Stock Code: 600690 Short Name: Haier Smart Home
Haier Smart Home Co., Ltd.2020 Third Quarterly Report
Contents
Ⅰ.IMPORTANT NOTICE ......................................................................................................................... 3
Ⅱ.COMPANY PROFILE .......................................................................................................................... 3
Ⅲ.SIGNIFICANT EVENTS ...................................................................................................................... 7
Ⅳ.APPENDIX .......................................................................................................................................... 16
I. IMPORTANT NOTICE
1.1 The Board of Directors, the Board of Supervisors, and the directors, supervisors and seniormanagement of Haier Smart Home Co., Ltd. (“the Company”) assure that the content set out in thequarterly report is true, accurate and complete, and free from any false record, misleadingrepresentation or material omission, and are individually and collectively responsible for thecontent set out therein.
1.2 All the directors of the Company attended the board meeting and reviewed the quarterly report.
1.3 Liang Haishan (legal representative of the Company), Gong Wei (chief financial officer of theCompany) and Ying Ke (the person in charge of accounting department) hereby certify that thefinancial statements set out in the quarterly report are true, accurate and complete.
1.4 The third quarterly report of the Company has not been audited.
II. COMPANY PROFILE
2.1 Key financial data
Unit and Currency: RMB
| At the end of the reporting period | At the end of last year | Increase/decrease at the end of the reporting period compared with the end of last year (%) | ||
| After the adjustment | Before the adjustment | |||
| Total assets | 200,206,564,161.26 | 187,454,236,283.17 | 187,454,236,283.17 | 6.80 |
| Net assets attributable to shareholders of listed companies | 50,439,076,950.23 | 47,888,319,765.92 | 47,888,319,765.92 | 5.33 |
| At the beginning of the year to the end of the reporting period (January to September) | At the beginning of last year to the end of the reporting period of last year (January to September) | Yoy change (%) | ||
| After the adjustment | Before the adjustment | |||
| Net cash flows from | 5,711,204,674.45 | 8,476,037,239.40 | 9,006,912,568.45 | -32.62 |
| operating activities | ||||
| At the beginning of the year to the end of the reporting period (January to September) | At the beginning of last year to the end of the reporting period of last year (January to September) | Yoy change (%) | ||
| After the adjustment | Before the adjustment | |||
| Operating revenue | 154,411,813,689.44 | 150,232,288,468.02 | 148,896,109,856.46 | 2.78 |
| Net profits attributable to shareholders of listed companies | 6,300,507,503.54 | 7,612,154,769.74 | 7,772,860,902.81 | -17.23 |
| Net profits after deduction of non-recurring profit or loss attributable to shareholders of listed companies | 4,092,358,135.73 | 5,656,439,855.74 | 5,834,398,305.26 | -27.65 |
| Weighted average return on net assets (%) | 12.71 | 17.70 | 18.17 | Decreased by 4.99 percentage points |
| Basic earnings per share (RMB per share) | 0.958 | 1.195 | 1.221 | -19.83 |
| Diluted earnings per share (RMB per share) | 0.939 | 1.107 | 1.131 | -15.18 |
During the reporting period, the Company adhered to the direction of IoT smart home ecobrand strategy, leveraging advantages such as leading product packages, high-end brands, retailtransformation, global operation and Smart Home Experiential Cloud, to continuously expand its
leading position in the global market. The quarterly revenue, net profit attributable to owners of theParent Company and the net profit after deducting that are not attributable to the Parent Companyof the Company increased by 16.9%, 37.8% and 43.3%, respectively, in the third quarter of 2020.On 11 September 2020, the Company further launched Three winged Bird (三翼鸟), the firstscenario brand in the world, aiming at providing users with smart home full scenario solutions,leading the scenario-based, intelligent and one-stop consumer trend of home appliances andhousehold and accelerating the transformation and upgrade from selling product to providingtailored scenario.Performance of Key Indicators.(I) Revenue.The revenue for the first three quarters of the Company was RMB154.41 billion, representingan increase of 2.8%; the quarterly revenue in the third quarter was RMB58.68 billion, representingan increase of 16.9%, of which, revenue from China increased by 16.3% and revenue from overseasincreased by 17.5%.The increase of revenue was mainly attributable to:
(1) Domestic market. The Company focused on the construction of retail system with directaccess to users, and improved efficiency through four reconstructions of “goals, processes,organizations and mechanisms” as well as further digital operation transformation of “products,marketing, services, logistics, customer and user”. The Company also improved user’s experiencesand amplified user’s value through smart home scenario solutions. For the prospective of producttype:
① Refrigerator. With the trend of consumer demand and retail touch-point diversification,the Company, focusing on the users’ demand for healthy life scenarios in the post-epidemic period,kept iterating the product lineup and operation model, with technologies including full-spacepreservation and extreme preservation leading the industry development, launched bestsellersonline and offline for different groups of users and achieved network-wide integration by onlinelive broadcast and offline streaming and refined store operation, promoting revenue growth andshare expansion, in addition, Casarte continued to expand its share of high-end refrigerators, andhad 49.3% market share of the products priced above RMB15,000.
From January to September 2020, the online and offline market share by sales revenue was
35.1% and 38.9%, representing an increase of 1.3 percentage points and 2.3 percentage points,respectively.
② Washing machine. The Company focused on structural upgrade and achieved ayear-on-year increase in average selling price in the third quarter through launching mid-range andhigh-end products via e-commerce and KA channels, the introduction of the sixth generation Yunxi
products via exclusive store channel, and other measures to increase average prices in townshipmarkets. The Company improved efficiency of network operation through various measures, suchas classified and hierarchical management of downstream channels, and integration of online andoffline operations. The Company improved Casarte products market share by means of productiteration, upgrade users experience with air wash and marketing activities such as Baiwan Shuangzi,with an accumulative share of 11.8% offline, representing an increase of 3 percentage points. TheCompany also launched the online IP “Happy Chick” Leader brand washing machines, sped uplayout of chain channels and built an all network retail system, with an online share of 5%,representing an increase of 1.3 percentage points year on year. In addition, the Companyaccelerated the sales tumble dryer through differentiated offerings such as washing and dryingpackage as well as upgrading and rebuilding balcony, so as to create business increments.
From January to September 2020, the online and offline market share by sales revenue was
39.4% and 39.9%, representing an increase of 4.6 percentage points and 3.8 percentage points,respectively.
③ Air conditioner. Based on consumers' growing concerns for health and fresh air, theCompany developed 3D sterilization technology, water-washed air and other new technologies,created clean, fresh and moist health experience and build the brand recognition of “Choose Haierfor Healthy Air”. Focusing on improving operation capability and optimizing the efficiency ofprocurement, R&D and manufacturing, the Company reduced the number of SKUs and improvedthe efficiency of single models through optimization of outdoor machine platform, procurementstandardization and modularization, while continuous efforts have been made to consolidatedistribution network with direct consumer access and cover the weak market areas through theSmart Home Cloud model. Leverage on multiple brand portfolios, the Company expanded its usercoverage through the strategy of “high-end leadership of Casarte, scale introduction of Haier andcustomized focus of Leader”. The revenue of air-conditioners business for the third quarterincreased by 27%.
From January to September 2020, the online and offline market share by sales revenue was
11.2% and 14.5%, representing an increase of 2.5 percentage points and 2.3 percentage points,respectively. In particular, shares of Casarte air-conditioners increased from 1.2% to 3.7%.
④ Water heater. Through the proactive marketing strategies and relying on the brandportfolio of "Haier, Casarte, Leader", the Company continued to gain market share. The Companyexpanded presence in new channels including heating & ventilation, building materials, hardwareand water heating, so as to broaden consumer base; focusing on old and renovated residentialcommunities, the Company attracted new users by organization activities in thousands of groups inthousands of areas and recruiting service partners; and the Company focused on designers andhome improvement channels to enhance new users recognition. The Company invested moreresources to Casarte, whose revenue growth reached 80% in the first three quarters.
From January to September 2020, the online and offline market share by sales revenue was
26.4% and 23.8%, representing an increase of 2.8 percentage points and 3.6 percentage points,respectively.
⑤ Kitchen appliances. The Company adhered to a high-end and whole-set product strategyand created terminal scenario experience to meet users’ needs for whole-set and intelligent scenariosolutions. The Company launched products including “12-m
Smart Air” range hoods withself-adaptive air volume, “3D oxygen-increasing” gas stoves with precise temperature control, andbuilt-in ovens featuring temperature and humidity control/active humidity control. Through thecombination of the Casarte “Gourmet” system and the Haier “Dual-protection” system, theCompany achieved market differentiation and increased the proportion of high-end sets, with therevenue from Casarte kitchen appliances in the first nine months exceeding 50%. The Companyachieved network and retail transformation by accelerating the construction of franchised stores intowns, realizing multi-port distribution through online and downstream channels, and expandingconstruction channel. In addition, the Company provided users with one-stop home cookingsolutions through “Three winged Bird Kitchen” and “Smart Cooking”, and accelerated marketingthrough participating in small home renovation projects. From January to September 2020, marketshare by sales revenue was 5.6%, representing an increase of 0.2 percentage point.
(2) Overseas Market.
The RenDanHeYi mechanism ensured the rapid response of small and micro enterprises in allregions to the challenges of the epidemic. Giving full play to the advantages in global resourcesallocation based on global procurement, supply chain and R&D platforms, we overcame the adverseimpact brought by external environment, thereby achieved the sustainable development of ourbusiness. We have achieved a comprehensive leading position with proprietary brands and rankedin TOP3 in the three categories (refrigeration, washing, air) in more than 20 countries. The profit ofoverseas operation for the third quarter increased by 58%.
① Global factories adhered to the normal epidemic prevention and resumption of work andproduction, overcame the shortage of parts, labor shortages and other risks and made all efforts tomeet the order demand. ② In respect of local marketing, we accelerated the upgrading of offlinetouch-points and expanded online channels, explored new online sales models and made greatefforts in overseas Experience Cloud model, to accelerate the transformation from selling product tocreating experience premium and enhance performance and the brand’s. For example, in theEuropean market, the Company has entered the TOP3 e-commerce channels in various countries, inAustralian market, the Company was listed in the brand section in 5 major mainstream onlinechannels, with its online sales doubled.
(II) Gross Margin.
Our gross margin was 28.0% for the first three quarters, representing a decrease of 0.78percentage point. Our gross margin in the third quarter was 28.1%, representing a decrease of 0.31percentage point.
(1) Domestic market. Affected by such factors as the increase in the proportion of theindustry’s online channels and intensified competition, the industry average price remained underdownward pressure in the third quarter, but its decrease gradually narrowed as compared with thefirst and second quarters. Domestic gross margin in the third quarter still declined year-on-year butthe decrease narrowed as compared with the first half of the year. In the third quarter, the Companyincreased the revenue from Casarte products by 22% in the third quarter by launching moremid-to-high-end products, contributing to the improvement of gross margin. In addition, theCompany optimized the supplier network and developed resources to achieve a balance betweenprice and quality on the procurement side, and improved manufacturing efficiency by optimizingthe layout of production areas, promoting flexible manufacturing, and continuously streamliningSKUs on the manufacturing side.
(2) Overseas market. Affected by such factors as the rapid growth in the revenue in the thirdquarter, rapid increase in the proportion of global leading product categories in line with thedevelopment trend toward large-volume and healthy home appliances and the improvement inmanufacturing efficiency of overseas factories, the gross margin increased significantly in the thirdquarter. ① Leadership in high-end products. In European market, the series of high-endrefrigerators with T-shaped doors and French refrigerators were simultaneously put on market inmany countries and regions, consolidating our Top 1 market share in Western Europe in respect ofmulti-door refrigerators. The price index of Haier refrigerators in major Western Europeancountries from January to September amounted to 140, and the average unit price increased byEUR78. Brand new series of Washing 979 and the series of high-end direct-drive super-quiet werelaunched, and the price index of washing machines from January to September staged ayear-on-year increase of 16%. In Japanese market, AQUA refrigerators launched brand new Delieproducts via iterative TZ ultrathin popular products. Retail sales of super-large refrigerators buckedthe trend by increasing 41%. ② Manufacturing efficiency improvement. Haier refrigeratorfactory in Russia improved production efficiency by 9% through Line of Balance and othermeasures; Pakistan factory improved its quality by more than 10% by introducing new technologiesand optimizing the quality system; carried out lean production and optimized the manufacturingexpense efficiency by 12%.
(III) Expense Rate.
(1) The selling expense ratio of the Company was 15.1% in the first three quarters,representing a decrease of 0.1 percentage point year on year. Among which, the selling expenseratio in the third quarter was 15.1%, representing a decrease of 1 percentage point year on year.With the implementation of a series of measures to reduce fees and improve efficiency this year, theselling expense ratio is gradually optimized.
① Domestic market. We promoted process reshaping and digital transformation andachieved improvements of organization efficiency by simplifying processes and eliminating processfor management and control; we achieved cost efficiency through the digitalization of marketingactivities and users management. The domestic sales expense ratio of the third quarter decreased by
1.4 percentage points.
② Overseas market. We advanced the establishment of terminal information system, so as toimprove operating efficiency. We also improved input-output through lean saving plan and othermeasures.
(2) The management expense ratio of the Company was 4.6% in the first three quarters,representing a decrease of 0.01 percentage point year on year. Among which, the managementexpense ratio in the third quarter was 4.2%, representing a decrease of 0.5 percentage point year onyear. The decrease in management expense ratio is mainly resulted from the improved efficiency oforganization operation.
(3) The research and development expense ratio of the Company was 3.2% in the first threequarters, representing an increase of 0.3 percentage point year on year, among which, the researchand development expense ratio in the third quarter was 3.5%, representing an increase of 0.2percentage point year on year. It is mainly due to the Company's promotion of its intelligentcompetitiveness and the increase in investment in APP, voice control, image recognition, big dataapplications, as well as related advanced research and development technologies.
(IV) Ecosystem Scenario Brand Construction.
In September 2020, the Company launched Three winged Bird (三翼鸟), the first scenariobrand in the world, which is based on three cores abilities: "Global Leading Explosive ScenarioSolutions", "Implementing Guarantee 1+N Capability" and "The Industry's Only Experiential CloudPlatform", working with the ecological side to promote the home Internet of Things into thousandsof households to provide users with smart home full scenario solutions covering balcony, kitchen,living room, bathroom, bedroom, whole house air, etc., and full scenario update services of wholehouse renovation and partly transformation, it developed a new track from selling products tocustomized scenario services. The Company has arranged 260 Haier No. 001 stores and four offlineexperience centers. Through more than 30,000 offline networks, more than 6,000 service butlersand more than 9,000 resource providers, the Company facilitated the nationwide application ofThree winged Bird scenario solutions.
From January to September in 2020, the ecological revenue of the Company was RMB7.2billion, representing an increase of 114%, among which, the ecological revenue of the third quarterwas RMB3.4 billion, representing an increase of 138% year on year. From January to September,the sales of scenario solutions was 687,000 sets, staging a year-on-year increase of 24.5%; networkappliance binding volume increased by 116%; in September 2020, daily active users of Haier SmartHome APP staged a year-on-year increase of 225%.Non-recurring profit or loss items and amount
√Applicable □Not Applicable
Unit and Currency: RMB
| Items | Amount for the current | Amount for the beginning of the |
| period (July to September) | year to the end of the reporting period (January to September) | |
| Profit or loss from disposal of non-current assets | -42,625,336.34 | -54,002,412.43 |
| Government grants included in current profit or loss, except that closely related to the normal operating business of the Company, complied with requirements of the national policies, continued to be granted with the amount and quantity determined under certain standards | 314,809,133.16 | 705,610,813.42 |
| Profit and loss of changes in fair value arising from holding of financial assets held for trading, derivative financial assets, financial liabilities held for trading and derivative financial liabilities except for valid straddle business relevant to normal business of the Company, as well as investment gain realized from disposal of financial assets held for trading, derivative financial assets, financial liabilities held for trading, derivative financial liabilities and other debt investments | 62,563,869.87 | 46,537,840.38 |
| Other non-operating income and expenses except for the aforementioned items | -24,102,076.04 | -13,751,473.89 |
| Profit from disposal of long-term equity investments | 2,267,620,952.48 | 2,267,421,126.83 |
| Impact on minority interests (after tax) | -234,662,122.80 | -364,743,321.11 |
| Impact on income tax | -346,815,267.65 | -378,923,205.39 |
| Total | 1,996,789,152.68 | 2,208,149,367.81 |
2.2 Table of total number of shareholders, top ten shareholders, top ten common shareholders (or theshareholders without selling restrictions) by the end of the reporting period
Unit: Share
| Total number of shareholders | 142,184 | ||||||
| Shareholdings of top ten shareholders | |||||||
| Name of shareholder (full name) | Number of shares held at the end of the period | Percentage (%) | Number of shares held subject to selling restrictions | Status of shares pledged or frozen | Nature of shareholder | ||
| Status | Number | ||||||
| Haier Electric Appliances International Co., Ltd. | 1,258,684,824 | 19.13 | Nil | Domestic non-state-owned legal entity | ||||
| Haier Group Corporation | 1,072,610,764 | 16.30 | Nil | Domestic non-state-owned legal entity | ||||
| Hong Kong Securities Clearing Company Limited | 547,189,119 | 8.32 | Nil | Unknown | ||||
| China Securities Finance Corporation Limited | 182,592,697 | 2.78 | Nil | Unknown | ||||
| Qingdao Haier Venture & Investment Information Co., Ltd. | 172,252,560 | 2.62 | Nil | Domestic non-state-owned legal entity | ||||
| GIC PRIVATE LIMITED | 114,053,758 | 1.73 | Nil | Foreign legal entity | ||||
| CLEARSTREAM BANKING S.A. (Note) | 91,168,350 | 1.39 | Nil | Foreign legal entity | ||||
| Qingdao Haichuangzhi Management Consulting Enterprise (Limited Partnership) | 73,011,000 | 1.11 | Nil | Domestic non-state-owned legal entity | ||||
| Central Huijin Asset Management Ltd. | 69,539,900 | 1.06 | Nil | Unknown | ||||
| National Social Security Fund Portfolio 113 | 65,793,903 | 1.00 | Nil | Unknown | ||||
| Shareholdings of top ten shareholders not subject to selling restrictions | ||||||||
| Name of shareholder | Number of tradable shares held not subject to selling restrictions | Class and number of shares | ||||||
| Class | Number | |||||||
| Haier Electric Appliances International Co., Ltd. | 1,258,684,824 | RMB ordinary | 1,258,684,824 |
| Haier Group Corporation | 1,072,610,764 | RMB ordinary | 1,072,610,764 |
| Hong Kong Securities Clearing Company Limited | 547,189,119 | RMB ordinary | 547,189,119 |
| China Securities Finance Corporation Limited | 182,592,697 | RMB ordinary | 182,592,697 |
| Qingdao Haier Venture & Investment Information Co., Ltd. | 172,252,560 | RMB ordinary | 172,252,560 |
| GIC PRIVATE LIMITED | 114,053,758 | RMB ordinary | 114,053,758 |
| CLEARSTREAM BANKING S.A. (Note) | 91,168,350 | Overseas listed foreign shares | 91,168,350 |
| Qingdao Haichuangzhi Management Consulting Enterprise (Limited Partnership) | 73,011,000 | RMB ordinary | 73,011,000 |
| Central Huijin Asset Management Ltd. | 69,539,900 | RMB ordinary | 69,539,900 |
| National Social Security Fund Portfolio 113 | 65,793,903 | RMB ordinary | 65,793,903 |
| Explanation of related-parties or parties acting in concert among the aforesaid shareholders | (1) Haier Electric Appliances International Co., Ltd. is a holding subsidiary of Haier Group Corporation. Haier Group Corporation holds 51.20% of its equity. Qingdao Haier Venture & Investment Information Co., Ltd. (青岛海尔创业投资咨询有限公司) and Qingdao Haichuangzhi Management Consulting Enterprise (Limited Partnership) (青岛海创智管理咨询企业(有限合伙)) are parties acting in concert with Haier Group Corporation; (2) The Company is not aware of the existence of any connections of other shareholders. | ||
| Explanation of preferential shareholders with restoration of voting rights and their shareholdings | Not applicable | ||
Note: (1) This account is the Clearstream Banking collection account for the Company's D shares,which is the original data provided by the German securities registration agency to the Company afterthe merger according to local market practices and technical settings, not representing the ultimateshareholder. (2) 57,142,857 shares in this account are held by Haier International Co., Limited, theconcerted actor of the Company’s ultimate controller Haier Group Corporation, accounting for 0.87% ofthe Company's total share capital.
2.3 Table of total number of preferential shareholders, top ten preferential shareholders, top tenpreferential shareholders without selling restrictions by the end of the reporting period
□Applicable √Not Applicable
III. SIGNIFICANT EVENTS
3.1 The major changes of and reasons for the key items of accounting statement and financial
indicators
√Applicable □ Not Applicable
1) Financial assets held for trading increased by 561.87% as compared to the beginning ofthe period, mainly due to the increase of the short-term wealth management products;
2) Derivative financial assets increased by 251.00% as compared to the beginning of theperiod, mainly due to the increase of forward foreign exchange contacts in the period;
3) Accounts receivable increased by 51.31% as compared to the beginning of the period,mainly due to the increase in revenue scale;
4) Other current assets decreased by 57.63% as compared to the beginning of the period,mainly due to the decrease of the wealth management products measured at amortized cost;
5) Other equity instruments investments increased by 90.02% as compared to the beginningof the period, mainly due to changes in the equity of the subsidiary, namely the investment in thesubsidiary was adjusted to other equity instruments investments;
6) Other non-current financial assets decreased by 100.00% as compared to the beginning ofthe period, mainly due to the reclassification of wealth management due within one year tofinancial assets held for trading;
7) Construction in progress increased by 42.20% as compared to the beginning of the period,mainly due to the increase in plant under construction and equipment;
8) Financial liabilities held for trading decreased by 99.62% as compared to the beginning ofthe period, mainly due to the expiration of the locked exchange rate instruments;
9) Derivative financial liabilities increased by 86.29% as compared to the beginning of theperiod, mainly due to the increase in interest rate swap agreements and forward foreign exchangecontracts;
10) Taxes payable increased by 50.42% as compared to the beginning of the period, mainlydue to the income tax on the investment income of the change in the equity of subsidiaries;
11) Other current liabilities increased by 1121.10% as compared to the beginning of theperiod, mainly due to the Company’s issuance of ultra-short-term financing bonds for financing;
12) Deferred income decreased by 35.05% as compared to the beginning of the period,mainly due to the change in the equity of subsidiaries;
13) Deferred income tax liabilities increased by 35.46% as compared to the beginning of theperiod, mainly due to the change in the equity of subsidiaries;
14) Other comprehensive income decreased by 124.56% as compared to the beginning of theperiod, mainly due to the exchange differences on translation of statements denominated in foreigncurrencies;
15) Taxes and surcharges decreased by 31.62% as compared to the same period of last year,mainly due to the change of value-added tax rate, which decreased from 16% to 13% since 1 April2019;
16) Other income increased by 40.25% as compared to the same period of last year, mainlydue to the increase of government grants in the period;
17) Gains on change of fair value decreased by 54.79% as compared to the same period oflast year, mainly due to the decrease of fair value in forward foreign exchange contacts in theperiod as compared to the same period of last year;
18) Loss on credit impairment increased by 231.53% as compared to the same period of lastyear, mainly due to the increase in bad debt loss of accounts receivable in the period;
19) Loss in assets impairment increased by 182.63% as compared to the same period of lastyear, mainly due to the increase in the provision of loss in inventory impairment in the period;
20) Gain from disposal of assets decreased by 271.97% as compared to the same period oflast year, mainly due to the recognition of loss from disposal of non-current assets in the period;
21) Non-operating income decreased by 77.13% as compared to the same period of last year,mainly due to the decrease of the fine income in the period compared to the same period of lastyear;
22) Non-operating expense decreased by 30.74% as compared to the same period of last year,mainly due to the decrease of one-off expenses recognized in the period;
23) Net cash flows from operating activities decreased by 32.62% as compared to the sameperiod of last year, mainly due to the decrease caused by the impact of COVID-19 in the firstquarter, and mostly offset by the year-on-year improvement in cash flows in the second and thirdquarters;
24) Net cash flows from investing activities increased by 69.98% as compared to the sameperiod of last year, mainly due to the cash inflow from the disposal of subsidiaries, the redemptionof wealth management products in the period, as well as the cash outflow from expense resultingfrom the acquisition of Candy in the same period of last year and the cash outflow from thepurchase of wealth management products;
25) Net cash flows from financing activities increased by 560.13% as compared to the sameperiod of last year, mainly due to the increase of borrowings in the period and issuance ofultra-short-term financing bonds.
3.2 Analysis on the progress of significant events and their impact and solution
√Applicable □ Not Applicable
(1) External guarantees: By the end of the reporting period, the external guarantees provided bythe Company and its subsidiaries were guarantees between the Company and its subsidiaries, the totalbalance of which amounted to RMB33.624 billion (among which, the balance of the guarantee providedfor the loan fund for acquisition of GEA was RMB4.795 billion and the balance of daily businessguarantees was RMB28.830 billion), accounting for 66.7% of the Company’s latest net assets and 16.8%of the latest total assets.
(2) Foreign exchange derivative: By the end of the reporting period, the aggregate balance of theCompany’s foreign exchange derivative transactions amounted to approximately USD1.505 billion.
(3) Entrusted wealth management: By the end of the reporting period, the balance of theCompany’s entrusted wealth management amounted to RMB2.441 billion, including three parts: ①temporarily-idle fund-raising wealth management: at the end of December 2018, the Company’sproceeds for the issuance of convertible corporate bonds were fully landed. In order to improve the yieldof temporarily-idle funds, the Company intended to carry out cash management with the amounts notexceed RMB0.7 billion after approved by the Board of Directors. By the end of the reporting period, thebalance of the entrusted wealth management amounted to RMB542 million; ②wealth management ofthe Company’s Hong Kong listed subsidiary: Haier Electronics Group Co., Ltd. (hereinafter referredto as “Haier Electronics”, stock code: “01169.HK”), the holding subsidiary of the Company, haspurchased some short-term principal-protected wealth management and structural deposits from thelarge commercial banks as an independently operating Hong Kong listed company in order to increasethe efficiency of the use of idle funds within the authorities of the management and on the premise ofsafeguarding funds security. In the purchase process, all the necessary board reports were subject to theprocedures such as filling and management’s review according to the regulations requirements for HongKong listed company, so as to ensure sufficient funds for the day-to-day operations of the main businessand improve the shareholders’ returns. By the end of the reporting period, the balance of the entrustedwealth management amounted to RMB1.894 billion. ③Temporary-idle funds wealth managementby certain subsidiaries of the Company: In order to improve the yield of temporarily-idle funds, somesubsidiaries of the Company use temporarily-idle funds for cash management within the authority of thegeneral manager’s office meeting. By the end of the reporting period, the balance of the entrusted wealthmanagement amounted to RMB5 million.
(4) The progress on the matters of privatization of Haier Electronics: On 12 December 2019,the Company announced the preliminary discussion on the implementation of H-share listing andprivatization of Haier Electronics. On 30 July 2020, the board of directors of the Company consideredand approved the relevant plans and disclosed the Report on Material Asset Purchase and Related
Transactions of Haier Smart Home Co., Ltd. (Draft) and relevant documents. Up to now, the Companyis continuing to advance the relevant matters and will continue to disclose when the relevant nodeprogress achieved according to the relevant requirements.
(5) The progress on the matters of transfer of COSMO’s equity: On 30 July 2020, the Companydisclosed the relevant announcement on the transfer of 54.50% of equity of Haier COSMOPlat IOTEcosystem Technology Co., Ltd. and related transactions. By the end of the reporting period, the equitytransfer has been completed.
3.3 Undertakings not performed as scheduled during the reporting period
□Applicable √Not Applicable
By the end of the reporting period, the Company had no undertakings not performed as scheduled. The undertakings in performance are as follows:
| Background of undertakings | Type of undertakings | Covenanter | Contents of undertakings | Date and term of undertakings | Any deadline for performance | Whether performed in a timely and strict way |
| Undertaking related to significant asset reorganization | Eliminate the right defects in land property etc. | Haier Group Corporation | During the period from September 2006 to May 2007, the Company issued shares to Haier Group Corporation (“Haier Group”) to purchase the controlling equity in its four subsidiaries, namely Qingdao Haier Air-Conditioner Electronics Co., Ltd. (青岛海尔空调电子有限公司), Hefei Haier Air-conditioning Co., Limited (合肥海尔空调器有限公司), Wuhan Haier Electronics Co., Ltd. (武汉海尔电器股份有限公司), Guizhou Haier Electronics Co., Ltd. (贵州海尔电器有限公司). With regard to the land and property required in the operation of Qingdao Haier Air-Conditioner Electronics Co., Ltd., Hefei Haier Air-conditioning Co., Limited, Wuhan Haier Electronics Co., Ltd. (the “Covenantees”), Haier Group made an undertaking (the “2006 Undertaking”). According to the content of 2006 Undertaking and current condition of each Covenantee, Haier Group will constantly assure that Covenantees will lease the land and property owned by Haier Group for free. Haier Group will make compensation in the event that the Covenantees suffer loss due to the | 27 September 2006, long-term | Yes | Yes |
| unavailability of such land and property. | ||||||
| Undertaking related to refinancing | Eliminate the right defects in land property etc. | Haier Group Corporation | Haier Group Corporation undertakes that it will assure HSH and its subsidiaries of the constant, stable and unobstructed use of the leased property. In the event that HSH or any of its subsidiaries suffers any economic loss due to the fact that leased property has no relevant ownership certificate, Haier Group Corporation will make compensation to impaired party in a timely and sufficient way and take all reasonable and practicable measures to support the impaired party to recover to normal operation before the occurrence of loss. Upon the expiration of relevant leasing period, Haier Group Corporation will grant or take practicable measures to assure HSH and its subsidiaries of priority to continue to lease the property at a price not higher than the rent in comparable market at that time. Haier Group Corporation will assure HSH and its subsidiaries of the constant, stable, free and unobstructed use of self-built property and land of the Group. In the event that HSH or any of its subsidiaries fails to continue to use self-built property according to its own will or in original way due to the fact that self-built property has no relevant ownership certificate, Haier Group Corporation will take all reasonable and practicable measures to eliminate obstruction and impact, or will support HSH or its affected subsidiary to obtain alternative property as soon as possible, if Haier Group Corporation anticipates it is unable to cope with or eliminate the external obstruction and impact with its reasonable effort. For details, please refer to the Announcement of Qingdao Haier Co., Ltd. on the Formation, Current Situation of the Defective Property, the Influence on Operation of Issuer Caused by Uncertainty of Ownership, Solution for the Defect and Guarantee Measures (L2014-005) published by the Company on the four major | 24 December 2013, long-term | Yes | Yes |
| securities newspapers and the website of SSE on 29 March 2014. | |||||
| Eliminate the right defects in land property etc. | Haier Smart Home Co., Ltd. | The Company undertakes that it will eliminate the property defects of the Company and main subsidiaries within five years with reasonable business effort since 24 December 2013, to achieve the legality and compliance of the Company and main subsidiaries in terms of land and property. For details, please refer to the Announcement of Qingdao Haier Co., Ltd. on the Formation, Current Situation of the Defective Property, the Influence on Operation of Issuer Caused by Uncertainty of Ownership, Solution for the Defect and Guarantee Measures (L2014-005) published by the Company on the four major securities newspapers and the website of SSE on 29 March 2014. During the aforesaid period, the Company has formulated relevant performance guarantee measures, including the re-application by the Company and its main subsidiaries to the competent government department for the property ownership certificate and to procure Haier Group Corporation to make guarantee undertakings in respect of the defective property with land ownership owned by it and its subsidiaries. As of the expiration date, the Company has resolved the property defects of itself and its eight major subsidiaries, while that of the other remaining five major subsidiaries is in process. The Company will make reasonable business efforts to resolve the property defects of these five major subsidiaries. Because of historical issues and other reasons, the approval procedure involved in solving some defective property problems is complicated, including that of multiple government departments, and it takes a long time to handle and coordinate related matters. Due to the above external factors, the Company was unable to complete the above undertakings within the original undertaking period. Therefore, after the approval of the board meeting held by the Company on 5 November 2018 | 24 December 2013, eight years | Yes | Yes |
| and the general meeting held on 21 December 2018, the term of the above undertakings was extended for three years based on the original deadline. | ||||||
| Other undertakings | Asset injection | Haier Group Corporation | Inject the assets of Haier Photoelectric to the Company or dispose such assets through other ways according to the requirements of the domestic supervision before June 2025. For more details, please refer to the Announcement of Haier Smart Home Co., Ltd. on the Changes of Some Undertakings on Asset Injection of Haier Group Corporation (L2020-024) published on the four major securities newspapers and the website of SSE on 30 April 2020. | December 2015 to June 2025 | Yes | Yes |
| Other undertakings | Profit forecast and compensation | Haier Electric Appliances International Co., Ltd. | In August 2018, Guanmei (Shanghai) Enterprise Management Company Limited (贯美(上海)企业管理有限公司) (hereinafter referred to as “Guanmei”), an indirect holding subsidiary of the Company replaced the 55% equity interests of Bingji (Shanghai) Enterprise Management Company Limited (冰戟(上海)企业管理有限公司) held by it with the 51% equity interests of Qingdao Haishi Water Equipment Co., Ltd. (hereinafter referred to as “Water Equipment”) held by Haier Electric Appliances International Co., Ltd. (hereinafter referred to as “Haier International”). In this regard, Haier International promises that the cumulative actual net profit recorded by the Water Equipment in the three accounting years during the profit compensation period shall not be less than its cumulative forecasted net profit in the corresponding year, otherwise Haier International shall compensate Guanmei’s results according to the Assets Replacement Agreement. Details are set out in the Announcement on Connected Transaction of Planning to Conduct Equity Replacement by Holding Subsidiary and Haier Electronics International Co., Ltd. of Qingdao Haier Co., Ltd. (L2018-047) published by the Company on the four major securities newspapers and the website of SSE | As of 30 April 2021 | Yes | Yes |
| on 31 August 2018. | ||||||
| Undertaking related to significant asset reorganization | Resolve horizontal competition | Haier Smart Home Co., Ltd. | Before this transaction (i.e. the transaction involving in the matters of HSH’s proposed privatization of HEG, the same as below), HEG was the holding subsidiary of the Company, and there was no horizontal competition between HEG and the Company; after the completion of this transaction, HEG will become the wholly-owned or holding subsidiary of the Company (depending on the implementation of the EB Proposal), and there is no or new horizontal competition between HEG and the Company. There is no new or potential horizontal competition between the Company and its controlling shareholder and other related parties controlled by its actual controller. | 31 July 2020, long-term | Yes | Yes |
| Undertaking related to significant asset reorganization | Undertaking related to share reduction | Directors, supervisors and senior management of HSH | The directors, supervisors and senior management of Haier Smart Home Co., Ltd. undertake: in this transaction, during the period from the earlier of the date of resumption of trading of HSH Shares and the date of issuance of this letter of undertaking to the completion of this transaction, I have no plan to reduce HSH Shares (if applicable). If I violate the aforesaid undertaking so as to cause any loss to HSH or other investors, I undertake to be liable for compensation to HSH or other investors according to laws. | 31 July 2020, completion of this transaction | Yes | Yes |
| Undertaking related to significant asset reorganization | Reduce connected transactions | Haier Electric Appliances International Co., Ltd. | 1. This transaction constitutes a connected transaction. The connected transaction procedures completed for this transaction are in compliance with relevant regulations, the connected transaction is priced fairly, and there are no circumstances that harm the interests of the Listed Company and non-connected shareholders. 2. After the completion of this transaction, the Company and its affiliated enterprises will take legal and effective measures to minimize and regulate the connected transactions with the Listed Company and consciously safeguard the interests of the | 29 July 2020, long-term | Yes | Yes |
| Listed Company and all shareholders, and will not take advantage of connected transactions for improper benefits. 3. Without prejudice to laws and regulations, if there are any unavoidable or well-grounded connected transactions between the Company and its affiliated enterprises and the Listed Company, the Company and its affiliated enterprises will enter into transaction agreements with the Listed Company according to laws to ensure they will strictly complete the connected transaction procedures specified in laws, regulations, regulatory documents and the Articles of Association, conduct connected transactions at a fair price in accordance with market-oriented principles to ensure the fairness and compliance of connected transactions, and will not take advantage of such connected transactions to engage in any act that harms the interests of the Listed Company or its minority shareholders, and at the same time, they will perform the information disclosure obligations in accordance with relevant regulations. | ||||||
| Undertaking related to significant asset reorganization | Undertaking related to share reduction | Haier Electric Appliances International Co., Ltd. | In this transaction, during the period from the earlier of the date of resumption of trading of HSH Shares and the date of issuance of this letter of undertaking to the completion of this transaction, the Company has no plan to reduce HSH Shares. If the Company violates the aforesaid undertaking so as to cause any loss to HSH or other investors, the Company undertakes to be liable for compensation to HSH or other investors according to laws. | 29 July 2020, completion of this transaction | Yes | Yes |
| Undertaking related to significant asset reorganizatio | Reduce connected transactions | Haier Group Corporation | 1. This transaction constitutes a connected transaction. The connected transaction procedures completed for this transaction are in compliance with relevant regulations, the connected transaction is priced fairly, and there are no circumstances that harm the interests of the Listed Company and non-connected shareholders. 2. After the completion of this | 29 July 2020, long-term | Yes | Yes |
| n | transaction, the Company and its affiliated enterprises will take legal and effective measures to minimize and regulate the connected transactions with the Listed Company and consciously safeguard the interests of the Listed Company and all shareholders, and will not take advantage of connected transactions for improper benefits. 3. Without prejudice to laws and regulations, if there are any unavoidable or well-grounded connected transactions between the Company and its affiliated enterprises and the Listed Company, the Company and its affiliated enterprises will enter into transaction agreements with the Listed Company according to laws to ensure they will strictly complete the connected transaction procedures specified in laws, regulations, regulatory documents and the Articles of Association, conduct connected transactions at a fair price in accordance with market-oriented principles to ensure the fairness and compliance of connected transactions, and will not take advantage of such connected transactions to engage in any act that harms the interests of the Listed Company or its minority shareholders, and at the same time, they will perform the information disclosure obligations in accordance with relevant regulations. | |||||
| Undertaking related to significant asset reorganizations | Resolve horizontal competition | Haier Group Corporation | 1. The Company and the holding subsidiary Haier Electric Appliances Internationals Co., Ltd. were mainly engaged in investment business during the reporting period. The Company and the holding subsidiary Haier Electric Appliances International Co., Ltd. (including their subsidiaries and entities holding more than 30% of its shares) are not involved in any existing or potential horizontal competition with HSH; 2. The domestic and overseas white goods businesses and assets held by the Company (including its subsidiaries and entities holding more than 30% of its shares) have been injected in HSH by way of asset integration and | 29 July 2020, long-term | Yes | Yes |
| equity transfer in accordance with the undertakings made by the Company in January 2011 and the requirements for adjustment of such undertakings considered and approved at the annual general meeting for 2014 of HSH; 3. Since the closing of acquisition of 100% shares of Haier New Zealand Investment Holding Company Limited, which holds 100% shares of Fisher & Paykel Appliances Holdings Limited, by Haier Singapore Investment Holding Co., Ltd., an overseas subsidiary of HSH in July 2018, there has been no horizontal competition between the Company (including its subsidiaries and entities holding more than 30% of its shares) and HSH in respect of any business at home and abroad. During the reporting period, there was no new horizontal competition between the Company (including its subsidiaries and entities holding more than 30% of its shares) and HSH; 4. After the completion of this transaction, there is no new or potential horizontal competition between the Company (including its subsidiaries and entities holding more than 30% of its shares) and its affiliated enterprises and HSH; 5. During the period when the Company is the controlling shareholder of HSH and HSH Shares are listed on the Hong Kong Stock Exchange, the Company and other subsidiaries thereof and entities holding more than 30% of its shares will not engage in any businesses which are in competition with those engaged in by HSH or run into existing or potential horizontal competition with HSH. | ||||||
| Undertaking related to significant asset reorganizatio | Maintain the independence of the Listed Company | Haier Group Corporation | After the completion of this transaction, the Company will equally exercise shareholders’ rights and fulfill shareholders’ obligations without seeking improper benefits by taking advantage of its shareholder status in strict accordance with the Company Law, Securities Law, relevant provisions of China Securities Regulatory Commission and Shanghai | 29 July 2020, long-term | Yes | Yes |
| n | Stock Exchange as well as the Articles of Association of HSH, etc. to keep the Listed Company completely separate from the Company and other enterprises under the control or significant influence of the Company in management, personnel, assets, finance, institution, and business operations so as to maintain the independence of the Listed Company in management, personnel, assets, finance, institution and business operations. After the completion of this transaction, the Company will regulate the external guarantees of the Listed Company and its subsidiaries without illegally occupying the funds thereof in compliance with the Notice on Several Issues concerning Regulating Fund Transactions between Listed Companies and Their Related Parties and the External Guarantees of Listed Companies《关于规范上市公司与关联方资金往来及上市公司对外担保若干问题的通知》 and the Circular of China Securities Regulatory Commission and China Banking Regulatory Commission on Regulating the External Guaranties Provided by Listed Companies《中国证券监督管理委员会、中国银行业监督管理委员会关于规范上市公司对外担保行为的通知》. The Company undertakes to strictly fulfill the above undertaking. If the Company and other enterprises under the control or significant influence of the Company violate the above undertaking so as to cause any damage to the rights and interests of the Listed Company, the Company will bear corresponding compensation liability according to laws. | |||||
| Undertaking related to significant asset reorganizatio | Undertaking related to share reduction | Haier Group Corporation | In this transaction, during the period from the earlier of the date of resumption of trading of HSH Shares and the date of issuance of this letter of undertaking to the completion of this transaction, the Company has no plan to reduce HSH Shares. If the Company violates the aforesaid undertaking so as to cause any loss to HSH or other investors, the | 29 July 2020, completion of this transaction | Yes | Yes |
| n | Company undertakes to be liable for compensation to HSH or other investors according to laws. | |||||
| Undertaking related to significant asset reorganization | Undertaking related to share reduction | Qingdao Haier Venture & Investment Information Co., Ltd. | In this transaction, during the period from the earlier of the date of resumption of trading of HSH Shares and the date of issuance of this letter of undertaking to the completion of this transaction, the Company has no plan to reduce HSH Shares. If the Company violates the aforesaid undertaking so as to cause any loss to HSH or other investors, the Company undertakes to be liable for compensation to HSH or other investors according to laws. | 29 July 2020, completion of this transaction | Yes | Yes |
| Undertaking related to significant asset reorganization | Undertaking related to share reduction | Qingdao Haichuangzhi Management Consulting Enterprise (Limited Partnership) | In this transaction, during the period from the earlier of the date of resumption of trading of HSH Shares and the date of issuance of this letter of undertaking to the completion of this transaction, the Company has no plan to reduce HSH Shares. If the Company violates the aforesaid undertaking so as to cause any loss to HSH or other investors, the Company undertakes to be liable for compensation to HSH or other investors according to laws. | 29 July 2020, completion of this transaction | Yes | Yes |
| Undertaking related to significant asset reorganization | Others | HCH (HK) INVESTMENT MANAGEMENT CO., LIMITED | 1. The Company legally holds the underlying shares and has complete ownership of the underlying shares, which are not subject to any right restrictions or involved in any circumstance which may affect the offer or closing of this transaction. 2. The Company has complete right to participate in this transaction and is entitled to accept offer for this transaction and sign and perform all agreements and documents involved in this transaction. 3. The Company intends to participate in this transaction as a shareholder in the scheme of arrangement. 4. Unless the privatisation of HEG is completed or HSH announces termination of privatisation, except for the transaction with HSH and its designated subject, the Company will not sell underlying shares, or reach any | 29 July 2020, six months after termination of privatisation/listing of H Shares | Yes | Yes |
| arrangement with any third party on disposing of relevant underlying shares or interests thereof, or set any pledge and other right restrictions on the underlying shares after issue of the letter of confirmation. 5. Unless the privatisation of HEG is completed or HSH announces termination of privatisation, except for participating in and promoting this transaction, the Company will not additionally hold HEG Shares, or reach any arrangement with other HEG Shareholders on disposing of the relevant underlying shares or interests thereof, or set any pledge and other right restrictions on the HEG Shares held by other HEG Shareholders. 6. The Company will comply with the relevant restrictions on the sale of HSH Shares in accordance with Rule 10.07 of the Rules Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited as amended from time to time: from the date of disclosure of the shareholdings of the Company in the Listing Document of HSH H Shares involved in this transaction to the 6th month after HSH H Shares are traded on the Hong Kong Stock Exchange, the Company will not sell HSH H Shares acquired by the Company through this transaction, or enter into any agreement on selling such shares, or set any option, right, interest or encumbrance for such shares; in addition, within six months after the expiry of the aforementioned 6-month period, the Company’s selling HSH H Shares, entering into any agreement on selling such shares, or exercising or executing relevant options, rights, interests or encumbrances for such shares will not cause Haier Group Corporation and its concerted parties to lose their status as controlling shareholders of HSH. | ||||||
| Undertaking related to significant | Reduce connected transactions | HCH (HK) INVESTMENT | 1. This transaction constitutes a connected transaction. The connected transaction procedures completed for this transaction are in compliance with relevant regulations, the connected transaction is priced fairly, and | 29 July 2020, long-term | Yes | Yes |
| asset reorganization | MANAGEMENT CO., LIMITED | there are no circumstances that harm the interests of the Listed Company and non-connected shareholders. 2. After the completion of this transaction, the Company and other enterprises controlled by it will take legal and effective measures to minimize and regulate the connected transactions with the Listed Company and consciously safeguard the interests of the Listed Company and all shareholders, and will not take advantage of connected transactions for improper benefits. 3. Without prejudice to laws and regulations, if there are any unavoidable or well-grounded connected transactions between the Company and other enterprises controlled by it and the Listed Company, the Company and other enterprises controlled by it will enter into transaction agreements with the Listed Company according to laws to ensure they will strictly complete the connected transaction procedures specified in laws, regulations, regulatory documents and the Articles of Association, conduct connected transactions at a fair price in accordance with market-oriented principles, and will not take advantage of such connected transactions to engage in any act that harms the interests of the Listed Company or its minority shareholders, and at the same time, they will perform the information disclosure obligations in accordance with relevant regulations. 4. Any agreement and arrangement on connected transactions made by the Company and other enterprises controlled by it with the Listed Company will not prevent the other party from conducting business or transaction with any third party for its own sake and under the same market competition conditions. | ||||
| Undertaking related to significant | Undertaking related to share | Haier International Co., Limited | In this transaction, during the period from the earlier of the date of resumption of trading of HSH Shares and the date of issuance of this letter of undertaking to the completion of this transaction, the Company has no | 29 July 2020, completion | Yes | Yes |
| asset reorganization | reduction | plan to reduce HSH Shares. If the Company violates the aforesaid undertaking so as to cause any loss to HSH or other investors, the Company undertakes to be liable for compensation to HSH or other investors according to laws. | of this transaction |
3.4 Warning of and explanation on reasons for the forecast that the accumulated net profit for the
period from the beginning of the year to the end of the next reporting period may be a loss or thereis a significant change as compared to that of the same period of last year
□Applicable √ Not Applicable
| Company name | Haier Smart Home Co., Ltd. |
| Legal representative | Liang Haishan |
| Date | 29 October 2020 |
IV. APPENDIX
4.1 Financial statements
CONSOLIDATED BALANCE SHEETS
30 September 2020Prepared by: Haier Smart Home Co., Ltd.
Unit and Currency: RMB Audit Type: Unaudited
| Items | 30 September 2020 | 31 December 2019 |
| Current assets: | ||
| Monetary capital | 43,971,616,468.55 | 36,178,815,683.25 |
| Provision of settlement fund | ||
| Placements with banks | ||
| Financial assets held for trading | 2,039,467,556.56 | 308,135,007.05 |
| Derivative financial assets | 67,245,929.66 | 19,158,132.45 |
| Bills receivable | 14,949,371,910.85 | 13,951,419,893.96 |
| Accounts receivable | 16,667,866,196.08 | 11,015,871,060.09 |
| Financing receivables | ||
| Prepayments | 1,421,696,685.35 | 1,272,921,546.72 |
| Premiums receivable | ||
| Reinsurance accounts receivable | ||
| Reinsurance contract reserves receivable | ||
| Other receivables | 2,265,149,963.22 | 2,163,517,802.50 |
| Including: interests receivable | ||
| dividends receivable | ||
| Financial assets purchased under resale agreements | ||
| Inventories | 26,868,460,739.65 | 28,228,600,971.61 |
| Contract assets | 327,756,561.53 | 422,738,398.42 |
| Assets held for sale | ||
| Non-current assets due within one year | ||
| Other current assets | 2,959,667,645.54 | 6,985,966,115.46 |
| Total current assets | 111,538,299,656.99 | 100,547,144,611.51 |
| Non-current assets: | ||
| Loans and advances granted | ||
| Debt investments | ||
| Other debt investments | ||
| Long-term receivables | 320,655,582.85 | 307,588,203.00 |
| Long-term equity investments | 21,240,150,916.22 | 20,460,763,915.68 |
| Other equity instruments investments | 2,652,599,272.58 | 1,395,959,878.92 |
| Other non-current financial assets | 294,547,364.47 | |
| Investment properties | 30,096,458.24 | 29,402,691.38 |
| Fixed assets | 20,500,127,791.46 | 21,180,057,212.01 |
| Construction in progress | 3,400,638,452.19 | 2,391,364,659.97 |
| Biological assets for production | ||
| Oil and gas assets | ||
| Right-of-use assets | 2,806,441,498.95 | 2,755,066,601.59 |
| Intangible assets | 10,402,722,491.26 | 10,687,071,783.07 |
| Development expenses | 186,306,556.93 | 193,285,777.10 |
| Goodwill | 23,344,329,711.65 | 23,351,729,813.35 |
| Long-term prepaid expenses | 424,316,522.83 | 437,586,912.58 |
| Deferred income tax assets | 1,971,472,465.31 | 1,578,901,892.73 |
| Other non-current assets | 1,388,406,783.80 | 1,843,764,965.81 |
| Total non-current assets | 88,668,264,504.27 | 86,907,091,671.66 |
| Total assets | 200,206,564,161.26 | 187,454,236,283.17 |
| Current liabilities: | ||
| Short-term borrowings | 8,525,338,027.22 | 8,585,049,237.18 |
| Borrowings from central bank | ||
| Placements from banks | ||
| Financial liabilities held for trading | 161,793.47 | 42,799,173.35 |
| Derivative financial liabilities | 185,453,864.17 | 99,548,853.97 |
| Bills payable | 18,075,782,128.00 | 19,308,538,776.92 |
| Accounts payable | 34,508,880,622.65 | 33,750,567,046.28 |
| Receipts in advance | ||
| Contract liabilities | 5,074,397,307.18 | 5,583,008,412.49 |
| Disposal of repurchased financial assets | ||
| Absorbing deposit and deposit in inter-bank market | ||
| Customer deposits for trading in securities | ||
| Amounts due to issuer for securities underwriting | ||
| Staff remuneration payable | 3,186,705,796.49 | 3,155,572,417.30 |
| Taxes payable | 3,184,397,236.75 | 2,117,056,381.04 |
| Other payables | 16,609,237,169.38 | 15,156,392,521.82 |
| Including: interests payable | ||
| dividends payable | ||
| Fees and commissions payable | ||
| Reinsurance accounts payable | ||
| Liabilities held for sale | ||
| Non-current liabilities due within one year | 7,882,943,632.73 | 7,317,138,918.02 |
| Other current liabilities | 6,033,058,626.01 | 494,065,707.54 |
| Total current liabilities | 103,266,356,204.05 | 95,609,737,445.91 |
| Non-current liabilities: | ||
| Deposits for insurance contracts | ||
| Long-term borrowings | 14,729,758,286.57 | 13,276,452,935.56 |
| Debentures payable | 7,001,667,987.29 | 7,004,585,761.43 |
| Including: preference shares | ||
| perpetual bonds | ||
| Lease liabilities | 2,094,925,821.41 | 1,980,271,767.35 |
| Long-term payable | 116,652,463.40 | 142,342,718.45 |
| Long-term staff remuneration payable | 1,160,093,620.84 | 1,122,350,237.36 |
| Estimated liabilities | 1,358,495,380.88 | 1,398,877,746.33 |
| Deferred income | 458,080,797.77 | 705,272,617.10 |
| Deferred income tax liabilities | 1,563,822,680.35 | 1,154,413,295.72 |
| Other non-current liabilities | 80,211,772.59 | 70,071,490.03 |
| Total non-current liabilities | 28,563,708,811.10 | 26,854,638,569.33 |
| Total liabilities | 131,830,065,015.15 | 122,464,376,015.24 |
| Owners’ equity (or shareholder’s equity): | ||
| Paid-in capital (or share capital) | 6,579,566,627.00 | 6,579,566,627.00 |
| Other equity instruments | 431,424,524.07 | 431,424,524.07 |
| Including: preference shares | ||
| perpetual bonds | ||
| Capital reserve | 4,814,724,134.07 | 4,435,890,845.47 |
| Less: treasury stock | ||
| Other comprehensive income | -323,685,888.69 | 1,317,988,619.66 |
| Special reserve | ||
| Surplus reserve | 2,655,327,405.46 | 2,655,327,405.46 |
| General risk provisions | ||
| Undistributed profits | 36,281,720,148.32 | 32,468,121,744.26 |
| Total equity attributable to owners (or shareholder’ equity) of the parent company | 50,439,076,950.23 | 47,888,319,765.92 |
| Minority interests | 17,937,422,195.88 | 17,101,540,502.01 |
| Total owners’ equity (or shareholders’ equity) | 68,376,499,146.11 | 64,989,860,267.93 |
| Total liabilities and owners’ equities (or shareholders’ equity) | 200,206,564,161.26 | 187,454,236,283.17 |
Legal representative: Liang Haishan Chief financial officer: Gong Wei
Person in charge of accounting department: Ying Ke
Balance Sheet of the Parent Company
30 September 2020Prepared by: Haier Smart Home Co., Ltd.
Unit and Currency: RMB Audit Type: Unaudited
| Items | 30 September 2020 | 31 December 2019 |
| Current Assets: | ||
| Monetary capital | 9,556,438,789.79 | 5,624,406,816.79 |
| Financial assets held for trading | ||
| Derivative financial assets | ||
| Bills receivable | ||
| Accounts receivable | 4,727,784,139.94 | 1,182,234,481.49 |
| Financing receivables | ||
| Prepayments | 925,761,289.10 | 30,749,459.11 |
| Other receivables | 2,608,811,023.31 | 5,885,752,905.74 |
| Including: interests receivable | ||
| dividends receivable | ||
| Inventories | 147,327,100.83 | 233,688,207.38 |
| Contract assets | ||
| Assets held for sale | ||
| Non-current assets due within one year | ||
| Other current assets | 545,955,057.97 | 705,958,670.28 |
| Total current assets | 18,512,077,400.94 | 13,662,790,540.79 |
| Non-current assets: | ||
| Debt investments | ||
| Other debt investments | ||
| Long-term receivables | ||
| Long-term equity investments | 35,652,576,621.87 | 35,566,480,370.20 |
| Other equity instruments investments | 804,882,401.58 | 5,147,131.28 |
| Other non-current financial assets | ||
| Investment properties | ||
| Fixed assets | 178,299,279.05 | 180,807,176.98 |
| Construction in progress | 51,278,884.38 | 65,367,920.02 |
| Biological assets for production | ||
| Oil and gas assets | ||
| Right-of-use assets | 1,770,219.19 | |
| Intangible assets | 45,225,376.38 | 15,779,108.14 |
| Development expenses | ||
| Goodwill | ||
| Long-term prepaid expenses | 4,602,913.36 | 5,405,209.80 |
| Deferred income tax assets | 109,055,186.69 | 97,384,845.46 |
| Other non-current assets | 3,792,624.04 | |
| Total non-current assets | 36,847,690,882.50 | 35,940,164,385.92 |
| Total assets | 55,359,768,283.44 | 49,602,954,926.71 |
| Current liabilities: | ||
| Short-term borrowings | ||
| Financial liabilities held for trading | ||
| Derivative financial liabilities | ||
| Bills payable | ||
| Accounts payable | 260,114,939.80 | 3,412,291,778.06 |
| Receipts in advance | ||
| Contract liabilities | 12,052,596.21 | 16,562,259.31 |
| Staff remuneration payable | 69,002,034.37 | 76,513,196.33 |
| Taxes payable | 566,604,346.90 | 86,856,453.32 |
| Other payables | 28,333,414,035.56 | 26,900,844,668.74 |
| Including: interests payable | ||
| dividends payable | ||
| Liabilities held for sale | ||
| Non-current liabilities due within one year | 814,925.37 | |
| Other current liabilities | 5,517,347,401.32 | 2,149,745.37 |
| Total current liabilities | 34,759,350,279.53 | 30,495,218,101.13 |
| Non-current liabilities: | ||
| Long-term borrowings | ||
| Debentures payable | ||
| Including: preference shares | ||
| perpetual bonds | ||
| Leasing liabilities | 851,678.50 | |
| Long-term payable | 20,000,000.00 | 20,000,000.00 |
| Long-term staff remuneration payable | ||
| Estimated liabilities | ||
| Deferred income | 14,140,000.00 | 59,820,000.00 |
| Deferred income tax liabilities | 137,012,198.98 | 43,325,120.18 |
| Other non-current liabilities | ||
| Total non-current liabilities | 172,003,877.48 | 123,145,120.18 |
| Total liabilities | 34,931,354,157.01 | 30,618,363,221.31 |
| Owners’ equity (or shareholder’s equity): | ||
| Paid-in capital (or share capital) | 6,579,566,627.00 | 6,579,566,627.00 |
| Other equity instruments | ||
| Including: preference shares | ||
| perpetual bonds | ||
| Capital reserve | 7,036,531,178.83 | 7,036,531,178.83 |
| Less: treasury stock | ||
| Other comprehensive income | -11,027,703.18 | 11,077,477.45 |
| Special reserve | ||
| Surplus reserve | 2,050,181,180.01 | 2,050,181,180.01 |
| Undistributed profits | 4,773,162,843.77 | 3,307,235,242.11 |
| Total owners’ equity (or shareholders’ equity) | 20,428,414,126.43 | 18,984,591,705.40 |
| Total liabilities and owners’ equities (or shareholders’ equity) | 55,359,768,283.44 | 49,602,954,926.71 |
Legal representative: Liang Haishan Chief financial officer: Gong Wei Person in charge
of accounting department: Ying Ke
Consolidated Income Statement
January-September 2020Prepared by: Haier Smart Home Co., Ltd
Unit and Currency: RMB Audit Type: Unaudited
| Items | Third quarter of 2020 (July-September) | Third quarter of 2019 (July-September) | First three quarters of 2020 (January-September) | First three quarter of 2019 (January-September) |
| I. Total operating revenue | 58,683,716,582.79 | 50,208,824,230.12 | 154,411,813,689.44 | 150,232,288,468.02 |
| Including: operating revenue | 58,683,716,582.79 | 50,208,824,230.12 | 154,411,813,689.44 | 150,232,288,468.02 |
| Interest income | ||||
| Insurance premiums earned | ||||
| Fee and commission income | ||||
| Ⅱ. Total cost of operations | 56,207,290,314.14 | 48,779,084,172.58 | 148,193,548,528.82 | 142,800,464,434.51 |
| Including: operating cost | 42,196,498,908.97 | 35,945,417,806.83 | 111,131,091,030.65 | 106,944,901,437.60 |
| Interest expenses | ||||
| Fee and commission expenses | ||||
| Insurance withdrawal payment | ||||
| Net payment from indemnity | ||||
| Net provisions withdrew for insurance liability | ||||
| Insurance policy dividend paid | ||||
| Reinsurance cost | ||||
| Taxes and | 194,170,7 | 280,336,294.15 | 469,361,548.05 | 686,389,122.70 |
| surcharges | 69.51 | |||
| Selling expenses | 8,835,106,847.37 | 8,067,287,691.29 | 23,362,019,340.66 | 22,845,186,914.20 |
| Administrative expenses | 2,472,958,038.88 | 2,379,366,109.55 | 7,081,266,745.91 | 6,915,467,472.27 |
| R&D expenses | 2,067,364,816.35 | 1,676,240,338.99 | 5,007,098,365.49 | 4,473,307,959.85 |
| Financial expenses | 441,190,933.06 | 430,435,931.77 | 1,142,711,498.06 | 935,211,527.89 |
| Including: interest expenses | 312,963,080.44 | 429,808,736.94 | 1,032,220,170.47 | 1,316,108,036.62 |
| Interest income | 138,881,994.75 | 145,204,158.57 | 358,504,311.40 | 403,901,539.17 |
| Add: other income | 398,380,225.84 | 184,663,138.32 | 923,669,481.27 | 658,592,545.44 |
| investment income (losses are represented by “-”) | 2,746,518,107.86 | 4,230,763,215.03 | 3,503,301,030.65 | 4,987,525,354.22 |
| Including: gain from investment in associates and joint ventures | ||||
| Derecognized gain of financial assets measured at amortized cost | ||||
| Exchange gain (losses are represented by “-”) | ||||
| Gains on net exposure hedges (losses are represented by “-”) | ||||
| Income from changes in fair value (losses are represented | 37,582,691.78 | -42,821,065.32 | 6,595,588.63 | 14,588,891.48 |
| by “-”) | ||||
| Loss on credit impairment (losses are represented by “-”) | -7,197,647.28 | -72,795,564.53 | -116,103,151.35 | -35,019,959.14 |
| Loss on assets impairment (losses are represented by “-”) | -118,128,488.40 | 210,045.69 | -727,876,621.09 | -257,537,859.51 |
| Gain from disposal of assets (losses are represented by “-”) | -38,148,967.49 | -26,845,448.82 | -52,591,373.95 | -14,138,765.95 |
| Ⅲ. Operating profit (losses are represented by “-”) | 5,495,432,190.96 | 5,702,914,377.91 | 9,755,260,114.78 | 12,785,834,240.05 |
| Add: non-operating income | 38,934,204.62 | 198,849,917.68 | 107,820,893.69 | 471,456,387.01 |
| Less: non-operating expenses | 67,512,649.51 | 63,054,240.98 | 122,983,406.06 | 177,560,949.27 |
| Ⅳ. Total profit (total losses are represented by “-”) | 5,466,853,746.07 | 5,838,710,054.61 | 9,740,097,602.41 | 13,079,729,677.79 |
| Less: income tax expense | 1,059,885,084.66 | 917,363,167.62 | 1,721,111,958.00 | 1,973,468,098.82 |
| Ⅴ. Net profit (net losses are represented by “-”) | 4,406,968,661.41 | 4,921,346,886.99 | 8,018,985,644.41 | 11,106,261,578.97 |
| (I) Classified by continuous operation | ||||
| 1.Net profit from continuous operation (net losses are represented by “-”) | 4,406,968,661.41 | 1,758,987,643.18 | 8,018,985,644.41 | 7,793,396,282.63 |
| 2. Net profit from discontinued operation (net losses are represented by “-”) | 3,162,359,243.81 | 3,312,865,296.34 | ||
| (II) Classified by ownership | ||||
| 1. Net profit attributable to shareholders of the Parent Company | 3,519,706,790.82 | 2,554,071,805.27 | 6,300,507,503.54 | 7,612,154,769.74 |
| (net losses are represented by “-”) | ||||
| 2. Profit or loss attributable to minority shareholders (net losses are represented by “-”) | 887,261,870.59 | 2,367,275,081.72 | 1,718,478,140.87 | 3,494,106,809.23 |
| VI. Other comprehensive income, net of tax | -1,464,746,735.20 | 671,163,493.94 | -1,726,210,230.61 | 877,244,401.03 |
| (I) Other comprehensive income attributable to owners of the Parent Company, net of tax | -1,444,082,794.82 | 623,918,532.71 | -1,664,084,285.15 | 857,542,799.89 |
| 1. Other comprehensive income that cannot be reclassified into profit or loss | -2,602,356.48 | -3,931,545.48 | -58,986,038.62 | -16,174,504.60 |
| (1) Changes arising from re-measurement of defined benefit plans | -2,808,591.43 | 655,808.28 | -2,796,373.04 | 255,491.10 |
| (2) Other comprehensive income that cannot be transferred into profit or loss under equity method | ||||
| (3) Changes in fair value of investments in other equity instruments | 206,234.95 | -4,587,353.76 | -56,189,665.58 | -16,429,995.70 |
| (4) Changes in fair value of own credit risks | ||||
| 2. Other comprehensive income to be reclassified into profit or loss | -1,441,480,438.34 | 627,850,078.19 | -1,605,098,246.53 | 873,717,304.49 |
| (1) Other comprehensive income that can be transferred into profit or loss under | -218,697,476.31 | 51,040,731.98 | -189,651,363.03 | 70,870,344.63 |
| equity method | ||||
| (2) Changes in fair value of other debt investments | ||||
| (3) Reclassified financial assets that are credited to other comprehensive income | ||||
| (4) Provisions for credit impairment of other debt investments | ||||
| (5) Cash flow hedges reserve | 993,839.00 | -10,608,611.29 | -84,274,049.94 | -36,007,555.07 |
| (6) Exchange differences on translation of financial statements denominated in foreign currencies | -1,223,776,801.03 | 587,417,957.50 | -1,331,172,833.56 | 838,854,514.93 |
| (7) Others | ||||
| (II) Other comprehensive income attributable to minority shareholders, net of tax | -20,663,940.38 | 47,244,961.23 | -62,125,945.46 | 19,701,601.14 |
| Ⅶ. Total comprehensive income | 2,942,221,926.21 | 5,592,510,380.93 | 6,292,775,413.80 | 11,983,505,980.00 |
| (I) Total comprehensive income attributable to the owners of Parent Company | 2,075,623,996.00 | 3,177,990,337.98 | 4,636,423,218.39 | 8,469,697,569.63 |
| (II) Total comprehensive income attributable to the minority shareholders | 866,597,930.21 | 2,414,520,042.95 | 1,656,352,195.41 | 3,513,808,410.37 |
| Ⅷ. Earnings per share: | ||||
| (I) Basic earnings per share (RMB/share) | 0.535 | 0.401 | 0.958 | 1.195 |
| (II) Diluted earnings per share (RMB/share) | 0.526 | 0.343 | 0.939 | 1.107 |
Legal representative: Liang Haishan Chief financial officer: Gong Wei
Person in charge of accounting department: Ying Ke
Profit Statement of the Parent Company
January-September 2020Prepared by: Haier Smart Home Co., Ltd
Unit and Currency: RMB Audit Type: Unaudited
| Items | Third quarter of 2020 (July-September) | Third quarter of 2019 (July-September) | First three quarters of 2020 (January-September) | First three quarter of 2019 (January-September) |
| I. Operating income | 1,195,275,124.30 | 903,401,779.64 | 6,237,992,223.98 | 2,234,271,154.27 |
| Less: operating cost | 815,513,821.74 | 665,370,343.10 | 5,213,924,603.29 | 1,615,752,876.42 |
| Taxes and surcharges | 7,304,197.70 | 5,324,414.17 | 18,647,884.55 | 14,118,655.09 |
| Selling expenses | 86,858,168.81 | 63,131,879.39 | 304,820,441.43 | 190,089,788.56 |
| Administration expenses | 68,072,858.57 | 179,457,329.72 | 200,361,265.40 | 320,496,657.73 |
| R&D expenses | 90,357,407.15 | 54,550,067.46 | 233,014,050.16 | 156,533,395.84 |
| Financial expenses | 17,149,862.40 | 11,752,125.45 | 46,128,332.17 | 111,189,066.25 |
| Including: interest expenses | 28,698,250.00 | 25,477,118.45 | 74,857,472.22 | 139,021,578.60 |
| Interest income | 14,208,638.45 | 12,873,607.27 | 30,293,547.81 | 30,581,562.15 |
| Add: other income | 28,797,741.49 | 4,501,688.94 | 62,059,874.59 | 56,974,198.19 |
| investment income (losses are represented by “-”) | 4,011,191,390.98 | 8,374,916.12 | 4,257,166,131.35 | 253,943,029.70 |
| Including: gains from investment in associates and joint ventures |
| Derecognized gain on financial assets measured at amortized cost | ||||
| Gains on net exposure hedges (losses are represented by “-”) | ||||
| Income from changes in fair value (losses are represented by “-”) | ||||
| Loss on credit impairment (losses are represented by “-”) | 391,099.72 | -7,920.79 | 675,131.84 | 979,217.15 |
| Loss on assets impairment (losses are represented by “-”) | -1,793,656.12 | -3,100,268.37 | ||
| Gain from disposal of assets (losses are represented by “-”) | 51,118.46 | |||
| II. Operating profit (losses are represented by “-”) | 4,148,605,384.00 | -63,315,695.38 | 4,537,896,516.39 | 138,038,277.88 |
| Add: non-operating income | 706,408.80 | 3,590,569.68 | 742,963.13 | 13,003,372.98 |
| Less: non-operating expenses | 19,547.73 | 1,007,999.99 | 339,043.62 | 2,971,024.42 |
| III. Total profit (total losses are | 4,149,292,245.07 | -60,733,125.69 | 4,538,300,435.90 | 148,070,626.44 |
| represented by “-”) | ||||
| Less: income tax expenses | 606,491,357.43 | -123,118.24 | 605,035,349.11 | -17,410,712.14 |
| IV. Net profit (net losses are represented by “-”) | 3,542,800,887.64 | -60,610,007.45 | 3,933,265,086.79 | 165,481,338.58 |
| (I) Net profit from continuous operations (net losses are represented by “-”) | 3,542,800,887.64 | -60,610,007.45 | 3,933,265,086.79 | 165,481,338.58 |
| (II) Net profit from discontinued operations (net losses are represented by “-”) | ||||
| V. Other comprehensive income, net of tax | -14,989,053.63 | 5,204,966.29 | -22,105,180.63 | 4,453,719.92 |
| (I) Other comprehensive income that cannot be reclassified into profit or loss | -67,243.43 | -178,713.89 | ||
| 1. Changes arising from re-measurement of defined benefit plans | ||||
| 2. Other comprehensive income that cannot be transferred into profit or loss under equity |
| method | ||||
| 3. Changes in fair value of investments in other equity instruments | -67,243.43 | -178,713.89 | ||
| 4. Changes in fair value of own credit risks | ||||
| (II) Other comprehensive income to be reclassified into profit or loss | -14,989,053.63 | 5,272,209.72 | -21,926,466.74 | 4,453,719.92 |
| 1. Other comprehensive income that can be transferred into profit or loss under equity method | -14,989,053.63 | 5,272,209.72 | -21,926,466.74 | 4,453,719.92 |
| 2. Changes in fair value of other debt investments | ||||
| 3. Reclassified financial assets that are credited to other comprehensive income | ||||
| 4. Provisions for credit impairment of other debt investments | ||||
| 5. Cash flow hedges reserve | ||||
| 6. Exchange differences on |
| translation of financial statements denominated in foreign currencies | |||||
| 7. Others | |||||
| VI. Total comprehensive income | 3,527,811,834.01 | -55,405,041.16 | 3,911,159,906.16 | 169,935,058.50 | |
| VII. Earnings per share: | |||||
| (I) Basic earnings per share (RMB/share) | |||||
| (II) Diluted earnings per share (RMB/share) | |||||
Legal representative: Liang Haishan Chief financial officer: Gong Wei
Person in charge of accounting department: Ying Ke
Consolidated Cash Flow StatementJanuary - September 2020Prepared by: Haier Smart Home Co., Ltd.
Unit and Currency: RMB Audit Type: Unaudited
| Items | The first three quarters of 2020 (January – September) | The first three quarters of 2019 (January – September) |
| I. Cash flows from operating activities: | ||
| Cash received from the sale of goods and rendering of services | 147,291,023,850.68 | 149,416,186,506.27 |
| Net increase in customers and interbank deposits | ||
| Net increase in borrowing from the central bank | ||
| Net cash increase in borrowing from other financial institutes | ||
| Cash received from premiums under | ||
| original insurance contract | ||
| Net cash received from reinsurance business | ||
| Net increase in deposits of policy holders and investment | ||
| Cash received from interest, fee and commissions | ||
| Net increase in cash borrowed | ||
| Net increase in cash received from repurchase operation | ||
| Net cash received from securities trading agency services | ||
| Refunds of taxes received | 976,790,858.07 | 1,049,707,932.77 |
| Cash received from other related operating activities | 858,777,749.41 | 1,023,187,631.12 |
| Sub-total of cash inflows from operating activities | 149,126,592,458.16 | 151,489,082,070.16 |
| Cash paid on purchase of goods and services | 107,290,072,174.03 | 110,367,698,756.06 |
| Net increase in loans and advances of customers | ||
| Net increase in deposits in PBOC and interbank | ||
| Cash paid for compensation payments under original insurance contract | ||
| Net increase in placements with banks | ||
| Cash paid for interest, fees and commissions | ||
| Cash paid for insurance policy dividend | ||
| Cash paid to and on behalf of employees | 16,400,625,372.03 | 16,241,539,773.60 |
| Cash paid for all types of taxes | 5,612,184,299.93 | 6,255,602,262.52 |
| Cash paid on other operation related activities | 14,112,505,937.72 | 10,148,204,038.58 |
| Sub-total of cash outflows from operating activities | 143,415,387,783.71 | 143,013,044,830.76 |
| Net cash flows from operating activities | 5,711,204,674.45 | 8,476,037,239.40 |
| II. Cash flows from investing activities: | ||
| Cash received from recovery of investments | 2,810,432,335.20 | 1,534,282,960.18 |
| Cash received from return on investments | 348,202,313.61 | 457,961,430.03 |
| Net cash received from the disposal of fixed assets, intangible assets and other long-term assets | 80,436,732.37 | 200,940,694.81 |
| Net cash received from disposal of subsidiaries and other operating entities | 1,314,096,598.53 | |
| Cash received from other investment related activities | 8,051,012.31 | 279,515,688.66 |
| Sub-total of cash inflows from investing activities | 4,561,218,992.02 | 2,472,700,773.68 |
| Cash paid on purchase of fixed assets, intangible assets and other long-term assets | 5,099,603,609.64 | 4,582,456,572.85 |
| Cash paid for investments | 1,758,422,705.33 | 3,059,069,407.17 |
| Net increase in secured loans | ||
| Net cash paid on acquisition of subsidiaries and other operating entities | 345,271,380.17 | 2,641,246,363.38 |
| Cash paid on other investment related activities | 52,942,942.62 | 1,167,045,427.42 |
| Sub-total of cash outflows from investing activities | 7,256,240,637.76 | 11,449,817,770.82 |
| Net cash flows from investing activities | -2,695,021,645.74 | -8,977,116,997.14 |
| III. Cash flows from financing activities: | ||
| Cash received from capital contributions | 1,326,697,709.68 | 14,318,688.54 |
| Including: cash received from capital contributions by minority shareholders of subsidiaries | ||
| Cash received from borrowings | 23,485,842,921.55 | 12,084,841,424.81 |
| Cash received from other financing related activities | 4,422,492.60 | 7,139,182.47 |
| Sub-total of cash inflows from financing activities | 24,816,963,123.83 | 12,106,299,295.82 |
| Cash paid on repayment of borrowings | 14,546,595,992.83 | 9,252,731,650.03 |
| Cash paid on distribution of dividends, profits or repayment of interest expenses | 3,966,850,550.91 | 3,082,361,819.88 |
| Including: dividend and profit paid to minority shareholders by subsidiaries | ||
| Cash paid on other financing related activities | 552,815,827.98 | 1,020,991,642.57 |
| Sub-total of cash outflows from financing activities | 19,066,262,371.72 | 13,356,085,112.48 |
| Net cash flows from financing activities | 5,750,700,752.11 | -1,249,785,816.66 |
| IV. Effect of fluctuations in exchange | -418,539,387.37 | 585,786,113.94 |
| rates on cash and cash equivalents | ||
| V. Net increase in cash and cash equivalents | 8,348,344,393.45 | -1,165,079,460.46 |
| Add: balance of cash and cash equivalents at the beginning of the period | 34,981,410,830.63 | 36,257,588,929.47 |
| VI. Balance of cash and cash equivalents at the end of the period | 43,329,755,224.08 | 35,092,509,469.01 |
Legal representative: Liang Haishan Chief financial officer: Gong Wei
Person in charge of accounting department: Ying Ke
Cash Flow Statement of the Parent Company
January-September 2020Prepared by: Haier Smart Home Co., Ltd.
Unit and Currency: RMB Audit Type: Unaudited
| Items | The first three quarters of 2020 (January – September) | Amount for the first three quarters of 2019 (January – September) |
| I. Cash flows from operating activities: | ||
| Cash received from the sale of goods and rendering of services | 3,467,075,928.84 | 1,219,703,551.51 |
| Refunds of taxes received | 20,913,285.18 | 31,329,360.51 |
| Cash received from other related operating activities | 27,453,408.37 | 182,304,374.25 |
| Sub-total of cash inflows from operating activities | 3,515,442,622.39 | 1,433,337,286.27 |
| Cash paid on purchase of goods and services | 9,943,115,483.72 | 57,147,717.08 |
| Cash paid to and on behalf of employees | 433,934,396.95 | 701,565,276.87 |
| Cash paid for all types of taxes | 196,697,391.69 | 116,443,799.11 |
| Cash paid on other operation related activities | 178,656,735.99 | 456,381,806.73 |
| Sub-total of cash outflows from operating activities | 10,752,404,008.35 | 1,331,538,599.79 |
| Net cash flows from operating activities | -7,236,961,385.96 | 101,798,686.48 |
| II. Cash flows from investing activities: | ||
| Cash received from recovery of investments | 4,410,000,000.00 | |
| Cash received from return on investments | 4,062,494,274.83 | 1,513,456,657.45 |
| 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 operating entities | ||
| Cash received from other investment related activities | 1,431,977,000.00 | |
| Sub-total of cash inflows from investing activities | 8,472,494,274.83 | 2,945,433,657.45 |
| Cash paid on purchase of fixed assets, intangible assets and other long-term assets | 98,238,434.96 | 30,442,256.39 |
| Cash paid for investments | 1,199,400,000.00 | 3,521,662,503.09 |
| Net cash paid on acquisition of subsidiaries and other operating entities | ||
| Cash paid on other investment related activities | 133,000,000.00 | 246,801,379.00 |
| Sub-total of cash outflows from investing activities | 1,430,638,434.96 | 3,798,906,138.48 |
| Net cash flows from investing activities | 7,041,855,839.87 | -853,472,481.03 |
| III. Cash flows from financing activities: | ||
| Cash received from capital contributions | ||
| Cash received from borrowings | 10,000,000,000.00 | |
| Cash received from other financing related activities | 1,155,486,114.60 | 3,728,909,076.12 |
| Sub-total of cash inflows from financing activities | 11,155,486,114.60 | 3,728,909,076.12 |
| Cash paid on repayment of borrowings | 4,500,000,000.00 | 1,500,000,000.00 |
| Cash paid on distribution of dividends, profits or repayment of interest expenses | 2,528,459,679.57 | 2,262,440,498.23 |
| Cash paid on other financing related activities | 8,419,159.30 | |
| Sub-total of cash outflows from financing activities | 7,028,459,679.57 | 3,770,859,657.53 |
| Net cash flows from financing activities | 4,127,026,435.03 | -41,950,581.41 |
| IV. Effect of fluctuations in exchange rates on cash and cash equivalents | 111,084.06 | -1,836,962.00 |
| V. Net increase in cash and cash equivalents | 3,932,031,973.00 | -795,461,337.96 |
| Add: balance of cash and cash equivalents at the beginning of the period | 5,624,406,816.79 | 7,068,899,574.96 |
| VI. Balance of cash and cash equivalents at the end of the period | 9,556,438,789.79 | 6,273,438,237.00 |
Legal representative: Liang Haishan Chief financial officer: Gong Wei
Person in charge of accounting department: Ying Ke
4.2 Status in relation to adjustments to the first implementation of relevant items in financialstatements at the beginning of the year for implementation of New Income Standards and NewLease Stands for the first time since 2020
□Applicable √Not Applicable
4.3 Explanation on retroactive adjustments of previously comparative data for implementation of New
Income Standards and New Lease Standards for the first time since 2020
□Applicable √Not Applicable
4.4 Audit report
□Applicable √Not Applicable