, my close relatives and other companies, enterprises or other economic organizations controlled by myself, my close relatives will try to avoid and reduce the related-party transactions with the listed Company and its affiliates; unless it is necessary for the business development of the listed Company, any related-party transactions with the listed Company and its affiliates will not be conducted. 2. After the transaction is completed, for the related-party transactions which are unavoidable or reasonable to happen with the listed Company and its affiliates, I, my close relatives and other companies, enterprises or economic organizations controlled by myself and my close relatives, will sign related transaction agreements with the listed Company and its affiliates in accordance with the relevant laws, regulations and regulatory documents and follow the general business principles of equality, willingness, equivalence and paid-use. The prices of related-party transactions shall be fair. Decision-making procedures, lawful information disclosure obligations and relevant reporting and approval procedures regarding the related-party transactions, shall be followed. The status of shareholders shall not be used to damage the legitimate rights and interests of the | Jul. 27, 2018 | Long-term | Normalcy |
| | listed Company and other shareholders. 3. After the completion of the transaction, I will not use the shareholders’ rights of the listed Company to manipulate or instruct the listed Company or its directors, supervisors and senior executives to make the listed Company provide or accept funds, commodities, services or other assets under inequal conditions or engage in any behaviors that would damage the interests of the listed companies. 4. I will urge my close relatives and other companies, enterprises and other economic organizations controlled by myself and my close relatives to abide by the aforementioned commitments. 5. If I, my close relatives and other companies, enterprises and other economic organizations controlled by myself and my close relatives violate the above commitments, the profits obtained by the violation of commitments belong to the listed Company, and I shall be liable for all losses caused to the listed Company and its affiliates. Within 30 working days since receiving the written notice from the listed Company, compensation will be made in cash. 6. The commitment is valid from the date when it is signed to the time when I cease to be the actual controller of Yaxia Automobile and there is no other related relationship with Yaxia Automobile. | | | | | Wang Zhendong, Aerospace Industry, Offcn Partnership | Letter of Commitment on reduction and standardization of related-party transactions | 1. After the completion of transaction, during the period of being the actual controller/shareholder， I, my close relatives and other companies, enterprises or other economic organizations controlled by myself, my close relatives，Aerospace Industry or Offcn Partnership, will try to avoid and reduce the related-party transactions with the listed Company. 2. After the transaction is completed, for the related-party transactions which are unavoidable or reasonable to happen with the listed Company and its affiliates, myself, my close relatives and other companies, enterprises or economic organizations controlled by myself and my close relatives, Aerospace Industry or Offcn Partnership, will sign related transaction agreements with the listed Company and its affiliates in accordance with the relevant laws, regulations and regulatory documents and follow the general business principles of equality, willingness, equivalence and paid-use. The prices of related-party transactions shall be fair. Decision-making procedures, lawful information disclosure obligations and relevant reporting and approval procedures regarding the related-party transactions, shall be followed. The status of | Apr. 27, 2018 | Long-term | Normalcy |
Section IV. Operating performance forecast for January-June 2020 □ Applicable √ Not applicable Section V. Securities investment □ Applicable √ Not applicable There was no securities investment during the reporting period of the Company. | | shareholders shall not be used to damage the legitimate rights and interests of the listed Company and other shareholders. 3. After the completion of the transaction, I/Aerospace Industry/Offcn Partnership will not use the shareholders’ rights of the listed Company to manipulate or instruct the listed Company or the directors, supervisors and senior executives of the listed Company to make the listed Company provide or accept funds, commodities, services or other assets in different forms under inequal conditions or engage in any behaviors that would damage the interests of listed companies. I/Aerospace Industry/Offcn Partnership shall be liable for all losses caused to the listed Company and its affiliates due to my/Aerospace Industry’s/Offcn Partnership’s failures in fulfilling commitments. | | | Are the commitments fulfilled on time? | Yes | | If the commitment is overdue, the specific reasons for the unfulfilled performance and the next phase of work plan should be specified | Not applicable |
Section VI. Wealth managed under trust √ Applicable □ Not applicable Unit: RMB 10 thousands | Type | Funding Source for Entrusted Funds | Entrusted Finance Amount | Unexpired Balance | Overdue Outstanding Amount | | Bank wealth management products | Self-owned fund | 236,931.00 | 101,205.00 | 0.00 | | Brokerage wealth management products | Self-owned fund | 8,000.00 | 0.00 | 0.00 | | Trust wealth management products | Self-owned fund | 501,903.91 | 501,903.91 | 0.00 | | Total | 746,834.91 | 603,108.91 | 0.00 |
Chapter IV. Financial StatementsSection I. Financial statements 1. Consolidated balance sheet Company: Offcn Education Technology Co., Ltd. March 31, 2020 Unit: RMB | ITEM | March 31, 2020 | December 31, 2019 | | Current Assets: | | |
| Cash and cash equivalents | 1,149,021,038.61 | 2,724,335,001.58 | | Deposit reservation for balance | | | | Lendings to banks and other financial institutions | | | | Financial assets held for trading | 5,931,135,332.29 | 1,754,396,227.54 |
| Derivative financial assets | | | | Notes receivable | | | | Accounts receivable | 8,414,291.79 | 2,721,638.09 | | Financing receivable | | |
| Prepayments | 3,259,770.00 | 2,461,009.00 | | Insurance premiums receivable | | | | Accounts receivable reinsurance | | | | Receivable reserves for reinsurance contracts | | |
| Other receivables | 464,762,227.06 | 255,013,296.96 | | Inc: Interest receivable | 30,188.89 | 567,341.68 | | Dividends receivable | | | | Financial assets purchased under resale agreements | | |
| Inventories | | | | Contract assets | | | | Assets held for sale | | | | Non-current assets maturing within one year | | |
| Other current assets | 186,411,240.41 | 97,336,600.16 |
| Total current assets | 7,743,003,900.16 | 4,836,263,773.33 | | Non-current Assets: | | | | Loans and Advances | | | | Debt investments | 1,941,879,536.67 | 1,923,598,909.09 |
| Other debt investments | | | | Long-term receivables | | | | Long-term equity investments | | | | Investment in other equity instruments | 162,800,000.00 | 162,800,000.00 |
| Other non-current financial assets | 138,166,559.96 | 138,166,559.96 | | Investment properties | 683,360,110.14 | 688,475,053.53 | | Fixed assets | 842,050,939.91 | 672,429,601.44 | | Construction in progress | 809,073,833.30 | 653,580,160.32 |
| Bearer biological assets | | | | Oil and gas assets | | | | Right-of-use assets | | | | Intangible assets | 195,814,581.94 | 197,507,227.40 |
| Development expenditure | | | | Goodwill | 99,867,720.38 | 99,867,720.38 | | Long-term prepaid expenses | 290,937,479.88 | 240,565,962.02 | | Deferred tax assets | 10,982,832.13 | 21,482,832.13 |
| Other non-current assets | 440,810,338.01 | 325,967,628.34 | | Total Non-current Assets | 5,615,743,932.32 | 5,124,441,654.61 | | Total Assets | 13,358,747,832.48 | 9,960,705,427.94 | | Current Liabilities: | | |
| Short-term borrowings | 3,717,000,000.00 | 2,867,000,000.00 | | Borrowings from central bank | | | | Borrowings from banks and other financial institutions | | | | Financial liabilities held for trading | | |
| Derivative financial liabilities | | |
| Notes payable | | | | Accounts payable | 31,879,174.21 | 236,481,990.86 | | Receipts in advance | | 2,634,276,203.88 | | Contract liabilities | 5,471,543,237.02 | |
| Financial assets sold for repurchase | | | | Deposits from customers and interbank | | | | Customer brokerage deposits | | | | Securities underwriting brokerage deposits | | |
| Employee benefits payable | 213,784,491.96 | 411,475,636.03 | | Taxes payable | 58,604,750.12 | 184,306,027.84 | | Other payables | 1,514,376,992.94 | 88,693,411.98 | | Inc: Interest payable | 10,879,429.21 | 4,521,557.54 |
| Dividends payable | 1,480,175,853.36 | | | Handling charges and commission payable | | | | Cession insurance premiums payable | | | | Held-for-sale liabilities | | |
| Non-current liabilities due within one year | | | | Other current liabilities | 164,146,297.11 | | | Total Current Liabilities | 11,171,334,943.36 | 6,422,233,270.59 | | Non-current Liabilities: | | |
| Insurance contract reserves | | | | Long-term borrowings | | | | Bonds payable | | | | Inc: preference share | | |
| Perpetual bond | | | | Lease liabilities | | | | Long-term payables | | | | Long-term employee benefits payable | | |
| Deferred income | | | | Deferred tax liabilities | 106,297,606.93 | 106,932,273.03 | | Other non-current liabilities | | | | Total Non-current Liabilities | 106,297,606.93 | 106,932,273.03 |
| Total Liabilities | 11,277,632,550.29 | 6,529,165,543.62 | | Owners' equity: | | | | Share capital | 103,807,623.00 | 103,807,623.00 | | Other equity instrument | | |
| Inc: preference share | | | | Perpetual bond | | | | Capital reserve | 1,212,031,049.50 | 1,198,581,049.50 | | Less: Treasury stock | | |
| Other comprehensive income | 37,500,000.00 | 37,500,000.00 | | Special reserve | | | | Surplus reserve | 45,000,000.00 | 45,000,000.00 | | General risk reserves | | |
| Retained earnings | 682,785,177.87 | 2,046,657,231.32 | | Total owners' equity attributable to the Company | 2,081,123,850.37 | 3,431,545,903.82 | | Minority interests | -8,568.18 | -6,019.50 | | Total Owners' Equity | 2,081,115,282.19 | 3,431,539,884.32 |
| Total Liabilities and Owners' Equity | 13,358,747,832.48 | 9,960,705,427.94 |
| ITEM | March 31, 2020 | December 31, 2019 | | Current Assets: | | | | Cash and cash equivalents | 138,009,066.67 | 6,931,803.33 | | Financial assets held for trading | 101,681.64 | 101,681.64 |
| Derivative financial assets | | | | Notes receivable | | | | Accounts receivable | 3,973,147.73 | | | Financing receivable | | | | Prepayments | | | | Other receivables | 1,816,279,715.10 | 1,717,949,520.99 | | Inc: Interest receivable | | | | Dividends receivable | 1,700,000,000.00 | 1,700,000,000.00 | | Inventories | | | | Contract assets | | | | Assets held for sale | | | | Non-current assets maturing within one year | | | | Other current assets | 882,459.86 | | | Total current assets | 1,959,246,071.00 | 1,724,983,005.96 | | Non-current Assets: | | | | Debt investments | | | | Other debt investments | | | | Long-term receivables | | | | Long-term equity investments | 18,582,307,907.14 | 18,582,307,907.14 | | Investment in other equity instruments | 162,800,000.00 | 162,800,000.00 | | Other non-current financial assets | | | | Investment properties | 393,144,190.07 | 395,978,156.15 | | Fixed assets | | | | Construction in progress | 372,569,103.57 | 72,569,103.57 | | Bearer biological assets | | | | Oil and gas assets | | | | Right-of-use assets | | | | Intangible assets | | | | Development expenditure | | | | Goodwill | | |
| Long-term prepaid expenses | | | | Deferred tax assets | 10,804,928.62 | 10,804,928.62 | | Other non-current assets | | | | Total Non-current Assets | 19,521,626,129.40 | 19,224,460,095.48 | | Total Assets | 21,480,872,200.40 | 20,949,443,101.44 | | Current Liabilities: | | | | Short-term borrowings | 570,000,000.00 | | | Financial liabilities held for trading | | | | Derivative financial liabilities | | | | Notes payable | | | | Accounts payable | 561,752.26 | 561,752.26 | | Receipts in advance | | | | Contract liabilities | | | | Employee benefits payable | | | | Taxes payable | 1,216,134.96 | 791,191.77 | | Other payables | 1,486,923,390.35 | 40,275,566.88 | | Inc: Interest payable | 757,625.01 | | | Dividends payable | 1,480,175,853.36 | | | Held-for-sale liabilities | | | | Non-current liabilities due within one year | | | | Other current liabilities | | | | Total Current Liabilities | 2,058,701,277.57 | 41,628,510.91 | | Non-current Liabilities: | | | | Long-term borrowings | | | | Bonds payable | | | | Inc: preference share | | | | Perpetual bond | | | | Lease liabilities | | | | Long-term payables | | | | Long-term employee benefits payable | | |
| Estimated liabilities | | | | Deferred income | | | | Deferred tax liabilities | 12,500,420.41 | 12,500,420.41 | | Other non-current liabilities | | | | Total Non-current Liabilities | 12,500,420.41 | 12,500,420.41 | | Total Liabilities | 2,071,201,697.98 | 54,128,931.32 | | Owners' equity: | | | | Share capital | 6,167,399,389.00 | 6,167,399,389.00 | | Other equity instrument | | | | Inc: preference share | | | | Perpetual bond | | | | Capital reserve | 12,775,326,370.33 | 12,775,326,370.33 | | Less: Treasury stock | | | | Other comprehensive income | 37,500,000.00 | 37,500,000.00 | | Special reserve | | | | Surplus reserve | 387,458,806.65 | 387,458,806.65 | | Retained earnings | 41,985,936.44 | 1,527,629,604.14 | | Total Owners' Equity | 19,409,670,502.42 | 20,895,314,170.12 | | Total Liabilities and Owners' Equity | 21,480,872,200.40 | 20,949,443,101.44 |
| ITEM | Amount for the current period | Amount for the prior period | | I. Total operating Revenue | 1,230,102,270.48 | 1,311,632,662.04 | | Inc: Operating income | 1,230,102,270.48 | 1,311,632,662.04 | | Interest income | | | | Earned premium | | | | Handling charges and commission income | | | | II. Total operating costs | 1,167,262,125.00 | 1,212,555,458.51 | | Inc: Operating costs | 520,863,204.58 | 547,540,054.15 |
| Interest expenses | | | | Handling charges and commissions expenses | | | | Surrenders | | | | Net payments for insurance claims | | | | Net change appropriation of deposit for duty | | | | Policyholder dividend expense | | | | Expenses for reinsurance accepted | | | | Taxes and surcharges | 3,265,783.95 | 7,017,678.96 | | Marketing expenses | 273,147,797.16 | 289,279,257.52 | | Administrative expenses | 209,704,141.65 | 221,635,553.09 | | Research and development expenses | 105,248,410.14 | 109,361,694.09 | | Financial expenses | 55,032,787.52 | 37,721,220.70 | | Inc: Interest expenses | 38,457,427.92 | 23,076,937.51 | | Interest income | 968,101.22 | 192,872.85 | | Add: Other income | 36,688,536.72 | 33,195.73 | | Investment income (Losses are indicated by "-") | 49,118,685.21 | 32,216,225.92 | | Inc: Share of profits in associates and joint ventures | | | | Derecognized gains of financial assets measured at amortized cost | | | | Foreign exchange gains (Losses are indicated by "-") | | | | Net exposure hedge income (Losses are indicated by "-") | | | | Income from changes in fair value (Losses are indicated by "-") | | | | Credit impairment losses (Losses are indicated by "-") | | | | Assets depreciation losses (Losses are indicated by "-") | | | | Income from the disposal of assets (Losses are indicated by "-") | 12,208.74 | | | III. Operating profit (Losses are indicated by "-") | 148,659,576.15 | 131,326,625.18 |
| Add: Non-operating income | 100.00 | 337,999.26 | | Less: Non-operating expenses | 75,001.22 | 17,195.86 | | IV. Total profit (Total Loss is indicated by "-") | 148,584,674.93 | 131,647,428.58 | | Less: Income tax expenses | 32,283,423.70 | 25,453,946.30 | | V. Net profit (Net loss is indicated by "-") | 116,301,251.23 | 106,193,482.28 | | (I) Classified by continuing/discontinuing operation | | | | 1. Net profit from continuing operations (Net loss is indicated by "-") | 116,301,251.23 | 106,193,482.28 | | 2. Net profit from discontinued operations (Net loss is indicated by "-") | | | | (II) Classified by ownership | | | | 1. Net profit attributable to owners of the Company | 116,303,799.91 | 106,193,482.28 | | 2. Minority Interest Income | -2,548.68 | | | VI. Other comprehensive income after tax | | | | Net other comprehensive income after tax attributable to owners of the Company | | | | (I) Other comprehensive income which will not be reclassified into gains or losses | | | | 1. Changes arising from remeasured or redefined benefit plan | | | | 2. Other comprehensive income which will not be transferred into gains or losses under the equity method | | | | 3. Changes in the investment fair value of other equity instruments | | | | 4. Changes in fair value of the enterprise's own credit risk | | | | 5. Others | | | | (II) Other comprehensive income which will be reclassified into gains or losses | | | | 1. Other comprehensive income which will be transferred into gains or losses under the equity method | | |
| 2. Changes in fair value of other debt investments | | | | 3. The amount of financial assets reclassified into other comprehensive income | | | | 4. Provision for credit impairment of other debt investments | | | | 5. Reserve for cash flow hedges | | | | 6. Conversion difference of foreign currency financial statements | | | | 7. Others | | | | Other comprehensive income attributable to minority shareholders, net of tax | | | | VII. Total comprehensive income | 116,301,251.23 | 106,193,482.28 | | Total comprehensive income attributable to owners of the Company | 116,303,799.91 | 106,193,482.28 | | Total comprehensive income attributable to minority interests | -2,548.68 | | | VIII. Earnings per share: | | | | (I) Basic earnings per share | 0.02 | 0.02 | | (II) Diluted earnings per share | 0.02 | 0.02 |
| Item | Amount for the current period | Amount for the previous period | | I. Operating Revenue | 3,783,950.22 | 3,638,285.43 | | Decrease: Operating costs | 2,833,966.08 | 2,831,353.47 | | Taxes and surcharges | 1,064,546.25 | 1,162,081.73 | | Selling expenses | | | | Administrative expenses | 2,207,928.42 | 8,603,635.27 |
| Research and development expenses | | | | Financial expenses | 3,145,323.81 | | | Including: Interest expenses | 3,167,404.17 | | | Interest income | 29,503.78 | | | Increase: Other income | | | | Investment income ("-" for loss) | | | | Including: Investment income of associates and joint ventures | | | | Profit and loss from derecognition of financial assets at a mortized cost ("-" for loss) | | | | Profit and losses from net exposure hedging ("-" for loss) | | | | Profit and loss on the changes in fair value ("-" for loss) | | | | Credit impairment loss ("-" for loss) | | | | Asset impairment loss ("-" for loss) | | | | Asset disposal income ("-" for loss) | | | | II. Operating profit ("-" for loss) | -5,467,814.34 | -8,958,785.04 | | Add: Non-operating income | | | | Less: Non-operating expenses | | | | III. Total profit ("-" for total loss) | -5,467,814.34 | -8,958,785.04 | | Less: Income tax expenses | | | | IV. Net profit ("-" for net loss) | -5,467,814.34 | -8,958,785.04 | | 1. Net profit from continuing operations ("-" for net loss) | -5,467,814.34 | -8,958,785.04 | | 2.Net profit from discontinued operations ("-" for net loss) | | | | V. Other comprehensive income after tax | | | | 1. Other comprehensive income that will not be reclassified to profit or loss | | | | (1) Changes with a defined benefit plan upon re-measurement | | |
| (2) Other comprehensive incomes that will be not reclassified into gains and losses under the equity method | | | | (3) Changes in the fair value of other equity instruments | | | | (4) Change in fair value of the enterprise's own credit risk | | | | (5) Others | | | | 2. Other comprehensive income that may be reclassified to profit or losses | | | | (1) Other comprehensive incomes that will be reclassified into gains and losses under the equity method | | | | (2) Changes in the fair value of other debt investments | | | | (3) The amount of financial assets reclassified into other comprehensive income | | | | (4) Provision for credit impairment of other debt investments | | | | (5) Cash flow hedge reserve | | | | (6) Foreign-currency financial statement translation difference | | | | (7) Others | | | | VI. Total comprehensive income | -5,467,814.34 | -8,958,785.04 | | VII. Earnings per share | | | | 1. Basic earnings per share | | | | 2. Diluted earnings per share | | |
| Item | Amount for the current period | Amount for the previous period | | I. Cash Flows from Operating Activities: | | |
| Cash receipts from the sale of goods and the rendering of services | 4,268,644,542.62 | 3,787,712,684.29 | | Net increase in customer bank deposits and deposits | | | | Net increase in borrowings from the Central Bank | | | | Net increase of borrowings from other financial institutions | | | | Cash received from original insurance contracts | | | | Net cash received from reinsurance | | | | Net increase in deposits from policy holders | | | | Cash received from interest, fees and commission | | | | Net increase in bank borrowings | | | | Net increase in repurchase operating capital | | | | Net cash received from agent trading | | | | Refund of tax | | | | Other cash receipts relating to other operating activities | 3,552,880.40 | 226,068.58 | | Subtotal of cash inflows from operating activities | 4,272,197,423.02 | 3,787,938,752.87 | | Cash paid for goods and services | 304,236,568.73 | 244,466,417.21 | | Net increase in loans and advances to customers | | | | Net increase in deposits with the Central Bank and other financial institutions | | | | Cash paid for original insurance contract claims | | | | Net increase in placements from banks and other financial institutions | | | | Cash paid for interests, fees and commissions | | | | Cash paid for dividend policy | | | | Cash paid to and for employees | 1,090,339,239.09 | 801,689,160.29 | | Tax paid | 112,063,354.25 | 143,983,256.22 | | Other cash payment relating to operating activities | 201,339,948.10 | 175,055,945.24 | | Subtotal of cash outflows from operating activities | 1,707,979,110.17 | 1,365,194,778.96 | | Net cash flows from operating activities | 2,564,218,312.85 | 2,422,743,973.91 | | II. Cash Flows from Investing Activities | | | | Cash received from return of investment | 9,555,548,985.25 | 2,817,530,000.00 | | Cash received from investments | 31,375,210.42 | 16,682,775.57 | | Net cash received from disposal of fixed assets, intangible assets and other long-term assets | 12,208.74 | |
| Net cash received from disposal of subsidiaries and other business units | | | | Other cash receipts relating to investing activities | | | | Subtotal of cash inflows from financing activities | 9,586,936,404.41 | 2,834,212,775.57 | | Cash paid to acquire fixed assets, intangible assets and other long-term assets | 812,081,033.98 | 8,436,483.33 | | Cash paid to acquire investments | 13,732,288,090.00 | 5,708,470,000.00 | | Net increase in pledged loans | | | | Net cash paid to acquire subsidiaries and other business units | | | | Other cash payment relating to investing activities | | | | Subtotal of cash outflows from investing activities | 14,544,369,123.98 | 5,716,906,483.33 | | Net cash flows from investing activities | -4,957,432,719.57 | -2,882,693,707.76 | | III. Cash Flows from Financing Activities | | | | Cash received from investments | | | | Including: Cash received from minority shareholders to subsidiaries | | | | Cash received from loans | 1,660,000,000.00 | 360,000,000.00 | | Other cash received from financing activities | | | | Subtotal of cash inflows from financing activities | 1,660,000,000.00 | 360,000,000.00 | | Cash repayments of loans | 810,000,000.00 | | | Cash payments for distribution of dividends, profits or interest | 32,099,556.25 | 16,945,425.00 | | Including: Dividends and profits paid to minority shareholders by subsidiaries | | | | Other cash payments relating to financing activities | | | | Subtotal cash outflow from financing activities | 842,099,556.25 | 16,945,425.00 | | Net cash flows from financing activities | 817,900,443.75 | 343,054,575.00 | | IV. Effect of foreign currency exchange rate changes on cash and cash equivalents | | | | V. Net Increase of Cash and Cash Equivalents | -1,575,313,962.97 | -116,895,158.85 | | Add: Balance of cash and cash equivalents at the beginning of period | 2,724,335,001.58 | 651,069,029.10 | | VI. Balance of cash and cash equivalents at the end of period | 1,149,021,038.61 | 534,173,870.25 |
6. Cash Flow Statements of the Parent Company Unit: RMB | Item | Amount for the current period | Amount for the previous period | | I. Cash Flow From Operating Activities | | | | Cash received from sales of goods or rendering of services | | | | Refund of tax levy | | | | Other cash receipts relating to other operating activities | 416,689.56 | 440,714,643.28 | | Subtotal of cash inflows from operating activities | 416,689.56 | 440,714,643.28 | | Cash paid for goods and services | | | | Cash paid to and for employees | | 895,723.48 | | Tax paid | 1,580,784.85 | 4,034,858.95 | | Other cash payment relating to operating activities | 135,348,862.21 | 1,043,539.47 | | Subtotal of cash outflows from operating activities | 136,929,647.06 | 5,974,121.90 | | Net cash flows from operating activities | -136,512,957.50 | 434,740,521.38 | | II. Cash Flows from Investing Activities | | | | Cash received from the return of investment | | | | Cash received from investments | | | | Net cash received from the disposal of fixed assets, intangible assets and other long-term assets | | | | Net cash received from disposal of subsidiaries and other business units | | | | Other cash receipts relating to investing activities | | | | Subtotal of cash inflows from investing activities | | | | Cash paid to acquire fixed assets, intangible assets and other long-term assets | 300,000,000.00 | 1,929,500.00 | | Cash paid to acquire investments | | | | Net cash paid to acquire subsidiaries and other business units | | | | Other cash payment relating to investing activities | | | | Subtotal of cash outflows from investing activities | 300,000,000.00 | 1,929,500.00 | | Net cash flows from investing activities | -300,000,000.00 | -1,929,500.00 | | III. Cash Flows from Financing Activities | | | | Cash received from investments | | | | Cash received from loans | 570,000,000.00 | |
| Other cash received from financing activities | | | | Subtotal of cash inflows from financing activities | 570,000,000.00 | | | Cash repayments of loans | | 85,000,000.00 | | Cash payments for distribution of dividends, profits or interest | 2,409,779.16 | 319,931,024.40 | | Other cash payments relating to financing activities | | 1,182,647.75 | | Subtotal cash outflow from financing activities | 2,409,779.16 | 406,113,672.15 | | Net cash flows from financing activities | 567,590,220.84 | -406,113,672.15 | | IV. Effect of foreign currency exchange rate changes on cash and cash equivalents | | | | V. Net Increase of Cash and Cash Equivalents | 131,077,263.34 | 26,697,349.23 | | Increase: Cash and cash equivalents at the beginning of period | 6,931,803.33 | 5,304,519.61 | | VI. Cash and cash equivalents at the end of period | 138,009,066.67 | 32,001,868.84 |
| ITEM | December 31, 2019 | January 1, 2020 | Adjustments | | Current Assets: | | | | | Cash and cash equivalents | 2,724,335,001.58 | 2,724,335,001.58 | | | Deposit reservation for balance | | | | | Lendings to banks and other financial institutions | | | | | Financial assets held for trading | 1,754,396,227.54 | 1,754,396,227.54 | | | Derivative financial assets | | | | | Notes receivable | | | | | Accounts receivable | 2,721,638.09 | 2,721,638.09 | | | Financing receivable | | | | | Prepayments | 2,461,009.00 | 2,461,009.00 | |
| Insurance premiums receivable | | | | | Accounts receivable reinsurance | | | | | Receivable reserves for reinsurance contracts | | | | | Other receivables | 255,013,296.96 | 255,013,296.96 | | | Inc: Interest receivable | 567,341.68 | 567,341.68 | | | Dividends receivable | | | | | Financial assets purchased under resale agreements | | | | | Inventories | | | | | Contract assets | | | | | Assets held for sale | | | | | Non-current assets maturing within one year | | | | | Other current assets | 97,336,600.16 | 97,336,600.16 | | | Total current assets | 4,836,263,773.33 | 4,836,263,773.33 | | | Non-current Assets: | | | | | Loans and advances | | | | | Debt investments | 1,923,598,909.09 | 1,923,598,909.09 | | | Other debt investments | | | | | Long-term receivables | | | | | Long-term equity investments | | | | | Investment in other equity instruments | 162,800,000.00 | 162,800,000.00 | | | Other non-current financial assets | 138,166,559.96 | 138,166,559.96 | | | Investment properties | 688,475,053.53 | 688,475,053.53 | | | Fixed assets | 672,429,601.44 | 672,429,601.44 | | | Construction in progress | 653,580,160.32 | 653,580,160.32 | | | Bearer biological assets | | | | | Oil and gas assets | | | | | Right-of-use assets | | | | | Intangible assets | 197,507,227.40 | 197,507,227.40 | |
| Development expenditure | | | | | Goodwill | 99,867,720.38 | 99,867,720.38 | | | Long-term prepaid expenses | 240,565,962.02 | 240,565,962.02 | | | Deferred tax assets | 21,482,832.13 | 21,482,832.13 | | | Other non-current assets | 325,967,628.34 | 325,967,628.34 | | | Total non-current assets | 5,124,441,654.61 | 5,124,441,654.61 | | | Total assets | 9,960,705,427.94 | 9,960,705,427.94 | | | Current Liabilities: | | | | | Short-term borrowings | 2,867,000,000.00 | 2,867,000,000.00 | | | Borrowings from central bank | | | | | Borrowings from banks and other financial institutions | | | | | Financial liabilities held for trading | | | | | Derivative financial liabilities | | | | | Notes payable | | | | | Accounts payable | 236,481,990.86 | 236,481,990.86 | | | Receipts in advance | 2,634,276,203.88 | | -2,634,276,203.88 | | Contract liabilities | | 2,557,549,712.50 | 2,557,549,712.50 | | Financial assets sold for repurchase | | | | | Deposits from customers and interbank | | | | | Customer brokerage deposits | | | | | Securities underwriting brokerage deposits | | | | | Employee benefits payable | 411,475,636.03 | 411,475,636.03 | | | Taxes payable | 184,306,027.84 | 184,306,027.84 | | | Other payables | 88,693,411.98 | 88,693,411.98 | | | Inc: Interest payable | 4,521,557.54 | 4,521,557.54 | | | Dividends payable | | | | | Handling charges and commissions payable | | | |
| Accounts payable reinsurance | | | | | Liabilities held for sale | | | | | Non-current liabilities due within one year | | | | | Other current liabilities | | 76,726,491.38 | 76,726,491.38 | | Total current liabilities | 6,422,233,270.59 | 6,422,233,270.59 | | | Non-current Liabilities: | | | | | Insurance contract reserves | | | | | Long-term borrowings | | | | | Bonds payable | | | | | Inc: preference share | | | | | Perpetual bond | | | | | Lease liabilities | | | | | Long-term payables | | | | | Long-term employee benefits payable | | | | | Estimated liabilities | | | | | Deferred income | | | | | Deferred tax liabilities | 106,932,273.03 | 106,932,273.03 | | | Other non-current liabilities | | | | | Total non-current liabilities | 106,932,273.03 | 106,932,273.03 | | | Total liabilities | 6,529,165,543.62 | 6,529,165,543.62 | | | Owners' Equity: | | | | | Share capital | 103,807,623.00 | 103,807,623.00 | | | Other equity instrument | | | | | Inc: preference share | | | | | Perpetual bond | | | | | Capital reserve | 1,198,581,049.50 | 1,198,581,049.50 | | | Less: Treasury stock | | | | | Other comprehensive income | 37,500,000.00 | 37,500,000.00 | | | Special reserve | | | | | Surplus reserve | 45,000,000.00 | 45,000,000.00 | | | General risk reserve | | | | | Retained earnings | 2,046,657,231.32 | 2,046,657,231.32 | |
| Total owners' equity attributable to the Company | 3,431,545,903.82 | 3,431,545,903.82 | | | Minority interest | -6,019.50 | -6,019.50 | | | Total owners' equity | 3,431,539,884.32 | 3,431,539,884.32 | | | Total liabilities and owners' equity | 9,960,705,427.94 | 9,960,705,427.94 | |
| Item | December 31, 2019 | January 1, 2020 | Adjustments | | Current Assets: | | | | | Cash and cash equivalents | 6,931,803.33 | 6,931,803.33 | | | Financial assets held for trading | 101,681.64 | 101,681.64 | | | Derivative financial assets | | | | | Notes receivable | | | | | Accounts receivable | | | | | Financing receivable | | | | | Prepayments | | | | | Other receivables | 1,717,949,520.99 | 1,717,949,520.99 | | | Inc: Interest receivable | | | | | Dividends receivable | 1,700,000,000.00 | 1,700,000,000.00 | | | Inventories | | | | | Contract assets | | | | | Assets held for sale | | | | | Non-current assets maturing within one year | | | | | Other current assets | | | | | Total current assets | 1,724,983,005.96 | 1,724,983,005.96 | | | Non-current Assets: | | | | | Debt investments | | | |
| Other debt investments | | | | | Long-term receivables | | | | | Long-term equity investments | 18,582,307,907.14 | 18,582,307,907.14 | | | Investment in other equity instruments | 162,800,000.00 | 162,800,000.00 | | | Other non-current financial assets | | | | | Investment properties | 395,978,156.15 | 395,978,156.15 | | | Fixed assets | | | | | Construction in progress | 72,569,103.57 | 72,569,103.57 | | | Bearer biological assets | | | | | Oil and gas assets | | | | | Right-of-use assets | | | | | Intangible assets | | | | | Development expenditure | | | | | Goodwill | | | | | Long-term prepaid expenses | | | | | Deferred tax assets | 10,804,928.62 | 10,804,928.62 | | | Other non-current assets | | | | | Total non-current assets | 19,224,460,095.48 | 19,224,460,095.48 | | | Total assets | 20,949,443,101.44 | 20,949,443,101.44 | | | Current Liabilities: | | | | | Short-term borrowings | | | | | Financial liabilities held for trading | | | | | Derivative financial liabilities | | | | | Notes payable | | | | | Accounts payable | 561,752.26 | 561,752.26 | | | Receipts in advance | | | | | Contract liabilities | | | | | Employee benefits payable | | | | | Taxes payable | 791,191.77 | 791,191.77 | | | Other payables | 40,275,566.88 | 40,275,566.88 | |
| Inc: Interest payable | | | | | Dividends payable | | | | | Liabilities held for sale | | | | | Non-current liabilities due within one year | | | | | Other current liabilities | | | | | Total current liabilities | 41,628,510.91 | 41,628,510.91 | | | Non-current Liabilities: | | | | | Long-term borrowings | | | | | Bonds payable | | | | | Inc: preference share | | | | | Perpetual bond | | | | | Lease liabilities | | | | | Long-term payables | | | | | Long-term employee benefits payable | | | | | Estimated liabilities | | | | | Deferred income | | | | | Deferred tax liabilities | 12,500,420.41 | 12,500,420.41 | | | Other non-current liabilities | | | | | Total non-current liabilities | 12,500,420.41 | 12,500,420.41 | | | Total liabilities | 54,128,931.32 | 54,128,931.32 | | | Owners' Equity: | | | | | Share capital | 6,167,399,389.00 | 6,167,399,389.00 | | | Other equity instrument | | | | | Inc: preference share | | | | | Perpetual bond | | | | | Capital reserve | 12,775,326,370.33 | 12,775,326,370.33 | | | Less: Treasury stock | | | | | Other comprehensive income | 37,500,000.00 | 37,500,000.00 | | | Special reserve | | | | | Surplus reserve | 387,458,806.65 | 387,458,806.65 | | | Retained earnings | 1,527,629,604.14 | 1,527,629,604.14 | | | Total owners' equity | 20,895,314,170.12 | 20,895,314,170.12 | | | Total liabilities and owners' equity | 20,949,443,101.44 | 20,949,443,101.44 | |
Statement of adjustmentsNone 2. Retrospective adjustments of previous comparative data due to the first implementation of the newstandards governing income and lease since 2020 □ Applicable √ Not applicable Section III. Auditor’s ReportHas the Q1 Report been audited? □Yes √ No Q1 Report of the Company has not been audited.
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