Stock Code: 603605 Stock Abbreviation: ProyaBond Code: 113634 Bond Abbreviation: Proya Convertible Bond
Proya Cosmetics Co., Ltd.Semi-Annual Report 2024
Important Notes
I. The Board of Directors, Board of Supervisors, directors, supervisors and senior
management of the Company warrant that the content of the Semi-Annual Report isauthentic, accurate and complete, free from false records, misleading statements and majoromissions, and shall be jointly and severally liable therefore.
II. All directors of the Company attended the meeting of the Board of Directors.
III. The Semi-Annual Report has not been audited.
IV. HOU Juncheng, chairman of the Company, and WANG Li, CFO, person in charge of
Accounting Department (and Head of the Accounting Department) of the Companyrepresent and warrant that the financial report in the Semi-Annual Report is authentic,accurate and complete.
V. The profit distribution plan or the plan for capitalization of capital reserves for the
Reporting Period approved by the Board of DirectorsNo profit distribution plan or the plan for capitalization of capital reserves during the Reporting Period.
VI. Disclosure of risks involved in forward-looking statements
√Applicable □Not applicable
The Report contains forward-looking statements which involve the future plans, development strategies,etc. of the Company, yet do not constitute substantive undertakings of the Company to investors.Investors should exercise caution prior to making investment decisions.
VII. Whether there is any non-operating capital occupation by a controlling shareholder and
other related partiesNo
VIII. Whether there is any external guarantee provided in violation of specified decision-making
proceduresNo
IX. Whether the majority of the directors are unable to warrant the authenticity, accuracy and
completeness of the Semi-Annual Report disclosed by the CompanyNo
X. Disclosure of major risksThe Company has disclosed the existing risks in details in this Report. Refer to “(I) Possible risks”, “V.Other Disclosures”, “Section III Management Discussion and Analysis”.
XI. Others
□Applicable √Not applicable
Contents
Section I Definitions ...... 4
Section II Company Profile and Key Financial Indicators ...... 4
Section III Management Discussion and Analysis ...... 8
Section IV Corporate Governance ...... 24
Section V Environmental and Social Responsibility ...... 26
Section VI Important Matters ...... 28
Section VII Shareholders and Changes in Shares ...... 81
Section VIII Information on Preference Shares ...... 86
Section IX Information on Bonds ...... 87
Section X Financial Report ...... 93
| Documents Available for Inspection | Financial statements signed and sealed by the Legal Representative, CFO, and person in charge of Accounting Department of the Company |
| Original copies of all documents and announcements of the Company disclosed during the Reporting Period in newspapers designated by China Securities Regulatory Commission |
Section I Definitions
In this Report, unless the context otherwise requires, the following terms have the following meanings:
| Definition | ||
| Proya Cosmetics, this Company, or the Company | refers to | Proya Cosmetics Co., Ltd. |
| CSRC | refers to | China Securities Regulatory Commission |
| SSE | refers to | Shanghai Stock Exchange |
| Articles of Association | refers to | Articles of Association of Proya Cosmetics Co., Ltd. |
| RMB/RMB'0,000 | refers to | RMB/RMB '0,000 |
Section II Company Profile and Key Financial Indicators
I. Company Information
| Chinese name of the Company | 珀莱雅化妆品股份有限公司 |
| Abbreviation of the Chinese name | 珀莱雅 |
| English name of the Company | Proya Cosmetics Co., Ltd. |
| Abbreviation of the English name | Proya |
| Legal representative of the Company | HOU Juncheng |
II. Contact Details
| Board Secretary | Securities Affairs Representative | |
| Name | WANG Li | WANG Xiaoyan |
| Mailing address | 10/F, Proya Building, No. 588 Xixi Road, Xihu District, Hangzhou City, Zhejiang Province | 10/F, Proya Building, No. 588 Xixi Road, Xihu District, Hangzhou City, Zhejiang Province |
| Telephone | 0571-87352850 | 0571-87352850 |
| Fax | 0571-87352813 | 0571-87352813 |
| proyazq@proya.com | proyazq@proya.com |
III. Changes in General Information
| Registered address | No. 588 Xixi Road, Liuxia Neighborhood, Xihu District, Hangzhou City, Zhejiang Province |
| Historical changes in the Company's registered address | For details, please refer to the Announcement on Revision of the Articles of Association and Change in Business Registration (Announcement No. 2019-008) disclosed by the Company in the designated information disclosure media on February 27, 2019 |
| Office address of the Company | Proya Building, No. 588 Xixi Road, Xihu District, Hangzhou City, Zhejiang Province |
| Postal code of the registered office address | 310023 |
| Company website | http://www.proya-group.com |
| proyazq@proya.com |
| Index changes during the Reporting Period | Not applicable |
IV. Changes in Information Disclosure and Places for Inspection
| Name of designated newspapers for information disclosure by the Company | Shanghai Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, China Daily |
| Website for the publication of the Semi-Annual Report | http://www.sse.com.cn |
| Place for inspection of the Semi-Annual Report of the Company | Board of Director's Office, Proya Building, No.588 Xixi Road, Xihu District, Hangzhou City, Zhejiang Province |
| Index changes during the Reporting Period | Not applicable |
V. Stock Overview
| Stock class | Stock exchange | Stock abbreviation | Stock code | Stock abbreviation before changes |
| A share | Shanghai Stock Exchange | Proya | 603605 | None |
VI. Other Relevant Information
□Applicable √Not applicable
VII. Key Accounting Data and Financial Indicators of the Company(I) Key accounting data
Unit: Yuan Currency: RMB
| Key accounting data | In the Reporting Period (January - June) | Same period of prior year | Year-on-year change (%) |
| Operating revenue | 5,001,465,470.72 | 3,626,991,878.22 | 37.90 |
| Net profit attributable to shareholders of the listed company | 701,671,374.89 | 499,493,997.71 | 40.48 |
| Net profit attributable to shareholders of the listed company, net of non-recurring gains and losses | 678,996,518.33 | 478,891,852.27 | 41.78 |
| Net cash flows from operating activities | 662,102,794.39 | 1,181,268,072.03 | -43.95 |
| End of the Reporting Period | End of prior year | Change as at the end of the Reporting Period over the end of prior year (%) | |
| Net assets attributable to shareholders of the listed company | 4,541,679,882.42 | 4,349,545,381.60 | 4.42 |
| Total assets | 7,362,862,729.83 | 7,323,078,222.45 | 0.54 |
(II) Key financial indicators
| Key financial indicators | In the Reporting Period (January - June) | Same period of prior year | Year-on-year change (%) |
| Basic earnings per share (RMB/share) | 1.78 | 1.25 | 42.40 |
| Diluted earnings per share (RMB/share) | 1.72 | 1.24 | 38.71 |
| Basic earnings per share after deducting non-recurring gains and losses (RMB/share) | 1.72 | 1.20 | 43.33 |
| Weighted average ROE (%) | 15.34 | 13.29 | Up by 2.05 percentage points |
| Weighted average ROE after deducting non-recurring gains and losses (%) | 14.85 | 12.74 | Up by 2.11 percentage points |
Notes to key accounting data and financial indicators
□Applicable √Not applicable
VIII. Differences in Accounting Data under Chinese and International Accounting Standards
□Applicable √Not applicable
IX. Items and amounts of non-recurring gains and losses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Non-recurring gains and losses item | Amount | Notes (if applicable) |
| Gains or losses from disposal of non-current assets, including write-offs of provision for asset impairment accrued | -712,859.58 | |
| Government grants included in current profit or loss (excluding government grants that are closely related to the Company’s normal business operations, compliant with national policies, granted at set standards, and imposing sustaining influence on the Company's profit or loss) | 41,996,899.59 | |
| Gains or losses from change in fair value generated by financial assets and financial liabilities held by non-financial businesses as well as gains or losses from disposal of financial assets and financial liabilities, except for valid hedging business related to the Company's normal business operations | ||
| Capital occupation fees charged to non-financial enterprises and included in current profit or loss | ||
| Gains or losses on authorizing others to invest or manage |
| Non-recurring gains and losses item | Amount | Notes (if applicable) |
| assets | ||
| Gains or losses from outward entrusted loaning | ||
| Asset loss incurred by force majeure such as natural disasters | ||
| Reversal of provision for impairment of accounts receivable individually tested for impairment | ||
| Gains when the investment cost of acquiring a subsidiary, an associate or a joint venture is less than the fair value of the identifiable net assets of the invested entity | ||
| Current net gains or losses of subsidiaries established by business combination under common control from the beginning of the period to the combination date | ||
| Gains or losses from exchange of non-monetary assets | ||
| Gains or losses from debt restructuring | ||
| One-time expenses incurred due to the cessation of relevant business activities, such as staffing expenses | ||
| One-time impact on current gains or losses due to the adjustments of taxes and accounting laws and regulations | ||
| One-time share-based payment recognized for cancellation and modification of equity incentive plans | ||
| Gains or losses from changes in the fair value of employee compensation payable for share-based payment in cash after the exercise date | ||
| Gains or losses arising from changes in the fair value of investment property subsequently measured with the fair value model | ||
| Gains arising from transactions with unreasonable transaction price | ||
| Gains or losses arising from contingencies unrelated to the Company's normal operations | ||
| Custody fee income from entrusted operations | ||
| Other non-operating revenue and expenses besides the above items | -474,557.25 | |
| Other items that conform to the definition of non-recurring gains and losses | ||
| Less: Effect of income tax | 10,032,617.51 | |
| Impact of minority interests (after tax) | 8,102,008.69 | |
| Total | 22,674,856.56 |
The reasons should be explained for the Company defining items not listed in the ExplanatoryAnnouncement on Information Disclosure for Companies Offering Their Securities to the Public No. 1 –Non-Recurring Gains and Losses as non-recurring gains and losses items of high value and defining thenon-recurring gains and losses items listed in the same document as recurring gains and losses items.
□Applicable √Not applicable
X. Others
□Applicable √Not applicable
Section III Management Discussion and AnalysisI. Description of the Industry in Which the Company Operates and Primary Businesses of theCompany during the Reporting Period(I) Primary businessThe Company seeks to build a new domestic cosmetics industry platform, and is primarily engaged inR&D, production and sales of cosmetic products. Main brands owned by the Company include Proya,TIMAGE, Off&Relax, Hapsode, CORRECTORS, INSBAHA, UZERO and Anya. The Company's ownbrands have covered fields such as popular exquisite skincare, make-up, body & hair, andhigh-efficiency skincare:
1. Popular exquisite skincare brand
(1) Proya, focusing on technology skincare, designed for young white-collar female customers, generallypriced at RMB200 to RMB500, sold both online and offline.
(2) Hapsode, positioned as an “expert in oily skin care”, focusing on college students and other youngfemale customers, generally priced at RMB50 to RMB200, sold mainly online.
2. Make-up brand
TIMAGE, a professional make-up artist brand customized for Chinese faces, generally priced atRMB150 to RMB300, sold mainly online.
3. Body & hair brand
Off&Relax, positioned as an “expert in Asian scalp health care”, generally priced at RMB150 toRMB200, sold mainly online.
4. High-efficiency skincare brand
CORRECTORS, a high-efficiency skincare brand, generally priced at RMB260 to RMB600, sold online.
(II) Business models
1. Sales models
Mainly online sales, supplemented by offline sales.Online sales are mainly operated through direct sales and distribution. Direct sales are mainly carried outthrough platforms such as Tmall, Douyin, JD, Kwai, and Pinduoduo, and distribution is based onplatforms such as Taobao, JD, and Vipshop.Offline sales are mainly operated through dealers. Channels include cosmetics franchise stores anddepartment stores.
2. Production/R&D models
Self-production is the main production model of the Company, supplemented by OEM production. Theskincare products of the Company are mainly self-produced while make-up products adopt bothself-production and OEM production. The Company has self-built skincare and make-up factories.Independent R&D is the main R&D model of the Company, supplemented byindustry-university-research cooperation. The Company maintains R&D cooperation with front-endresearch institutions and high-quality raw material suppliers including Zhejiang University, ZhejiangUniversity of Technology, Hangzhou Dianzi University, Jiangnan University, Beijing Technology andBusiness University, BASF China, Ashland China, DSM Shanghai, CRODA China, Evonik China,Spanish LIPOTRUE, S.L., and Shenzhen Siyomicro Bio-tech.
(III) Industry overviewAccording to the Guidelines for the Industry Classification of Listed Companies issued by the CSRC, theCompany falls under chemical raw material and chemical product manufacturing (classification code:
C26); according to Industrial Classifications for National Economic Activities (GB/T 4754-2017), theCompany falls under daily chemical product manufacturing (C268), and further falls under cosmeticsmanufacturing (C2682).According to statistics from the National Bureau of Statistics, from January to June 2024, the total retailsales of consumer goods reached RMB23,596.9 billion, a YOY increase of 3.7%; the total retail sales ofcosmetics reached RMB216.8 billion, a YOY increase of 1.0% (the retail sales value from the businessesabove designated units).
II. Analysis of Core Competitiveness during the Reporting Period
√Applicable □Not applicable
Facing the rapidly changing external market, the Company was firmly committed to the leadership andimplementation of the 6
*
N Strategy. We consolidated and deepened precise operation managementsystem highlighting “R&D, products, contents, operation”, supplemented by a self-driven organizationstructure featuring “culture-strategy-mechanism-talents”. We flexibly responded to market developmentand changes, rapidly established our presence and invested in emerging channels. Meanwhile, weexplored overseas development opportunities, seized the chance for Chinese brands to expand globally,and drove business growth with an expanded market scope and enhanced responsiveness.With a keen insight into consumers' needs, the Company continued to sharpen the strengths of heroproducts, as well as build and improve the matrix of core hero products based on our strong competencein R&D and backed by our quick-response internal organizational capabilities. In doing so, the Companykept expanding our brand appeal and vitality. A self-driven agile organization was built to serve thesecond tier brands and the brands at the incubation stage, forming a fledgling brand matrix in skincare,make-up, and personal care products. By building our own MCN team and content marketing team, theCompany strengthened the internal circular ecology and fostered the external ecosystem of Proya brand.
III. Business Discussion and Analysis(I) Financial analysis
1. Year-on-year growth in operating revenue
Operating revenue amounted to RMB5.001 billion, up by 37.90% YOYIncluding: primary operating revenue was RMB4.994 billion, up by 37.99% YOYOther operating revenue was RMB7 million
Primary operating revenue:
(1) By channel
| By channel | Amount (RMB100 million) | Change in H1 2024 YOY (%) | Change in 2023 YOY (%) | Change in 2022 YOY (%) | Change in 2021 YOY (%) | Proportion of H1 2024 (%) | Proportion of 2023 (%) | Proportion of 2022 (%) | Proportion of 2021 (%) | |
| Online | Direct sales | 37.24 | 40.01 | 50.70 | 59.79 | 76.16 | 74.56 | 75.91 | 70.40 | 60.66 |
| Distribution | 9.56 | 42.52 | 16.49 | 16.79 | 8.56 | 19.13 | 17.16 | 20.58 | 24.27 | |
| Subtotal | 46.80 | 40.52 | 42.96 | 47.50 | 49.54 | 93.69 | 93.07 | 90.98 | 84.93 | |
| Offline | Cosmetics stores | 2.23 | -7.66 | 11.59 | -11.96 | -40.52 | 4.46 | 5.56 | 6.96 | 10.88 |
| Others | 0.91 | 92.29 | -6.98 | -32.32 | -30.50 | 1.85 | 1.37 | 2.06 | 4.19 | |
| Subtotal | 3.14 | 8.85 | 7.35 | -17.62 | -38.03 | 6.31 | 6.93 | 9.02 | 15.07 | |
| Total | 49.94 | 37.99 | 39.74 | 37.69 | 23.28 | 100.00 | 100.00 | 100.00 | 100.00 | |
Note: The proportion of sales revenue from each channel is as the percentage of primary operatingrevenue.
(2) By brand
| By brand | Amount (RMB100 million) | Change in H1 2024 YOY (%) | Change in 2023 YOY (%) | Change in 2022 YOY (%) | Change in 2021 YOY (%) | Proportion of H1 2024 (%) | Proportion of 2023 (%) | Proportion of 2022 (%) | Proportion of 2021 (%) | |
| Self-owned brands | Proya | 39.81 | 37.67 | 36.36 | 37.46 | 28.25 | 79.71 | 80.73 | 82.74 | 82.87 |
| TIMAGE | 5.82 | 40.57 | 75.06 | 132.04 | 103.48 | 11.66 | 11.26 | 8.99 | 5.33 | |
| OR | 1.38 | 41.91 | 71.17 | 509.93 | - | 2.76 | 2.42 | 1.98 | - | |
| Hapsode | 1.61 | 22.35 | 61.82 | 188.27 | - | 3.22 | 3.41 | 2.94 | - | |
| Other brands | 1.32 | 56.29 | 18.86 | -60.11 | -5.96 | 2.65 | 2.18 | 2.57 | 8.85 | |
| Subtotal | 49.94 | 37.99 | 40.86 | 40.74 | 26.63 | 100.00 | 100.00 | 99.22 | 97.05 | |
| Agency brands | Cross-border agency brands | 0.00 | - | -100.00 | -63.01 | -34.04 | 0.00 | 0.00 | 0.78 | 2.95 |
| Total | 49.94 | 37.99 | 39.74 | 37.69 | 23.28 | 100.00 | 100.00 | 100.00 | 100.00 | |
Note: The proportion of sales revenue from each brand is as the percentage of primary operating revenue.The revenue from OR and Hapsode was incorporated into that of other brands for 2021 and prior years,but has been shown separately since 2022.
(3) By category
| Category | Amount (RMB100 million) | Change in H1 2024 YOY (%) | Change in 2023 YOY (%) | Change in 2022 YOY (%) | Change in 2021 YOY (%) | Proportion of H1 2024 (%) | Proportion of 2023 (%) | Proportion of 2022 (%) | Proportion of 2021 (%) |
| Skincare (including cleansing) | 41.91 | 37.12 | 37.85 | 38.56 | 22.70 | 83.91 | 85.03 | 86.20 | 86.10 |
| Make-up | 6.65 | 42.84 | 48.28 | 21.70 | 32.97 | 13.32 | 12.55 | 11.82 | 13.38 |
| Body & hair | 1.38 | 42.26 | 71.17 | 509.93 | - | 2.77 | 2.42 | 1.98 | - |
| Others | 0.00 | - | - | -100.00 | -41.05 | 0.00 | 0.00 | 0.00 | 0.52 |
| Total | 49.94 | 37.99 | 39.74 | 37.69 | 23.28 | 100.00 | 100.00 | 100.00 | 100.00 |
Note: The sales revenue from body & hair products was included in the “Skincare (including cleansing)”category for 2021 and prior years, but has been shown separately since 2022.
2. Year-on-year growth in net profit
Net profit attributable to shareholders of the listed company amounted to RMB702 million, up by 40.48%YOYNet profit attributable to shareholders of the listed company net of non-recurring profit and lossamounted to RMB679 million, up by 41.78% YOY
| Indicator | H1 2024 | 2023 | 2022 | 2021 | Notes |
| 1. Net profit margin | 14.47% | 13.82% | 13.02% | 12.02% | Mainly due to the increased operating revenue and reduced administrative expense ratio. |
| 2. Gross profit margin | 69.82% | 69.93% | 69.70% | 66.46% | |
| 3. Sales expense ratio | 46.78% | 44.61% | 43.63% | 42.98% | Mainly due to the increased payment for image promotion fees. |
| Including: Image promotion fee ratio | 41.25% | 39.69% | 37.90% | 36.12% | |
| 4. Administrative expense ratio | 3.54% | 5.11% | 5.13% | 5.12% | Mainly due to the decreased share-based payment expenses. |
| 5. R&D expense ratio | 1.89% | 1.95% | 2.00% | 1.65% | The parent company's R&D expense ratio was 3.82% for January to June 2024 (compared with 5.10% for the same period last year) |
| 6. Accounts receivable turnover rate (times) | 40.40 | 39.87 | 53.04 | 21.88 | |
| 7. Accounts receivable turnover days (days) | 8.91 | 9.03 | 6.79 | 16.45 | |
| 8. Inventory turnover rate (times) | 4.08 | 3.65 | 3.46 | 3.39 | |
| 9. Inventory turnover days (days) | 88.20 | 98.57 | 103.91 | 106.19 |
(II) Analysis of business operations
1. New product strategy
Proya:
During the Reporting Period, Proya continued to consolidate the “hero product strategy”, focusing onupgrading hero products of the “Advanced Firming Nourishing Series” and “Advanced Original RepairSeries”. The world's exclusive innovative ingredient “Recombinant Collagen Type XVII” was firstlyapplied in “Advanced Original Repair Cream 2.0”, further solidifying the brand's expertise in basalmembrane repair and anti early-aging. In “Advanced Firming Nourishing Essence 3.0”, Proya applied“cyclic peptide”, the first patented raw material of the Chinese beauty industry, together with the special“Retinol + HPR” formula, and also adopted exclusive collagen activation technology, thus achievingadvanced anti-wrinkle effects.Proya also launched a brand new product line, the “Sebum Control Purifying Series”, which marked ascientifically efficient solution for various oily skin issues by utilizing the exclusive oil-controltechnology “?SeboPlex?” and new fermented extracts. Additionally, Proya rolled out the“Illuminating Skin-Purifying Series” and a new-edition of Sun Around Protective Shield SunscreenSerum, further expanding the brand's offerings in the brightening and sun protection categories.
In the first half of 2024, Proya maintained its leading position in the essence and cream categories onTmall, ranking first in both. Proya ranked second in sheet masks and facial care sets, and fourth in eyecreams. The market shares for all core categories saw significant growth.
TIMAGE:
During the Reporting Period, TIMAGE continued to consolidate the hero product matrix in the facialmake-up category, and made further efforts on base makeup front. Some new single products werelaunched, such as Porcelain Yarn Glow Pressed Powder, Balanced Soft Cushion Foundation andConcealer (For mixed skin), Cream Foundation for Dry Skin, and Vigorous and Flowing Jade EssenceGlossy Lipstick. The “Small Round Liquid Foundation” continued to maintain strong growth across allchannels. During the “618” shopping festival, it ranked first in the foundation category on Tmall amongall domestic products, and third in the whole foundation category. The “Porcelain Yarn Glow PressedPowder” rushed to eighth in the powder category on Tmall.In the first half of 2024, TIMAGE’ core hero products all ranked top in all categories. Among them, the“Tri-colored Contour Palette” ranked first in the highlighter category on Tmall; the “Dual-coloredHighlighter Palette” ranked second in the highlighter category on Tmall; the “Master Make-up Primer”ranked first in the sun block/primer category on Tmall; the “Tri-colored Concealer Palette” ranked firstin the concealer category on Tmall; and the “Tri-colored Blush Palette” ranked first in the blush categoryon Tmall.
Off&Relax (OR):
During the Reporting Period, Off&Relax deepened its brand image of an “Expert in Asian Scalp HealthCare”. The brand continued to increase the consumer penetration of the hero product “OR Refresh SpaShampoo” in an effort to make it be recognized by more people. Meanwhile, Off&Relax launchedoil-control shampoos and repair shampoos for the second tier of hair care products, striving to expandthe market shares of core categories. Additionally, Off&Relax endeavored to stabilize the ranking of itshair care series - hair mask category, and mainly promoted the new product OR Soft & Shine Hair Oil.During the “618” shopping festival, OR Soft & Shine Hair Oil ranked top 10 among the hair careessential oils on Tmall.In the first half of 2024, Off&Relax kept improving its brand image of professionalism. The “ORPurifying Scalp Cleanser” ranked first in the pre-shampoo category on Tmall, with a market share ofmore than 10% in this category. The second hero product “OR Medicated Hair Tonic” ranked second inthe scalp essence best seller list on Tmall during the “618” shopping festival in 2024.
Hapsode:
During the Reporting Period, Hapsode continued to deepen its brand recognition as an “Expert in OilySkin Care”. Co-branding with Loopy, an IP popular among young people, Hapsode rolled out Loopylimited edition of cleansing products (including Purifying Watery Cleansing Foam, Pore PurelyCleansing Mud Mask, Purifying Moisture Cleansing Mousse, Soft Purifying Cleansing Balm). Hapsodealso launched a campaign with the theme of “Real me, So loopy”, hoping that the brand will become asincere companion of young users in their daily lives. During the “38” shopping festival, the limitededition of Pore Purely Cleansing Mud Mask ranked first in both the “Tmall's Mud Mask PositiveFeedback List” and “Mud Mask Repurchase List”.In the first half of 2024, the Ultra Soothing Serum achieved high growth in sales, earned a reputation ofgood efficacy for Hapsode. Some other products were newly launched, such as Anti-Acne ClarifyingSerum, Soft Purifying Cleansing Balm, and Cloud Watery Sunscreen (upgraded).
2. New marketing strategy
Proya:
During the Reporting Period, Proya followed its brand strategy around two brand keywords:
“youthfulness” and “technological prowess”. Embracing the “spirit of exploration”, the brand hasaddressed the multifaceted factors behind specific skin concerns. The following brand marketinginitiatives have been undertaken:
(1) “Thank You for Remembering” in January. In this event, Proya specially launched Thank you forremembering, a short film inspired by our users' true stories. At the same time, the MV for its themesong, Shufen, was released, showcasing the journey of a little girl named Tiantian as she searches for hergrandmother, Shufen. The story conveys warmth, strength, and love. A user story exhibition themedThank You for Remembering was held at Liuxia Metro Station in Hangzhou to expand the core of“thankfulness” and express our gratitude to users for their “remembering”.
(2) “Infinite Space” Offline Pop-Up Event in March. In this event, Proya made the debut of its five“Infinite Space” pop-up stores simultaneously in Shanghai, Hangzhou, Chongqing and Chengdu. Thisevent opened a new journey of discovery for “Scientific Formulation, the Scientific Choice for Skin”along with users.
(3) “It's Gender, Not Border” on Women’s Day in March. In this event, Proya specially launched a TVC:
We Are Just Different. In the silhouettes of more women's lives, people can see their courage inconfronting “prejudice”, and learn their occupations, hobbies, ages, identities, and lifestyles.
(4) The “Proya Empty Bottles Recycling Program” on May Day Holiday. In this event, Proya joinedhands with the eco-friendly brand “Wuyuzaisheng”, a leader in sustainable lifestyle aesthetics, to launchthe “Proya Empty Bottles Recycling Program”. This program aimed to integrate the concept of scientificskincare into daily life together with users, and to find out more possibilities of sustainable living.
(5) On Mother’s Day in May, Proya released the short film Do You Hear. In this event, Proya showedthat mothers are overshadowed by the judgments of others, highlighting their voicelessness in the role of“being a mom”. It calls on the public to recognize the struggles that mothers are facing and they can bewhat they want to be.
TIMAGE:
During the Reporting Period, TIMAGE continued to carry out marketing activities by following the“Chinese make-up, original beauty” brand philosophy. By launching and marketing new productsthrough e-commerce channels, TIMAGE carried out the following marketing events to enrich the core ofChinese aesthetics:
(1) In January, TIMAGE officially announced its first brand ambassador, CHEN Duling, and released aseries of conceptual films and print ads. TIMAGE aimed to enhance the overall brand visibility andbreak through to new audiences, presenting the brand’s makeup effects to consumers. Leveraging theinfluence of the celebrity, TIMAGE expanded the appeal of the “Small Round Liquid Foundation”, andreinforced consumers' impression of TIMAGE as “a professional makeup artist brand”. The product hasrepeatedly trending across all platforms.
(2) In March, TIMAGE launched the limited edition “TIMAGE & SUMMER PALACE” series. Incollaboration with the national IP of “Summer Palace”, TIMAGE gave four hero products a new lookand elevated the brand's aesthetic to new level. Online, TIMAGE released a new video of CHEN Duling,where she looks stunning wearing a fresh and unique makeup with mint green eyeshadow and watery lipeffect. This further reinforced the products' image, makeup style and application techniques, acceleratingthe establishment of brand perception for base makeup. Offline, TIMAGE held the “TIMAGE &
SUMMER PALACE” series launch event at the Summer Palace in Beijing on March 25, attended by ourbrand founder Mr. TANG Yi, TIMAGE's brand ambassador CHEN Duling, and celebrity makeup artists.TIMAGE also broadcasted the entire event live on TIMAGE's Tmall livestream channel on Tmall SuperBrand Day, boosting the overall brand visibility and sales.
(3) In May, TIMAGE traced the origin of Celadon series, drawing inspiration from porcelain for makeup.Mr. MENG Qingyang and the brand founder Mr. TANG Yi were invited to co-star in a branddocumentary themed around celadon, creating the concept of “Chinese Celadon Base Makeup” andshowcasing the Chinese aesthetics expressed through the brand. With “Little Round Liquid Foundation”as the core hero product, TIMAGE continued to build market awareness and product reputation.
3. New channel strategy
Proya:
Online:
(1) Tmall flagship store
During the Reporting Period, the Company continuously increased the market penetration of brand heroproducts. To capture more market share, we increased efforts to promote product kits, and introducednew categories and products, such as Sebum Control Purifying Lotion and the Energy Series. Weenhanced customer perception, and coordinated both on-site and off-site efforts to offer customersexclusive products, in this way to expand our core customer base. By deeply engaging across all touchpoints, we capitalized on content marketing opportunities to drive precise traffic to our stores.Additionally, we refined operations for target customers, increasing member recruitment andengagement to boost repeat purchases from existing customers.During the “38” and “618” shopping festivals in 2024, the gross merchandise volume (GMV) of Proya'sTmall flagship store ranked first on Tmall Beauty. And during the “618” shopping festival, we toppedthe Tmall fast-moving consumer goods rankings for the first time. In the first half of 2024, the GMV ofProya's Tmall flagship store ranked first on Tmall Beauty for the first time.
(2) Douyin
During the Reporting Period, the Company continued to strengthen refined operations. In terms of selflive-streaming, the Company further refined the brand matrix account setup and implemented amulti-product distribution strategy. To optimize the hero product strategy, we mainly promoted certaincore products in the live-streaming room to create dedicated accounts for hero products, so as to achievean integration of brand recommendation and sales. Additionally, by organically combining the DouyinMall with self live-streaming, we developed a special product pipeline to promote a synergistic growthbetween live streaming and the online mall. In terms of KOL live-streaming, we engaged in deepcollaborations with high-quality influencers to diversify live-streaming scenarios, effectively boostingthe integration of brand recommendation and sales.During the “618” shopping festival in 2024, the GMV of Proya ranked first on Douyin Beauty, andranked first among domestic products. In the first half of 2024, the GMV of Proya ranked second onDouyin Beauty.
(3) JD
During the Reporting Period, the Company enhanced the strategic status of hero products by upliftingtheir category ranking and sales share. We explored competitive categories on the platform andstrategically planned product lines in each price range, striving to seize opportunities for special offers.Through concerted efforts both on-site and off-site, we enhanced brand competitiveness and further
expanded our market share. We also deeply focused on our user operation system and refined operationsbased on target audience. These efforts aim to increase user value and promote high repeat purchasesand conversions. Moreover, we rationally deployed our efforts on advertising for targeted audience,giving the priority to efficiency.During the “618” shopping festival in 2024, the GMV of Proya ranked third on JD Beauty, and rankedfirst among domestic products. In the first half of 2024, the GMV of Proya ranked fifth on JD Beauty,and ranked first among domestic products.
Offline:
(1) Department store channel
The Company continuously optimized the store structure and advanced the transition of the managementsystem at leading stores to a directly operated model. At the same time, we developed high-quality newdepartment stores and shopping center network, and comprehensively upgraded the brand image of newcounters. Furthermore, the Company continued to strengthen internal management, and further improvedthe training system for counter consultants, by doing so to improve their retail management skills andcustomer service levels and increase average sales per counter.
(2) Cosmetics store channel
In terms of market positioning, the Company leveraged the potential of the Proya brand and products tocontinuously expand market share. We deepened cooperation with new type of mall aggregate stores,upgraded brand experience zones, and established brand image communication hubs. Moreover, in thetraditional cosmetics store channel, we maintained the brand's momentum by solidifying cooperationwith existing major cosmetics clients.
4. New organizational strategy
(1) Institutional construction: The Company continued to deepen the value return concept of “highinvestment, high performance and high returns”, reinforcing a results-oriented performance culture. Wehave established a business-centered multiple incentive system, including a combination of short-termincentives represented by performance bonuses/project bonuses, mid-term incentives represented byoverachievement bonuses, and long-term incentives. Additionally, we upgraded our human resourcemanagement system to enhance work efficiency through empowerment tools.
(2) Talent development: We collaborated with prestigious institutions and continuously recruitedmanagement trainees, supplementing high-potential talent pools in R&D, product, marketing, andoperations. We set up qualification standards for key positions to guide employee growth and provide abasis for talent cultivation. Furthermore, we conducted empowerment training for middle and juniormanagers to enhance their situational leadership and goal management capabilities.
5. New R&D strategy
During the Reporting Period, the Company continued to enhance its R&D layout of all key stages fromraw material to finished products, including fundamental research, formula development, efficacyevaluation, etc. The focus was to conduct research on skin mechanisms, design active substances, verifytheir efficacy, as well as research and develop new skin care, make-up, and body & hair products.
(1) Patents: During the Reporting Period, the Company newly applied for 16 national invention patents,and 6 utility model patents, totaling 22 new patents; newly obtained 3 nationally licensed inventionpatents, 1 utility model patents, and 3 design patents, totaling 7 patents. As of the end of the ReportingPeriod, the Company had 125 nationally authorized invention patents, 21 utility model patents, and 92design patents, totaling 238 patents.
(2) Standard releasing: During the Reporting Period, the Company released 10 group standards as adrafter. As of the end of the Reporting Period, the Company had led or participated in the developmentof 17 national standards, 4 light industry standards, and 36 group standards.
(3) R&D results: During the Reporting Period, the Company led and participated in the preparation ofvocational evaluation standards for the China National Light Industry Council (includingQG-9-02-01-15 Cosmetic Efficacy Evaluator and QG-9-02-01-14 Fragrance Evaluator). The Companypublished energy skincare research reports with a total of 23 papers during this period. The researchfindings on core technology of our Advanced Firming Nourishing series, titled Mitigation ofretinol-induced skin irritation by physiologic lipids: Evidence from patch testing, was published in theJournal of Cosmetic Dermatology.
(4) Strategic cooperation: During the Reporting Period, the Company deepened our existing strategicpartnerships. We furthered our collaborations with Zhejiang University, Shanghai Academy ofAgricultural Sciences, Beijing Technology and Business University, SiyoMicro, WuXi AppTec, andZhejiang Peptide.
6. New supply chain guarantee
(1) During the Reporting Period, the Huzhou production base made a ceaseless effort to developeco-friendly green factories. It actively initiated the “Zero Direct Discharge of Rainwater” renovationproject, including excavating and constructing surface channels for rainwater and sewage water,modifying rainwater discharge outlets for transparent supervision, expanding the initial rainwatercollection pool, and building a smart platform for the emergency pool warning system.
(2) During the Reporting Period, the Huzhou production base officially operated new productionworkshops, including multiple sets of intelligent homogeneous emulsification equipment and severalfully automated production lines. Higher operational efficiency was achieved with a newly developedpre-process treatment system and an advanced intelligent manufacturing model in the industry. Boastingthe first new workshop in the industry to apply an automated process control system, the workshop hadreduced risk of equipment misuse and ensured product quality stability.
(3) During the Reporting Period, all management personnel at the Huzhou production base diligentlystudied the Three-Year Action Plan to Strengthen Workplace Safety (2024-2026) released by WorkSafety Committee of the State Council. The base proposed the theme of “Respect Life, Care for Safety,Fundamental Improvements, Deep Governance”, comprehensively enhanced the Company's safetymanagement. Collaborating with a third-party consulting firm, the base established a safety productionsystem framework, conducted hazard inspections, and built a risk management platform to achievevisual safety effects. These efforts aimed at improving emergency response capabilities, establishing anemergency management system, and enhancing crisis management skills for sustainable safetyproduction.
(4) During the Reporting Period, the Huzhou production base always upheld the quality controlphilosophy of “Process Control, Quality and Safety, and Customer Satisfaction”, and continuallyoptimized the quality management system. This resulted in a year-on-year decrease in online customercomplaints for Proya brand. Additionally, the Huzhou production base and the Huzhou MarketSupervising Administration collaborated on training, organized peer companies to verify equipmentinstallation, commissioning, and operation, and validated the design, installation, and operation of thepurified water system and clean air conditioning system. These initiatives aimed to empower industrydevelopment.
(5) During the Reporting Period, the Huzhou production base, as an industry benchmark for full-chaintransparent factories, remained committed to its original mission of presenting consumers with fully
transparent production processes, quality control, and logistics operations. The base also frequentlycooperated with our brand to conduct live-streaming activities.
Material changes in business operations of the Company during the Reporting Period and mattersthat occurred during the Reporting Period that had and are expected to have significant impactson business operations of the Company
□Applicable √Not applicable
IV. Main Operations during the Reporting Period(I) Analysis of primary business
1. Analysis of changes in items related to financial statements
Unit: Yuan Currency: RMB
| Item | Amount for the current period | Amount for the same period last year | Change (%) |
| Operating revenue | 5,001,465,470.72 | 3,626,991,878.22 | 37.90 |
| Operating costs | 1,509,530,495.30 | 1,069,489,813.93 | 41.14 |
| Selling expenses | 2,339,661,922.31 | 1,579,997,275.26 | 48.08 |
| General and administrative expenses | 176,927,741.63 | 192,127,158.56 | -7.91 |
| Financial expenses | -24,649,322.32 | -30,353,566.91 | Not applicable |
| R&D expenses | 94,613,242.52 | 91,520,865.15 | 3.38 |
| Net cash flows from operating activities | 662,102,794.39 | 1,181,268,072.03 | -43.95 |
| Net cash flows from investing activities | 193,194,272.98 | -102,775,712.36 | Not applicable |
| Net cash flows from financing activities | -508,846,622.56 | -252,230,919.73 | Not applicable |
Reasons for changes in operating revenue: Mainly due to increased online sales.Reasons for changes in operating costs: The increase in operating costs was mainly due to increasedoperating revenue.Reasons for changes in selling expenses: Selling expenses for January to June 2024 amounted toRMB2.34 billion, accounting for 46.78% of operating revenue (compared with 43.56% for the sameperiod last year). Selling expenses increased by RMB760 million a YOY increase of 48.08%, mainly dueto an increase of RMB688 million a YOY increase of 50.03% in the image promotion expenses in thecurrent period.Reasons for changes in general and administrative expenses: General and administrative expenses forJanuary to June 2024 amounted to RMB177 million, accounting for 3.54% of operating revenue(compared with 5.30% for the same period last year). General and administrative expenses decreased byRMB15 million a YOY decrease of 7.91%, mainly due to the YOY decrease in restricted share equityincentive fees.Reasons for changes in financial expenses: Mainly due to the YOY increase in interest expenses.Reasons for changes in R&D expenses: R&D expenses for January to June 2024 amounted to RMB95million, a YOY increase of RMB3.0924 million, accounting for 1.89% of operating revenue (comparedwith 2.52% for the same period last year). The parent company’s R&D expense ratio for January to June2024 was 3.82% (compared with 5.10% for the same period last year).
Reasons for changes in net cash flows from operating activities: Mainly due to: 1. A YOY increase inoperating revenue and the increase in cash received from the sale of goods; 2. The increase in thepayment for goods; 3. The increase in the payment for image promotion expenses.Reasons for changes in net cash flows from investing activities: Mainly due to the recovery of timedeposits of RMB300 million.Reasons for changes in net cash flows from financing activities: 1. Cash paid for distribution ofdividends, profits or repayment of interest increased by RMB103 million; 2. Cash paid for repurchase ofthe Company's shares increased by RMB157 million.
2. A detailed description on significant changes in the Company's activities, profit composition
or sources of profit during the current period
□Applicable √Not applicable
(II) Description on significant changes in profit caused by non-primary business activities
□Applicable √Not applicable
(III) Analysis of assets and liabilities
√Applicable □Not applicable
1. Assets and liabilities
Unit: Yuan
| Item | Closing amount of the current period | Proportion of the closing amount of the current period to total assets (%) | Closing amount of the previous period | Proportion of the closing amount of the previous period to total assets (%) | Change ratio of the closing amount of the current period compared with that of the previous year (%) | Explanation |
| Receivables financing | 3,695,843.86 | 0.05 | 7,378,700.06 | 0.10 | -49.91 | Mainly due to the reduced balance of bank acceptance notes as of the end of the period. |
| Other receivables | 13,836,491.18 | 0.19 | 81,966,213.90 | 1.12 | -83.12 | Mainly because the annual rebates receivable from e-commerce platforms for the previous year were recovered |
| Item | Closing amount of the current period | Proportion of the closing amount of the current period to total assets (%) | Closing amount of the previous period | Proportion of the closing amount of the previous period to total assets (%) | Change ratio of the closing amount of the current period compared with that of the previous year (%) | Explanation |
| during the current period. | ||||||
| Other current assets | 65,561,804.15 | 0.89 | 99,765,073.07 | 1.36 | -34.28 | Mainly due to the decreased input VAT to be deducted. |
| Construction in progress | 72,172,878.34 | 0.98 | 52,038,642.94 | 0.71 | 38.69 | Mainly due to the increased balance of Huzhou Production Base Expansion Project (Phase I). |
| Other non-current assets | 25,267,082.68 | 0.34 | 16,974,946.99 | 0.23 | 48.85 | Mainly due to the increase in prepayments for long-term asset purchase funds. |
| Notes payable | 0.00 | 0.00 | 36,959,074.14 | 0.50 | -100.00 | Mainly due to the reduced balance of bank acceptance notes payable. |
| Receipts in advance | 152,319.76 | 0.00 | 30,514.45 | 0.00 | 399.17 | Mainly due to the increased rents receivable in advance. |
| Employee benefits payable | 98,158,990.54 | 1.33 | 166,444,494.43 | 2.27 | -41.03 | Mainly due to the opening balance includes the unpaid year-end bonus payable for the year 2023. |
| Item | Closing amount of the current period | Proportion of the closing amount of the current period to total assets (%) | Closing amount of the previous period | Proportion of the closing amount of the previous period to total assets (%) | Change ratio of the closing amount of the current period compared with that of the previous year (%) | Explanation |
| Taxes payable | 151,086,065.86 | 2.05 | 222,765,869.94 | 3.04 | -32.18 | Mainly due to the decrease in income tax payable and value-added tax (VAT) payable. |
| Treasury shares | 298,659,030.87 | 4.06 | 146,966,735.61 | 2.01 | 103.22 | Mainly due to the share repurchase by the Company through centralized bidding transactions with its own funds. |
| Minority interests | 73,151,801.81 | 0.99 | 50,765,849.41 | 0.69 | 44.10 | Mainly due to the increase in the profit of our subsidiary Ningbo Timage Cosmetics Co., Ltd. as well as gains or losses attributable to minority interests. |
Other explanationsNone
2. Overseas assets
√Applicable □Not applicable
(1) Scale of assets
Including overseas assets of RMB15,174.31 (Unit: RMB '0,000 Currency: RMB), accounting for 2.06%of the total assets.
(2) Description of a high percentage of overseas assets
□Applicable √Not applicable
Other explanationsNone
3. Restrictions on prime assets as of the end of the Reporting Period
√Applicable □Not applicable
Unit: Yuan
| Item | Closing book balance | Closing book value | Type of restrictions | Cause for restrictions |
| Monetary capital | 30,000,000.00 | 30,000,000.00 | Cannot be withdrawn at any time | Fixed-term deposit |
| 8,800,000.00 | 8,800,000.00 | Frozen | L/C deposit | |
| 250,000.00 | 250,000.00 | Frozen | Transformer deposit | |
| 70,000.00 | 70,000.00 | Frozen | Vehicle ETC deposit | |
| 5,540,922.50 | 5,540,922.50 | Frozen | Pinduoduo deposit | |
| 2,553,262.81 | 2,553,262.81 | Frozen | Directly-operated store deposit | |
| Total | 47,214,185.31 | 47,214,185.31 |
4. Other explanations
□Applicable √Not applicable
(IV) Analysis of investment
1. Overall analysis of external equity investments
√Applicable □Not applicable
Unit: Yuan
| Item | Closing amount | Opening amount |
| Other equity instrument investments | 107,660,400.00 | 107,660,400.00 |
| Investment in joint ventures | 3,053,932.82 | 3,059,991.91 |
| Investment in associates | 108,366,561.93 | 110,514,166.58 |
| Total | 219,080,894.75 | 221,234,558.49 |
For details, refer to the particulars contained in “17. Long-term equity investments” in “VII. Notes to theItems in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
(1). Significant equity investments
□Applicable √Not applicable
(2). Significant non-equity investments
□Applicable √Not applicable
(3). Financial assets measured at fair value
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Asset category | Opening amount | Gains and losses from changes in fair value for the current period | Accumulated change in fair value included in equities | Impairment accrued for the current period | Amount of purchase for the current period | Amount of sale/redemption for the current period | Other changes | Closing amount |
| Others | 107,660,400.00 | -38,742,000.00 | 107,660,400.00 | |||||
| Total | 107,660,400.00 | -38,742,000.00 | 107,660,400.00 |
For details, refer to the particulars contained in “18. Other equity instrument investments” in “VII. Notes to the Items in Consolidated Financial Statements”,“Section X Financial Report” of this Report.Investment in securities
□Applicable √Not applicable
Description of investment in securities
□Applicable √Not applicable
Investment in private equity fund
□Applicable √Not applicable
Investment in derivatives
□Applicable √Not applicable
(V) Sale of major assets and equity
□Applicable √Not applicable
(VI) Analysis of major controlled and invested companies
√Applicable □Not applicable
Unit: RMB '0,000
| Major subsidiary | Nature of business | Major products and services | Registered capital | Total assets | Net assets | Net profit | Holding or shareholding |
| Zhejiang Meiligu Electronic Commerce Co., Ltd. | Cosmetics sales | Cosmetics | 1,000.00 | 147,458.38 | 48,450.26 | 12,835.52 | Holding |
| Hangzhou Proya Trade Co., Ltd. | Cosmetics sales | Cosmetics | 5,000.00 | 26,270.57 | 15,863.10 | 4,958.08 | Holding |
(VII) Structured entities controlled by the Company
□Applicable √Not applicable
V. Other Disclosures(I) Possible risks
√Applicable □Not applicable
1. Industry competition risks
(1) The Company's brand strategy and channel strategy fail to come up to expectations due to intensifiedcompetition from various brands in the industry;
(2) The control of digital and precise delivery costs fails to come up to expectations due to intensifiedcompetition in marketing and ads delivery.
2. Project incubation risks
(1) New brand incubation risk: performance fails to come up to expectations despite heavy investment inmarketing;
(2) New category cultivation risk: as the operation modes for different categories of products differgreatly, the team is unable to meet the requirements and performance fails to come up to expectations.
(II) Other disclosures
□Applicable √Not applicable
Section IV Corporate Governance
I. General Meetings of Shareholders
| Session of meeting | Date of meeting | Query index of the designated website where the resolution is published | Resolution disclosure date | Meeting resolution |
| 2023 Annual General Meeting of Shareholders | May 9, 2024 | Announcement No. 2024-023 on SSE website (www.sse.com.cn) | May 10, 2024 | The meeting approved proposals including the Company's Annual Report 2023 and its Summary, and the Company's 2023 Annual Profit Distribution Plan. For details, see the Announcement on Resolutions of the 2023 Annual General Meeting of Shareholders (Announcement No.: 2024-023) released by the Company on the SSE website (http://www.sse.com.cn) on May 10, 2024 and relevant media. |
Request of preferred shareholders with restored voting rights for convening an ExtraordinaryGeneral Meeting
□Applicable √Not applicable
Description of the General Meeting of Shareholders
□Applicable √Not applicable
II. Changes in the Company's directors, supervisors and senior management
□Applicable √Not applicable
Description of changes in directors, supervisors and senior management of the Company
□Applicable √Not applicable
III. Profit Distribution or Capital Reserve Conversion PlanProfit distribution plan and plan for conversion of capital reserve into share capital proposed forthe first half of 2024
| Distribution or conversion or not | No |
| Number of bonus shares distributed per 10 shares (share) | 0 |
| Amount of cash dividends per 10 shares (RMB) (tax inclusive) | 0 |
| Number of shares converted per 10 shares (share) | 0 |
| Description of profit distribution plan and plan for conversion of capital reserve into share capital | |
| Not applicable | |
IV. The Company's Equity Incentive Plans, Employee Stock Ownership Plans or Other Employee
Incentives and Their Impact(I) Relevant equity incentive matters disclosed in the interim announcement and with noprogress or change in subsequent implementation
√Applicable □Not applicable
| Matter | Reference |
| Announcement on Adjusting the Price and Quantity of Restricted Shares Repurchased under the 2022 Restricted Shares Incentive Plan | Announcement No. 2023-036 disclosed on SSE website, Shanghai Securities News, and Securities Times on June 21, 2023 |
| Announcement on the Repurchase and Cancellation of Some Equity Incentive Restricted Shares | Announcement No. 2023-037 disclosed on SSE website, Shanghai Securities News, and Securities Times on June 21, 2023 |
| Announcement on the Implementation of the Repurchase and Cancellation of Some Restricted Shares under the 2022 Restricted Shares Incentive Plan | Announcement No. 2023-044 disclosed on SSE website, Shanghai Securities News, and Securities Times on August 22, 2023 |
| Announcement on the Repurchase and Cancellation of Some Equity Incentive Restricted Shares | Announcement No. 2023-058 disclosed on SSE website, Shanghai Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, and China Daily on September 15, 2023 |
| Announcement on the Satisfaction of Conditions for Release from Sales Restrictions in the First Release Period under the 2022 Restricted Shares Incentive Plan and Listing | Announcement No. 2023-061 disclosed on SSE website, Shanghai Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, and China Daily on September 20 2023 |
| Announcement on Adjusting the Repurchase Price of the 2022 Restricted Shares Incentive Plan | Announcement No. 2023-069 disclosed on SSE website, Shanghai Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, and China Daily on October 24, 2023 |
| Announcement on the Implementation of the Repurchase and Cancellation of Some Restricted Shares under the 2022 Restricted Shares Incentive Plan | Announcement No. 2023-080 disclosed on SSE website, Shanghai Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, and China Daily on December 11, 2023 |
| Announcement on Adjusting the Repurchase Price of the 2022 Restricted Shares Incentive Plan | Announcement No. 2024-037 disclosed on SSE website, Shanghai Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, and China Daily on August 28, 2024 |
| Announcement on the Repurchase | Announcement No. 2024-038 disclosed on SSE website, Shanghai |
| and Cancellation of Some Equity Incentive Restricted Shares | Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, and China Daily on August 28, 2024 |
(II) Incentives not disclosed in the interim announcement or with subsequent progressParticulars of equity incentives
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
Particulars of employee stock ownership plans
□Applicable √Not applicable
Other incentives
□Applicable √Not applicable
Section V Environmental and Social ResponsibilityI. Environmental Information(I) Environmental issues of the Company and major subsidiaries included in the list of primary
pollutant discharge entities announced by the environmental authority
□Applicable √Not applicable
(II) Statement on environmental protection of companies not included in the list of key pollutantdischarging units
√Applicable □Not applicable
1. Administrative penalties due to environmental issues
□Applicable √Not applicable
2. Disclosure of other environmental information with reference to primary pollutant dischargeentities
√Applicable □Not applicable
During the Reporting Period, the Huzhou production base made a ceaseless effort to developeco-friendly green factories. It actively initiated the “Zero Direct Discharge of Rainwater” renovationproject, including excavating and constructing surface channels for rainwater and sewage water,modifying rainwater discharge outlets for transparent supervision, expanding the initial rainwatercollection pool, and building a smart platform for the emergency pool warning system.
3. Reasons for non-disclosure of other environmental information
□Applicable √Not applicable
(III) Statement on subsequent progress or change in environmental information disclosed during
the Reporting Period
□Applicable √Not applicable
(IV) The Company's performance in helping protect the environment, prevent pollution and fulfill
environmental responsibilities
□Applicable √Not applicable
(V) Measures taken to reduce carbon emissions during the Reporting Period and their effects
□Applicable √Not applicable
II. Poverty Alleviation and Rural Revitalization Progress
□Applicable √Not applicable
Section VI Important Matters
I. Fulfillment of Commitments(I) Commitments made by the Company's actual controllers, shareholders, related parties, acquirers and the Company and other relevant parties during
the Reporting Period or continuing to the Reporting Period
√Applicable □Not applicable
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| IPO-related commitments | Restrictions on sales of shares | Directors, senior management HOU Juncheng, FANG Yuyou and CAO Liangguo | (1) During their terms as the Company's director/senior management, they shall not transfer more than 25% of their total shares directly or indirectly held in the Company each year. Within 6 months after leaving office, they shall not transfer their shares directly or indirectly held in the Company. (2) If their shares in the Company | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| are sold within two years upon expiration of the lock-up period, the selling price shall not be lower than the offering price. If the closing price of the Company's shares is lower than the offering price for 20 consecutive trading days within 6 months after the Company's IPO, or the closing price as of the end of the 6-month period after the Company's IPO is lower than the offering price, the lock-up period for their shares in the Company will be automatically extended for 6 months. Their commitments above shall survive job change and |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| resignation. (3) Should any of them/their partnership violate the said share lock-up commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. | |||||||||
| Restrictions on sales of shares | Senior management JIN Yanhua | (1) Within 12 months from the date of the Company's IPO, they shall not transfer or authorize others to manage their shares directly or indirectly held in the Company or have the Company repurchase such shares. (2) During their terms as the Company's senior management, they shall | April 16, 2018 | No | April 16, 2018 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| not transfer more than 25% of their total shares directly or indirectly held in the Company each year. Within 6 months after leaving office, they shall not transfer their shares directly or indirectly held in the Company. (3) If their shares in the Company are sold within two years upon expiration of the lock-up period, the selling price shall not be lower than the offering price. If the closing price of the Company's shares is lower than the offering price for 20 consecutive trading days within 6 months after the Company's IPO, or the |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| closing price as of the end of the 6-month period after the Company's IPO is lower than the offering price, the lock-up period for their shares in the Company will be automatically extended for 6 months. Their commitments above shall survive job change and resignation. (4) Should any of them/their partnership violate the said share lock-up commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. | |||||||||
| Restrictions on sales of | Senior management | (1) Within 12 months from the date of the | September 3, 2018 | No | September 3, 2018 to | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| shares | WANG Li | Company's IPO, they shall not transfer or authorize others to manage their shares directly or indirectly held in the Company or have the Company repurchase such shares. (2) During their terms as the Company's senior management, they shall not transfer more than 25% of their total shares directly or indirectly held in the Company each year. Within 6 months after leaving office, they shall not transfer their shares directly or indirectly held in the Company. (3) If their shares in the Company are sold within two years | long-term |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| upon expiration of the lock-up period, the selling price shall not be lower than the offering price. If the closing price of the Company's shares is lower than the offering price for 20 consecutive trading days within 6 months after the Company's IPO, or the closing price as of the end of the 6-month period after the Company's IPO is lower than the offering price, the lock-up period for their shares in the Company will be automatically extended for 6 months. Their commitments above shall survive job change and resignation. (4) Should |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| any of them/their partnership violate the said share lock-up commitments, the lock-up period for their/their partnership's shares in the Company will be automatically extended for 6 months. | |||||||||
| Restrictions on sales of shares | Controlling shareholder and actual controller HOU Juncheng and FANG Aiqin | (1) Within 24 months upon expiration of the lock-up period, they shall not directly or indirectly reduce their shares in the issuer by more than 6% of the total number of shares of the issuer before such IPO. (2) They can only sell shares in the Company through methods including but not limited to collective trading through bidding | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| at the stock exchange, block trading, and transfer by agreement in line with applicable laws, regulations and rules. (3) Before selling the Company's shares, they shall announce the same three trading days in advance, discharge the obligation to disclose information in a timely and accurate manner as per the rules of the stock exchange, except to the extent that their shares in the Company are less than 5%. (4) Should they fail to perform the said intent of share reduction, they must explain the cause for failing to do so at the Company's General |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| Meeting of Shareholders and the media designated by the CSRC and publicly apologize to the Company's shareholders and investors. | |||||||||
| Restrictions on sales of shares | Shareholders FANG Yuyou and LI Xiaolin directly holding more than 5% shares in the Company | (1) If they intend to reduce shares after the lock-up period expires, they will prudently make a share reduction plan as necessary for the Company to stabilize the share price, carry on business and conduct capital operation as required by the CSRC and the exchange on shareholders for share reduction, whereby reducing shares gradually upon expiration of the lock-up period. (2) They | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| can only sell shares in the Company through methods including but not limited to collective trading through bidding at the stock exchange, block trading, and transfer by agreement in line with applicable laws, regulations and rules. (3) Before selling the Company's shares, they shall announce the same three trading days in advance, discharge the obligation to disclose information in a timely and accurate manner as per the rules of the stock exchange, except to the extent that their shares in the Company are less than 5%. (4) Should they |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| fail to perform the said intent of share reduction, they must explain the cause for failing to do so at the Company's General Meeting of Shareholders and the media designated by the CSRC and publicly apologize to the Company's shareholders and public investors. | |||||||||
| Others | The Company | When the preconditions for enabling the share price stabilization plan are met, if the Company fails to take specific measures to stabilize the share price, the Company must explain the cause for failing to do so at the Company's General Meeting of Shareholders and the media designated | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| by the CSRC and publicly apologize to the Company's shareholders and public investors. In the event of losses to investors not as a result of force majeure, the Company will be liable for compensation to investors by law, and be liable otherwise as required by laws, regulations and competent regulators; if the losses are caused due to force majeure, the Company shall work out a plan in the shortest possible time to minimize losses to investors and submit it to the General Meeting of Shareholders for deliberation, so as to |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| protect the interests of the Company's investors as much as possible. Within three years from the date of the Company's IPO, if the Company appoints new directors and senior management, the Company will require such new directors and senior management to fulfill the commitments made by the directors and senior management at the time of the Company's IPO. | |||||||||
| Others | The Company's controlling shareholders and actual controllers | When the preconditions for enabling the share price stabilization plan are met, if failing to take specific measures to stabilize the share price as per the plan, they must | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| explain the cause for failing to do so at the issuer's General Meeting of Shareholders and the media designated by the CSRC and publicly apologize to the issuer's shareholders and public investors. Where the commitment is not fulfilled, they will not receive shareholder dividends from the issuer within 5 working days from the date when the said incident occurs, and they will not be able to transfer their shares until they have taken and carried out measures to stabilize the share price as per the said plan. | |||||||||
| Others | The | When the preconditions | November | No | November | Yes | Not | Not |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| Company's directors (excluding independent directors) and senior management | for enabling the share price stabilization plan are met, if failing to take specific measures to stabilize the share price as per the plan, they must explain the cause for failing to do so at the issuer's General Meeting of Shareholders and the media designated by the CSRC and publicly apologize to the issuer's shareholders and public investors. Where the commitment is not fulfilled, they will not receive remuneration and shareholder dividends (if any) from the issuer within 5 working days from the date when the said incident occurs, and | 15, 2017 | 15, 2017 to long-term | applicable | applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| they will not be able to transfer their shares until they have taken and carried out measures to stabilize the share price as per the said plan. | |||||||||
| Others | The Company | If the Company's prospectus contains false records, misleading statements or major omissions, which causes investors to suffer losses in securities transactions, the Company will compensate investors for such losses by law. After the illegal facts mentioned above are identified by the CSRC or the stock exchange on which the Company is listed or the competent judicial authority, the | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| Company will actively compensate investors for direct economic losses incurred therefrom by settling with investors with respect to measurable economic losses directly incurred to investors, mediating with investors through a third party and establishing an investor compensation fund based on the principles of procedure simplification, active negotiation, compensation in advance, and effective protection of investors' interests, especially small and medium investors. If found to have violated the said commitments, the |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| Company will publicly apologize to shareholders and public investors for failing to perform the said compensation measures at the General Meeting of Shareholders and the media designated by the CSRC and compensate investors for the actual losses identified by the CSRC and the competent judicial authority. | |||||||||
| Others | The issuer's controlling shareholders and actual controllers | If the issuer's prospectus contains false records, misleading statements or major omissions, which causes investors to suffer losses in securities transactions, they will compensate investors for such losses by law. After the illegal facts | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| mentioned above are identified by the CSRC or the stock exchange on which the Company is listed or the competent judicial authority, the Company will actively compensate investors for direct economic losses incurred therefrom by settling with investors with respect to measurable economic losses directly incurred to investors, mediating with investors through a third party and establishing an investor compensation fund based on the principles of procedure simplification, active negotiation, compensation in advance, |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| and effective protection of investors' interests, especially small and medium investors. If found to have violated the said commitments, the Company's controlling shareholders and actual controllers will publicly apologize to the issuer's shareholders and public investors for failing to perform the said compensation measures at the issuer's General Meeting of Shareholders and the media designated by the CSRC and will not receive shareholder dividends from the Issuer within 5 working days from the date when the said commitments are |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| violated, and their shares in the issuer will not be transferred until they have taken and carried out compensation measures as per the said commitments. | |||||||||
| Others | Directors, supervisors and senior management | If the issuer's prospectus contains false records, misleading statements or major omissions, which causes investors to suffer losses in securities transactions, they will compensate investors for such losses by law. After the illegal facts mentioned above are identified by the CSRC or the stock exchange on which the Company is listed or the competent judicial authority, the | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| Company will actively compensate investors for direct economic losses incurred therefrom by settling with investors with respect to measurable economic losses directly incurred to investors, mediating with investors through a third party and establishing an investor compensation fund based on the principles of procedure simplification, active negotiation, compensation in advance, and effective protection of investors' interests, especially small and medium investors. If found to have violated the said commitments, the |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| Company's directors, supervisors and senior management will publicly apologize to the issuer's shareholders and public investors for failing to perform the said compensation measures at the issuer's General Meeting of Shareholders and the media designated by the CSRC and will not receive remuneration (or allowances) and shareholder dividends (if any) from the issuer within 5 working days from the date when the said commitments are violated, and their shares in the issuer will not be transferred until they have taken and carried |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| out compensation measures as per the said commitments. | |||||||||
| Others | The Company | In order to ensure the effective use of the proceeds from the IPO, effectively prevent the risk of diluting immediate returns and improve future returns, the Company intends to take measures including tightening operation management and internal control, accelerating the progress of fundraising projects, and strengthening the investor return mechanism, so as to improve asset quality, increase operation revenue, raise future earnings, and achieve | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| sustainable development to fill the diluted immediate returns. The Company promises to continuously improve various measures to fill the diluted immediate returns in accordance with the implementation rules subsequently issued by the CSRC and Shanghai Stock Exchange. If found to have violated the said commitments, the Company will promptly announce the facts and cause of such violation, except for force majeure or other reasons not attributable to the Company, apologize to the Company's |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| shareholders and public investors, make supplementary commitments or substitute commitments to investors to protect the interests of investors as much as possible, and implement such supplementary commitments or substitute commitments subject to the approval by the Company's General Meeting of Shareholders. | |||||||||
| Others | Controlling shareholder and actual controller HOU Juncheng and FANG Aiqin | In order to ensure that the Company’s measures to fill the diluted immediate returns can be effectively performed, they, as the Company’s controlling shareholder and actual controller, promise that: | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| (1) Under no circumstances will they abuse their position as the controlling shareholder and actual controller by ultra vires interfering with the Company’s operation and management activities or encroaching on the Company’s interests; (2) After the CSRC and the SSE have otherwise released opinions and implementation rules on measures to fill the diluted immediate returns and such commitments, if the Company’s relevant provisions and his or her commitments contradict such rules, they will immediately make |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| supplementary commitments in line with such rules of the CSRC and the SSE, and actively work towards the Company's issuing of new commitments or measures to comply with the requirements of the CSRC and the SSE; (3) They will fully, completely and promptly perform the Company’s measures regarding compensation for the diluted immediate returns and his or her commitments regarding the measures to compensate for the diluted immediate returns. If found to have violated such |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| commitments, which causes losses to the Company or shareholders, they are willing to: ① explain the cause and apologize at the General Meeting of Shareholders and the media designated by the CSRC; ② be held liable for compensation to the Company and/or shareholders by law; ③ unconditionally accept the penalties or regulatory measures taken by the CSRC and/or the SSE and other securities regulators as per relevant regulations and rules. The said measures to fill the diluted immediate returns |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| shall not be deemed to constitute a guarantee for the Company's future profits. | |||||||||
| Others | Directors, senior management | In order to ensure that the Company’s measures to fill for the diluted immediate returns can be effectively performed, they, as the Company’s directors and senior management, promise that: (1) They will not offer benefits to other entities or individuals for free or on unfair terms, or otherwise harm the Company’s interests; (2) They will strictly follow the Company’s budget management by limiting his or her duty consumption to the extent | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| required, subject to the Company’s supervision and management and free from waste or excessive consumption; (3) They will not use the Company’s assets to engage in investment and consumption activities unrelated to his or her duties; (4) They will actively work towards the improvement of the Company's the compensation system, so as to be more in line with the requirements for filling the diluted immediate returns; support the Company’s Board of Directors or Remuneration Committee in linking the |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| implementation of the Company’s measures to fill the diluted immediate returns to developing, revising and supplementing the Company’s compensation system; promise that the vesting conditions for the Company’s equity incentives to be announced will be linked to the implementation of the Company’s measures to fill the returns; (5) After the CSRC and the SSE otherwise release the opinions and implementation rules on the measures to fill the diluted immediate returns and their commitments, if the Company’s relevant |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| provisions and his or her commitments contradict such rules, they will immediately make supplementary commitments in line with the rules of the CSRC and the SSE, and actively work towards the Company's making of new commitments or taking new measures to comply with the requirements of the CSRC and the SSE; (6) They will fully, completely and promptly perform the Company’s measures regarding filling the diluted immediate returns and his or her commitments regarding the measures to |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| fill the diluted immediate returns. If found to have violated such commitments, which causes losses to the Company or shareholders, they are willing to: ① explain the cause and apologize at the General Meeting of Shareholders and the media designated by the CSRC; ② be held liable for compensation to the Company and/or shareholders by law; ③ unconditionally accept the penalties or regulatory measures taken by the CSRC and/or the SSE and other securities regulators as per relevant regulations |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| and rules. The said measures to fill the diluted immediate returns shall not be deemed to constitute a guarantee for the issuer's future profits. | |||||||||
| Avoiding horizontal competition | Controlling shareholder and actual controller HOU Juncheng and FANG Aiqin | 1. They do not and will not directly or indirectly engage in any activities constituting horizontal competition with the existing and future businesses of the Company and its holding subsidiaries, including but not limited to the R&D, production and sale of any products that are the same as or similar to those of the Company and its holding subsidiaries. They shall be liable for economic | November 15, 2017 | No | November 15, 2017 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| losses caused by violation of the above commitments to the Company. 2. For the enterprises under his or her control, they will perform their obligations under such commitments through the agencies and personnel (including but not limited to directors and managers), and they shall be liable for the economic losses caused by violation of the above commitments to the Company. 3. From the date of signing this letter of commitment, if the Company further expands the scope of its products and business, they or the enterprises under his or |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| her control shall not compete with the Company within the expanded product or business scope, or will, in case of any possible competition with the Company within the expanded product or business scope, withdraw from the competition by: (1) stopping the production of competing or potentially competing products; (2) stopping the operation of competing or potentially competing business; (3) transferring the competing business to the Company; or (4) transferring the competing business to an unrelated third party. 4. |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| Their shareholding companies, including Hangzhou Huazhuang Industrial Investment Co., Ltd. and Huzhou Mogan Wangshu Cosmetics Industry Phase I Venture Capital Partnership (Limited Partnership), and companies that they invest in engage in no cosmetics business or upstream and downstream business thereof. If these companies engage in such businesses in the future, they commit that they will withdraw their investment in the enterprises through equity transfer and other means, |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| and that the Company will be given priority to decide whether to invest in the said enterprises according to legal provisions and the consent of other shareholders of such enterprises. | |||||||||
| Commitments on refinancing | Others | Controlling shareholder and actual controller HOU Juncheng and FANG Aiqin | In order to ensure that the Company’s measures to fill the immediate returns can be effectively performed, they commit that: 1. They will not interfere with the Company’s operation and management activities beyond their authority or encroach on the Company’s interests; 2. From the date of making these commitments to the | April 21, 2021 | No | April 21, 2021 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| completion of the Company’s public offering of A-share convertible corporate bonds, in the event that the CSRC makes other new regulatory requirements regarding the measures to fill returns and the commitments thereof, and if the above commitments cannot satisfy such requirements of the CSRC, they will make supplementary commitments as per the latest requirements of the CSRC at that time; 3. They will effectively implement the Company’s measures to fill returns and their |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| commitments in this regard, and if found to have violated such commitments, which results in losses to the Company or investors, they are willing to be liable for compensation to the Company or investors according to law. As one of the parties responsible for the measures to fill the returns, should they violate or refuse to fulfill the above commitments, they shall be subject to the punishment or relevant regulatory measures imposed on them by the securities regulatory authorities such as the CSRC and the |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| SSE in accordance with the relevant regulations and rules. | |||||||||
| Others | Directors, senior management | In order to ensure that the Company’s measures to fill the immediate returns can be effectively performed, they commit that: 1. They will not offer benefits to other entities or individuals for free or on unfair terms, or otherwise harm the Company’s interests; 2. They will restrict their post-related consumption behaviors; 3. They will not use the Company’s assets to engage in investment and consumption activities unrelated to his or her duties; 4. They will link | April 21, 2021 | No | April 21, 2021 to long-term | Yes | Not applicable | Not applicable |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| the remuneration system established by the Board of Directors or the Remuneration and Appraisal Committee to the implementation of the Company’s measures for filling returns; 5. If the Company implements equity incentives in the future, the vesting conditions for the Company’s equity incentives to be announced will be linked to the implementation of the Company’s measures to fill the returns; 6. From the date of this commitment to the completion of the Company’s public offering of A-share |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| convertible corporate bonds, if the CSRC makes other new regulatory requirements regarding the measures to fill returns and the commitments thereof, and if the above commitments cannot satisfy such requirements of the CSRC, they will make supplementary commitments as per the latest requirements of the CSRC. As one of the parties responsible for the measures to fill the returns, should they violate or refuse to fulfill the above commitments, they shall be subject to the punishment or relevant regulatory |
| Background of commitment | Commitment type | Commitment party | Commitment content | Commitment date | Any deadline for performance | Duration | Whether the commitment is timely and strictly performed | Specific reasons for failure of on-time fulfillment | The next step in the event of failure of on-time fulfillment |
| measures imposed on them by the securities regulatory authorities such as the CSRC and the SSE in accordance with the relevant regulations and rules. |
II. Non-operating Occupation of Funds by the Controlling Shareholders and Other Related Parties during the Reporting Period
□Applicable √Not applicable
III. Illegal Guarantee
□Applicable √Not applicable
IV. Audit of the Semi-Annual Report
□Applicable √Not applicable
V. Information on Changes and Handling of Matters Related to Non-Standard Audit Opinions
in the Annual Report for the Previous Year
□Applicable √Not applicable
VI. Matters Related to Bankruptcy and Reorganization
□Applicable √Not applicable
VII. Material Litigations and Arbitrations
□The Company had material litigations and arbitrations during the Reporting Period √The Company hadno material litigations and arbitrations during the Reporting Period
VIII. Suspected Violations, Penalties and Rectifications of the Company and Its Directors,
Supervisors, Senior Management, Controlling Shareholders and Actual Controllers
□Applicable √Not applicable
IX. Integrity of the Company and Its Controlling Shareholders and Actual Controllers during theReporting Period
√Applicable □Not applicable
During the Reporting Period, the Company and its controlling shareholders and actual controllers werein good faith.
X. Significant Related-party Transactions(I) Related-party transactions pertaining to daily operation
1. Matters that have been disclosed in the interim announcement without progress or change in
the follow-up implementation
□Applicable √Not applicable
2. Matters that have been disclosed in the interim announcement with progress or changes inthe follow-up implementation
□Applicable √Not applicable
3. Matters not disclosed in the interim announcement
□Applicable √Not applicable
(II) Related-party transactions relevant to asset acquisition or equity acquisition and disposal
1. Matters that have been disclosed in the interim announcement without progress or change inthe follow-up implementation
□Applicable √Not applicable
2. Matters that have been disclosed in the interim announcement with progress or changes in the
follow-up implementation
□Applicable √Not applicable
3. Matters not disclosed in the interim announcement
□Applicable √Not applicable
4. Disclosable performance achievements during the Reporting Period involving agreed-uponperformance
□Applicable √Not applicable
(III) Significant related-party transactions pertaining to joint external investment
1. Matters that have been disclosed in the interim announcement without progress or change in
the follow-up implementation
□Applicable √Not applicable
2. Matters that have been disclosed in the interim announcement with progress or changes in thefollow-up implementation
□Applicable √Not applicable
3. Matters not disclosed in the interim announcement
□Applicable √Not applicable
(IV) Credits and debits with related parties
1. Matters that have been disclosed in the interim announcement without progress or change inthe follow-up implementation
□Applicable √Not applicable
2. Matters that have been disclosed in the interim announcement with progress or changes in thefollow-up implementation
□Applicable √Not applicable
3. Matters not disclosed in the interim announcement
□Applicable √Not applicable
(V) Financial business between the Company and related financial companies, holdingfinancial companies and related parties
□Applicable √Not applicable
(VI) Other significant related-party transactions
□Applicable √Not applicable
(VII) Others
□Applicable √Not applicable
XI. Significant Contracts and Their Performance
1. Trusteeship, contracting and leasing
□Applicable √Not applicable
2. Significant guarantees that have been performed or remained outstanding during theReporting Period
□Applicable √Not applicable
3. Other material contracts
□Applicable √Not applicable
XII. Progress on the Use of Raised Funds
√Applicable □Not applicable
(I) Overall use of raised funds
√Applicable □Not applicable
Unit: RMB '0,000
| Source of raised funds | Time of paying in | Total amount of raised funds | Net amount of raised funds after deduction of issuance expenses (1) | Total committed investment of raised funds in the prospectus (2) | Total amount of over-raised funds (3)=(1)-(2) | Total amount of raised funds invested as of the end of the Reporting Period (4) | Including: Total amount of over-raised funds invested as of the end of the Reporting Period (5) | Proportion of raised funds invested as of the end of the Reporting Period (%) (6)＝(4)/(1) | Proportion of over-raised funds invested as of the end of the Reporting Period (%) (7)＝(5)/(3) | Amount invested in the current year (8) | Proportion of amount invested in the current year (%) （9）=(8)/(1) | Total amount of raised funds whose purpose is changed |
| Issuance of convertible bonds | December 14, 2021 | 75,171.30 | 74,450.87 | 74,450.87 | 65,827.32 | 88.42 | 0.00 | 7,661.58 | 10.29 | 0.00 | ||
| Total | / | 75,171.30 | 74,450.87 | 74,450.87 | 65,827.32 | / | / | 7,661.58 | / | 0.00 |
(II) Details of fund-raising investment projects
√Applicable □Not applicable
1. Details of the use of raised funds
√Applicable □Not applicable
Unit: RMB '0,000
| Source of raised funds | Project name | Project nature | Whether it is a committed investment project in the prospectus | Whether investment subject is changed | Total planed investment amount of raised funds (1) | Amount invested in the current year | Total amount of raised funds invested as of the end of the Reporting Period (2) | Proportion of amount invested as of the end of the Reporting Period (%) (3)＝(2)/(1) | Date when the project reaches their intended use | Settled or not | Whether investment progress in line with the planned schedule | Reason for failure to keep up with the schedule | Benefit achieved in the current year | Benefit or research achievement that has been realized in this project | Whether there is a significant change in the feasibility of the project. If so, please provide specific details | Amount of balance |
| Issuance of convertible bonds | Huzhou Production Base Expansion Project (Phase I) | Production and construction | Yes | No | 33,850.00 | 5,571.46 | 29,007.15 | 85.69 | December 2024 | No | Yes | Not applicable | 12,813.60 | 35,069.00 | No | 4,842.85 |
| Issuance of convertible bonds | Longwu R&D Center Construction Project [Note 1] | Research and development | Yes | No | 19,450.00 | 647.35 | 19,700.80 | 101.29 | June 2024 | Yes | Yes | Not applicable | Not applicable | No | 0.00 | |
| Issuance of convertible bonds | Information System Upgrade Project | Operation management | Yes | No | 8,801.27 | 1,408.62 | 4,552.07 | 51.72 | December 2025 [Note 2] | No | No | The rapid growth of the Company's business has led to an increased demand for a robust IT support platform. Meanwhile, system debugging and implementation optimization are also required to align with this growth. | Not applicable | No | 4,249.20 | |
| Issuance of convertible bonds | Replenishment of Working Capital [Note 1] | Supplementing working capital and repaying debts | Yes | No | 12,349.60 | 34.15 | 12,567.30 | 101.76 | Yes | Not applicable | Not applicable | No | 0.00 | |||
| Total | / | / | / | / | 74,450.87 | 7,661.58 | 65,827.32 | / | / | / | / | / | 12,813.60 | / | / | 9,092.05 |
[Note 1] The investment amount for the Longwu R&D Center Construction Project and the Replenishment of Working Capital as of the end of the Reporting Periodexceeded the adjusted total investment, with the progress exceeding 100.00%. This was due to the interest income generated from idle funds in the raised fundsaccount.[Note 2] According to the resolutions passed at the 19th meeting of the third session of Board of Directors and the 17th meeting of the third session of Board ofSupervisors held on August 26, 2024, the Company decided to postpone the expected date for the Information System Upgrade Project to reach its intended use
from December 2024 to December 2025, in light of the current actual construction progress of the raised funds investment projects. The Company has decided toextend the construction period of the Information System Upgrade Project for the following reason: With the rapid growth of the Company’s businesses andcontinuous advancements in information technology, the Company has higher requirements for the IT support platform, including the need for iterative software andhardware upgrades, as well as system debugging and optimization. To ensure the high-quality implementation of the investment projects and the effective use of theraised funds, the Company, adhering to the principles of prudence and maximizing efficiency, has planned to extend the construction period of the InformationSystem Upgrade Project.
2. Details of the use of over-raised funds
□Applicable √Not applicable
(III) Change or termination of fund-raising investment during the Reporting Period
□Applicable √Not applicable
(IV) Other uses of raised funds during the Reporting Period
1. Advance investment and replacement in the project invested with the raised funds
√Applicable □Not applicable
During the Reporting Period, the Company did not have any advance investment or replacement in the project invested with the raised funds.
2. Use of idle raised funds to temporarily replenish working capital
□Applicable √Not applicable
3. Management of idled raised funds through investment
□Applicable √Not applicable
4. Others
□Applicable √Not applicable
XIII. Explanations on Other Significant Matters
□Applicable √Not applicable
Section VII Shareholders and Changes in SharesI. Changes in Share Capital(I) Table of changes in shares
1. Table of changes in shares
Unit: ’0,000 shares
| Before this change | Increase or decrease (+ or -) due to this change | After this change | |||||||
| Number | Percentage (%) | Issuance of new shares | Bonus shares | Shares converted from capital reserve | Other | Subtotal | Number | Percentage (%) | |
| I. Restricted shares | 195.7060 | 0.4933 | 195.7060 | 0.4933 | |||||
| 1. Shares held by the state | |||||||||
| 2. Shares held by state-owned legal persons | |||||||||
| 3. Shares held by other domestic funds | 195.7060 | 0.4933 | 195.7060 | 0.4933 | |||||
| Including: Shares held by domestic non-state-owned legal persons | |||||||||
| Shares held by domestic natural persons | 195.7060 | 0.4933 | 195.7060 | 0.4933 | |||||
| 4. Shares held by foreign funds | |||||||||
| Including: Shares held by foreign legal persons | |||||||||
| Shares held by foreign natural persons | |||||||||
| II. Unrestricted circulating shares | 39,480.0124 | 99.5067 | 0.0231 | 0.0231 | 39,480.0355 | 99.5067 | |||
| 1. RMB ordinary shares | 39,480.0124 | 99.5067 | 0.0231 | 0.0231 | 39,480.0355 | 99.5067 | |||
| 2. Foreign-funded shares listed domestically | |||||||||
| 3. Foreign-funded shares listed overseas | |||||||||
| 4. Others | |||||||||
| III. Total shares | 39,675.7184 | 100.00 | 0.0231 | 0.0231 | 39,675.7415 | 100.00 | |||
2. Explanation on changes in shares
√Applicable □Not applicable
With the approval of the CSRC's the Reply on Approving Proya Cosmetics Co., Ltd.'s Public Issuance ofConvertible Corporate Bonds (Zheng Jian Xu Ke [2021] No. 3408), on December 8, 2021, the Companypublicly issued 7,517,130 convertible bonds with a face value of RMB100 per share and a total face
value of RMB751,713,000, with a term of 6 years. With the approval of the SSE's Self-RegulatorySupervision Decision Letter [2021] No. 503, the convertible corporate bonds issued by the Companyamounting to RMB751,713,000 would be listed and traded on the Shanghai Stock Exchange fromJanuary 4, 2022, with the short name of “Proya Convertible Bond” and the bond code of “113634”.Proya Convertible Bonds began to be converted into shares on June 14, 2022. During the ReportingPeriod, RMB23,000 of Proya Convertible Bond had been converted to 231 A shares of the Company.The number of the unrestricted circulating shares of the Company increased by 231.
3. Impact of share changes on earnings per share, net assets per share and other financialindicators from the end of the Reporting Period to the disclosure date of the interim report (ifany)
□Applicable √Not applicable
4. Disclosure of other content that the Company deems necessary or the securities regulatoryauthority requires
□Applicable √Not applicable
(II) Changes in restricted shares
□Applicable √Not applicable
II. Shareholders(I) Total number of shareholders:
| Total number of shareholders of ordinary shares as of the end of the Reporting Period(account) | 19,292 |
| Total number of shareholders of preference shares whose voting rights have been restored as of the end of the Reporting Period(account) | 0 |
(II) Table of shareholdings of the top ten shareholders and the top ten shareholders of
circulating shares (or unrestricted shareholders) as of the end of the Reporting Period
Unit: Share
| Shareholdings of the top ten shareholders (excluding securities lending and refinancing) | |||||||
| Name of shareholder (full name) | Change during the Reporting Period | Number of shares held at the end of the period | Percentage (%) | Number of restricted shares held | Pledged, marked or frozen | Nature of shareholder | |
| Share status | Number | ||||||
| HOU Juncheng | 0 | 136,739,037 | 34.46 | 0 | None | 0 | Domestic natural person |
| Hong Kong Securities Clearing Company Limited | 2,061,839 | 81,371,736 | 20.51 | 0 | None | 0 | Others |
| FANG Yuyou | 0 | 59,625,258 | 15.03 | 0 | Frozen | 17,041,269 | Domestic natural person |
| GIC PRIVATE LIMITED | 6,211,086 | 9,101,355 | 2.29 | 0 | None | 0 | Other | |
| National Social Security Fund Portfolio 109 | 2,335,782 | 5,346,756 | 1.35 | 0 | None | 0 | Others | |
| China Construction Bank Co., Ltd. - CUAM Consumer Industry Hybrid Securities Investment Fund | -399,937 | 3,950,121 | 1.00 | 0 | None | 0 | Others | |
| Abrdn Asia Limited - Abrdn Fund - China A-share Sustainable Equity Fund | -1,456,300 | 3,610,113 | 0.91 | 0 | None | 0 | Others | |
| Industrial and Commercial Bank of China Limited - Invesco Great Wall Emerging Growth Hybrid Securities Investment Fund | 0 | 3,332,000 | 0.84 | 0 | None | 0 | Others | |
| China Life Insurance Company Limited - Traditional - General insurance products - 005L - CT001 Hu | 208,962 | 2,513,291 | 0.63 | 0 | None | 0 | Others | |
| Schroder Investment Management (Hong Kong) Limited - Schroder International Selection Fund China A-share (stock exchange) | 2,160,723 | 2,160,723 | 0.54 | 0 | None | 0 | Others | |
| Shareholdings of the top ten unrestricted shareholders (excluding securities lending and refinancing, and shares reserved for executives) | ||||||||
| Name of shareholder | Number of unrestricted circulating shares held | Type and number of shares | ||||||
| Type | Number | |||||||
| HOU Juncheng | 136,739,037 | RMB ordinary shares | 136,739,037 | |||||
| Hong Kong Securities Clearing Company Limited | 81,371,736 | RMB ordinary shares | 81,371,736 | |||||
| FANG Yuyou | 59,625,258 | RMB ordinary shares | 59,625,258 | |||||
| GIC PRIVATE LIMITED | 9,101,355 | RMB ordinary shares | 9,101,355 | |||||
| National Social Security Fund Portfolio 109 | 5,346,756 | RMB ordinary shares | 5,346,756 | |||||
| China Construction Bank Co., Ltd. - CUAM Consumer Industry Hybrid Securities Investment Fund | 3,950,121 | RMB ordinary shares | 3,950,121 |
| Abrdn Asia Limited - Abrdn Fund - China A-share Sustainable Equity Fund | 3,610,113 | RMB ordinary shares | 3,610,113 |
| Industrial and Commercial Bank of China Limited - Invesco Great Wall Emerging Growth Hybrid Securities Investment Fund | 3,332,000 | RMB ordinary shares | 3,332,000 |
| China Life Insurance Company Limited - Traditional - General insurance products - 005L - CT001 Hu | 2,513,291 | RMB ordinary shares | 2,513,291 |
| Schroder Investment Management (Hong Kong) Limited - Schroder International Selection Fund China A-share (stock exchange) | 2,160,723 | RMB ordinary shares | 2,160,723 |
| Explanation on the special account for repurchase among the top ten shareholders | As of the end of the Reporting Period, 2,210,825 shares of the Company were held in the Company's special securities account for repurchase, representing 0.56% of the total share capital of the Company. | ||
| Explanation on the above-mentioned shareholders' entrusting voting rights, entrusted voting rights and abstention from voting rights | None | ||
| Explanation on the association or concerted action among the shareholders mentioned above | FANG Yuyou is the younger brother of HOU Juncheng's spouse FANG Aiqin, so HOU Juncheng and FANG Yuyou are associated. | ||
| Explanation on the shareholders of preference shares with voting rights restored and their shareholdings | None | ||
Note: Shareholdings in regular and credit accounts of Schroder Investment Management (Hong Kong)Limited - Schroder International Selection Fund China A-share (stock exchange) at the beginning of theperiod are not included in the top 200 shareholders of the Company.
Securities lending and refinancing involved by shareholders holding more than 5% shares, the top tenshareholders and the top ten shareholders of unrestricted circulating shares
√Applicable □Not applicable
Unit: Share
| Securities lending and refinancing involved by shareholders holding more than 5% shares, the top ten shareholders and the top ten shareholders of unrestricted circulating shares | ||||||||
| Name of shareholder (full name) | Shareholdings in regular and credit accounts at the beginning of the period | Securities lending and refinancing at the beginning of the period but not yet returned | Shareholdings in regular and credit accounts at the end of the period | Securities lending and refinancing at the end of the period but not yet returned | ||||
| Total | Percentage | Total | Percentage | Total | Percentage | Total | Percentage | |
| amount | (%) | amount | (%) | amount | (%) | amount | (%) | |
| National Social Security Fund Portfolio 109 | 3,010,974 | 0.759 | 88,800 | 0.022 | 5,346,756 | 1.348 | 3,700 | 0.001 |
Change in the top ten shareholders and the top ten shareholders of unrestricted circulating shares overthe previous period due to securities lending and refinancing/their returning
□Applicable √Not applicable
Shareholdings and sales restrictions of the top ten restricted shareholders
√Applicable □Not applicable
Unit: Share
| Number | Name of shareholder of restricted shares | Number of restricted shares held | Availability of restricted shares for circulation and trading | Sales restrictions | |
| Time of availability for circulation and trading | Number of new shares available for circulation and trading | ||||
| 1 | Equity incentive object | 1,957,060 | See the note below for details | ||
| Explanation on the association or concerted action among the shareholders mentioned above | None | ||||
Note: The restricted shares held by equity incentive objects are those granted under the 2022 RestrictedShares Incentive Plan. The restricted period was 12 months, 24 months, and 36 months from thecompletion of their registration with CSDC Shanghai Branch (September 6, 2022).
(III) Strategic investors or general legal persons becoming the top ten shareholders through
placement of new shares
□Applicable √Not applicable
III. Information on Directors, Supervisors and Senior Management(I) Changes in shareholdings of current directors, supervisors, and senior management andthose who resigned during the Reporting Period
√Applicable □Not applicable
Unit: Share
| Name | Position | Number of shares held at the beginning of the period | Number of shares held at the end of the period | Change in shares during the Reporting Period | Cause for change |
| JIN Yanhua | Deputy General | 303,762 | 227,862 | -75,900 | Shares reduced |
| Manager | for personal capital need | ||||
| WANG Li | Deputy General Manager, Secretary of the Board of Directors, CFO | 315,491 | 236,651 | -78,840 | Shares reduced for personal capital need |
Other explanations
□Applicable √Not applicable
(II) Equity incentives granted to directors, supervisors and senior management during theReporting Period
□Applicable √Not applicable
(III) Other explanations
□Applicable √Not applicable
IV. Changes in Controlling Shareholders and Actual Controllers
□Applicable √Not applicable
Section VIII Information on Preference Shares
□Applicable √Not applicable
Section IX Information on Bonds
I. Corporate Bonds (including Enterprise Bonds） and Debt Financing Instruments ofNon-Financial Enterprises
□Applicable √Not applicable
II. Information on Convertible Corporate Bonds
√Applicable □Not applicable
(I) Information on issuance of convertible bondsWith the Approval of the CSRC, namely, the Reply on Approving Proya Cosmetics Co., Ltd.'s PublicIssuance of Convertible Corporate Bonds (Zheng Jian Xu Ke [2021] No. 3408), on December 8, 2021,the Company publicly issued 7,517,130 convertible corporate bonds with a face value of RMB100 pershare and a total face value of RMB751,713,000. These convertible bonds were issued at face value witha term of 6 years.With the approval of the SSE's Self-Regulatory Supervision Decision Letter [2021] No. 503, theconvertible corporate bonds issued by the Company amounting to RMB751,713,000 were listed andtraded on the Shanghai Stock Exchange from January 4, 2022. The bond is referred to as “ProyaConvertible Bond”, with the bond code of “113634”. The nominal interest rate of the convertiblecorporate bonds issued this time was as follows: 0.30% in the first year, 0.50% in the second year, 1.00%in the third year, 1.50% in the fourth year, 1.80% in the fifth year, and 2.00% in the sixth year. Theduration of the convertible corporate bonds runs from December 8, 2021 to December 7, 2027.According to the relevant regulations and the Prospectus of Proya Cosmetics Co., Ltd. for the PublicOffering of A-Share Convertible Corporate Bonds, this “Proya Convertible Bond” issued by theCompany can be converted into the Company's shares from June 14, 2022. The conversion period isfrom June 14, 2022 to December 7, 2027. The initial conversion price is RMB195.98/share, and thelatest conversion price is RMB97.35/share. The historical adjustments to the conversion price are asfollows：
1. Since the 2021 Equity Distribution Plan was implemented by the Company, the conversion price ofProya Convertible Bond has been adjusted to RMB139.37/share since May 30, 2022. For details, see theAnnouncement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of Convertible Bondsdue to 2021 Equity Distribution Plan (Announcement No.: 2022-029) released by the Company on theSSE website (www.sse.com.cn) on May 24, 2022.
2. Since the registration of restricted shares involved in the grant under the 2022 Restricted SharesIncentive Plan was completed, the conversion price of the Proya Convertible Bond has been adjusted toRMB138.92/share since September 9, 2022. For details, see the Announcement of Proya Cosmetics Co.,Ltd. on Adjustment of Conversion Price of “Proya Convertible Bond” due to Additional Issuance fromGranting of Restricted Shares (Announcement No.: 2022-052) released by the Company on the SSEwebsite (www.sse.com.cn) on September 8, 2022.
3. Since the 2022 Equity Distribution Plan was implemented by the Company, the conversion price ofthe Proya Convertible Bond has been adjusted to RMB98.61/share since May 29, 2023. For details, seethe Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of ConvertibleBonds due to 2022 Equity Distribution Plan (Announcement No.: 2023-030) released by the Companyon the SSE website (www.sse.com.cn) on May 23, 2023.
4. Since the Company completed the repurchase and cancellation of 105,350 incentive restricted sharesunder the 2022 Restricted Shares Incentive Plan, the conversion price of the Proya Convertible Bond has
been adjusted to RMB98.62/share since August 29, 2023. For details, see the Announcement of ProyaCosmetics Co., Ltd. on Completion of Repurchase and Cancellation of Some Incentive Restricted Sharesand Adjustment of Conversion Price of “Proya Convertible Bond” (Announcement No.: 2023-045)released by the Company on the SSE website (www.sse.com.cn) on August 28, 2023.
5. Since the 2023 Semi-Annual Equity Distribution Plan was implemented by the Company, theconversion price of the Proya Convertible Bond has been adjusted to RMB98.24/share since October 23,2023. For details, see the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of ConversionPrice of Convertible Bonds due to 2023 Semi-Annual Equity Distribution Plan (Announcement No.:
2023-065) released by the Company on the SSE website (www.sse.com.cn) on October 17, 2023.
6. Since the Company completed the repurchase and cancellation of 66,192 incentive restricted sharesunder the 2022 Restricted Shares Incentive Plan, the conversion price of the Proya Convertible Bond hasbeen adjusted to RMB98.25/share since December 18, 2023. For details, see the Announcement of ProyaCosmetics Co., Ltd. on Adjustment of Conversion Price of “Proya Convertible Bond” and TradingSuspension for Conversion (Announcement No.: 2023-086) released by the Company on the SSEwebsite (www.sse.com.cn) on December 15, 2023.
7. Since the 2023 Equity Distribution Plan was implemented by the Company, the conversion price ofthe Proya Convertible Bond has been adjusted to RMB97.35/share since June 25, 2024. For details, seethe Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price due to 2023 EquityDistribution Plan (Announcement No.: 2024-028) released by the Company on the SSE website(www.sse.com.cn) on June 19, 2024.
(II) Information on holders and guarantors of convertible bonds during the Reporting Period
| Name of the convertible corporate bond | Proya Convertible Bond | |
| Number of holders of the convertible corporate bond at the end of the Reporting Period | 7,303 | |
| Guarantors of the convertible bond of the Company | None | |
| Material changes in the profitability, asset conditions and credit conditions of the guarantors | None | |
| The top ten holders of the convertible bond are as follows: | ||
| Name of holders of the convertible corporate bond | Number of bonds held at the end of the Reporting Period (RMB) | Holding ratio (%) |
| China Life Pension Hongyi Fixed-benefit Pension Products - Industrial and Commercial Bank of China Limited | 32,790,000 | 4.37 |
| Bank of China Limited - China Southern Changyuan Convertible Bond Securities Investment Fund | 25,786,000 | 3.43 |
| Industrial and Commercial Bank of China Limited - China Southern Guangli Return Bond Securities Investment Fund | 24,664,000 | 3.29 |
| Agricultural Bank of China Limited - China Southern Xiyuan Convertible Bond Securities Investment Fund | 24,579,000 | 3.27 |
| China Galaxy Securities Co., Ltd. | 23,600,000 | 3.14 |
| China Southern Asset Management Ningkang | 20,699,000 | 2.76 |
| Name of the convertible corporate bond | Proya Convertible Bond | |
| Convertible Bond Fixed-benefit Pension Products - Bank of China Limited | ||
| Industrial and Commercial Bank of China Limited - Guangfa Convertible Bond Sponsored Securities Investment Fund | 20,000,000 | 2.66 |
| China Merchants Bank Co., Ltd. - Hwabao WP Convertible Bond Securities Investment Fund | 18,942,000 | 2.52 |
| China Life Pension Anxiangxinqi Mixed Pension Products - Industrial and Commercial Bank of China Limited | 17,949,000 | 2.39 |
| National Social Security Fund Portfolio 201 | 17,298,000 | 2.30 |
(III) Changes in convertible bonds during the Reporting Period
Unit: Yuan Currency: RMB
| Name of the convertible corporate bond | Before this change | Increase or decrease due to this change | After this change | ||
| Share conversion | Redemption | Sell-back | |||
| Proya Convertible Bond | 750,789,000 | 23,000 | 750,766,000 | ||
(IV) Cumulative conversion of convertible bonds into shares during the Reporting Period
| Name of the convertible corporate bond | Proya Convertible Bond |
| Amount of shares converted from bonds in the Reporting Period (RMB) | 23,000 |
| Number of shares converted from bonds in the Reporting Period (share) | 231 |
| Accumulated number of shares converted from bonds (share) | 6,869 |
| Proportion of the accumulated number of converted shares in the total number of issued shares of the Company before conversion (%) | 0.0024 |
| Amount of bonds not converted into shares (RMB) | 750,766,000 |
| Proportion of unconverted convertible bonds in the total amount of convertible bonds issued (%) | 99.8740 |
(V) Historical adjustments to the conversion price
Unit: Yuan Currency: RMB
| Name of the convertible corporate bond | Proya Convertible Bond | ||||
| Date of adjustments to the conversion price | Adjusted conversion price | Time of disclosure | Media of disclosure | Explanation on adjustments to the conversion price | |
| May 30, 2022 | RMB139.37/share | May 24, 2022 | SSE website, Shanghai Securities | Since the 2021 Equity Distribution Plan was implemented by the Company, the conversion price of | |
| News, Securities Times | Proya Convertible Bond has been adjusted to RMB139.37/share since May 30, 2022. For details, see the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of Convertible Bonds due to 2021 Equity Distribution Plan (Announcement No.: 2022-029) released by the Company on the SSE website (www.sse.com.cn) on May 24, 2022. | |||
| September 9, 2022 | RMB138.92/share | September 8, 2022 | SSE website, Shanghai Securities News, Securities Times | Since the registration of restricted shares involved in the grant under the 2022 Restricted Shares Incentive Plan was completed, the conversion price of the Proya Convertible Bond has been adjusted to RMB138.92/share since September 9, 2022. For details, see the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of “Proya Convertible Bond” due to Additional Issuance from Granting of Restricted Shares (Announcement No.: 2022-052) released by the Company on the SSE website (www.sse.com.cn) on September 8, 2022. |
| May 29, 2023 | RMB98.61/share | May 23, 2023 | SSE website, Shanghai Securities News, Securities Times | Since the 2022 Equity Distribution Plan was implemented by the Company, the conversion price of the Proya Convertible Bond has been adjusted to RMB98.61/share since May 29, 2023. For details, see the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of Convertible Bonds due to 2022 Equity Distribution Plan (Announcement No.: 2023-030) released by the Company on the SSE website (www.sse.com.cn) on May 23, 2023. |
| August 29, 2023 | RMB98.62/share | August 28, 2023 | SSE website, Shanghai Securities News, Securities Times | Since the Company completed the repurchase and cancellation of 105,350 incentive restricted shares under the 2022 Restricted Shares Incentive Plan, the conversion price of the Proya Convertible Bond has been adjusted to RMB98.62/share since August 29, 2023. For details, see the Announcement of Proya Cosmetics Co., Ltd. on Completion of Repurchase and Cancellation of Some Incentive Restricted Shares and Adjustment of Conversion Price of “Proya Convertible Bond” (Announcement No.: 2023-045) released by the Company on the SSE website (www.sse.com.cn) on August 28, 2023. |
| October 23, 2023 | RMB98.24/share | October 17, 2023 | SSE website, Shanghai Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, China Daily | Since the 2023 Semi-Annual Equity Distribution Plan was implemented by the Company, the conversion price of the Proya Convertible Bond has been adjusted to RMB98.24/share since October 23, 2023. For details, see the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of Convertible Bonds due to 2023 Semi-Annual Equity Distribution Plan (Announcement No.: 2023-065) released by the Company on the SSE website (www.sse.com.cn) on October 17, 2023. |
| December 18, 2023 | RMB98.25/share | December 15, 2023 | SSE website, Shanghai Securities News, Securities Times, China Securities Journal, Securities | Since the Company completed the repurchase and cancellation of 66,192 incentive restricted shares under the 2022 Restricted Shares Incentive Plan, the conversion price of the Proya Convertible Bond has been adjusted to RMB98.25/share since December 18, 2023. For details, see the |
| Daily, Economic Information Daily, China Daily | Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of “Proya Convertible Bond” and Trading Suspension for Conversion (Announcement No.: 2023-086) released by the Company on the SSE website (www.sse.com.cn) on December 15, 2023. | |||
| June 25, 2024 | RMB97.35/share | June 19, 2024 | SSE website, Shanghai Securities News, Securities Times, China Securities Journal, Securities Daily, Economic Information Daily, China Daily | Since the 2023 Equity Distribution Plan was implemented by the Company, the conversion price of the Proya Convertible Bond has been adjusted to RMB97.35/share since June 25, 2024. For details, see the Announcement of Proya Cosmetics Co., Ltd. on Adjustment of Conversion Price of Convertible Bonds due to 2023 Equity Distribution Plan (Announcement No.: 2024-028) released by the Company on the SSE website (www.sse.com.cn) on June 19, 2024. |
| Latest conversion price as of the end of the Reporting Period | RMB97.35/share | |||
(VI) The Company's liabilities, changes in credit and cash arrangements for debt repayment infuture yearsAs of June 30, 2024, the Company's total assets were RMB7,362,862,729.83, and its liabilities totaledRMB2,748,031,045.60, with a gearing ratio of 37.32%. On June 13, 2024, the rating agency ChinaLianhe Credit Rating Co., Ltd. issued the 2024 Tracking Rating Report of Proya Cosmetics Co., Ltd.The main long-term credit rating of the Company is “AA”, the credit rating of Proya Convertible Bondis “AA”, and the rating outlook is “stable”. The results of this rating remain consistent with the previousrating.The Company's future repayment of the principal and interest of convertible bonds mainly comes fromthe cash flow generated from the Company's business activities. With stable primary business operationsand a strong financial position, the Company's cash flows from operating activities are abundant,demonstrating robust debt repayment capability.
(VII) Other explanations on convertible bondsNone
Section X Financial ReportI. Audit Report
□Applicable √Not applicable
II. Financial Statements
Consolidated Balance Sheet
June 30, 2024Prepared by: Proya Cosmetics Co., Ltd.
Unit: Yuan Currency: RMB
| Item | Notes | June 30, 2024 | December 31, 2023 |
| Current assets: | |||
| Monetary capital | VII. 1 | 4,052,800,790.90 | 4,011,085,558.07 |
| Provision for settlement | |||
| Placements with banks and other financial institutions | |||
| Financial assets held for trading | |||
| Derivative financial assets | |||
| Notes receivable | |||
| Accounts receivable | VII. 5 | 383,322,337.03 | 344,570,196.54 |
| Receivables financing | VII. 7 | 3,695,843.86 | 7,378,700.06 |
| Prepayments | VII. 8 | 255,919,184.09 | 202,870,195.58 |
| Premiums receivable | |||
| Reinsurance accounts receivable | |||
| Provision for reinsurance contract receivables | |||
| Other receivables | VII. 9 | 13,836,491.18 | 81,966,213.90 |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Financial assets purchased under resale agreements | |||
| Inventory | VII. 10 | 797,541,148.23 | 797,215,155.68 |
| Including: Data resources | |||
| Contract assets | |||
| Assets held for sale | |||
| Non-current assets due within one year | |||
| Other current assets | VII. 13 | 65,561,804.15 | 99,765,073.07 |
| Total current assets | 5,572,677,599.44 | 5,544,851,092.90 | |
| Non-current assets: | |||
| Loans and advances to customers | |||
| Debt investments | |||
| Other debt investments | |||
| Long-term receivables | |||
| Long-term equity investments | VII. 17 | 111,420,494.75 | 113,574,158.49 |
| Other equity instrument investments | VII. 18 | 107,660,400.00 | 107,660,400.00 |
| Other non-current financial assets | |||
| Investment property | VII. 20 | 65,239,912.91 | 66,156,471.91 |
| Fixed assets | VII. 21 | 825,874,380.92 | 827,350,985.29 |
| Construction in progress | VII. 22 | 72,172,878.34 | 52,038,642.94 |
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use assets | VII. 25 | 16,995,953.78 | 14,104,821.34 |
| Intangible assets | VII. 26 | 397,608,786.61 | 404,688,009.16 |
| Including: Data resources | |||
| Development expenditure | |||
| Including: Data resources | |||
| Goodwill | |||
| Long-term deferred expenses | VII. 28 | 67,163,449.93 | 67,184,328.83 |
| Deferred income tax assets | VII. 29 | 100,781,790.47 | 108,494,364.60 |
| Other non-current assets | VII. 30 | 25,267,082.68 | 16,974,946.99 |
| Total non-current assets | 1,790,185,130.39 | 1,778,227,129.55 | |
| Total assets | 7,362,862,729.83 | 7,323,078,222.45 | |
| Current liabilities: | |||
| Short-term borrowings | VII. 32 | 200,155,555.56 | 200,155,555.56 |
| Borrowings from the central bank | |||
| Placements from banks and other financial institutions | |||
| Financial liabilities held for trading | |||
| Derivative financial liabilities | |||
| Notes payable | VII. 35 | 36,959,074.14 | |
| Accounts payable | VII. 36 | 1,061,672,558.10 | 1,018,522,358.60 |
| Receipts in advance | VII. 37 | 152,319.76 | 30,514.45 |
| Contract liabilities | VII. 38 | 242,809,306.75 | 301,014,873.58 |
| Financial assets sold under repurchase agreements | |||
| Customer deposits and deposits from banks and other financial institutions | |||
| Funds from securities trading | |||
| agencies | |||
| Funds from underwriting securities agencies | |||
| Employee benefits payable | VII. 39 | 98,158,990.54 | 166,444,494.43 |
| Taxes payable | VII. 40 | 151,086,065.86 | 222,765,869.94 |
| Other payables | VII. 41 | 151,600,173.08 | 155,345,148.68 |
| Including: Interest payable | |||
| Dividends payable | |||
| Fees and commissions payable | |||
| Reinsurance accounts payable | |||
| Held-for-sale liabilities | |||
| Non-current liabilities due within one year | VII. 43 | 4,561,267.98 | 3,970,060.11 |
| Other current liabilities | VII. 44 | 18,495,292.07 | 15,022,173.42 |
| Total current liabilities | 1,928,691,529.70 | 2,120,230,122.91 | |
| Non-current liabilities: | |||
| Insurance contract reserves | |||
| Long-term borrowings | |||
| Bonds payable | VII. 46 | 770,198,904.64 | 753,119,902.88 |
| Including: Preference shares | |||
| Perpetual bonds | |||
| Lease liabilities | VII. 47 | 11,733,319.90 | 9,970,306.87 |
| Long-term payables | |||
| Long-term employee benefits payable | |||
| Estimated liabilities | VII. 50 | 30,541,670.83 | 33,063,299.45 |
| Deferred income | VII. 51 | 6,865,620.53 | 6,383,359.33 |
| Deferred income tax liabilities | VII. 29 | ||
| Other non-current liabilities | |||
| Total non-current liabilities | 819,339,515.90 | 802,536,868.53 | |
| Total liabilities | 2,748,031,045.60 | 2,922,766,991.44 | |
| Owner's equity (or shareholders' equity): | |||
| Paid-in capital (or share capital) | VII. 53 | 396,757,415.00 | 396,757,184.00 |
| Other equity instruments | VII. 54 | 50,892,427.49 | 50,893,986.60 |
| Including: Preference shares | |||
| Perpetual bonds | |||
| Capital reserve | VII. 55 | 865,040,403.32 | 864,150,974.43 |
| Less: Treasury shares | VII. 56 | 298,659,030.87 | 146,966,735.61 |
| Other comprehensive income | VII. 57 | -53,978,652.16 | -53,847,100.91 |
| Special reserve | |||
| Surplus reserve | VII. 59 | 198,411,582.50 | 198,411,582.50 |
| General risk reserve | |||
| Undistributed profits | VII. 60 | 3,383,215,737.14 | 3,040,145,490.59 |
| Total owner's equity (or shareholders' equity) attributable to the parent company | 4,541,679,882.42 | 4,349,545,381.60 | |
| Minority interests | 73,151,801.81 | 50,765,849.41 | |
| Total owner's equity (or shareholders' equity) | 4,614,831,684.23 | 4,400,311,231.01 | |
| Total liabilities and owners' equity (or shareholders' equity) | 7,362,862,729.83 | 7,323,078,222.45 |
The chairman of the Company: HOU Juncheng CFO of the Company: WANG LiHead of Accounting Department: WANG Li
Parent Company's Balance Sheet
June 30, 2024Prepared by: Proya Cosmetics Co., Ltd.
Unit: Yuan Currency: RMB
| Item | Notes | June 30, 2024 | December 31, 2023 |
| Current assets: | |||
| Monetary capital | 2,524,381,945.57 | 2,816,366,399.45 | |
| Financial assets held for trading | |||
| Derivative financial assets | |||
| Notes receivable | |||
| Accounts receivable | XIX. 1 | 746,406,908.34 | 586,728,691.35 |
| Receivables financing | 3,317,243.57 | 4,732,700.06 | |
| Prepayments | 96,713,926.20 | 66,223,228.82 | |
| Other receivables | XIX. 2 | 63,315,069.88 | 80,702,024.60 |
| Including: Interest receivable | |||
| Dividends receivable | |||
| Inventory | 395,965,581.76 | 516,042,533.80 | |
| Including: Data resources | |||
| Contract assets | |||
| Assets held for sale | |||
| Non-current assets due within one year | |||
| Other current assets | 45,712,806.65 | 38,762,926.06 | |
| Total current assets | 3,875,813,481.97 | 4,109,558,504.14 | |
| Non-current assets: | |||
| Debt investments | |||
| Other debt investments | |||
| Long-term receivables | |||
| Long-term equity investments | XIX. 3 | 403,021,885.90 | 418,748,241.23 |
| Other equity instrument investments | 71,838,000.00 | 71,838,000.00 | |
| Other non-current financial assets | |||
| Investment property | 94,112,640.62 | 95,815,110.34 | |
| Fixed assets | 784,560,134.87 | 783,893,280.52 | |
| Construction in progress | 71,578,501.14 | 51,841,256.80 | |
| Productive biological assets | |||
| Oil and gas assets | |||
| Right-of-use assets | 11,935,650.36 | 13,640,458.38 | |
| Intangible assets | 366,012,612.46 | 371,083,311.38 | |
| Including: Data resources | |||
| Development expenditure | |||
| Including: Data resources | |||
| Goodwill | |||
| Long-term deferred expenses | 62,419,419.54 | 62,969,904.19 | |
| Deferred income tax assets | 10,339,068.57 | 8,256,631.70 | |
| Other non-current assets | 25,490,102.07 | 17,197,966.38 | |
| Total non-current assets | 1,901,308,015.53 | 1,895,284,160.92 | |
| Total assets | 5,777,121,497.50 | 6,004,842,665.06 | |
| Current liabilities: | |||
| Short-term borrowings | 200,155,555.56 | 200,155,555.56 | |
| Financial liabilities held for trading | |||
| Derivative financial liabilities | |||
| Notes payable | 36,959,074.14 | ||
| Accounts payable | 618,393,931.98 | 603,314,221.56 | |
| Receipts in advance | |||
| Contract liabilities | 88,026,178.65 | 220,349,629.19 | |
| Employee benefits payable | 55,646,984.10 | 88,243,004.64 | |
| Taxes payable | 87,718,715.94 | 161,141,517.93 | |
| Other payables | 109,785,052.96 | 113,223,667.48 | |
| Including: Interest payable | |||
| Dividends payable | |||
| Held-for-sale liabilities | |||
| Non-current liabilities due within one year | 3,557,401.05 | 3,488,575.66 | |
| Other current liabilities | 28,645,451.80 | ||
| Total current liabilities | 1,163,283,820.24 | 1,455,520,697.96 | |
| Non-current liabilities: | |||
| Long-term borrowings | |||
| Bonds payable | 770,198,904.64 | 753,119,902.88 | |
| Including: Preference shares | |||
| Perpetual bonds | |||
| Lease liabilities | 7,806,471.97 | 9,970,306.87 | |
| Long-term payables | |||
| Long-term employee benefits payable | |||
| Estimated liabilities | |||
| Deferred income | 6,865,620.53 | 6,383,359.33 | |
| Deferred income tax liabilities | |||
| Other non-current liabilities | |||
| Total non-current liabilities | 784,870,997.14 | 769,473,569.08 | |
| Total liabilities | 1,948,154,817.38 | 2,224,994,267.04 | |
| Owner's equity (or shareholders' equity): | |||
| Paid-in capital (or share capital) | 396,757,415.00 | 396,757,184.00 | |
| Other equity instruments | 50,892,427.49 | 50,893,986.60 | |
| Including: Preference shares | |||
| Perpetual bonds | |||
| Capital reserve | 918,413,962.09 | 917,524,533.21 | |
| Less: Treasury shares | 298,659,030.87 | 146,966,735.61 | |
| Other comprehensive income | -53,180,700.00 | -53,180,700.00 | |
| Special reserve | |||
| Surplus reserve | 198,411,582.50 | 198,411,582.50 | |
| Undistributed profits | 2,616,331,023.91 | 2,416,408,547.32 | |
| Total owner's equity (or shareholders' equity) | 3,828,966,680.12 | 3,779,848,398.02 | |
| Total liabilities and owners' equity (or shareholders' equity) | 5,777,121,497.50 | 6,004,842,665.06 | |
The chairman of the Company: HOU Juncheng CFO of the Company: WANG LiHead of Accounting Department: WANG Li
Consolidated Income StatementJanuary to June 2024
Unit: Yuan Currency: RMB
| Item | Notes | H1 2024 | H1 2023 |
| I. Total operating revenue | VII. 61 | 5,001,465,470.72 | 3,626,991,878.22 |
| Including: Operating revenue | 5,001,465,470.72 | 3,626,991,878.22 | |
| Interest income |
| Premiums earned | |||
| Fees and commission income | |||
| II. Total operating costs | 4,137,984,289.63 | 2,941,251,103.74 | |
| Including: Operating costs | VII. 61 | 1,509,530,495.30 | 1,069,489,813.93 |
| Interest expenses | |||
| Fees and commissions expenses | |||
| Surrenders | |||
| Net compensation expenses | |||
| Net provision for insurance liability reserves | |||
| Insurance policy dividend expenses | |||
| Reinsurance expenses | |||
| Taxes and surcharges | VII. 62 | 41,900,210.19 | 38,469,557.75 |
| Selling expenses | VII. 63 | 2,339,661,922.31 | 1,579,997,275.26 |
| General and administrative expenses | VII. 64 | 176,927,741.63 | 192,127,158.56 |
| R&D expenses | VII. 65 | 94,613,242.52 | 91,520,865.15 |
| Financial expenses | VII. 66 | -24,649,322.32 | -30,353,566.91 |
| Including: Interest expenses | 10,601,806.58 | 5,817,515.18 | |
| Interest income | 37,663,413.80 | 34,019,097.62 | |
| Add: Other income | VII. 67 | 66,048,236.39 | 35,532,621.58 |
| Investment income (“-” for losses) | VII. 68 | -2,153,663.74 | -1,164,626.88 |
| Including: Investment income from associates and joint ventures | -2,153,663.74 | -1,831,700.47 | |
| Gains from derecognition of financial assets measured at amortized cost (“-” for losses) | |||
| Foreign exchange gains (“-” for losses) | |||
| Net gain on exposure hedging (“-” for losses) | |||
| Gains on changes in fair value (“-” for losses) | |||
| Credit impairment losses (“-” for losses) | VII. 71 | 2,297,873.84 | 6,753,856.82 |
| Asset impairment losses (“-” for losses) | VII. 72 | -32,417,516.03 | -52,178,199.75 |
| Gains from disposal of assets | VII. 73 | -712,859.58 | -217,694.21 |
| (“-” for losses) | |||
| III. Operating profit (“-” for losses) | 896,543,251.97 | 674,466,732.04 | |
| Add: Non-operating revenue | VII. 74 | 956,198.43 | 1,359,664.17 |
| Less: Non-operating expenses | VII. 75 | 1,430,755.68 | 2,913,343.62 |
| IV. Total profit (“-” for total losses) | 896,068,694.72 | 672,913,052.59 | |
| Less: Income tax expenses | VII. 76 | 172,136,418.43 | 144,644,731.37 |
| V. Net profit (“-” for net losses) | 723,932,276.29 | 528,268,321.22 | |
| (I) Classified by operation continuity | |||
| 1. Net profit from continuing operations (“-” for net losses) | 723,932,276.29 | 528,268,321.22 | |
| 2. Net profit from discontinued operations (“-” for net losses) | |||
| (II) Classified by ownership | |||
| 1. Net profit attributable to shareholders of the parent company (“-” for net losses) | 701,671,374.89 | 499,493,997.71 | |
| 2. Profits or losses attributable to minority interests (“-” for net losses) | 22,260,901.40 | 28,774,323.51 | |
| VI. Other comprehensive income, net of tax | VII. 77 | -131,551.25 | 1,269,633.36 |
| (I) Other comprehensive income attributable to owners of the parent company, net of tax | -131,551.25 | 1,269,633.36 | |
| 1.Other comprehensive income that cannot be reclassified into profit or loss | |||
| (1) Changes arising from re-measurement of defined benefit plans | |||
| (2) Other comprehensive income that cannot be reclassified into profit or loss under the equity method | |||
| (3) Changes in the fair value of other equity instrument investments | |||
| (4) Changes in the fair value of the Company's own credit risks | |||
| 2. Other comprehensive income that will be reclassified into profit or loss | -131,551.25 | 1,269,633.36 | |
| (1) Other comprehensive income that can be reclassified into profit or loss under the equity method | |||
| (2) Changes in the fair value of other debt investments | |||
| (3) Amount of financial assets reclassified into other comprehensive income | |||
| (4) Credit impairment provisions of other debt investments | |||
| (5) Cash flow hedging reserve | |||
| (6) Conversion differences of financial statements denominated in foreign currencies | -131,551.25 | 1,269,633.36 | |
| (7) Others | |||
| (II) Other comprehensive income attributable to minority interests, net of tax | |||
| VII. Total comprehensive income | 723,800,725.04 | 529,537,954.58 | |
| (I) Total comprehensive income attributable to owners of the parent company | 701,539,823.64 | 500,763,631.07 | |
| (II) Total comprehensive income attributable to minority interests | 22,260,901.40 | 28,774,323.51 | |
| VIII. Earnings per share: | |||
| (I) Basic earnings per share (RMB/share) | 1.78 | 1.25 | |
| (II) Diluted earnings per share (RMB/share) | 1.72 | 1.24 | |
For business combinations involving enterprises under common control in the current period, the netprofit realized by the acquirees before the combination is RMB0.00, and the net profit realized therebyin the prior period was RMB0.00.The chairman of the Company: HOU Juncheng CFO of the Company: WANG LiHead of Accounting Department: WANG Li
Parent Company's Income Statement
January to June 2024
Unit: Yuan Currency: RMB
| Item | Notes | H1 2024 | H1 2023 |
| I. Operating revenue | XIX. 4 | 2,475,390,588.58 | 1,730,545,125.09 |
| Less: Operating costs | XIX. 4 | 1,157,388,181.64 | 823,776,575.95 |
| Taxes and surcharges | 11,550,127.35 | 15,808,311.59 | |
| Selling expenses | 430,271,487.56 | 265,242,258.63 | |
| General and administrative expenses | 155,479,110.03 | 137,869,495.89 | |
| R&D expenses | 94,436,533.40 | 88,272,258.48 | |
| Financial expenses | -17,929,131.62 | -29,081,987.57 | |
| Including: Interest expenses | 10,394,771.26 | 79,333.44 | |
| Interest income | 29,144,053.33 | 1,254.56 | |
| Add: Other income | 26,613,066.79 | 4,808,666.20 | |
| Investment income (“-” for losses) | XIX. 5 | 1,838,583.82 | -4,145,129.34 |
| Including: Investment income from associates and joint ventures | -2,153,663.74 | -1,600,000.00 | |
| Gains from derecognition of financial assets measured at amortized cost (“-” for losses) | |||
| Net gain on exposure hedging (“-” for losses) | |||
| Gains on changes in fair value (“-” for losses) | |||
| Credit impairment losses (“-” for losses) | -14,432,000.29 | 10,624,149.77 | |
| Asset impairment losses (“-” for losses) | -1,841,545.51 | -50,071,970.30 | |
| Gains from disposal of assets (“-” for losses) | -535,789.27 | 30,842.94 | |
| II. Operating profit (“-” for losses) | 655,836,595.76 | 389,904,771.39 | |
| Add: Non-operating revenue | 514,727.31 | 189,623.01 | |
| Less: Non-operating expenses | 1,270,771.69 | 1,904,339.55 | |
| III. Total profit (“-” for total losses) | 655,080,551.38 | 388,190,054.85 | |
| Less: Income tax expenses | 96,556,946.45 | 60,740,291.78 | |
| IV. Net profit (“-” for net losses) | 558,523,604.93 | 327,449,763.07 | |
| (I) Net profit from continuing operations (“-” for net losses) | 558,523,604.93 | 327,449,763.07 | |
| (II) Net profit from discontinuing |
| operations (“-” for net losses) | |||
| V. Other comprehensive income, net of tax | |||
| (I) Other comprehensive income that cannot be reclassified into profit and loss | |||
| 1. Changes arising from the re-measurement of defined benefit plans | |||
| 2. Other comprehensive income that cannot be reclassified into profit or loss under the equity method | |||
| 3. Changes in the fair value of other investments in equity instrument | |||
| 4. Changes in the fair value of the Company's own credit risks | |||
| (II) Other comprehensive income that will be reclassified into profit or loss | |||
| 1. Other comprehensive income that can be reclassified into profit or loss under the equity method | |||
| 2. Changes in the fair value of other debt investments | |||
| 3. Amount of financial assets reclassified into other comprehensive income | |||
| 4. Credit impairment provisions of other debt investments | |||
| 5. Cash flow hedging reserve | |||
| 6. Conversion differences of financial statements denominated in foreign currencies | |||
| 7. Others | |||
| VI. Total comprehensive income | 558,523,604.93 | 327,449,763.07 | |
| VII. Earnings per share: | |||
| (I) Basic earnings per share (RMB/share) | |||
| (II) Diluted earnings per share (RMB/share) | |||
The chairman of the Company: HOU Juncheng CFO of the Company: WANG LiHead of Accounting Department: WANG Li
Consolidated Cash Flow Statement
January to June 2024
Unit: Yuan Currency: RMB
| Item | Notes | H1 2024 | H1 2023 |
| I. Cash flows from operating activities: | |||
| Cash receipts from sales of goods and rendering of services | 5,188,493,822.96 | 4,012,341,644.34 | |
| Net increase in customer deposits and deposits from banks and other financial institutions | |||
| Net increase in borrowings from the central bank | |||
| Net increase in placements from other financial institutions | |||
| Cash receipts from premiums under original insurance contracts | |||
| Net cash receipts from reinsurance business | |||
| Net increase in deposits and investments from policyholders | |||
| Cash receipts from interest, fees and commissions | |||
| Net increase in placements from banks and other financial institutions | |||
| Net increase of returned business capital | |||
| Net cash receipts from securities trading agency services | |||
| Receipts of tax refunds | 706,235.61 | ||
| Other cash receipts relating to operating activities | VII. 78 | 95,696,427.87 | 139,316,229.94 |
| Subtotal of cash inflows from operating activities | 5,284,896,486.44 | 4,151,657,874.28 | |
| Cash payments for goods purchased and services received | 1,428,665,826.98 | 799,703,317.01 | |
| Net increase in loans and advances to customers | |||
| Net increase in deposits with the central bank and other financial institutions | |||
| Cash paid for compensation | |||
| payments under original insurance contract | |||
| Net increase in placements with banks and other financial institutions | |||
| Cash payments for interest, fees and commissions | |||
| Cash payments for policy dividends | |||
| Cash payments to and on behalf of employees | 435,062,730.66 | 338,318,620.54 | |
| Taxes and fees paid | 578,999,517.56 | 462,196,371.81 | |
| Other cash payments relating to operating activities | VII. 78 | 2,180,065,616.85 | 1,370,171,492.89 |
| Subtotal of cash outflows from operating activities | 4,622,793,692.05 | 2,970,389,802.25 | |
| Net cash flows from operating activities | 662,102,794.39 | 1,181,268,072.03 | |
| II. Cash flows from investing activities: | |||
| Cash receipts from returns on investments | |||
| Cash receipts from investments income | 5,570,000.01 | ||
| Net cash receipts from disposal of fixed assets, intangible assets and other long-term assets | 1,831,479.00 | 338,439.51 | |
| Net cash receipts from the disposal of subsidiaries and other operating entities | 3,018,142.61 | ||
| Other cash receipts relating to investing activities | VII. 78 | 300,000,000.00 | |
| Subtotal of cash inflows from investing activities | 307,401,479.01 | 3,356,582.12 | |
| Cash payments for purchase and construction of fixed assets, intangible assets and other long-term assets | 114,207,206.03 | 99,314,112.66 | |
| Cash payments for investments | 6,818,181.82 | ||
| Net increase in pledged loans | |||
| Net cash payments for acquisition of subsidiaries and other operating entities | |||
| Other cash payments relating to investing activities | |||
| Subtotal of cash outflows | 114,207,206.03 | 106,132,294.48 | |
| from investing activities | |||
| Net cash flows from investing activities | 193,194,272.98 | -102,775,712.36 | |
| III. Cash flows from financing activities: | |||
| Cash receipts from capital contributions | 125,051.00 | ||
| Including: Cash receipts by subsidiaries from minority shareholders’ investment | 125,051.00 | ||
| Cash receipts from borrowings | 100,000,000.00 | ||
| Other cash receipts relating to financing activities | |||
| Subtotal of cash inflows from financing activities | 125,051.00 | 100,000,000.00 | |
| Cash payments for debt repayment | 100,000,000.00 | ||
| Cash payments for distribution of dividends, profits or payment of interest expenses | 352,238,406.92 | 249,213,328.27 | |
| Including: Dividends and profits paid by subsidiaries to minority shareholders | |||
| Other cash payments relating to financing activities | VII. 78 | 156,733,266.64 | 3,017,591.46 |
| Subtotal of cash outflows from financing activities | 508,971,673.56 | 352,230,919.73 | |
| Net cash flows from financing activities | -508,846,622.56 | -252,230,919.73 | |
| IV. Effect of changes in foreign exchange rates on cash and cash equivalents | -131,551.25 | 1,269,633.36 | |
| V. Net increase in cash and cash equivalents | 346,318,893.56 | 827,531,073.30 | |
| Add: Opening balance of cash and cash equivalents | 3,659,267,712.03 | 3,125,333,085.05 | |
| VI. Closing balance of cash and cash equivalents | 4,005,586,605.59 | 3,952,864,158.35 | |
The chairman of the Company: HOU Juncheng CFO of the Company: WANG LiHead of Accounting Department: WANG Li
Parent Company's Cash Flow Statement
January to June 2024
Unit: Yuan Currency: RMB
| Item | Notes | H1 2024 | H1 2023 |
| I. Cash flows from operating activities: | |||
| Cash receipts from sales of goods and rendering of services | 2,462,318,871.31 | 2,184,341,066.74 | |
| Receipts of tax refunds | |||
| Other cash receipts relating to operating activities | 41,149,587.80 | 103,874,829.15 | |
| Subtotal of cash inflows from operating activities | 2,503,468,459.11 | 2,288,215,895.89 | |
| Cash payments for goods purchased and services received | 1,120,239,457.41 | 559,795,926.80 | |
| Cash payments to and on behalf of employees | 221,756,428.15 | 153,659,418.21 | |
| Taxes and fees paid | 320,479,322.60 | 200,776,457.67 | |
| Other cash payments relating to operating activities | 534,201,388.16 | 338,218,749.52 | |
| Subtotal of cash outflows from operating activities | 2,196,676,596.32 | 1,252,450,552.20 | |
| Net cash flows from operating activities | 306,791,862.79 | 1,035,765,343.69 | |
| II. Cash flows from investing activities: | |||
| Cash receipts from returns on investments | 25,686,259.80 | 2,540,410.44 | |
| Cash receipts from investments income | 5,570,000.01 | ||
| Net cash receipts from disposal of fixed assets, intangible assets and other long-term assets | 1,119,759.00 | ||
| Net cash receipts from the disposal of subsidiaries and other operating entities | |||
| Other cash receipts relating to investing activities | 300,000,000.00 | ||
| Subtotal of cash inflows from investing activities | 332,376,018.81 | 2,540,410.44 | |
| Cash payments for purchase and construction of fixed assets, intangible assets and other long-term assets | 112,494,647.56 | 96,289,876.84 | |
| Cash payments for investments | 5,550,640.00 | 11,318,181.82 | |
| Net cash payments for acquisition of subsidiaries and other operating entities | |||
| Other cash payments relating to investing activities | |||
| Subtotal of cash outflows from investing activities | 118,045,287.56 | 107,608,058.66 | |
| Net cash flows from investing activities | 214,330,731.25 | -105,067,648.22 | |
| III. Cash flows from financing activities: | |||
| Cash receipts from capital contributions | |||
| Cash receipts from borrowings | 100,000,000.00 | ||
| Other cash receipts relating to financing activities | |||
| Subtotal of cash inflows from financing activities | 100,000,000.00 | ||
| Cash payments for debt repayment | 100,000,000.00 | ||
| Cash payments for distribution of dividends, profits or payment of interest expenses | 352,238,406.92 | 249,213,328.27 | |
| Other cash payments relating to financing activities | 155,580,389.64 | 2,500,055.46 | |
| Subtotal of cash outflows from financing activities | 507,818,796.56 | 351,713,383.73 | |
| Net cash flows from financing activities | -507,818,796.56 | -251,713,383.73 | |
| IV. Effect of changes in foreign exchange rates on cash and cash equivalents | |||
| V. Net increase in cash and cash equivalents | 13,303,797.48 | 678,984,311.74 | |
| Add: Opening balance of cash and cash equivalents | 2,472,028,148.09 | 2,138,929,716.12 | |
| VI. Closing balance of cash and cash equivalents | 2,485,331,945.57 | 2,817,914,027.86 | |
The chairman of the Company: HOU Juncheng CFO of the Company: WANG LiHead of Accounting Department: WANG Li
Consolidated Statements of Changes in Owners' Equity
January to June 2024
Unit: Yuan Currency: RMB
| Item | H1 2024 | ||||||||||||||
| Equity attributable to owners of the parent company | Minority interests | Total equity attributable to owners | |||||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profits | Others | Subtotal | |||||
| Preference shares | Perpetual bonds | Others | |||||||||||||
I. Closing balanceof the previousyear
| I. Closing balance of the previous year | 396,757,184.00 | 50,893,986.60 | 864,150,974.43 | 146,966,735.61 | -53,847,100.91 | 198,411,582.50 | 3,040,145,490.59 | 4,349,545,381.60 | 50,765,849.41 | 4,400,311,231.01 |
Add: Changes inaccountingpolicies
| Add: Changes in accounting policies |
Correction forprevious errors
| Correction for previous errors |
Others
| Others |
II. Openingbalance of thecurrent year
| II. Opening balance of the current year | 396,757,184.00 | 50,893,986.60 | 864,150,974.43 | 146,966,735.61 | -53,847,100.91 | 198,411,582.50 | 3,040,145,490.59 | 4,349,545,381.60 | 50,765,849.41 | 4,400,311,231.01 |
III. Increase ordecrease in thecurrent period (“-”for decrease)
| III. Increase or decrease in the current period (“-” for decrease) | 231.00 | -1,559.11 | 889,428.89 | 151,692,295.26 | -131,551.25 | 343,070,246.55 | 192,134,500.82 | 22,385,952.40 | 214,520,453.22 |
(I) Totalcomprehensiveincome
| (I) Total comprehensive income | -131,551.25 | 701,671,374.89 | 701,539,823.64 | 22,260,901.40 | 723,800,725.04 |
(II) Owner'scontribution andcapital reduction
| (II) Owner's contribution and capital reduction | 231.00 | -1,559.11 | 889,428.89 | 153,062,220.18 | -152,174,119.40 | 125,051.00 | -152,049,068.40 |
1. Ordinary shares
contributed byowners
| 1. Ordinary shares contributed by owners | 125,051.00 | 125,051.00 |
2. Capital
contributions byother equityinstrumentholders
| 2. Capital contributions by other equity instrument holders |
3. Amount of
| 3. Amount of | 886,255.50 | 886,255.50 | 886,255.50 |
| Item | H1 2024 | ||||||||||||||
| Equity attributable to owners of the parent company | Minority interests | Total equity attributable to owners | |||||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profits | Others | Subtotal | |||||
| Preference shares | Perpetual bonds | Others | |||||||||||||
share-basedpayments creditedto owners' equity
share-basedpayments creditedto owners' equity
4. Others
| 4. Others | 231.00 | -1,559.11 | 3,173.39 | 153,062,220.18 | -153,060,374.90 | -153,060,374.90 |
(III) Profitdistribution
| (III) Profit distribution | -1,369,924.92 | -358,601,128.34 | -357,231,203.42 | -357,231,203.42 |
1. Withdrawal of
surplus reserve
| 1. Withdrawal of surplus reserve |
2. Withdrawal of
general riskreserve
| 2. Withdrawal of general risk reserve |
3. Distribution to
owners (orshareholders)
| 3. Distribution to owners (or shareholders) | -1,369,924.92 | -358,601,128.34 | -357,231,203.42 | -357,231,203.42 |
4. Others
| 4. Others |
(IV) Internalcarry-forward ofowners' equity
| (IV) Internal carry-forward of owners' equity |
1. Transfer of
capital reserve tocapital (or sharecapital)
| 1. Transfer of capital reserve to capital (or share capital) |
2. Transfer of
surplus reserve tocapital (or sharecapital)
| 2. Transfer of surplus reserve to capital (or share capital) |
3. Surplus reserve
to cover loss
| 3. Surplus reserve to cover loss |
4. Changes in
defined benefitscheme carriedforward toretained earnings
| 4. Changes in defined benefit scheme carried forward to retained earnings |
5. Other
comprehensiveincome carried
| 5. Other comprehensive income carried |
| Item | H1 2024 | ||||||||||||||
| Equity attributable to owners of the parent company | Minority interests | Total equity attributable to owners | |||||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profits | Others | Subtotal | |||||
| Preference shares | Perpetual bonds | Others | |||||||||||||
forward toretained earnings
forward toretained earnings
6. Others
| 6. Others |
(V) Specialreserve
| (V) Special reserve |
1. Withdrawal for
the period
| 1. Withdrawal for the period |
2. Utilization for
the period
| 2. Utilization for the period |
(VI) Others
| (VI) Others |
IV. Closingbalance for thecurrent period
| IV. Closing balance for the current period | 396,757,415.00 | 50,892,427.49 | 865,040,403.32 | 298,659,030.87 | -53,978,652.16 | 198,411,582.50 | 3,383,215,737.14 | 4,541,679,882.42 | 73,151,801.81 | 4,614,831,684.23 |
| Item | H1 2023 | ||||||||||||||
| Equity attributable to owners of the parent company | Minority interests | Total equity attributable to owners | |||||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profits | Others | Subtotal | |||||
| Preference shares | Perpetual bonds | Others | |||||||||||||
I. Closing balance of theprevious year
| I. Closing balance of the previous year | 283,519,469.00 | 50,903,510.12 | 914,815,786.22 | 164,976,000.00 | -1,918,603.07 | 141,759,734.50 | 2,300,384,763.19 | 3,524,488,659.96 | 12,734,670.33 | 3,537,223,330.29 |
Add: Changes in accountingpolicies
| Add: Changes in accounting policies |
Correction for previous errors
| Correction for previous errors |
Others
| Others |
II. Opening balance of thecurrent year
| II. Opening balance of the current year | 283,519,469.00 | 50,903,510.12 | 914,815,786.22 | 164,976,000.00 | -1,918,603.07 | 141,759,734.50 | 2,300,384,763.19 | 3,524,488,659.96 | 12,734,670.33 | 3,537,223,330.29 |
III. Increase or decrease in thecurrent period (“-” fordecrease)
| III. Increase or decrease in the current period (“-” for decrease) | 113,409,046.00 | -8,099.98 | -63,364,387.97 | -1,827,000.00 | 1,269,633.36 | 252,831,302.78 | 305,964,494.19 | 26,667,100.99 | 332,631,595.18 |
(I) Total comprehensive
| (I) Total comprehensive | 1,269,633.36 | 499,493,997.71 | 500,763,631.07 | 28,774,323.51 | 529,537,954.58 |
| Item | H1 2023 | ||||||||||||||
| Equity attributable to owners of the parent company | Minority interests | Total equity attributable to owners | |||||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profits | Others | Subtotal | |||||
| Preference shares | Perpetual bonds | Others | |||||||||||||
income
income(II) Owner's contribution andcapital reduction
| (II) Owner's contribution and capital reduction | 910.00 | -8,099.98 | 50,088,937.85 | -1,827,000.00 | 51,908,747.87 | 51,908,747.87 |
1. Ordinary shares contributed
by owners
| 1. Ordinary shares contributed by owners | -1,827,000.00 | 1,827,000.00 | 1,827,000.00 |
2. Capital contributions by
other equity instrument holders
| 2. Capital contributions by other equity instrument holders |
3. Amount of share-based
payments credited to owners'equity
| 3. Amount of share-based payments credited to owners' equity | 49,961,246.32 | 49,961,246.32 | 49,961,246.32 |
4. Others
| 4. Others | 910.00 | -8,099.98 | 127,691.53 | 120,501.55 | 120,501.55 |
(III) Profit distribution
| (III) Profit distribution | -246,662,694.93 | -246,662,694.93 | -246,662,694.93 |
1. Withdrawal of surplus
reserve
| 1. Withdrawal of surplus reserve |
2. Withdrawal of general risk
reserve
| 2. Withdrawal of general risk reserve |
3. Distribution to owners (or
shareholders)
| 3. Distribution to owners (or shareholders) | -246,662,694.93 | -246,662,694.93 | -246,662,694.93 |
4. Others
| 4. Others |
(IV) Internal carry-forward ofowners' equity
| (IV) Internal carry-forward of owners' equity | 113,408,136.00 | -113,408,136.00 |
1. Transfer of capital reserve to
capital (or share capital)
| 1. Transfer of capital reserve to capital (or share capital) | 113,408,136.00 | -113,408,136.00 |
2. Transfer of surplus reserve to
capital (or share capital)
| 2. Transfer of surplus reserve to capital (or share capital) |
3. Surplus reserve to cover loss
| 3. Surplus reserve to cover loss |
4. Changes in defined benefit
scheme carried forward toretained earnings
| 4. Changes in defined benefit scheme carried forward to retained earnings |
5. Other comprehensive income
carried forward to retainedearnings
| 5. Other comprehensive income carried forward to retained earnings |
| Item | H1 2023 | ||||||||||||||
| Equity attributable to owners of the parent company | Minority interests | Total equity attributable to owners | |||||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | General risk reserve | Undistributed profits | Others | Subtotal | |||||
| Preference shares | Perpetual bonds | Others | |||||||||||||
6. Others
| 6. Others |
(V) Special reserve
| (V) Special reserve |
1. Withdrawal for the period
| 1. Withdrawal for the period |
2. Utilization for the period
| 2. Utilization for the period |
(VI) Others
| (VI) Others | -45,189.82 | -45,189.82 | -2,107,222.52 | -2,152,412.34 |
IV. Closing balance for thecurrent period
| IV. Closing balance for the current period | 396,928,515.00 | 50,895,410.14 | 851,451,398.25 | 163,149,000.00 | -648,969.71 | 141,759,734.50 | 2,553,216,065.97 | 3,830,453,154.15 | 39,401,771.32 | 3,869,854,925.47 |
| The chairman of the Company: HOU Juncheng | CFO of the Company: WANG Li | Head of Accounting Department: WANG Li |
Statement of Changes in Owners' Equity of the Parent Company
January to June 2024
Unit: Yuan Currency: RMB
| Item | H1 2024 | ||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profits | Total equity attributable to owners | |||
| Preference shares | Perpetual bonds | Others | |||||||||
I. Closing balance of the previous year
| I. Closing balance of the previous year | 396,757,184.00 | 50,893,986.60 | 917,524,533.21 | 146,966,735.61 | -53,180,700.00 | 198,411,582.50 | 2,416,408,547.32 | 3,779,848,398.02 |
Add: Changes in accounting policies
| Add: Changes in accounting policies |
Correction for previous errors
| Correction for previous errors |
Others
| Others |
II. Opening balance of the current year
| II. Opening balance of the current year | 396,757,184.00 | 50,893,986.60 | 917,524,533.21 | 146,966,735.61 | -53,180,700.00 | 198,411,582.50 | 2,416,408,547.32 | 3,779,848,398.02 |
III. Increase or decrease in the currentperiod (“-” for decrease)
| III. Increase or decrease in the current period (“-” for decrease) | 231.00 | -1,559.11 | 889,428.88 | 151,692,295.26 | 199,922,476.59 | 49,118,282.10 |
| Item | H1 2024 | ||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profits | Total equity attributable to owners | |||
| Preference shares | Perpetual bonds | Others | |||||||||
(I) Total comprehensive income
| (I) Total comprehensive income | 558,523,604.93 | 558,523,604.93 |
(II) Owner's contribution and capitalreduction
| (II) Owner's contribution and capital reduction | 231.00 | -1,559.11 | 889,428.88 | 153,062,220.18 | -152,174,119.41 |
1. Ordinary shares contributed by
owners
| 1. Ordinary shares contributed by owners |
2. Capital contributions by other equity
instrument holders
| 2. Capital contributions by other equity instrument holders |
3. Amount of share-based payments
credited to owners' equity
| 3. Amount of share-based payments credited to owners' equity | 886,255.49 | 886,255.49 |
4. Others
| 4. Others | 231.00 | -1,559.11 | 3,173.39 | 153,062,220.18 | -153,060,374.90 |
(III) Profit distribution
| (III) Profit distribution | -1,369,924.92 | -358,601,128.34 | -357,231,203.42 |
1. Withdrawal of surplus reserve
| 1. Withdrawal of surplus reserve |
2. Distribution to owners (or
shareholders)
| 2. Distribution to owners (or shareholders) | -1,369,924.92 | -358,601,128.34 | -357,231,203.42 |
3. Others
| 3. Others |
(IV) Internal carry-forward of owners'equity
| (IV) Internal carry-forward of owners' equity |
1. Transfer of capital reserve to capital
(or share capital)
| 1. Transfer of capital reserve to capital (or share capital) |
2. Transfer of surplus reserve to capital
(or share capital)
| 2. Transfer of surplus reserve to capital (or share capital) |
3. Surplus reserve to cover loss
| 3. Surplus reserve to cover loss |
4. Changes in defined benefit scheme
carried forward to retained earnings
| 4. Changes in defined benefit scheme carried forward to retained earnings |
5. Other comprehensive income carried
forward to retained earnings
| 5. Other comprehensive income carried forward to retained earnings |
6. Others
| 6. Others |
(V) Special reserve
| (V) Special reserve |
| Item | H1 2024 | ||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profits | Total equity attributable to owners | |||
| Preference shares | Perpetual bonds | Others | |||||||||
1. Withdrawal for the period
| 1. Withdrawal for the period |
2. Utilization for the period
| 2. Utilization for the period |
(VI) Others
| (VI) Others |
IV. Closing balance for the currentperiod
| IV. Closing balance for the current period | 396,757,415.00 | 50,892,427.49 | 918,413,962.09 | 298,659,030.87 | -53,180,700.00 | 198,411,582.50 | 2,616,331,023.91 | 3,828,966,680.12 |
| Item | H1 2023 | ||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profits | Total equity attributable to owners | |||
| Preference shares | Perpetual bonds | Others | |||||||||
I. Closing balance of the previous year
| I. Closing balance of the previous year | 283,519,469.00 | 50,903,510.12 | 964,613,342.84 | 164,976,000.00 | 141,759,734.50 | 2,001,098,149.06 | 3,276,918,205.52 |
Add: Changes in accounting policies
| Add: Changes in accounting policies |
Correction for previous errors
| Correction for previous errors |
Others
| Others |
II. Opening balance of the current year
| II. Opening balance of the current year | 283,519,469.00 | 50,903,510.12 | 964,613,342.84 | 164,976,000.00 | 141,759,734.50 | 2,001,098,149.06 | 3,276,918,205.52 |
III. Increase or decrease in the currentperiod (“-” for decrease)
| III. Increase or decrease in the current period (“-” for decrease) | 113,409,046.00 | -8,099.98 | -63,340,763.87 | -1,827,000.00 | 80,787,068.14 | 132,674,250.29 |
(I) Total comprehensive income
| (I) Total comprehensive income | 327,449,763.07 | 327,449,763.07 |
(II) Owner's contribution and capitalreduction
| (II) Owner's contribution and capital reduction | 910.00 | -8,099.98 | 50,088,937.85 | -1,827,000.00 | 51,908,747.87 |
1. Ordinary shares contributed by
owners
| 1. Ordinary shares contributed by owners | -1,827,000.00 | 1,827,000.00 |
2. Capital contributions by other
equity instrument holders
| 2. Capital contributions by other equity instrument holders |
3. Amount of share-based payments
credited to owners' equity
| 3. Amount of share-based payments credited to owners' equity | 49,961,246.32 | 49,961,246.32 |
4. Others
| 4. Others | 910.00 | -8,099.98 | 127,691.53 | 120,501.55 |
(III) Profit distribution
| (III) Profit distribution | -246,662,694.93 | -246,662,694.93 |
| Item | H1 2023 | ||||||||||
| Paid-up capital (or share capital) | Other equity instruments | Capital reserve | Less: Treasury shares | Other comprehensive income | Special reserve | Surplus reserve | Undistributed profits | Total equity attributable to owners | |||
| Preference shares | Perpetual bonds | Others | |||||||||
1. Withdrawal of surplus reserve
| 1. Withdrawal of surplus reserve |
2. Distribution to owners (or
shareholders)
| 2. Distribution to owners (or shareholders) | -246,662,694.93 | -246,662,694.93 |
3. Others
| 3. Others |
(IV) Internal carry-forward of owners'equity
| (IV) Internal carry-forward of owners' equity | 113,408,136.00 | -113,408,136.00 |
1. Transfer of capital reserve to capital
(or share capital)
| 1. Transfer of capital reserve to capital (or share capital) | 113,408,136.00 | -113,408,136.00 |
2. Transfer of surplus reserve to
capital (or share capital)
| 2. Transfer of surplus reserve to capital (or share capital) |
3. Surplus reserve to cover loss
| 3. Surplus reserve to cover loss |
4. Changes in defined benefit scheme
carried forward to retained earnings
| 4. Changes in defined benefit scheme carried forward to retained earnings |
5. Other comprehensive income
carried forward to retained earnings
| 5. Other comprehensive income carried forward to retained earnings |
6. Others
| 6. Others |
(V) Special reserve
| (V) Special reserve |
1. Withdrawal for the period
| 1. Withdrawal for the period |
2. Utilization for the period
| 2. Utilization for the period |
(VI) Others
| (VI) Others | -21,565.72 | -21,565.72 |
IV. Closing balance for the currentperiod
| IV. Closing balance for the current period | 396,928,515.00 | 50,895,410.14 | 901,272,578.97 | 163,149,000.00 | 141,759,734.50 | 2,081,885,217.20 | 3,409,592,455.81 |
| The chairman of the Company: HOU Juncheng | CFO of the Company: WANG Li | Head of Accounting Department: WANG Li |
III. General Information about the Company
1. Company profile
√Applicable □Not applicable
Proya Cosmetics Co., Ltd. (hereinafter referred to as “Company” or the “Company”), formerly known asProya (Huzhou) Cosmetics Co., Ltd., was registered in Huzhou Municipal Administration for Industryand Commerce on May 24, 2006. The Company is headquartered in Hangzhou, Zhejiang Province. TheCompany currently holds a business license with unified social credit code of 91330100789665033F,with a registered capital of RMB396,756,973.00 and paid-in capital of RMB396,757,415.00 (an increaseof RMB442.00 due to pending industrial and commercial changes related to the conversion ofconvertible bonds). Among these, there are 1,957,060 A shares with restrictions in circulation, and394,800,355 A shares that are not subject to restrictions in circulation. The shares of the Company werelisted for trading on SSE on November 15, 2017.The Company is a beauty and personal care company mainly engaged in cosmetics research anddevelopment, production, and sales.The financial statements were approved for external disclosure by the 19th meeting of the third sessionof the Board of Directors on August 26, 2024.
IV. Preparation Basis of Financial Statements
1. Preparation basis
The financial statements of the Company are prepared on the going-concern basis.
2. Going concern
√Applicable □Not applicable
There are no matters or situations that may substantially affect the going-concern ability of the Companywithin 12 months since the end of the Reporting Period.
V. Significant Accounting Policies and Accounting EstimatesNotes to specific accounting policies and accounting estimates:
√Applicable □Not applicable
Important notes: The Company has formulated specific accounting policies and estimates fortransactions or events related to impairment of financial instruments, inventories, depreciation of fixedassets, construction in progress, intangible assets, and revenue recognition based on the actualproduction and operation characteristics.
1. Statement of compliance with accounting standards for business enterprisesThe financial statements have been prepared by the Company in compliance with the China AccountingStandards for Business Enterprises, and give an accurate and complete view of the Company's financialposition, operating results, changes in shareholders' equity, cash flow and other related information.
2. Accounting period
The accounting year of the Company is from January 1 to December 31 of each calendar year.
3. Operating cycle
√Applicable □Not applicable
The operating cycle of the Company's businesses is short; the Company adopts 12 months as theliquidity classification criteria for assets and liabilities.
4. Functional currency
The Company and our domestic subsidiaries use RMB as the functional currency, while our overseassubsidiaries, such as Hapsode Co., Ltd., Hanna Cosmetics Co., Ltd., and OR Off&Relax choose thecurrency of the main economic environment in which they operate as the functional currency since theyengage in overseas operations.
5. Determination method and selection basis of importance criteria
√Applicable □Not applicable
| Item | Importance criteria |
| Accounts receivable | The Company recognizes accounts receivable that individually exceed 0.3% of the total assets as important accounts receivable. |
| Receivables financing | The Company recognizes receivables financing that individually exceed 0.3% of the total assets as important receivables financing. |
| Other receivables | The Company recognizes other receivables that individually exceed 0.3% of the total assets as important other receivables. |
| Important prepayments aged over one year | The Company recognizes prepayments that individually exceed 0.3% of the total assets as important prepayments. |
| Important construction in progress | The Company recognizes construction in progress that individually exceeds 0.3% of the total assets as important construction in progress. |
| Important accounts payable aged over one year | The Company recognizes accounts payable that individually exceed 0.3% of the total assets as important accounts payable. |
| Important receipts in advance aged over one year or overdue | The Company recognizes receipts in advance that individually exceed 0.3% of the total assets as important receipts in advance. |
| Important contract liabilities aged over one year | The Company recognizes contract liabilities that individually exceed 0.3% of the total assets as important contract liabilities. |
| Important other payables aged over one year | The Company recognizes other payables that individually exceed 0.3% of the total assets as important other payables. |
| Important estimated liabilities | The Company recognizes estimated liabilities that individually exceed 0.3% of the total assets as important estimated liabilities. |
| Item | Importance criteria |
| Important cash flows from investing activities | The Company recognizes cash flows from investing activities that individually exceed 5% of the total assets as important cash flows from investing activities. |
| Important overseas operating entities | The Company recognizes overseas operating entities with absolute value of contribution to total profit that exceeds 5% of the absolute value of consolidated total profits as important overseas operating entities. |
| Important subsidiaries and non wholly-owned subsidiaries | The Company recognizes subsidiaries with absolute value of contribution to total profits that exceeds 5% of the absolute value of consolidated total profits as important subsidiaries or important non-wholly-owned subsidiaries. |
| Significant joint ventures, associates and joint operation | The Company recognizes joint ventures, associates and joint operations with absolute value of contribution to total profits that exceeds 5% of the absolute value of consolidated total profits as important joint ventures, associates and joint operations. |
| Important contingencies | The Company recognizes contingencies that have an impact on balance sheet items exceeding 1% of total assets or an impact on income statement items exceeding 5% of total profits as important contingencies. |
| Important commitments |
The Company recognizes commitments that have animpact on balance sheet items exceeding 1% of totalassets or an impact on income statement itemsexceeding 5% of total profits as importantcommitments.
| Important events after the balance sheet date | The Company recognizes events after the balance sheet date that have an impact on balance sheet items exceeding 1% of total assets or an impact on income statement items exceeding 5% of total profits as important events after the balance sheet date. |
6. Accounting treatment of business combination under or not under common control
√Applicable □Not applicable
1. Accounting treatment of business combination under common control
The assets and liabilities acquired by the Company through business combination are measured at thecarrying value of the combined party in the consolidated financial statements of the ultimate controllingparty at the combination date. The Company adjusts the capital reserve in accordance with the differencebetween the carrying value share of the owner’s equity of the combined party in the consolidatedfinancial statements of the ultimate controlling party and the carrying value of the consideration paid for
the business combination or the total nominal value of the issued shares. If the capital reserve is notsufficient to offset the difference, the retained earnings will be adjusted.
2. Accounting treatment of business combination not under common control
Where the cost of combination is higher than the fair value share of the net identifiable assets acquiredfrom the acquiree in the combination on the acquisition date, the Company recognizes such difference asgoodwill. Where the cost of combination is lower than the fair value share of the net identifiable assetsacquired from the acquiree in the combination on the acquisition date, the measurement of the acquiredfair value of the acquiree's identifiable assets, liabilities or contingent liabilities, as well as the cost ofcombination shall be rechecked. If the cost of combination remains lower than the fair value share of thenet identifiable assets acquired from the acquiree in the combination after the recheck, the differenceshall be included in current profit or loss.
7. Criteria for judgment of control and preparation of consolidated financial statements
√Applicable □Not applicable
1. Judgment of control
Control is having the power over the invested party, enjoying variable returns through participating inrelated activities of the invested party, and having the ability to use the power over the invested party toinfluence its variable return amount.
2. Preparation of consolidated financial statements
(1) The parent company incorporates all subsidiaries under its control into the consolidation scope of theconsolidated financial statements. The consolidated financial statements are based on the financialstatements of the parent company and its subsidiaries, and prepared by the parent company inaccordance with the Accounting Standards for Business Enterprises No. 33 - Consolidated FinancialStatements.
(2) Accounting treatment of acquisition and disposal of or disposal and acquisition of equity of the samesubsidiary in two consecutive accounting yearsThe acquisition of the equity of the acquiree is to control its operating and financial policies and toobtain long-term benefits from its operating activities. When the right to control the acquiree is acquired,it is included in the consolidation scope of the consolidated financial statements. Due to changes in theCompany's business plans and arrangements, if the equity of the acquiree is disposed of in the secondfiscal year to the point of losing control over it, the acquiree will be excluded from the consolidationscope of the consolidated financial statements when the control is lost.
8. Classification of joint arrangement and accounting treatment for joint operation
√Applicable □Not applicable
1. Joint arrangement can be divided into joint operation and joint venture.
2. When the Company is involved in a joint operation, the following items related to the share of interestin joint operation are recognized:
(1) The solely-held assets, and jointly owned assets according to the shareholding;
(2) The solely-assumed liabilities, and jointly undertaken liabilities according to the shareholding;
(3) Income incurred from disposing of the Company's share of output under the joint operation;
(4) Income incurred from disposing of assets of joint operation according to the Company's share;
(5) The solely-incurred expenses, and expenses incurred from joint operation according to theCompany's share.
9. Standards for determination of cash and cash equivalents
Cash presented in the cash flow statement refers to cash on hand and deposits that can be readilywithdrawn on demand. Cash equivalents refer to the short-term and highly liquid investments that arereadily convertible to known amounts of cash and subject to an insignificant risk of change in value.
10. Foreign currency transactions and translation of foreign-currency statements
√Applicable □Not applicable
1. Translation of foreign currency transactions
Foreign currency transactions are translated into RMB at the approximate rate of the spot rate on thetransaction date during initial recognition. On the balance sheet date, the foreign currency monetaryitems are translated based on the spot rate on the balance sheet date. The exchange difference arisingfrom the different exchange rate is included in current profit or loss, except the exchange differencebetween the principal and interest of the foreign currency borrowed for meeting the capitalizationrequirements. The foreign currency non-monetary items measured at historical cost are also translatedbased on the approximate rate of the spot rate on the transaction date, and the RMB amount is notchanged. The foreign currency non-monetary items measured at fair value are translated based on thespot rate on the determination date of the fair value, and the difference is included in current profit orloss or other comprehensive income.
2. Translation of foreign currency financial statements
Assets and liabilities items in the balance sheet are translated at the spot rates prevailing at the balancesheet date. Owners' equity items other than “undistributed profits” are translated at the spot rates on thetransaction dates. Income and expense items in the income statement are translated at the approximaterates of the spot rates on the transaction dates. Any balance incurred from the translation of foreigncurrency financial statements by the above method is included in other comprehensive income.
11. Financial instruments
√Applicable □Not applicable
1. Classification of financial assets and financial liabilities
Financial assets are classified into the following three categories during initial recognition: (1) financialassets measured at amortized cost; (2) financial assets measured at fair value with changes included inother comprehensive income; (3) financial assets measured at fair value with changes included in currentprofit or loss.Financial liabilities are divided into the following four categories during initial recognition: (1) financialliabilities measured at fair value with changes included in current profit or loss; (2) financial liabilitiesfrom failure of transfer of financial assets to meet the derecognition conditions or continued involvementin transferred financial assets; (3) financial guarantee contracts not belonging (1) or (2) above, and loancommitments that are given at a rate lower than the market interest rate, and not in the case described in
(1) above; (4) financial liabilities measured at amortized cost.
2. Recognition basis, measurement method and derecognition conditions for financial assets andfinancial liabilities
(1) Recognition basis and initial measurement method for financial assets and financial liabilitiesOne financial asset or financial liability is recognized when the Company becomes one party of afinancial instrument contract. The financial assets or financial liabilities are measured at the fair valueduring initial recognition. For financial assets and financial liabilities measured at fair value withchanges included in current profit or loss, relevant transaction expenses are directly included in current
profit or loss; for other kinds of financial assets or financial liabilities, relevant transaction expenses areincluded in the amount of initial recognition. However, where the accounts receivable initiallyrecognized by the Company do not contain a significant financing component or the Company does notconsider the financing component in the contract of less than one year, the initial measurement is madeaccording to the transaction price defined in the Accounting Standards for Business Enterprises No. 14 -Revenue.
(2) Subsequent measurement of financial assets
1) Financial assets measured at amortized cost
Such financial assets are subsequently measured at amortized cost using the effective interest method.The gains and losses incurred by the financial assets measured at amortized cost but not belonging toany hedging relationship are included in current profit or loss during derecognition, reclassification andamortization according to the effective interest method or impairment recognition.
2) Debt instrument investment measured at fair value with changes included in other comprehensiveincomeThe method of subsequent measurement at the fair value is adopted. The interest, impairment losses orgains, and exchange gains and losses based on the effective interest method are included in current profitor loss, and other gains or losses are included in other comprehensive income. During derecognition, theaccumulated gains or losses previously included in other comprehensive income are transferred fromother comprehensive income to the current profit or loss.
3) Equity instrument investment measured at fair value with changes included in other comprehensiveincomeThe method of subsequent measurement at the fair value is adopted. The dividends obtained (except forthe part from investment cost recovery) shall be included in current profit or loss, and other gains orlosses are included in other comprehensive income. During derecognition, the accumulated gains orlosses previously included in other comprehensive income are transferred from other comprehensiveincome and included in retained earnings.
4) Financial assets measured at fair value with changes included in current profit or lossSuch financial assets are subsequently measured at fair value. The generated gains or losses (includinginterest and dividend income) are included in current profit or loss, unless the financial assets belong topart of a hedging relationship.
(3) Subsequent measurement of financial liabilities
1) Financial liabilities measured at fair value with changes included in current profit or lossSuch financial liabilities include financial liabilities held for trading (including derivative instrumentsbelonging to financial liabilities) and those designated as financial liabilities measured at fair value withchanges included in current profit or loss. For such financial liabilities are subsequently measured at fairvalue. The fair value changes of financial liabilities measured at fair value with change included incurrent profit or loss due to an adjustment in the Company's own credit risk are included in othercomprehensive income, unless the treatment will cause or enlarge the accounting mismatch in the profitor loss. Other gains or losses generated from such financial liabilities (including interest expense, exceptthe fair value changes arising from the credit risk adjustment of the Company) shall be included incurrent profit or loss, unless the financial liabilities belong to part of the hedging relationship. Duringderecognition, the accumulated gains or losses previously included in other comprehensive income aretransferred from other comprehensive income and included in retained earnings.
2) Financial liabilities from failure of transfer of financial assets to meet the derecognition conditions orcontinued involvement in transferred financial assets
Measurement shall be performed in accordance with the Accounting Standards for Business EnterprisesNo. 23 - Transfer of Financial Assets.
3) Financial guarantee contracts not belonging to 1) or 2) above, and loan commitments that are given ata rate lower than the market interest rate, and not in the case described in 1) aboveThe subsequent measurement is made at the higher one of the following two amounts, after initialrecognition: ① loss provisions determined according to regulations on impairment of financialinstruments; ② balance of the initially recognized amount after deducting cumulative amortizationrecognized in accordance with the regulations set out in the Accounting Standards for BusinessEnterprises No. 14 - Revenue.
4) Financial liabilities measured at amortized cost
Such financial liabilities are measured at amortized cost using the effective interest method. The gainsand losses incurred by the financial liabilities measured at amortized cost but not belonging to anyhedging relationship are included in current profit or loss during derecognition or amortization inaccordance with the effective interest method.
(4) Derecognition of financial assets and financial liabilities
1) Financial assets satisfying one of the following conditions are derecognized:
① The contract right to collect cash flow from the financial assets has been terminated;
② The financial assets have been transferred and such transfer meets the provisions for derecognition offinancial assets in the Accounting Standards for Business Enterprises No. 23 - Transfer of FinancialAssets.
2) When the existing obligations under the financial liabilities (or part thereof) are released, suchfinancial liabilities (or that part thereof) are derecognized.
3. Recognition basis and measurement method for transfer of financial assets
If the Company has transferred almost all the risks and rewards related to the ownership of financialassets, the financial assets are derecognized, and the rights and obligations resulting from or retained inthe transfer are separately recognized as assets or liabilities. In case that almost all the risks and rewardsrelated to the ownership of the financial assets are retained, the recognition of the transferred financialassets is continued. In the case that almost all the risks and rewards related to the ownership of thefinancial assets are neither transferred nor retained, it shall be treated as follows: (1) if control over thefinancial assets is not retained, the financial assets shall be derecognized, and the rights and obligationsresulting from or retained in the transfer are separately recognized as the assets or liabilities; (2) ifcontrol over the financial assets is retained, the relevant financial assets are recognized according to thedegree of continued involvement in the transferred financial assets, and the relevant liabilities arerecognized accordingly.If the transfer of an entire financial asset satisfies the conditions for derecognition, the differencebetween the two amounts below shall be included in current profit or loss: (1) carrying value of thetransferred financial assets at the date of derecognition; (2) the sum of consideration received for thetransfer of the financial asset, plus the corresponding derecognized portion of accumulated change in fairvalue previously included in other comprehensive income (in cases where the transferred financial assetis debt instrument investment measured at fair value with changes included in other comprehensiveincome). If part of the financial asset is transferred and the transfer satisfies the conditions forderecognition, the overall carrying value before the transfer of the financial asset is allocated accordingto their respective relative fair value at the transfer date between the portion of the derecognized part andthe remaining part, and the difference between the two amounts below is included in current profit orloss: (1) carrying value of the derecognized part; (2) the sum of consideration for the derecognized part,plus the corresponding derecognized part of accumulated change in fair value previously included in
other comprehensive income (in cases where the transferred financial assets are debt instrumentinvestments measured at fair value with changes included in other comprehensive income).
4. Method of determining the fair value of financial assets and financial liabilitiesThe Company adopts valuation techniques appropriate to the prevailing circumstances with the supportof sufficient data and other information available, to determine the fair value of relevant financial assetsand financial liabilities. The Company divides the inputs for the estimation technique into the followinglevels and uses them in turn:
(1) The input of the first level is the unadjusted quotation of the same assets or liabilities that can beobtained on the measurement date in the active market;
(2) The input of the second level is the directly or indirectly observable input of related assets orliabilities except the input of the first level, including: the quotation of similar assets or liabilities in anactive market; the quotation of the same or similar assets or liabilities in an inactive market; otherobservable inputs other than quotation, such as the interest rate and yield curves that can be observedduring the normal quotation intervals; and the inputs for market validation;
(3) The input of the third level is the unobservable input of related assets or liabilities, including interestrates that cannot be observed directly or cannot be verified according to observable market data, stockvolatility, future cash flows of retirement obligations borne during the business combination, andfinancial forecasts based on its own data.
5. Impairment of financial instruments
Based on the expected credit loss, the Company carries out accounting treatment for impairment andrecognizes the loss provision for the financial assets measured at amortized cost, the debt instrumentinvestment measured at fair value with changes included in other comprehensive income, contract assets,lease receivables, loan commitment other than financial liabilities measured at fair value with changesincluded in current profit or loss, and the financial guarantee contracts of financial liabilities notmeasured at fair value with changes included in current profit or loss or financial liabilities not fromfailure of transfer of financial assets to meet the derecognition conditions or continued involvement intransferred financial assets.Expected credit loss refers to the weighted average of credit losses of financial instruments weighted bythe risk of default. Credit loss refers to the balance between all contractual cash flows discountedaccording to the original effective interest rate and receivables under contract by the Company and allcash flows expected to be collected, i.e. the present value of all cash shortages. In particular, thepurchased or underlying financial assets of the Company with credit impairment incurred shall bediscounted according to their effective interest rate upon credit adjustment.For purchased or underlying financial assets with credit impairment incurred, only the accumulativechanges in the expected credit loss in the whole duration after initial recognition shall be recognized bythe Company as loss provision on the balance sheet date.For lease receivables, receivables and contract assets from transactions in accordance with theAccounting Standards for Business Enterprises No. 14 - Revenue, excluding significant financingcomponents or without consideration, by the Company, to financing components in the contract of nomore than one year, the Company measures the loss provision according to the amount equal to theexpected credit loss in the whole duration by applying the simplified measurement method.For receivables and contract assets from transactions in accordance with the Accounting Standards forBusiness Enterprises No. 14 - Revenue, excluding significant financing components or withoutconsideration, by the Company, to financing components in the contract of no more than one year, theCompany measures the loss provision according to the amount equal to the expected credit loss in thewhole duration by applying the simplified measurement method.
For financial assets other than the above measurement methods, the Company shall, on each balancesheet date, assess whether their credit risk has increased significantly since initial recognition. If thecredit risk has increased significantly since the initial recognition, the Company will measure the lossprovision based on the amount of expected credit loss in the whole duration; if the credit risk has notsignificantly increased since the initial recognition, the Company will measure the loss provision basedon the amount of expected credit loss for the financial instruments in the next 12 months.The Company determines whether the credit risk of financial instruments has increased significantlysince initial recognition by utilizing the available, reasonable and well-grounded information, includingforward-looking information, and comparing the default risks of the financial instruments on the balancesheet date and on the initial recognition date.If the Company determines that the financial instruments bear a low credit risk on the balance sheet date,it assumes that the credit risk of the financial instruments has not increased significantly since initialrecognition.The Company evaluates the expected credit risk and measures the expected credit loss based on singlefinancial instruments or portfolio of financial instruments. When based on the portfolio of financialinstruments, the Company divides financial instruments into different portfolios on the basis of theircommon risk characteristics.The Company re-measures the expected credit loss on each balance sheet date, and the increased orreversed amount of the loss provision arising therefrom, as losses or gains from impairment, shall beincluded in current profit or loss. For financial assets measured at amortized cost, the loss provisiondeducts the carrying value of the financial assets listed in the balance sheet; for the debt investmentmeasured at fair value with changes included in other comprehensive income, the Company recognizesits loss provision in other comprehensive income without deducting the carrying value of the financialassets.Recognition criteria and accrual methods for expected credit losses on receivables and contract assets:
1) Receivables and contract assets with expected credit losses accrued based on the portfolio of creditrisk characteristics
| Portfolio category | Basis for determining the portfolio | Method for measurement of expected credit loss |
| Bank acceptance notes receivable | Note type | Calculating the expected credit loss by the default risk exposure and the expected credit loss rate in the whole duration by referring to historical experience in credit loss and according to the current situation and the forecast on future economic conditions |
| Accounts receivable - aging portfolio | Account age | Calculating the expected credit loss by preparing a comparison table between age of accounts receivable and expected credit loss rate in referring to historical experience in credit loss and according to the current situation and the forecast on future economic conditions |
| Other receivables - aging portfolio | Account age | Calculating the expected credit loss by preparing a comparison table between age of |
| Portfolio category | Basis for determining the portfolio | Method for measurement of expected credit loss |
| other receivables and expected credit loss rate in referring to historical experience in credit loss and according to the current situation and the forecast on future economic conditions |
2) Comparison table between age of aging portfolio and expected credit loss rate
| Account age | Expected credit loss rate of accounts receivable (%) | Expected credit loss rate of other receivables (%) |
| Within 1 year (inclusive, same for below) | 5.00 | 5.00 |
| 1-2 years | 30.00 | 30.00 |
| 2-3 years | 50.00 | 50.00 |
| Above 3 years | 100.00 | 100.00 |
The aging of accounts receivable/other receivables is calculated from the month in which the amountsare actually incurred.
3) Criteria for identifying receivables and contract assets for which expected credit losses are accrued onan individual basisFor receivables and contract assets with significantly different credit risk and credit risk portfolio, theCompany accrues expected credit losses on an individual basis.
6. Offset of financial assets and financial liabilities
The financial assets and financial liabilities are listed in the balance sheet respectively without offsetting.However, when the following conditions are met, the financial assets and liabilities are presented at thenet amount after mutual offset in the balance sheet: (1) the Company has the legal right of offsetting therecognized amount and such legal right is currently enforceable; (2) the Company plans to settle by netamount or simultaneously realize the financial assets and clear off the financial liabilities.When the financial assets that do not meet the derecognition conditions are transferred, the Companydoes not offset the transferred financial assets with the relevant liabilities.
12. Notes receivable
□Applicable √Not applicable
13. Accounts receivable
√Applicable □Not applicable
Classification and determination basis of portfolios with bad debt provisions accrued by portfolioof credit risk characteristics
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
Calculation of account ages of portfolios of credit risk characteristics recognized on the accountage basis
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
Criteria for judgment of provision for bad debts accrued individually
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
14. Receivables financing
√Applicable □Not applicable
Classification and determination basis of portfolios with bad debt provisions accrued by portfolioof credit risk characteristics
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
Calculation of account ages of portfolios of credit risk characteristics recognized on the accountage basis
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
Criteria for judgment of provision for bad debts accrued individually
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
15. Other receivables
√Applicable □Not applicable
Classification and determination basis of portfolios with bad debt provisions accrued by portfolioof credit risk characteristics
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
Calculation of account ages of portfolios of credit risk characteristics recognized on the accountage basis
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
Criteria for judgment of provision for bad debts accrued individually
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
16. Inventory
√Applicable □Not applicable
Inventory category, issue valuation method, inventory system, amortization of low-valueconsumables and packaging materials
√Applicable □Not applicable
1. Classification of inventories
Inventories include finished goods or commodities held for sale in the ordinary course of business,goods in process during the production, materials and supplies consumed in the course of production andrendering of labor services.
2. Valuation method of delivered inventories
The moving weighted average method is adopted for delivered inventories.
3. Inventory system
The Company adopts a perpetual inventory system.
4. Amortization of low-value consumables and packaging materials
(1) Low-value consumables
Amortization is performed by the immediate write-off method.
(2) Packaging materials
Amortization is performed by the immediate write-off method.
Recognition criteria and accrual methods of inventory depreciation reserves
√Applicable □Not applicable
At the balance sheet date, inventories are measured at the lower of cost and net realizable value, andprovision for inventory depreciation is made based on the difference between a cost and its net realizablevalue. The net realizable value of inventories directly for sale is determined by the amount of theestimated selling price after deducting the estimated selling expenses and relevant taxes during theordinary course of production and business; the net realizable value of inventories required to beprocessed is determined by the amount of the estimated selling price of the finished products afterdeducting the estimated cost to be incurred to completion, the estimated selling expenses and relevanttaxes during the ordinary course of production and business. On the balance sheet date, the net realizablevalue is determined separately for the two parts of the same inventory with or without contract price, andis compared with the relevant costs to separately determine the amount withdrawn or reversed forprovision for inventory depreciation.
Portfolio category and determination basis for accruing inventory depreciation reserves accordingto portfolios, and determination basis for the net realizable value of different categories ofinventories
□Applicable √Not applicable
Calculation method and determination basis for the net realizable value of each inventory ageportfolio based on the inventory age
□Applicable √Not applicable
17. Contract assets
√Applicable □Not applicable
Recognition methods and standards of contract assets
√Applicable □Not applicable
The rights of the Company to collect consideration from the customer unconditionally (i.e. onlydepending on time) are presented as receivables; the rights (depending on other factors than time) tocollect consideration for transferring goods to the customer are presented as contract assets.
Classification and determination basis of portfolios with bad debt provisions accrued by portfolioof credit risk characteristics
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
Calculation of account ages of portfolios of credit risk characteristics recognized on the accountage basis
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
Criteria for judgment of provision for bad debts accrued individually
√Applicable □Not applicable
Refer to “11. Financial instruments” in “V. Significant Accounting Policies and Accounting Estimates”of “Section X Financial Report” of this report for details.
18. Non-current assets or disposal groups held for sale
□Applicable √Not applicable
Recognition criteria and accounting treatment for non-current assets classified as held for sale ordisposal groups
□Applicable √Not applicable
Identification criteria and presentation methods for discontinued operations
□Applicable √Not applicable
19. Long-term equity investments
√Applicable □Not applicable
1. Joint control and significant influence criterion
Joint control is the contractually agreed sharing of control of an arrangement. It exists only whendecisions about the relevant activities of the arrangement require the unanimous consent of the partiessharing control. Significant influence refers to the power to participate in the decision-making processon the financial and operating policies of the investee. It cannot control or jointly control the formulationof such policies with other parties.
2. Determination of investment cost
(1) For business combination under common control: where the merging party pays cash, transfersnon-cash assets, bears debts or issues equity securities as consideration of the combination, the initialinvestment cost is the share with reference to the carrying value of the owners' equity of the acquiree inthe consolidated financial statements of the ultimate controlling party on the date of combination. Thedifference between the initial investment cost of long-term equity investment and the carrying value ofthe consideration paid for the combination or total nominal value of the issued shares is adjusted tocapital reserve. If the capital reserve is not sufficient to offset the difference, the retained earnings areadjusted.The Company judges whether the item is a “package deal” via long-term equity investment formed bybusiness combination under common control through multiple transactions. For the “package deal”,multiple deals are subject to accounting treatment as one deal with control rights having been acquired.For items that do not belong to the “package deal”, the initial investment cost is determined on the basisof the share with reference to the carrying value of the net assets of the acquiree in the consolidatedfinancial statements of the ultimate controlling party after combination on the date of combination. Thedifference between initial investment cost of long-term equity investment at the date of combination andthe sum of the carrying amount of long-term equity investment before combination and carrying value ofnewly paid consideration for additional shares acquired on the date of combination is to adjust capitalreserve. If the capital reserve is insufficient to offset the difference, the retained earnings are adjusted.
(2) For the business combination not under common control, the fair value of consideration paid forcombination is regarded as the initial investment cost on the acquisition date.For the long-term equity investment achieved by the Company via business combination not undercommon control through several transactions, the relevant accounting treatment is based on individualfinancial statements or consolidated financial statements:
1) In individual financial statements, the initial investment cost calculated by the cost method instead isthe sum of the carrying value of the equity investment originally held and the newly increasedinvestment cost.
2) In the consolidated financial statements, the item is determined whether it is a “package deal”. For the“package deal”, multiple deals are subject to accounting treatment as one deal with control rights havingbeen acquired. For items that do not belong to the “package deal”, the equity of the acquiree held beforethe acquisition date is re-measured at the fair value of this equity on the acquisition date, and thedifference between the fair value and its carrying value is included in the current investment income. Ifthe equity of the acquiree held before the acquisition date is related to other comprehensive incomeunder the equity method, the other related comprehensive income is converted into the current incomeon the acquisition date, excluding the other comprehensive income derived from changes of netliabilities or net assets due to re-measurement on defined benefit plan by the investee.
(3) For cases other than business combination: if it is acquired with cash, the initial investment cost shallbe the actual payment. If it is acquired through issuing equity securities, the initial investment cost is thefair value of the equity securities in issue. If it is acquired through debt restructuring, the initialinvestment cost is determined based on the Accounting Standards for Business Enterprises No. 12 - DebtRestructuring. If it is acquired through the exchange of non-monetary assets, the initial investment costis determined based on the Accounting Standards for Business Enterprises No. 7 - Exchange ofNon-monetary Assets.
3. Subsequent measurement and recognition of profit or loss
For long-term equity investment controlled by the investee, the cost method is adopted for accounting.For the long-term equity investment of associates and joint ventures, the equity method is adopted foraccounting.
4. Treatment of step-by-step disposal through several transactions until the loss of control of investmentin subsidiaries
(1) Principles for determining whether a transaction is a “package deal”
In the event of a step-by-step disposal of equity investments in subsidiaries through several transactionsuntil the loss of control, the Company determines whether the step-by-step transaction is a “package deal”by taking into account the terms of the transaction agreement for each step of the step-by-steptransaction, the disposal consideration obtained, the object of the disposal, the method of disposal, andthe point of time of the disposal, among other information. The terms, conditions and economic effectsof individual transactions generally indicate that multiple transactions are a “package deal” when one ormore of the following conditions are met:
1) These transactions were entered into simultaneously or after considering the effects of each other;
2) These transactions constituted a complete commercial result as a whole;
3) One transaction was conditional upon at least one of the other transaction;
4) One transaction was not economical on its own but was economical when considering together withother transactions.
(2) Accounting treatment that is not a “package deal”
1) Individual financial statements
For disposal of equity, the difference between the carrying value and the consideration actually receivedis included in current profit or loss. The accounting of remaining equity is completed by the equitymethod in case of significant influence on the investee or implementation of joint control with otherparties. However, in case of no control, joint control or significant influence on the investee, theaccounting of remaining equity must comply with the relevant provisions of the Accounting Standardsfor Business Enterprises No.22 - Recognition and Measurement of Financial Instruments.
2) Consolidated financial statements
Before the loss of control, the difference between the price of disposal and the subsidiary's share of netassets entitled from the disposal of long-term equity investment cumulatively calculated from theacquisition date or the date of merger, is adjusted to capital reserve (capital premium). If the capitalpremium is insufficient to offset the difference, the retained earnings are adjusted.When control over the original subsidiary is lost, the remaining equity is re-measured at fair value as atthe date on which the control is lost. The difference between the sum of the consideration received fromequity disposal and the fair value of the remaining equity minus the share of the net assets of the originalsubsidiary proportionate to the original shareholding accumulated from the date of acquisition or mergeris included in investment gains of the period during which the control is lost, and meanwhile, thegoodwill is offset. Other comprehensive income related to the equity investment in the originalsubsidiary is transferred to investment gains of the period during which the control is lost.
(3) Accounting treatment belonging to “package deal”
1) Individual financial statements
Accounting treatment is made by taking each transaction as one transaction disposing the subsidiary andlosing the control right. However, the difference between the amount received each time for disposalbefore the control is lost and the carrying value of the long-term equity investment corresponding to thedisposal of investment is recognized as other comprehensive income in the individual financialstatements, and is transferred to profit or loss of the period during which the control is lost upon loss ofcontrol.
2) Consolidated financial statements
Accounting treatment is made by taking each transaction as one transaction disposing the subsidiary andlosing the control right. However, the difference between the amount received each time for disposal
before the control is lost and the net assets of said subsidiary corresponding to the disposal of investmentis recognized as other comprehensive income in the consolidated financial statements, and is transferredto profit or loss of the period during which the control is lost upon loss of control.
20. Investment property
(1). In case of cost measurement model:
Depreciation or amortization method
1. Investment property includes leased land use rights, land use rights held for transfer upon appreciation,and rental buildings.
2. The cost method is employed for initial measurement of investment property, and cost model forsubsequent measurement. Depreciation or amortization shall be withdrawn using the same method asthat for fixed assets and intangible assets.
21. Fixed assets
(1). Conditions for recognition
√Applicable □Not applicable
Fixed assets are tangible assets that are held for the sake of production of goods, rendering of services,lease or business management, with a service life of more than one accounting year. A fixed asset isrecognized when related economic benefits are likely to flow into the Company and the cost of this fixedasset can be measured reliably.
(2). Method for depreciation
√Applicable □Not applicable
| Category | Method for depreciation | Useful lives of depreciation (year) | Residual value | Annual depreciation rate |
| Houses and buildings | Straight-line method | 10 or 30 | 5% | 9.50% or 3.17% |
| General equipment | Straight-line method | 3-10 | 5% | 31.67%-9.50% |
| Dedicated equipment | Straight-line method | 5-10 | 5% | 31.67%-9.50% |
| Transportation vehicles | Straight-line method | 5 | 5% | 19.00% |
22. Construction in progress
√Applicable □Not applicable
1. Construction in progress is recognized when the following conditions are satisfied at the same time:
economic benefits are likely to flow into the Company; and the costs of such construction in progresscan be measured reliably. Construction in progress is measured at the actual cost incurred to make theassets ready for their intended use.
2. Construction in progress is transferred to fixed assets at the actual cost when it meets the expectedcondition for service. When construction in progress has achieved serviceable conditions but final
settlement has not been finished yet, it is first transferred to fixed assets as per estimated value. Afterfinal settlement is finished, the estimated value is adjusted based on actual cost, but the depreciatedamount will not be adjusted.
| Category | Standards and timings for converting construction in progress to fixed assets |
| Dedicated equipment | Meet the design requirements or the standards stipulated in the contract after installation and commissioning |
| Houses and buildings | When the physical construction has been fully completed or substantially completed and can be put into use |
23. Borrowing costs
√Applicable □Not applicable
1. Criteria for recognition of capitalized borrowing costs
For borrowing costs incurred by the Company that are directly attributable to the acquisition andconstruction or production of assets qualified for capitalization, the costs will be capitalized andincluded in the costs of the related assets. Other borrowing costs shall be recognized as expenses as theyare incurred and are included in current profit or loss.
2. Capitalization period of borrowing costs
(1) Capitalization of borrowing costs begins when the following three conditions are fully satisfied: 1)expenditures for the assets have been incurred; 2) borrowing costs have been incurred; 3) acquisition andconstruction or production that are necessary to make the assets ready for the intended use or sale havebegun.
(2) Where abnormal interruption of the assets eligible for capitalization occurs during the acquisition andconstruction or production process and such interruption has lasted for more than 3 consecutive months,the capitalization of borrowing costs is suspended; the borrowing costs during the interruption arerecognized as expenses of the current period till resumption of acquisition and construction orproduction of the assets.
(3) Capitalization of borrowing costs is suspended during periods in which the asset qualified forcapitalization under acquisition and construction or production is ready for the intended use or sale.
3. Capitalization rate and amount of borrowing costs
In case of special borrowing for the acquisition and construction or production of assets meeting thecapitalization conditions, the interest amount to be capitalized is recognized after deducting interestincome earned from the deposits or investment income from the temporary investment funded by theunused borrowing balance (including recognized depreciation or amortization of premium undereffective interest method) actually incurred in the current period of specific borrowing; for generalborrowing occupied for the acquisition and construction or production of assets meeting thecapitalization conditions, the interest amount to be capitalized shall be determined by the result obtainedby multiplying the capitalization rate of occupied general borrowing with the weighted average value ofthe asset expenditure for the accumulated expenditure exceeding the specific borrowing portion.
24. Biological assets
□Applicable √Not applicable
25. Oil and gas assets
□Applicable √Not applicable
26. Intangible assets
(1). Useful life and the basis for its determination, estimation, amortization methods or reviewprocedures
√Applicable □Not applicable
1. Intangible assets, including land use rights, patent rights and non-patented technologies, are initiallymeasured at cost.
2. Intangible assets with limited useful life are amortized systematically and reasonably over their usefullife in accordance with the expected realization method of the economic benefits related to the intangibleassets. If the expected realization method cannot be reliably determined, the straight-line method is usedfor amortization. The specific information is shown as below:
| Item | Useful life (year) | Determination basis of useful life | Amortization method |
| Land use rights | 40 or 50 | Estimated useful life | Straight-line method |
| Non-patented technologies | 5 | Estimated useful life | Straight-line method |
| Office software | 3-10 | Estimated useful life | Straight-line method |
| Patent right | 5 | Estimated useful life | Straight-line method |
| Customer resources | 3 | Estimated income life | Straight-line method |
| Trademark rights | 10 | Estimated useful life | Straight-line method |
(2). Collection scope of R&D expenditures and related accounting treatment
√Applicable □Not applicable
1. Collection scope of R&D expenditures
(1) Labor costs
Labor costs include salaries, basic endowment insurance premiums, basic medical insurance premiums,unemployment insurance premiums, work-related injury insurance premiums, maternity insurancepremiums and housing provident funds of the Company's R&D personnel, as well as labor costs ofexternal R&D personnel.If R&D personnel serve multiple R&D projects at the same time, the labor costs are allocatedproportionally among different R&D projects based on the working hour records of R&D personnel ofvarious R&D projects provided by the management department of the Company.If the personnel directly engaged in R&D activities and external R&D personnel are also engaged innon-R&D activities, the Company will allocate the actual labor costs between R&D expenses andproduction & operation expenses by adopting reasonable methods such as the proportion of actualworking hours based on the working hour records of R&D personnel at different positions.
(2) Direct input cost
Direct input costs refer to the relevant expenses actually incurred by the Company for theimplementation of R&D activities, including: 1) costs of directly consumed materials, fuel and power; 2)
development and manufacturing expenses of molds and process equipment used for intermediate testsand product trial production, purchase expenses of samples, prototypes and general testing means whichdo not constitute fixed assets, and inspection expenses of trial production products; 3) expenses foroperation, maintenance, adjustment, inspection, testing and repair of instruments and equipment used forR&D activities.
(3) Depreciation expenses and long-term deferred expenses
Depreciation expenses refer to the depreciation expenses of instruments, equipment and buildings in usefor R&D activities.If the instruments, equipment and buildings in use for R&D activities are also used for non-R&Dactivities, the use of such instruments, equipment and buildings in use are recorded as necessary, and thedepreciation expenses actually incurred are allocated between R&D expenses and production &operation expenses in a reasonable way based on the actual working hours, usable area and other factors.Long-term deferred expenses refer to the long-term deferred expenses incurred in the process ofreconstruction, modification, decoration and repair of R&D facilities, which are collected according tothe actual expenditures and amortized evenly by stages within the prescribed period.
(4) Amortization expenses of intangible assets
Amortization expenses of intangible assets refer to the amortization expenses of software, intellectualproperty rights and non-patented technologies (including proprietary technology, licenses, designs andcalculation methods) used for R&D activities.
(5) Entrusted external R&D expenses
Entrusted external R&D expenses refer to the expenses incurred by the Company in entrusting otherinstitutions or individuals at home and abroad to carry out R&D activities (the results of R&D activitiesare owned by the Company and closely related to the Company's main operations).
(6) Others expenses
Other expenses refer to other expenses directly related to R&D activities other than the above expenses,including costs of technical books and materials, data translation fees, expert consultation fees, high-techR&D insurance premiums, retrieval, demonstration, evaluation, appraisal and acceptance fees of R&Dresults, intellectual property application fees, registration fees, agency fees, conference fees, travelexpenses, and communication fees.
2. Expenses incurred during the research phase of internal R&D projects are included in current profit orloss when actually incurred. Expenses incurred during the development phase of internal R&D projectsare recognized as intangible assets when all of the following conditions are satisfied: (1) it is technicallyfeasible to complete the intangible assets so that it will be available for use or sale; (2) there is anintention to complete the intangible assets for use or sale; (3) the intangible assets can produce economicbenefits, including that there is evidence that the products produced using the intangible assets has amarket or the intangible assets itself has a market; if the intangible assets is for internal use, there isevidence that there exists usage for the intangible assets; (4) there is sufficient support in terms oftechnology, financial resources and other resources in order to complete the development of theintangible assets, and there is capability to use or sell the intangible assets; (5) the expenses attributableto the development phase of the intangible assets can be measured reliably.
27. Impairment of long-term assets
√Applicable □Not applicable
For such long-term assets as long-term equity investment, investment properties measured by the costmodel, fixed assets, construction in progress, right-of-use assets and intangible assets with limited useful
life, in case that there are signs indicating impairment on the balance sheet date, the recoverable amountshall be estimated. Whether there is a sign of impairment or not, the goodwill acquired in the businesscombination and intangible assets with indefinite useful life is tested for impairment each year. Theimpairment test on goodwill is carried out in combination with its related asset group or asset groupportfolio.In case the recoverable amount of the above long-term assets is less than its carrying value, the provisionfor asset impairment is recognized according to its differences and included in current profit or loss.
28. Long-term deferred expenses
√Applicable □Not applicable
The long-term deferred expenses involve all expenses already paid with amortization period of morethan 1 year (excluding 1 year). Long-term deferred expenses are recorded at the actual amount incurredand are amortized equally over the period of benefit or over a specified period. If the long-term deferredexpenses cannot provide benefit to future accounting periods, then all of the amortized value of theunamortized long-term deferred expenses are transferred into current profit or loss.
29. Contract liabilities
√Applicable □Not applicable
The Company recognizes the obligation to transfer goods to customers for the consideration received orreceivable from the customers as contract liabilities.
30. Employee remuneration
(1). Accounting treatment for short-term remuneration
√Applicable □Not applicable
During the accounting period when employees provide service for the Company, the short-termremuneration actually incurred will be recognized as liabilities, and will be included in current profit orloss or the costs of the related assets.
(2). Accounting treatment for post-employment benefits
√Applicable □Not applicable
Post-employment benefits are divided into the defined contribution plan and defined benefit plan.
(1) During the accounting period when employees provide service for the Company, the amount to bedeposited as calculated according to the defined contribution plan shall be recognized as liabilities, andwill be included in current profit or loss or the costs of the related assets.
(2) The accounting treatment for the defined benefit plan generally comprises the following steps:
1) According to the expected cumulative benefit unit method, the demographic variables, financialvariables, etc. shall be estimated through unbiased and mutually consistent actuarial assumption, so as tomeasure the obligations arising from the defined benefit plan and determine the period of relevantobligations. In addition, the obligations generated from the defined benefit plan shall be discounted, soas to determine the present value of defined benefit plan obligations and current service cost;
2) In case of assets in the defined benefit plan, the deficit or surplus generated from the present value ofobligations of the defined benefit plan minus the fair value of the assets of defined benefit plan isrecognized as net liabilities or net assets in the defined benefit plan. When the defined benefit plan has a
surplus, the net assets of the defined benefit plan are measured at the lower of the surplus of the definedbenefit plan and the asset caps;
3) At the end of the period, the employee remuneration costs generated by the defined benefit plan arerecognized as three parts, i.e., service costs, net interest of the net liabilities or net assets of the definedbenefit plan, and the changes generated by re-measurement of the net liabilities or net assets of thedefined benefit plan, in which the service costs and the net interest of the net liabilities or net assets ofthe defined benefit plan are included in current profit or loss or the costs of the related assets, and thechanges generated by re-measurement of the net liabilities or net assets of the defined benefit plan areincluded in other comprehensive income, and cannot be reversed to profit or loss in the subsequentaccounting period. However, the amount recognized in other comprehensive income can be transferredwithin the equity scope.
(3). Accounting treatment for termination benefits
√Applicable □Not applicable
If termination benefits are provided to employees, the employee remuneration liabilities arising from thetermination benefits are recognized on the earlier date of the following and included in current profit orloss: (1) when the Company cannot unilaterally withdraw the termination benefits provided due totermination of labor relation plan or layoff proposal; (2) when the Company recognizes the cost orexpenses related to the restructuring involving payment of termination benefits.
(4). Accounting treatment for other long-term employees' benefits
√Applicable □Not applicable
Other long-term employee benefits satisfying the conditions in the defined contribution plan are treatedin accounting as stipulated in the defined contribution plan; and other long-term benefits beyond that aretreated in accounting as stipulated in the defined contribution plan. In order to simplify relatedaccounting treatment, the generated employee remuneration costs are recognized as the service cost. Thetotal net amount of item composed of the net interest of net liabilities or net assets of other long-termemployee benefits and the changes generated from re-measuring net liabilities or net assets of otherlong-term employee benefits is included in current profit or loss or the costs of the related assets.
31. Estimated liabilities
√Applicable □Not applicable
1. The obligations imposed by contingencies, such as providing external guarantee, lawsuits, productquality assurance and onerous contracts, become the current obligations assumed by the Company,which are determined by the Company as estimated liabilities when their performance is very likely toresult in economic benefit outflow from the Company and their amount can be measured reliably.
2. The estimated liabilities are initially measured by the Company based on the optimal estimate to bepaid for performing relevant current obligations and their carrying value are reviewed on the balancesheet date.
32. Share-based payments
√Applicable □Not applicable
1. Types of share-based payments
There are equity-settled and cash-settled share-based payments.
2. Relevant accounting treatment of implementing, modifying and terminating the share-based paymentscheme
(1) Equity-settled share-based payments
These equity-settled share-based payments vested immediately after the grant date and exchanged foremployee services shall be included in relevant costs or expenses as per the fair value of the equityinstruments on the grant date, and the capital reserve shall be adjusted accordingly. For equity-settledshare-based payments that are vested only after the services within the waiting period are completed orthe specified performance conditions are satisfied and that are exchanged for employee services, theservices acquired in the current period are included in relevant costs or expenses as per the fair value ofthe equity instruments on the grant date based on the optimal estimate of the number of vesting equityinstruments on each balance sheet date within the waiting period, and the capital reserve is adjustedaccordingly.The equity-settled share-based payments exchanged for services of other parties are measured as per thefair value of the services of other parties on the date of acquisition if its reliable measurement is possible.If the reliable measurement of the fair value of other parties' services is impossible, but that of the equityinstruments is possible, it will be measured as per the fair value of the equity instruments on the date ofacquiring the services and are included in relevant costs or expenses, and the owner's equity is increasedaccordingly.
(2) Cash-settled share-based payments
These cash-settled share-based payments vested immediately after the grant date and exchanged foremployee services shall be included in relevant costs or expenses as per the fair value of the liabilitiesassumed by the Company on the grant date, and the liabilities shall be increased accordingly. For thesecash-settled share-based payments that are vested only after the services within the waiting period arecompleted or the specified performance conditions are satisfied and that are exchanged for employeeservices, the services acquired in the current period shall be included in relevant costs or expenses andcorresponding liabilities as per the fair value of the liabilities assumed by the Company based on theoptimal estimate of the vesting conditions on each balance sheet date within the waiting period.
(3) Modifying and terminating the share-based payment scheme
If the modification increases the fair value of the granted equity instruments, the Company recognizesthe increase of the acquired services according to the increase of the fair value of the equity instruments.If the modification increases the number of the granted equity instruments, the Company recognizes theincreased fair value of the equity instruments as the increase of the acquired services accordingly. If theCompany modifies the vesting conditions in a way favorable to employees, the Company considers themodified vesting conditions when dealing with the vesting conditions.If the modification decreases the fair value of the granted equity instruments, the Company continues torecognize the amount of the acquired services according to the fair value of the equity instruments on thegrant date, without taking into account the decrease of the fair value of the equity instruments. If themodification decreases the number of the granted equity instruments, the Company treats the decreasedpart as cancellation of the granted equity instruments. If the Company modifies the vesting conditions ina way unfavorable to employees, the Company will not consider the modified vesting conditions whendealing with the vesting conditions.If the Company cancels or settles the granted equity instruments within the waiting period (other thanthe cancellation arising from failure to meet the vesting conditions), the cancellation or settlement isregarded as accelerated vesting treatment to immediately recognize the amount that should berecognized within the remaining waiting period.
33. Preference shares, perpetual bonds and other financial instruments
√Applicable □Not applicable
According to the relevant standards for financial instruments, for financial instruments such asconvertible corporate bonds issued, the Company shall classify these financial instruments or theircomponents as financial assets, financial liabilities or equity instruments during initial recognition, basedon the contractual terms of the financial instruments issued and the economic substance they reflect, notonly in legal form, but in combination with the definitions of financial assets, financial liabilities orequity instruments.On the balance sheet date, for financial instruments classified as equity instruments, the accountingtreatment for interest expense or dividend distribution as the Company's profit distribution, and forrepurchase, cancellation, etc. as changes in equity is carried out; for financial instruments classified asfinancial liabilities, the accounting treatment for interest expense or dividend distribution as borrowingcosts is carried out, and the gains or losses from repurchase or redemption are included in current profitor loss.
34. Revenue
(1). Accounting policy applied for recognition and measurement of revenues disclosed by businesstype
√Applicable □Not applicable
1. Revenue recognition principle
The Company shall, on the commencement date of the contract, evaluate the contract, identify theindividual performance obligations provided in the contract and determine whether to perform themwithin a period or at a time point.The performance obligations shall be deemed to be performed within a period if one of the followingconditions is satisfied, otherwise, it will be deemed to be performed at a time point: (1) the customeracquires and consumes the economic benefits brought by the Company's performance while theCompany is performing its obligations; (2) the customer is capable to control the commodities inprogress during the Company's performance; (3) the commodities produced during the Company'sperformance have irreplaceable purpose and the Company has the right to collect the amounts for theperformance part already completed to date within the whole contract term.For the obligations performed within a period, the Company shall recognize the revenue according to theperformance progress in that period. If the performance progress cannot be determined in a reasonableway, but the incurred costs are expected to be reimbursed, the revenue shall be recognized according tothe incurred amount of costs until the performance progress can be determined in a reasonable way. Forthe obligations performed at a time point, the revenue shall be recognized at the time of the customer'sacquiring the control of related commodities or services. The Company shall take into account thefollowing when judging whether the customer has acquired the commodity control: (1) the Company hasthe current right for collection, namely the customer has the current obligation for payment with respectto the commodity; (2) the Company has transferred the legal title of the commodity to the customer,namely the customer has possessed the legal title of the commodity; (3) the Company has transferred thephysical commodity to the customer, namely the customer has physical possession of the commodity; (4)the Company has passed the main risks and return on the commodity's title to the customer, namely thecustomer has acquired the same; (5) the customer has accepted the commodity; and (6) there is otherinformation indicating that the customer has acquired the commodity control.
2. Revenue measurement principle
(1) The Company shall measure the revenue according to the transaction price apportioned to theindividual performance obligations. The transaction price refers to the consideration amount of whichthe Company is expected to have right for collection due to transfer of commodities or services to thecustomer, excluding the amounts charged on behalf of the third party and expected to refund to thecustomer.
(2) In case of variable consideration in the contract, the Company shall determine the optimal estimateof the variable consideration according to the expected value or the amount most likely to be incurred,while the transaction price including the variable consideration shall not exceed the amount under thecircumstance where the accumulatively recognized revenue will be highly unlikely to suffer majorreversal when relevant uncertainties are eliminated.
(3) In case of major financing composition in the contract, the Company shall determine the transactionprice according to the payable amount assumed to be paid by the customer in cash immediately after heacquires the control of the commodities or services. The difference between the transaction price and thecontract consideration shall be amortized by the effective interest method within the contract term. If theCompany expects, on the commencement date of the contract, that the interval between the customer'sacquisition of the control of the commodities or services and its payment is not more than one year, themajor financing composition in the contract shall not be taken into account.
(4) In case of two or more performance obligations in the contract, the Company shall, on thecommencement date of the contract, apportion the transaction price to the individual performanceobligations according to the relative proportion of the individual sales price of the commoditiesundertaken as per the individual performance obligations.
(2). Different business models for similar businesses involve different revenue recognition andmeasurement methods
√Applicable □Not applicable
The Company mainly sells cosmetics. It has different sales models classified as distribution, directselling and sales on commission.
(1) Distribution
The sales revenue shall be recognized after the Company delivers the products to the buyer according tothe provisions of the contract and the buyer accepts the same.
(2) Direct selling
The sales revenue shall be recognized after the Company delivers the commodities to the consumer, andthe consumer confirms receipt and makes payment.
(3) Sales on commission
The sales revenue shall be recognized after the Company delivers the products to the commissionedparty according to the provisions of the contract and the commissioned party provides the list of sales oncommission to the Company upon selling the products to others.
35. Contract cost
√Applicable □Not applicable
The incremental cost incurred by the Company for acquiring the contract that is expected to berecoverable, as the contract acquisition cost, shall be recognized as an asset. If the amortization period ofthe contract acquisition cost is no more than one year, it shall be directly included in current profit orloss when incurred.
The cost incurred by the Company for performing the contract that falls out of the standard scope ofrelevant criteria for stock, fixed assets or intangible assets and that satisfies the following conditions, asthe contract performance cost, shall be recognized as an asset:
1. The cost is directly related to one contract acquired currently or as expected, including direct labor,direct materials and manufacturing expenses (or similar), costs expressly borne by the customer andother costs incurred solely in connection with the contract;
2. The cost increases the resources for the Company to perform its obligations in the future;
3. The cost is expected to be recoverable.
The Company shall amortize the assets related to the contract cost on the same basis as for recognizingthe revenue of the commodities or services in connection with the assets and shall be charged to thecurrent profit or loss.If the carrying value of the assets related to the contract cost is higher than the surplus considerationexpected to be acquired for transferring the commodities or services in connection with the assets minusthe cost expected to be incurred, the Company shall make the provision for impairment against theexceeding part and recognize it as the assets impairment loss. If any changes in the factors forimpairment in previous periods make the surplus consideration expected to be acquired for transferringthe commodities or services in connection with the assets minus the cost expected to incur higher thanthe carrying value of the assets, the provision for assets impairment made originally shall be reversedand included in current profit or loss, provided that the reversed carrying value of the assets is no morethan that on the reversal date without making the provision for impairment.
36. Government grants
√Applicable □Not applicable
1. Government grants are recognized when all of the following conditions are satisfied: (1) the Companyis able to meet the conditions attached to the government grants; (2) the Company is able to receive thegovernment grants. In case of government grants as monetary assets, they shall be measured as per theamount received or receivable. In case of government grants as non-monetary assets, they shall bemeasured as per the fair value; in case that the fair value cannot be acquired in a reliable way, they shallbe measured as per the nominal amount.
2. Basis of determination and accounting treatment for government grants related to assetsThese government grants that are used for purchasing and constructing or otherwise forming long-termassets as specified in government documents are classified as government grants related to assets. Incase of no provision in government documents, the government grants shall be determined on the basisof the essential condition required for obtaining the grants, and shall be considered as related to assets ifthe essential condition is purchasing and constructing or otherwise forming long-term assets. Thegovernment grants related to assets shall offset the carrying value of relevant assets or be recognized asdeferred income. If the government grants related to assets are recognized as deferred income, they shallbe included in the profit or loss in a reasonable and systematic way within the useful life of relevantassets. The government grants measured as per the nominal amount shall be directly included in currentprofit or loss. If related assets are sold, transferred, scrapped or damaged before the end of their usefullife, the related deferred income balance unallocated shall be transferred into the current profit or loss ofassets disposal.
3. Basis of determination and accounting treatment for government grants related to incomeThe government grants other than those related to assets are classified as government grants related toincome. If it is difficult to distinguish whether the government grants containing both the part related to
assets and the part related to income are related to assets or income, they shall be entirely classified asthe government grants related to income. The government grants related to income that are used forcompensation for relevant costs or losses in subsequent periods shall be recognized as deferred income,and included in current profit or loss or offset relevant costs in the period in which relevant costs orlosses are recognized; those used for compensation for relevant costs or losses that have incurred shallbe directly included in current profit or loss or offset relevant costs.
4. The government grants related to daily business activities of the Company shall be included in otherincome or offset relevant costs according to the nature of the economic business. The government grantsunrelated to the daily activities of the Company shall be included in non-operating income and expenses.
37. Deferred income tax assets/liabilities
√Applicable □Not applicable
1. According to the difference between the carrying value of the assets and liabilities and their tax basis(if the tax basis of the items recognized not as assets and liabilities can be determined according to theprovisions of the tax law, the difference between that tax basis and their carrying amount), the deferredincome tax assets or liabilities shall be calculated and recognized according to the tax rate applicable inthe period where it is expected to recover the assets or liquidate the liabilities.
2. Deferred income tax assets are recognized to the extent that it is very likely to obtain the taxableincome to deduct the deductible temporary differences. If on the balance sheet date, there are conclusiveevidence proving that it is very likely to obtain sufficient taxable income in future periods to deduct thedeductible temporary differences, the deferred income tax assets not recognized yet in previousaccounting periods shall be recognized.
3. If the carrying value of the deferred income tax assets is reviewed on the balance sheet date and it isvery likely to not obtain sufficient taxable income in future periods to deduct their benefits, the carryingvalue of the deferred income tax assets shall be written down. When it is very likely to obtain sufficienttaxable income, the amount written down shall be reversed.
4. The current income tax and deferred income tax of the Company are included in current profit or lossas the income tax expense or income, except for the income tax arising from the followingcircumstances: (1) business combination; (2) transaction or matters recognized directly in the owner'sequity.
5. Where the following conditions are met simultaneously, the Company will present the deferredincome tax assets and deferred income tax liabilities at the net amount after offset: (1) the Company hasa legal right to settle the current income tax assets and liabilities on a net basis; (2) the deferred incometax assets and liabilities relate to income taxes levied by the same taxation authority on either the sametaxable entity, or different taxable entities. However, in the future, for each significant period of deferredincome tax assets and liabilities being reversed, the involved taxable entity intends to either settle currentincome tax assets and liabilities on a net basis, or to acquire the assets and settle the liabilitiessimultaneously.
38. Lease
√Applicable □Not applicable
Basis of judgment and accounting treatment of the Company as the lessee for short-term leasesand low-value asset leases subject to simplified treatment
√Applicable □Not applicable
On the commencement date of the lease term, the Company recognizes leases with a lease term notexceeding 12 months and no purchase option as short-term leases; leases with low value when individual
leased assets are brand-new assets are recognized as leases of low-value assets. If the Companysubleases or is expected to sublease the leased assets, the original lease is not recognized as a lease oflow-value assets.For all short-term leases and leases of low-value assets, the Company records the lease payments in thecost of related assets or the current profit or loss by straight-line method over each period of the leaseterm.Except for the above-mentioned short-term leases and leases of low-value assets that adopt simplifiedtreatment, the Company recognizes leases as right-of-use assets and lease liabilities, on thecommencement date of the lease term.
(1) Right-of-use assets
Right-of-use assets are initially measured at cost which includes: 1) the initial measurement amount oflease liabilities; 2) the lease payments made on or before the commencement date of the lease term,deducting the amounts related to the lease incentive given if there is a lease incentive; 3) the initial directcosts incurred by the lessee; 4) the estimated costs to be incurred by the lessee to dismantle and removeleased assets, restore the site where the leased assets are located, or restore the leased assets to thecondition agreed upon in the lease terms.The Company depreciates right-of-use assets by the straight-line method. If it can be reasonablydetermined that the ownership of the leased assets will be acquired at the expiration of the lease term,the Company shall accrue depreciation over the remaining useful life of the leased assets. If it cannot bereasonably determined that the ownership of the leased assets can be acquired at the expiration of thelease term, the Company shall accrue depreciation over the lease term or the remaining useful life of theleased assets, whichever is shorter.
(2) Lease liabilities
On the commencement date of the lease term, the Company recognizes the present value of theoutstanding lease payments as lease liabilities. When calculating the present value of lease payments, theinterest rate implicit in the lease is used as the discount rate. If the interest rate implicit in the leasecannot be determined, the Company's incremental borrowing rate is used as the discount rate. Thedifference between the lease payment and its present value is regarded as the unrecognized financingexpense, and the interest expense is recognized in each period of the lease term according to the discountrate of the present value of the recognized lease payment, and is included in current profit or loss.Variable lease payments that are not included in the measurement of lease liabilities are included incurrent profit or loss when actually incurred.After the commencement date of the lease term, when there is a change in the actual amount of fixedpayment, a change in the estimated payable amount of the guaranteed residual value, a change in theindex or ratio used to determine the lease payment amount, or a change in the evaluation result or actualexercise of the purchase option, renewal option or termination option, the Company re-measures thelease liabilities according to the present value of the changed lease payments, and adjusts the carryingvalue of the right-of-use assets accordingly. If the carrying value of the right-of-use assets has beenreduced to zero, but the lease liabilities still need to be further reduced, the remaining amount shall beincluded in current profit or loss.
Classification and accounting treatment of the Company as the lessor for leases
√Applicable □Not applicable
On the commencement date of the lease term, the Company classifies the leases that have almost all therisks and rewards related to the ownership of the leased assets substantially transferred as financialleases, and other leases as operating leases.
(1) Operating lease
During each period of the lease term, the Company recognizes the lease receipts as rental income by thestraight-line method, capitalizes the initial direct expenses incurred and amortizes the expenses on thesame basis as for rental income recognition, to be included in current profit or loss in installments. Thevariable lease payments obtained by the Company related to operating leases but not included in thelease receipts are included in current profit or loss when actually incurred.
(2) Financial lease
On the commencement date of the lease term, the Company recognizes the financial lease receivablesbased on the net lease investment (the sum of the unguaranteed residual value and the present value ofthe lease receipts that have not been received on the commencement date of the lease term discounted atthe interest rate implicit in the lease), and derecognizes financial lease assets. During each period of thelease term, the Company calculates and recognizes interest income based on the interest rate implicit inthe lease.The variable lease payments received by the Company that are not included in the measurement of netlease investment are included in current profit or loss when actually incurred.
39. Other significant accounting policies and accounting estimates
√Applicable □Not applicable
Accounting treatment related to repurchasing the Company’s sharesIf the Company’s shares are acquired due to reasons such as reducing registered capital or rewardingemployees, the actual amount paid is treated as treasury shares and recorded for future reference. Wherethe repurchased shares are canceled, the difference between the total face value of the shares calculatedbased on the face value and number of canceled shares and the actual amount paid for the repurchasewill be offset against the capital reserve. If the capital reserve is insufficient to be offset, the retainedearnings will be offset. Where the repurchased shares are rewarded to employees of the Company asequity-settled share-based payments, the cost of treasury shares delivered to employees and thecumulative amount of capital reserves (other capital reserves) during the waiting period is charged offwhen employees exercise their rights to purchase shares of the Company and relevant payments arereceived, and the capital reserves (share premium) are also adjusted according to the difference.
40. Changes in significant accounting policies and accounting estimates
(1). Changes in significant accounting policies
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Contents and reasons for changes in accounting policies | Name of statement item affected significantly | Affected amount |
| Since January 1, 2024, the Company has implemented the provisions on “Classification of Current and Non-current Liabilities” in the Interpretation No. 17 of the Accounting Standards for Business Enterprise issued by the Ministry of Finance. | The change of accounting policy has no impact on the Company's financial statements | 0.00 |
| Since January 1, 2024, the Company has implemented the provisions on “Disclosure of | The change of accounting policy has no impact on the Company's | 0.00 |
| Supplier Financing Arrangements” in the Interpretation No. 17 of the Accounting Standards for Business Enterprise issued by the Ministry of Finance. | financial statements | |
| Since January 1, 2024, the Company has implemented the provisions on “Accounting Treatment of Sale and Leaseback Transactions” in the Interpretation No. 17 of the Accounting Standards for Business Enterprise issued by the Ministry of Finance. | The change of accounting policy has no impact on the Company's financial statements | 0.00 |
Other explanationsNone
(2). Changes in significant accounting estimates
□Applicable √Not applicable
(3). Adjustments to financial report at the beginning of the year relating to the initial adoption of
the new accounting standards or interpretation of standards since 2024
□Applicable √Not applicable
41. Others
□Applicable √Not applicable
VI. Taxes
1. Major tax types and tax rates
Particulars on major tax types and tax rates
√Applicable □Not applicable
| Tax type | Taxing basis | Tax rate |
| Value-added tax (VAT) | The output tax is calculated on the basis of the income from sales of products and taxable income from rendering of services calculated according to the provisions of the tax law. The difference between the output tax and the amount after deducting the input tax which is allowed to be deductible in the current period is the payable VAT. | 13%, 9%, 6%, 1% |
| Consumption tax | Taxable sales (volume) | 15% |
| Property tax | In case of ad valorem taxation, it is calculated and paid as per 1.2% of the remaining value after 30% of the original value of the property is deducted in a lump sum; in case of taxation according to lease, it is calculated and paid as per 12% of the rental income. | 12%, 1.2% |
| Urban maintenance and construction | Actual turnover tax paid | 7%, 5% |
| tax | ||
| Education surcharge | Actual turnover tax paid | 3% |
| Surcharge for local education | Actual turnover tax paid | 2% |
| Enterprise income tax | Taxable income | [Note] |
[Note]: Descriptions on tax payers with different enterprise income tax ratesIf there are taxpayers with different enterprise income tax rates, details will be disclosed
√Applicable □Not applicable
| Name of taxpayer | Income tax rate (%) |
| The Company | 15 |
| Hangzhou Proya Trade Co., Ltd. | 25 |
| Anya (Huzhou) Cosmetics Co., Ltd. | 25 |
| Yueqing Laiya Trading Co., Ltd. | 25 |
| Mijing Siyu (Hangzhou) Cosmetics Co., Ltd. | 25 |
| Zhejiang Meiligu Electronic Commerce Co., Ltd. | 25 |
| Huzhou Chuangdai E-commerce Co., Ltd. | 25 |
| Hangzhou CORRECTORS Trade Co., Ltd. | 25 |
| Hapsode (Hangzhou) Cosmetics Co., Ltd. | 25 |
| Huzhou Hapsode Trading Co., Ltd. | 25 |
| Ningbo TIMAGE Cosmetics Co., Ltd. | 25 |
| Zhejiang Beauty Cosmetics Co., Ltd. | 25 |
| Ningbo Tangyu Trading Co., Ltd. | 25 |
| Proya (Zhejiang) Cosmetics Co., Ltd. | 25 |
| Hanna Cosmetics Co., Ltd. | Relevant taxes are calculated and paid according to local tax regulations in South Korea |
| Hapsode Co., Ltd. | Relevant taxes are calculated and paid according to local tax regulations in South Korea |
| Hong Kong Keshi Trading Co., Ltd. | Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China |
| Hong Kong Xinghuo Industry Limited | Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China |
| Hong Kong Wanyan Electronic Commerce Co., Limited | Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China |
| Hong Kong Zhongwen Electronic Commerce Co., Limited | Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China |
| Hong Kong Xuchen Trading Limited | Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China |
| Boya (Hong Kong) Investment Management Co., Limited | Relevant taxes are calculated and paid according to local tax regulations in Hong Kong, China |
| Proya Europe SARL | Relevant taxes are calculated and paid according to local tax regulations in Luxembourg |
| OR Off&Relax | Relevant taxes are calculated and paid according to |
| local tax regulations in Japan | |
| PROYA PTE. LTD | Relevant taxes are calculated and paid according to local tax regulations in Singapore |
| PROYA BEAUTY MALAYSIA SDH. BHD. | Relevant taxes are calculated and paid according to local tax regulations in Malaysia |
| Proya EUROPE SAS | Relevant taxes are calculated and paid according to local tax regulations in France |
| Tax payers other than the above | 20 |
2. Tax preference
√Applicable □Not applicable
The Company passed the high-tech enterprise review on December 8, 2023 and obtained the high-techenterprise certificate, which is valid for 3 years. The preferential period of enterprise income tax is from2023 to 2025. The Company was subject to the enterprise income tax at the preferential rate of 15%during the Reporting Period.According to the Announcement of the Ministry of Finance and the State Taxation Administration onFurther Implementing Preferential Policies of Income Tax for Micro and Small Enterprises(Announcement No. 13 [2022] of the Ministry of Finance and the State Taxation Administration) andthe Announcement on Preferential Policies of Income Tax for Micro and Small Enterprises andIndividual Industrial and Commercial Households (Announcement No. 6 [2023] of the Ministry ofFinance and the State Taxation Administration), the subsidiaries Huzhou Niuke Technology Co., Ltd.,Xuzhou Laibo Information Technology Co., Ltd., Ningbo Jingzhe Cosmetics Co., Ltd., and HangzhouWeiluoke Cosmetics Co., Ltd. meet the tax standards for small low-profit enterprises. Thus, the portionof taxable income not exceeding RMB1 million in the current period is reduced by 25% to be includedin the taxable income and the enterprise income tax is paid by such subsidiaries at the rate of 20%, andthe portion of taxable income exceeding RMB1 million but not exceeding RMB3 million in the currentperiod is also reduced by 25% to be included in the taxable income and the enterprise income tax is alsopaid by such subsidiaries at the rate of 20%.According to the Announcement on Further Implementing the “Six Taxes and Two Fees” Reduction andExemption Policies for Micro and Small Enterprises (Announcement No. 10 [2022] of the Ministry ofFinance and the State Taxation Administration), the subsidiaries Huzhou UZERO Trading Co., Ltd.,Huzhou Keyan Trading Co., Ltd., Hangzhou Proya Commercial Management Co., Ltd., and HangzhouTIMAGE Cosmetics Co., Ltd. meet the tax standards for small and low-profit enterprises or small-scaleVAT taxpayers. Thus, urban maintenance and construction tax, property tax, urban land use tax, stamptax (excluding securities trading stamp tax), farmland occupation tax, education surcharges, orsurcharges for local education shall be subject to the reduced tax rate of 50% or less.According to the Announcement on Exempting Small-Scale Value-Added Tax Taxpayers fromValue-Added Tax (Announcement No. 19 [2023] of the Ministry of Finance and the State TaxationAdministration), the subsidiaries Hangzhou Tielexin Aini Catering Management Co., Ltd. andHangzhou Luxiaotie Fitness Co., Ltd. meet the tax conditions of small-scale VAT taxpayers. Thus,small-scale VAT taxpayers are exempted from VAT if their monthly sales are less than RMB100,000(inclusive), and taxable sales income subject to a 3% levy rate is reduced by 1% levy rate to levy VAT.According to the Circular of the Ministry of Finance, and the State Taxation Administration on theTaxation Policy for Cross-border E-commerce Retail Exports (Cai Shui 〔2013〕 No. 96), thesubsidiaries Hangzhou TIMAGE Cosmetics Co., Ltd. and Hangzhou Oumisi Trading Co., Ltd. meet the
policy conditions for VAT and consumption tax refund (exemption) on export goods for e-commerceexporters, and are eligible to enjoy VAT and consumption tax refund (exemption).
3. Others
□Applicable √Not applicable
VII. Notes to the Items in Consolidated Financial Statements
1. Monetary capital
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Cash on hand | 27,735.67 | 29,332.00 |
| Cash at bank | 3,996,134,295.71 | 3,783,575,412.37 |
| Other monetary capital | 56,638,759.52 | 227,480,813.70 |
| Deposits with finance companies | ||
| Total | 4,052,800,790.90 | 4,011,085,558.07 |
| Of which: Total cash deposited outside China | 90,724,146.54 | 79,895,831.50 |
Other explanationsAt the end of the period, bank deposits subject to restricted use included the fixed-term deposit ofRMB30,000,000.00, the transformer fixed-term deposit of RMB250,000.00, and the L/C deposit ofRMB8,800,000.00, the ETC vehicle deposit of RMB70,000.00, the Pinduoduo deposit ofRMB5,540,922.50, and the Tmall and Alipay deposits of RMB2,553,262.81 in other monetary capital.At the beginning of the period, bank deposits subject to restricted use included the fixed-term deposit ofRMB335,288,251.36, the transformer fixed-term deposit of RMB250,000.00, and the L/C deposit ofRMB8,800,000.00, the ETC vehicle deposit of RMB70,000.00, Pinduoduo deposit of 5,298,890.00, andthe Tmall and Alipay deposits of RMB2,110,704.68 in other monetary capital.
2. Financial assets held for trading
□Applicable √Not applicable
3. Derivative financial assets
□Applicable √Not applicable
4. Notes receivable
(1). Presentation of notes receivable by category
□Applicable √Not applicable
(2). Notes receivable pledged by the Company at the end of the period
□Applicable √Not applicable
(3). Notes receivable endorsed or discounted by the Company at the end of the period and not yetdue on the balance sheet date
□Applicable √Not applicable
(4). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stageNone
Explanation on significant changes in book balance of notes receivable with changes in provision forloss in the current period:
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Information on notes receivable actually written off in the current period
□Applicable √Not applicable
Wherein, information on write-off of important notes receivable:
□Applicable √Not applicable
Explanation on the write-off of notes receivable:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
5. Accounts receivable
(1). Disclosed by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Account age | Closing book balance | Opening book balance |
| Within 1 year | ||
| Including: Sub-items within 1 year | ||
| Within 1 year | 402,151,155.98 | 361,290,118.83 |
| Subtotal within 1 year | 402,151,155.98 | 361,290,118.83 |
| 1-2 years | 1,096,907.60 | 1,358,203.20 |
| 2-3 years | 1,033,446.15 | 787,682.79 |
| Above 3 years | 10,222,217.42 | 12,055,855.34 |
| 3-4 years | ||
| 4-5 years | ||
| Above 5 years | ||
| Total | 414,503,727.15 | 375,491,860.16 |
(2). Disclosed by classification of bad debt provisions
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Category | Closing balance | Opening balance | ||||||||
| Book balance | Provision for bad debts | Book value | Book balance | Provision for bad debts | Book value | |||||
| Amount | Percentage (%) | Amount | Provision ratio (%) | Amount | Percentage (%) | Amount | Provision ratio (%) | |||
| Provision for bad debts accrued individually | 6,674,759.71 | 1.61 | 6,674,759.71 | 100.00 | 8,401,266.23 | 2.24 | 8,401,266.23 | 100.00 | ||
| Including: | ||||||||||
| Provision for bad debts accrued individually | 6,674,759.71 | 1.61 | 6,674,759.71 | 100.00 | 8,401,266.23 | 2.24 | 8,401,266.23 | 100.00 | ||
| Provision for bad debts accrued by portfolio | 407,828,967.44 | 98.39 | 24,506,630.41 | 6.01 | 383,322,337.03 | 367,090,593.93 | 97.76 | 22,520,397.39 | 6.13 | 344,570,196.54 |
| Including: | ||||||||||
| Aging portfolio | 407,828,967.44 | 98.39 | 24,506,630.41 | 6.01 | 383,322,337.03 | 367,090,593.93 | 97.76 | 22,520,397.39 | 6.13 | 344,570,196.54 |
| Total | 414,503,727.15 | / | 31,181,390.12 | / | 383,322,337.03 | 375,491,860.16 | / | 30,921,663.62 | / | 344,570,196.54 |
Provision for bad debts accrued individually:
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Name | Closing balance | |||
| Book balance | Provision for bad debts | Provision ratio (%) | Reason for provision | |
| Provision for bad debts accrued individually | 6,674,759.71 | 6,674,759.71 | 100.00 | Expected to be unrecoverable |
| Total | 6,674,759.71 | 6,674,759.71 | 100.00 | / |
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
√Applicable □Not applicable
Provision by portfolio: aging portfolio
Unit: Yuan Currency: RMB
| Name | Closing balance | ||
| Accounts receivable | Provision for bad debts | Provision ratio (%) | |
| Account age portfolio | 407,828,967.44 | 24,506,630.41 | 6.01 |
| Total | 407,828,967.44 | 24,506,630.41 | 6.01 |
Explanation on provision for bad debts accrued by portfolio:
√Applicable □Not applicable
| Account age | Closing amount | ||
| Book balance | Provision for bad debts | Provision ratio (%) | |
| Within 1 year | 402,151,155.98 | 20,107,557.80 | 5.00 |
| 1-2 years | 1,094,341.19 | 328,302.36 | 30.00 |
| 2-3 years | 1,025,400.05 | 512,700.03 | 50.00 |
| Above 3 years | 3,558,070.22 | 3,558,070.22 | 100.00 |
| Subtotal | 407,828,967.44 | 24,506,630.41 | 6.01 |
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stageNone
Explanation on significant changes in book balance of accounts receivable with changes in provision forloss in the current period:
□Applicable √Not applicable
(3). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Category | Opening balance | Amount of changes in the current period | Closing balance | |||
| Provision | Withdrawal or write-back | Charge-off or write-off | Other changes | |||
| Provision for bad debts accrued individually | 8,401,266.23 | -43,206.74 | 1,683,299.78 | 6,674,759.71 | ||
| Provision for bad debts accrued by portfolio | 22,520,397.39 | 2,503,334.91 | 517,101.89 | 24,506,630.41 | ||
| Total | 30,921,663.62 | 2,460,128.17 | 2,200,401.67 | 31,181,390.12 | ||
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(4). Information on accounts receivable actually written off in the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Written off amount |
| Accounts receivable actually written off | 2,200,401.67 |
Among them, significant accounts receivable that are written off
□Applicable √Not applicable
Explanation on the write-off of the accounts receivable:
□Applicable √Not applicable
(5). Information on accounts receivable and contract assets of the top five closing balances
collected by debtor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Company name | Closing balance of accounts receivable | Closing balance of contract assets | Closing balance of accounts receivable and contract assets | Proportion of total closing balance of accounts receivable and contract assets (%) | Closing balance of provision for bad debts |
| Beijing Jingdong Century Trading Co., Ltd. | 325,159,144.36 | 325,159,144.36 | 78.45 | 16,257,957.22 | |
| Vipshop (China) Co., Ltd. | 43,362,762.04 | 43,362,762.04 | 10.46 | 2,168,138.10 | |
| Zhejiang Haochao Network Technology Co., Ltd. | 8,868,799.73 | 8,868,799.73 | 2.14 | 443,439.99 | |
| BOTANIERA (Hangzhou) Health Technology Co., Ltd. | 4,226,414.46 | 4,226,414.46 | 1.02 | 211,320.72 | |
| Hangzhou Zhishang Technology Co., Ltd. | 4,211,104.29 | 4,211,104.29 | 1.02 | 305,432.53 | |
| Total | 385,828,224.88 | 385,828,224.88 | 93.09 | 19,386,288.56 |
Other explanationsNone
Other explanations:
□Applicable √Not applicable
6. Contract assets
(1). Information on contract assets
□Applicable √Not applicable
(2). Amount of and reasons for significant changes in carrying amount during the Reporting
Period
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stageNone
Explanation on significant changes in book balance of contract assets with changes in provision for lossin the current period:
□Applicable √Not applicable
(4). Information on provision for bad debts of contract assets accrued in the current period
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(5). Information on contract assets actually written off in the current period
□Applicable √Not applicable
Wherein, information on write-off of important contract assets:
□Applicable √Not applicable
Explanation on write-off of contract assets:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
7. Receivables financing
(1). Presentation of receivable financing by category
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Bank acceptance bills | 3,695,843.86 | 7,378,700.06 |
| Total | 3,695,843.86 | 7,378,700.06 |
(2). Receivable financing pledged by the Company at the end of the period
□Applicable √Not applicable
(3). Receivable financing endorsed or discounted by the Company at the end of the period and notyet due on the balance sheet date
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Recognized amount terminated at the end of the period | Recognized amount not terminated at the end of the period |
| Bank acceptance bills | 3,317,243.57 | |
| Total | 3,317,243.57 |
(4). Disclosed by classification of bad debt provisions
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Category | Closing balance | Opening balance | ||||||||
| Book balance | Provision for bad debts | Book value | Book balance | Provision for bad debts | Book value | |||||
| Amount | Percentage (%) | Amount | Provision ratio (%) | Amount | Percentage (%) | Amount | Provision ratio (%) | |||
Provision for baddebts accruedindividually
| Provision for bad debts accrued individually |
Including:
Including:
Provision for baddebts accrued byportfolio
| Provision for bad debts accrued by portfolio | 3,695,843.86 | 100.00 | 3,695,843.86 | 7,378,700.06 | 100.00 | 7,378,700.06 |
Including:
Including:
Bank acceptancebills
| Bank acceptance bills | 3,695,843.86 | 100.00 | 3,695,843.86 | 7,378,700.06 | 100.00 | 7,378,700.06 |
Total
| Total | 3,695,843.86 | / | / | 3,695,843.86 | 7,378,700.06 | / | / | 7,378,700.06 |
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stageNone
Explanation on significant changes in book balance of receivable financing with changes in provision forloss in the current period:
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Information on receivable financing actually written off in the current period
□Applicable √Not applicable
Wherein, write-off of important receivable financing:
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
(7). Information on changes in the current period of receivables financing and changes in fairvalue:
□Applicable √Not applicable
(8). Other explanations:
□Applicable √Not applicable
8. Prepayments
(1). Prepayments are presented by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Account age | Closing balance | Opening balance | ||
| Amount | Percentage (%) | Amount | Percentage (%) | |
| Within 1 year | 252,004,694.35 | 98.47 | 200,521,100.41 | 98.84 |
| 1-2 years | 3,445,144.45 | 1.35 | 1,427,668.59 | 0.70 |
| 2-3 years | 307,256.02 | 0.12 | 383,035.66 | 0.19 |
| Above 3 years | 162,089.27 | 0.06 | 538,390.92 | 0.27 |
| Total | 255,919,184.09 | 100.00 | 202,870,195.58 | 100.00 |
Explanation on reasons why prepayments aged over one year and a significant amount are not settled intime:
None
(2). Information on prepayments of the top five closing balances collected by prepaid objects
√Applicable □Not applicable
| Company name | Book balance | Ratio of balance of prepayment （%） |
| Wuhan Juliang Xingtu Technology Co., Ltd. | 33,179,473.96 | 12.96 |
| Hangzhou Alimama Software Service Co., Ltd. | 30,343,105.11 | 11.86 |
| Shanghai Vision Star Co., Ltd. | 29,641,409.97 | 11.58 |
| Shanghai Zhuiji Information Technology Co., Ltd. | 25,566,592.57 | 9.99 |
| Guangxi Jingdong Qingchuan E-commerce Co., Ltd. | 21,467,458.49 | 8.39 |
| Total | 140,198,040.10 | 54.78 |
Other explanations
□Applicable √Not applicable
9. Other receivables
Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Interest receivable | ||
| Dividends receivable | ||
| Other receivables | 13,836,491.18 | 81,966,213.90 |
| Total | 13,836,491.18 | 81,966,213.90 |
Other explanations:
□Applicable √Not applicable
Interest receivable
(1). Classification of interest receivable
□Applicable √Not applicable
(2). Significant overdue interest
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
(4). Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Information on interest receivable actually written off in the current period
□Applicable √Not applicable
Among them, information on interest receivable significantly written off
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Dividends receivable
(1). Dividends receivable
□Applicable √Not applicable
(2). Important dividends receivable aged over one year
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
(4). Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Information on dividends receivable actually written off in the current period
□Applicable √Not applicable
Among them, information on dividends receivable significantly written off
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Other receivables
(1). Disclosed by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Account age | Closing book balance | Opening book balance |
| Within 1 year | ||
| Including: Sub-items within 1 year | ||
| Within 1 year | 14,006,095.31 | 83,104,304.36 |
| Subtotal within 1 year | 14,006,095.31 | 83,104,304.36 |
| 1-2 years | 658,726.31 | 3,463,981.21 |
| 2-3 years | 139,184.44 | 5,143,264.28 |
| Above 3 years | 32,179,244.59 | 28,159,425.53 |
| 3-4 years | ||
| 4-5 years | ||
| Above 5 years | ||
| Total | 46,983,250.65 | 119,870,975.38 |
(2). Information on classification by nature of payment
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Nature of payment | Closing book balance | Opening book balance |
| Security deposits | 9,410,169.46 | 10,750,199.61 |
| Suspense payment receivables | 34,955,576.08 | 105,147,206.95 |
| Reserve funds | 754,889.89 | 620,596.53 |
| Temporary loans | 3,000,000.00 | |
| Others | 1,862,615.22 | 352,972.29 |
| Total | 46,983,250.65 | 119,870,975.38 |
(3). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Provision for bad debts | First stage | Second stage | Third stage | Total |
| Expected credit losses over the next 12 months | Expected credit loss for the entire duration (credit impairment not occurred) | Expected credit loss for the entire duration (credit impairment occurred) | ||
| Balance as of January 1, 2024 | 4,155,215.19 | 1,039,194.36 | 32,710,351.93 | 37,904,761.48 |
| Balance as of January 1, 2024 in the current period | ||||
| – Transferred into the second stage | -32,446.96 | 32,446.96 | ||
| – Transferred into the third stage | -244,112.68 | 244,112.68 | ||
| – Transferred back to the second stage | ||||
| – Transferred back to the first stage | ||||
| Amount accrued in the current period | -3,422,463.46 | -560,318.53 | -775,220.02 | -4,758,002.01 |
| Amount written-back in the current period | ||||
| Amount charged-off in the current period | ||||
| Amount written-off in the current period | ||||
| Other changes | ||||
| Balance as of June 30, 2024 | 700,304.77 | 267,210.11 | 32,179,244.59 | 33,146,759.47 |
Classification basis and provision ratio of provision for bad debts for each stageNone
Explanation on significant changes in book balance of other receivables with changes in provision forloss in the current period:
□Applicable √Not applicable
The amount of provision for bad debts in the current period and the basis for evaluating whether thecredit risk of financial instruments increases significantly:
□Applicable √Not applicable
(4). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Category | Opening balance | Amount of changes in the current period | Closing balance | |||
| Provision | Withdrawal or write-back | Charge-off or write-off | Other changes | |||
| Provision for bad debts accrued individually | 26,204,225.55 | -287,151.76 | 25,917,073.79 | |||
| Provision for bad debts accrued by portfolio | 11,700,535.93 | -4,470,850.25 | 7,229,685.68 | |||
| Total | 37,904,761.48 | -4,758,002.01 | 33,146,759.47 | |||
Among them, significant amount of bad-debt provision written back or withdrawn in the current period:
□Applicable √Not applicable
Other explanationsNone
(5). Information on other receivables actually written-off in the current period
□Applicable √Not applicable
Among them, information on write-off of other important receivables:
□Applicable √Not applicable
Explanation on write-off of other receivables:
□Applicable √Not applicable
(6). Information on other receivables of the top five closing balances collected by debtor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Company name | Closing balance | As a proportion of total closing balance in other receivables (%) | Nature of payment | Account age | Closing balance of provision for bad debts |
| EURL PHARMATICA | 18,084,211.41 | 38.49 | Suspense payment receivables | Above 3 years | 18,084,211.41 |
| SIKEROM EURPOE GMBH | 7,832,862.38 | 16.67 | Suspense payment receivables | Above 3 years | 7,832,862.38 |
| Beijing Youzhuju Network Technology Co., Ltd. | 6,749,586.04 | 14.37 | Suspense payment receivables | Within 1 year | 337,479.30 |
| Hangzhou Property Maintenance Fund Management Center | 4,708,614.72 | 10.02 | Security deposits | Above 3 years | 4,708,614.72 |
| Vipshop (China) Co., Ltd. | 2,000,000.00 | 4.26 | Security deposits | Within 1 year | 100,000.00 |
| Total | 39,375,274.55 | 83.81 | / | / | 31,063,167.81 |
(7). Presented as other receivables due to centralized fund management
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
10. Inventory
(1). Classification of inventories
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Provision for devaluation of inventories/Impairment provision of contract performance cost | Carrying value | Book balance | Provision for devaluation of inventories/Impairment provision of contract performance cost | Carrying value | |
| Raw materials | 69,791,806.37 | 10,759,173.61 | 59,032,632.76 | 64,320,795.95 | 10,411,607.57 | 53,909,188.38 |
| Packaging | 40,751,775.87 | 2,776,330.68 | 37,975,445.19 | 54,811,928.32 | 4,460,418.42 | 50,351,509.90 |
| Goods in process | 19,500,750.41 | 1,862,020.25 | 17,638,730.16 | 22,883,723.89 | 252,167.47 | 22,631,556.42 |
| Outsourcing gifts | 29,734,356.70 | 1,311,338.01 | 28,423,018.69 | 22,364,071.52 | 171,660.98 | 22,192,410.54 |
| Inventory commodities | 719,991,150.75 | 84,589,691.02 | 635,401,459.73 | 725,768,386.69 | 88,209,742.39 | 637,558,644.30 |
| Turnover materials | ||||||
| Consumable biological assets | ||||||
| Contract performance cost | ||||||
| Low-value consumables | 19,748,155.93 | 678,294.23 | 19,069,861.70 | 10,957,787.46 | 385,941.32 | 10,571,846.14 |
| Total | 899,517,996.03 | 101,976,847.80 | 797,541,148.23 | 901,106,693.83 | 103,891,538.15 | 797,215,155.68 |
(2). Data resources recognized as inventory
□Applicable √Not applicable
(3). Provision for devaluation of inventories and impairment provision of contract performance
cost
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increased amount in the current period | Decreased amount in the current period | Closing balance | ||
| Provision | Others | Write-back or charge-off | Others | |||
| Raw materials | 10,411,607.57 | 844,086.27 | 496,520.23 | 10,759,173.61 | ||
| Packaging | 4,460,418.42 | 536,823.37 | 2,220,911.11 | 2,776,330.68 | ||
| Goods in process | 252,167.47 | 1,767,777.30 | 157,924.52 | 1,862,020.25 | ||
| Outsourcing gifts | 171,660.98 | 1,610,053.81 | 470,376.78 | 1,311,338.01 | ||
| Inventory commodities | 88,209,742.39 | 27,200,269.01 | 30,820,320.38 | 84,589,691.02 | ||
| Turnover materials | ||||||
| Consumable biological assets | ||||||
| Contract performance cost | ||||||
| Low-value consumables | 385,941.32 | 458,506.27 | 166,153.36 | 678,294.23 | ||
| Total | 103,891,538.15 | 32,417,516.03 | 34,332,206.38 | 101,976,847.80 | ||
Reason for write-back or charge-off of provisions for devaluation of inventories in the current period
√Applicable □Not applicable
At the end of the current period, the net realizable value of some products was lower than theircorresponding cost, so the provision for devaluation of inventories was accrued based on the differencebetween the cost and the net realizable value; In the current period, the Company consumed, sold orscrapped some of the inventories of which the Company had already accrued provisions for devaluation,so the provisions for devaluation was charged off in the current period.
Provision for devaluation of inventories accrued by portfolio
□Applicable √Not applicable
Accrual standards for provision for devaluation of inventories accrued by portfolio
□Applicable √Not applicable
(4). Capitalized amount of borrowing expenses included in closing balance of inventories and itscalculation standard and basis
□Applicable √Not applicable
(5). Explanation on current amortization amount of contract performance cost
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
11. Assets held for sale
□Applicable √Not applicable
12. Non-current assets due within one year
□Applicable √Not applicable
Debt investments due within one year
□Applicable √Not applicable
Other debt investments due within one year
□Applicable √Not applicable
Other explanations on non-current assets due within one yearNone
13. Other current assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Contract acquisition cost | ||
| Return cost receivable | 9,831,666.11 | 9,190,580.83 |
| Input VAT to be deducted | 54,842,290.06 | 90,306,570.44 |
| Advance payment of taxes | 887,847.98 | 267,921.80 |
| Total | 65,561,804.15 | 99,765,073.07 |
Other explanations:
None
14. Debt investments
(1). Information on debt investments
□Applicable √Not applicable
Changes in impairment provisions of debt investments in the current period
□Applicable √Not applicable
(2). Significant debt investments at the end of the period
□Applicable √Not applicable
(3). Information on accrual of impairment provisions
□Applicable √Not applicable
Classification basis and provision ratio of impairment provisions for each stage:
None
Explanation on significant changes in book balance of debt investments with changes in provision forloss in the current period:
□Applicable √Not applicable
Amount of impairment provision accrued in the current period and the basis for evaluating whether thecredit risk of financial instruments increases significantly：
□Applicable √Not applicable
(4). Information on debt investments actually written off in the current period
□Applicable √Not applicable
Wherein, write-off of important debt investments
□Applicable √Not applicable
Explanation on write-off of debt investments:
□Applicable √Not applicable
Other explanations:
None
15. Other debt investments
(1). Information on other debt investments
□Applicable √Not applicable
Changes in impairment provisions of other debt investments in the current period
□Applicable √Not applicable
(2). Important other debt investments at the end of the period
□Applicable √Not applicable
(3). Information on accrual of impairment provisions
□Applicable √Not applicable
(4). Information on other debt investments actually written off in the current period
□Applicable √Not applicable
Wherein, write-off of important other debt investments
□Applicable √Not applicable
Explanation on write-off of other debt investments:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
16. Long-term receivables
(1) Information on long-term receivables
□Applicable √Not applicable
(2) Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(3) Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(4) Information on long-term receivables actually written off in the current period
□Applicable √Not applicable
Wherein, write-off of important long-term receivables
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
17. Long-term equity investments
(1). Information on long-term equity investments
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Invested entity | Opening balance | Changes in the current period | Closing balance | Closing balance of provision for impairment | |||||||
| Additional investment | Investment decrease | Recognized investment gain and loss under the equity method | Other comprehensive income adjustments | Other changes in equity | Declaration of cash dividends or profits | Provision for impairment | Others | ||||
I. Joint Venture
I. Joint VentureHuzhou PanruiIndustry InvestmentPartnership(LimitedPartnership)
| Huzhou Panrui Industry Investment Partnership (Limited Partnership) | 3,059,991.91 | -6,059.09 | 3,053,932.82 |
Subtotal
| Subtotal | 3,059,991.91 | -6,059.09 | 3,053,932.82 |
II. Associates
II. AssociatesXiongke CultureMedia (Hangzhou)Co., Ltd.
| Xiongke Culture Media (Hangzhou) Co., Ltd. | 2,617,834.89 | -13,338.97 | 2,604,495.92 |
Jiaxing WoyongInvestmentPartnership(LimitedPartnership)
| Jiaxing Woyong Investment Partnership (Limited Partnership) | 100,964,443.84 | -784,658.16 | 100,179,785.68 |
Zhuhai HaishilongBiotechnology Co.,Ltd.
| Zhuhai Haishilong Biotechnology Co., Ltd. | 2,401,207.78 | -1,179,976.41 | 1,221,231.37 | 81,442,213.22 |
Beijing XiushiCulturalDevelopment Co.,Ltd.
| Beijing Xiushi Cultural Development Co., Ltd. | 4,530,680.07 | -169,631.11 | 4,361,048.96 |
Subtotal
| Subtotal | 110,514,166.58 | -2,147,604.65 | 108,366,561.93 | 81,442,213.22 |
Total
| Total | 113,574,158.49 | -2,153,663.74 | 111,420,494.75 | 81,442,213.22 |
(2). Information on impairment testing of long-term equity investments
□Applicable √Not applicable
Other explanationsNone
18. Other equity instrument investments
(1). Information on other equity instrument investments
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Changes in the current period | Closing balance | Dividend income recognized in the current period | Accumulated gains recognized in other comprehensive income | Accumulated losses recognized in other comprehensive income | Reason for designation as measured at fair value through other comprehensive income | ||||
| Additional investment | Investment decrease | Gains recognized in other comprehensive income in the current period | Losses recognized in other comprehensive income in the current period | Others | |||||||
| Hangzhou Regenovo Bio-technology Co., Ltd. | 20,580,000.00 | 20,580,000.00 | Refer to “Other explanations” | ||||||||
| LIPOTRUE,S.L. | 35,822,400.00 | 35,822,400.00 | Refer to “Other explanations” | ||||||||
| Golong Holdings Co., Ltd. | 51,258,000.00 | 51,258,000.00 | -38,742,000.00 | Refer to “Other explanations” | |||||||
| Total | 107,660,400.00 | 107,660,400.00 | -38,742,000.00 | / | |||||||
(2). Explanation on derecognition in the current period
□Applicable √Not applicable
Other explanations:
√Applicable □Not applicable
Reason for equity instrument investments designated as measured at fair value through other comprehensive incomeThe Company invests in equity for strategic investment purposes, and the investees will take the Company's investments as equity instruments. Therefore, theCompany designates such equity instrument investments as financial assets at fair value through other comprehensive income.
19. Other non-current financial assets
□Applicable √Not applicable
20. Investment property
Measurement mode of investment property
(1). Investment property with the cost measurement mode
Unit: Yuan Currency: RMB
| Item | Building and construction | Land use rights | Construction in progress | Total |
| I. Original carrying value | ||||
| 1. Opening balance | 78,781,143.26 | 78,781,143.26 | ||
| 2. Amount increased in the current period | ||||
| (1) Outsourcing | ||||
| (2) Transfer-in of inventories, fixed assets, or construction in process | ||||
| (3) Increase due to business combination | ||||
| 3. Amount decreased in the current period | ||||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| 4. Closing balance | 78,781,143.26 | 78,781,143.26 | ||
| II. Accumulated depreciation and amortization | ||||
| 1. Opening balance | 12,624,671.35 | 12,624,671.35 | ||
| 2. Amount increased in the current period | 916,559.00 | 916,559.00 | ||
| (1) Provision or amortization | 916,559.00 | 916,559.00 | ||
| 3. Amount decreased in the current period | ||||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| 4. Closing balance | 13,541,230.35 | 13,541,230.35 | ||
| III. Impairment provision | ||||
| 1. Opening balance | ||||
| 2. Amount increased in the current period | ||||
| (1) Provision | ||||
| 3. Amount decreased in the current period | ||||
| (1) Disposal | ||||
| (2) Other transfer-out | ||||
| 4. Closing balance | ||||
| IV. Carrying value | ||||
| 1. Closing book value | 65,239,912.91 | 65,239,912.91 | ||
| 2. Opening carrying value | 66,156,471.91 | 66,156,471.91 |
(2). Information on investment property with pending property right certificate:
□Applicable √Not applicable
(3). Information on impairment testing of investment property with the cost measurement mode
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
21. Fixed assets
Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Fixed assets | 825,874,380.92 | 827,350,985.29 |
| Disposal of fixed assets | ||
| Total | 825,874,380.92 | 827,350,985.29 |
Other explanations:
None
Fixed assets
(1). Information on fixed assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Houses and buildings | General equipment | Dedicated equipment | Transportation vehicles | Total |
| I. Original carrying value: | |||||
| 1. Opening balance | 741,705,056.99 | 87,185,816.55 | 341,968,417.89 | 26,111,311.37 | 1,196,970,602.80 |
| 2. Amount increased in the current period | 2,232,250.01 | 2,722,565.38 | 27,516,911.39 | 2,892,852.97 | 35,364,579.75 |
| (1) Purchase | 692,037.22 | 1,586,682.25 | 2,671,342.81 | 2,234,065.36 | 7,184,127.64 |
| (2) Transfer-in of construction in process | 1,540,212.79 | 1,135,883.13 | 24,845,568.58 | 658,787.61 | 28,180,452.11 |
| (3) Increase due to business combination | |||||
| 3. Amount decreased in the current period | 262,000.00 | 875,044.44 | 6,482,441.86 | 2,366,008.87 | 9,985,495.17 |
| (1) Disposal or scrapping | 262,000.00 | 875,044.44 | 6,482,441.86 | 2,366,008.87 | 9,985,495.17 |
| 4. Closing balance | 743,675,307.00 | 89,033,337.49 | 363,002,887.42 | 26,638,155.47 | 1,222,349,687.38 |
| II. Accumulated depreciation | |||||
| 1. Opening balance | 149,100,164.07 | 51,823,325.01 | 148,111,236.39 | 19,247,359.78 | 368,282,085.25 |
| 2. Amount increased in the current period | 14,182,369.94 | 3,792,921.00 | 14,690,175.13 | 1,847,851.15 | 34,513,317.22 |
| (1) Provision | 14,182,369.94 | 3,792,921.00 | 14,690,175.13 | 1,847,851.15 | 34,513,317.22 |
| 3. Amount decreased in the current period | 248,900.00 | 825,684.71 | 5,944,342.01 | 638,701.55 | 7,657,628.27 |
| (1) Disposal or scrapping | 248,900.00 | 825,684.71 | 5,944,342.01 | 638,701.55 | 7,657,628.27 |
| 4. Closing balance | 163,033,634.01 | 54,790,561.30 | 156,857,069.51 | 20,456,509.38 | 395,137,774.20 |
| III. Impairment provision | |||||
| 1. Opening balance | 1,337,532.26 | 1,337,532.26 | |||
| 2. Amount increased in the current period | |||||
| (1) Provision | |||||
| 3. Amount decreased in the current period | |||||
| (1) Disposal or scrapping | |||||
| 4. Closing balance | 1,337,532.26 | 1,337,532.26 | |||
| IV. Carrying value | |||||
| 1. Closing book value | 580,641,672.99 | 34,242,776.19 | 204,808,285.65 | 6,181,646.09 | 825,874,380.92 |
| 2. Opening carrying value | 592,604,892.92 | 35,362,491.54 | 192,519,649.24 | 6,863,951.59 | 827,350,985.29 |
(2). Information on temporarily idle fixed assets
□Applicable √Not applicable
(3). Fixed assets leased out through operating lease
□Applicable √Not applicable
(4). Information on fixed assets with pending property right certificate
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Carrying value | Reason for failure to obtain the property right certificate |
| Expansion of Huzhou Production Base | 118,431,660.33 | The property right certificate is still being processed |
| Longwu R&D Center | 78,066,904.37 | The property right certificate is still being processed |
| Total | 196,498,564.70 |
(5). Information on impairment testing of fixed assets
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Disposal of fixed assets
□Applicable √Not applicable
22. Construction in progress
Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Construction in progress | 72,172,878.34 | 52,038,642.94 |
| Engineering materials | ||
| Total | 72,172,878.34 | 52,038,642.94 |
Other explanations:
None
Construction in progress
(1). Information on construction in progress
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Impairment provision | Carrying value | Book balance | Impairment provision | Carrying value | |
| Huzhou Production Base Expansion Project (Phase I) | 45,604,574.07 | 45,604,574.07 | 24,853,830.82 | 24,853,830.82 | ||
| Longwu R&D Center Construction Project | 4,627,838.83 | 4,627,838.83 | 8,377,199.03 | 8,377,199.03 | ||
| Decoration engineering | 5,890,607.33 | 5,890,607.33 | 4,759,533.93 | 4,759,533.93 | ||
| Information System Upgrade Project | 10,029,833.75 | 10,029,833.75 | 8,545,628.83 | 8,545,628.83 | ||
| Other sporadic projects | 6,020,024.36 | 6,020,024.36 | 5,502,450.33 | 5,502,450.33 | ||
| Total | 72,172,878.34 | 72,172,878.34 | 52,038,642.94 | 52,038,642.94 |
(2). Information on changes in important construction in progress projects in the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Budget | Opening balance | Increased amount in the current period | Amount of transfer to fixed assets in the current period | Amount of other decreases in the current period | Closing balance | Proportion of accumulated project investment to budget (%) | Progress of project | Accumulated amount of interest capitalization | Including: Amount of interest capitalization in the current period | Interest capitalization rate in the current period (%) | Source of funds |
| Huzhou Production Base Expansion Project (Phase I) | RMB416.78 million | 24,853,830.82 | 40,601,886.97 | 15,208,973.30 | 4,642,170.42 | 45,604,574.07 | 70.89 | 70.89 | 22,835,277.15 | 7,223,424.01 | 4.57 | Raised funds and self-owned funds |
| Longwu R&D Center Construction Project | RMB128.61 million | 8,377,199.03 | 1,386,496.50 | 5,034,232.82 | 101,623.88 | 4,627,838.83 | 97.45 | 100.00 | 14,857,625.44 | Raised funds and self-owned funds | ||
| Information System Upgrade Project | RMB112.40 million | 8,545,628.83 | 3,382,261.74 | 254,715.05 | 1,643,341.77 | 10,029,833.75 | 16.55 | 16.55 | 7,042,186.20 | 1,704,052.18 | 4.57 | Raised funds and self-owned funds |
| Total | RMB657.79 million | 41,776,658.68 | 45,370,645.21 | 20,497,921.17 | 6,387,136.07 | 60,262,246.65 | / | / | 44,735,088.79 | 8,927,476.19 | / | / |
(3). Information on impairment provision of construction in progress accrued in the currentperiod
□Applicable √Not applicable
(4). Information on impairment testing of construction in progress
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
Engineering materials
□Applicable √Not applicable
23. Productive biological assets
(1). Productive biological assets with the cost measurement mode
□Applicable √Not applicable
(2). Information on impairment testing of productive biological assets with the cost measurementmode
□Applicable √Not applicable
(3). Productive biological assets with fair value measurement mode
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
24. Oil and gas assets
(1). Information on oil and gas assets
□Applicable √Not applicable
(2). Information on impairment testing of oil and gas assets
□Applicable √Not applicable
Other explanations:
None
25. Right-of-use assets
(1). Information on right-of-use assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Houses and buildings | Total |
| I. Original carrying value | ||
| 1. Opening balance | 19,640,777.98 | 19,640,777.98 |
| 2. Amount increased in the current period | 6,207,585.50 | 6,207,585.50 |
| 1) Lease-in | 6,207,585.50 | 6,207,585.50 |
| 3. Amount decreased in the current period | ||
| 4. Closing balance | 25,848,363.48 | 25,848,363.48 |
| II. Accumulated depreciation | ||
| 1. Opening balance | 5,535,956.64 | 5,535,956.64 |
| 2. Amount increased in the current period | 3,316,453.06 | 3,316,453.06 |
| (1) Provision | 3,316,453.06 | 3,316,453.06 |
| 3. Amount decreased in the current period | ||
| (1) Disposal | ||
| 4. Closing balance | 8,852,409.70 | 8,852,409.70 |
| III. Impairment provision | ||
| 1. Opening balance | ||
| 2. Amount increased in the current period | ||
| (1) Provision | ||
| 3. Amount decreased in the current period | ||
| (1) Disposal | ||
| 4. Closing balance | ||
| IV. Carrying value | ||
| 1. Closing book value | 16,995,953.78 | 16,995,953.78 |
| 2. Opening carrying value | 14,104,821.34 | 14,104,821.34 |
(2). Information on impairment testing of right-of-use assets
□Applicable √Not applicable
Other explanations:
None
26. Intangible assets
(1). Information on intangible assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Land use rights | Office software | Patent right | Non-patented technologies | Customer resources | Trademark rights | Total |
| I. Original carrying value | |||||||
| 1. Opening balance | 472,400,130.10 | 27,171,790.13 | 471,089.70 | 563,293.07 | 12,833,684.00 | 39,897,000.00 | 553,336,987.00 |
| 2. Amount increased in the current period | 1,888,140.42 | 1,888,140.42 | |||||
| (1) Purchase | 441,686.87 | 441,686.87 | |||||
| (2) Transfer from construction in process | 1,446,453.55 | 1,446,453.55 | |||||
| (3) Increase due to business combination | |||||||
| 3. Amount | |||||||
| decreased in the current period | |||||||
| (1) Disposal | |||||||
| 4. Closing balance | 472,400,130.10 | 29,059,930.55 | 471,089.70 | 563,293.07 | 12,833,684.00 | 39,897,000.00 | 555,225,127.42 |
| II. Accumulated amortization | |||||||
| 1. Opening balance | 104,228,449.37 | 24,273,981.82 | 436,627.44 | 545,786.51 | 12,833,684.00 | 6,330,448.70 | 148,648,977.84 |
| 2. Amount increased in the current period | 5,914,333.18 | 1,051,889.39 | 6,290.40 | 1,994,850.00 | 8,967,362.97 | ||
| (1) Provision | 5,914,333.18 | 1,051,889.39 | 6,290.40 | 1,994,850.00 | 8,967,362.97 | ||
| 3. Amount decreased in the current period | |||||||
| (1) Disposal | |||||||
| 4. Closing balance | 110,142,782.55 | 25,325,871.21 | 442,917.84 | 545,786.51 | 12,833,684.00 | 8,325,298.70 | 157,616,340.81 |
| III. Impairment provision | |||||||
| 1. Opening balance | |||||||
| 2. Amount increased in the current period | |||||||
| (1) Provision | |||||||
| 3. Amount decreased in the current period | |||||||
| (1) Disposal | |||||||
| 4. Closing balance | |||||||
| IV. Carrying value | |||||||
| 1. Closing book value | 362,257,347.55 | 3,734,059.34 | 28,171.86 | 17,506.56 | 31,571,701.30 | 397,608,786.61 | |
| 2. Opening carrying value | 368,171,680.73 | 2,897,808.31 | 34,462.26 | 17,506.56 | 33,566,551.30 | 404,688,009.16 | |
At the end of the current period, the proportion of intangible assets formed through internal R&D of theCompany to the balance of intangible assets is 0.00%.
(2). Data resources recognized as intangible assets
□Applicable √Not applicable
(3). Information on land use rights without the property right certificate
□Applicable √Not applicable
(4). Information on impairment testing of intangible assets
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
27. Goodwill
(1). Original carrying value of goodwill
□Applicable √Not applicable
(2). Impairment provision of goodwill
□Applicable √Not applicable
(3). Information about the asset group or combination of asset groups of goodwill
□Applicable √Not applicable
Changes to the asset group or combination of asset groups
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(4). Specific methods for determining the recoverable amount
The recoverable amount is determined based on the net amount after deducting disposal expenses fromfair value
□Applicable √Not applicable
The recoverable amount is determined based on the present value of expected future cash flows
□Applicable √Not applicable
Reasons for significant discrepancies between the aforementioned information and the information usedin previous years’ impairment tests or external information
□Applicable √Not applicable
Reasons for significant discrepancies between the information used in previous years’ impairment testsof the Company and the actual situation of the current year
□Applicable √Not applicable
(5). Information on performance commitments and corresponding goodwill impairmentWhen goodwill is formed, there is a performance commitment and the Reporting Period or its previousperiod is within the performance commitment period
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
28. Long-term deferred expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increased amount in the current period | Amortized amount in the current period | Other decreased amount | Closing balance |
| Renovation costs | 65,851,266.83 | 9,157,367.36 | 8,844,980.76 | 66,163,653.43 | |
| Software service fees | 1,333,062.00 | 333,265.50 | 999,796.50 | ||
| Total | 67,184,328.83 | 9,157,367.36 | 9,178,246.26 | 67,163,449.93 |
Other explanations:
None
29. Deferred income tax assets or liabilities
(1). Deferred income tax assets without offset
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance | ||
| Deductible temporary difference | Deferred income tax assets | Deductible temporary difference | Deferred income tax assets | |
| Provision for bad debts of accounts receivable | 13,107,583.86 | 2,888,336.47 | 22,142,965.55 | 5,533,579.62 |
| Provision for devaluation of inventories | 77,086,572.32 | 15,257,404.90 | 82,737,837.07 | 15,220,065.94 |
| Impact of share-based payments | 39,301,124.41 | 7,506,279.60 | 31,715,129.69 | 5,935,847.80 |
| Unrealized profit from internal transactions | 269,742,266.66 | 54,209,602.46 | 159,567,947.59 | 39,891,986.91 |
| Unused membership points | 92,713,129.39 | 23,178,282.35 | 127,713,129.39 | 31,928,282.35 |
| Government grants pertinent to assets | 6,865,620.53 | 1,029,843.08 | 6,383,359.33 | 957,503.90 |
| Anticipated return losses | 17,393,403.14 | 3,653,342.09 | 6,686,117.43 | 1,671,529.37 |
| Estimated unused gifts for sold products | 50,074,244.87 | 12,518,561.21 | ||
| Interest expenses on convertible bonds | 8,654,179.67 | 1,298,126.95 | 1,321,312.76 | 198,196.91 |
| Lease expenses | 16,294,587.89 | 2,537,259.67 | 13,940,366.98 | 2,139,203.47 |
| Advertising and business promotion expenses | 12,000,000.00 | 3,000,000.00 | 10,339,382.64 | 2,584,845.66 |
| Accrued expenses | 14,451,922.15 | 2,914,846.09 | ||
| Changes in the fair value of other equity instrument investments | 38,742,000.00 | 5,811,300.00 | 38,742,000.00 | 5,811,300.00 |
| Total | 591,900,467.87 | 120,369,777.57 | 565,815,715.45 | 127,305,749.23 |
(2). Deferred income tax liabilities without offset
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance | ||
| Taxable temporary difference | Deferred income tax liabilities | Taxable temporary difference | Deferred income tax liabilities | |
| Asset assessment appreciation in businesses consolidation not under common control | ||||
| Changes in the fair value of other debt investments | ||||
| Changes in the fair value of other equity instrument investments | ||||
| One-time deduction for depreciation of fixed assets | 110,300,243.62 | 16,649,225.12 | 110,300,243.62 | 16,649,225.12 |
| Deferred income tax recognized on right-of-use assets | 16,269,471.17 | 2,938,761.98 | 14,104,821.34 | 2,162,159.51 |
| Total | 126,569,714.79 | 19,587,987.10 | 124,405,064.96 | 18,811,384.63 |
(3). Deferred income tax assets or liabilities presented in net amount after offset
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Deferred income tax assets and liabilities offset at the end of the period | Closing balance of deferred income tax assets or liabilities after offset | Deferred income tax assets and liabilities offset at the beginning of the period | Opening balance of deferred income tax assets or liabilities after offset |
| Deferred income tax assets | 19,587,987.10 | 100,781,790.47 | 18,811,384.63 | |
| Deferred income tax liabilities | 19,587,987.10 | 18,811,384.63 |
(4). Details of unrecognized deferred income tax assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Deductible temporary difference | 248,027,591.67 | 200,424,961.81 |
| Deductible losses | 408,161,924.03 | 414,387,984.35 |
| Total | 656,189,515.70 | 614,812,946.16 |
(5). Deductible loss of unrecognized deferred income tax assets will expire in the following years
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Year | Closing balance | Opening balance | Remarks |
| 2024 | 59,874,593.56 | 71,058,103.62 | |
| 2025 | 61,988,298.67 | 61,988,728.89 | |
| 2026 | 52,929,357.54 | 53,623,347.32 | |
| 2027 | 118,228,015.33 | 127,093,665.49 | |
| 2028 | 100,624,139.03 | 100,624,139.03 | |
| January - June 2029 | 14,517,519.90 | ||
| Total | 408,161,924.03 | 414,387,984.35 | / |
Other explanations:
□Applicable √Not applicable
30. Other non-current assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Impairment | Carrying | Book balance | Impairment | Carrying | |
| provision | value | provision | value | |||
| Contract acquisition cost | ||||||
| Contract performance cost | ||||||
| Return cost receivable | ||||||
| Contract assets | ||||||
| Funds prepaid for purchase of long-term assets | 16,574,578.53 | 16,574,578.53 | 8,775,522.84 | 8,775,522.84 | ||
| Other long-term assets | 8,692,504.15 | 8,692,504.15 | 8,199,424.15 | 8,199,424.15 | ||
| Total | 25,267,082.68 | 25,267,082.68 | 16,974,946.99 | 16,974,946.99 |
Other explanations:
None
31. Assets with limited ownership or use rights
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing | Opening | ||||||
| Book balance | Carrying value | Type of restrictions | Description of restrictions | Book balance | Carrying value | Type of restrictions | Description of restrictions | |
| Monetary capital | 47,214,185.31 | 47,214,185.31 | Others | Note 1 | 351,817,846.04 | 351,817,846.04 | Others | Note 2 |
| Notes receivable | ||||||||
| Inventory | ||||||||
| Including: Data resources | ||||||||
| Fixed assets | ||||||||
| Intangible assets | ||||||||
| Including: Data resources | ||||||||
| Total | 47,214,185.31 | 47,214,185.31 | / | / | 351,817,846.04 | 351,817,846.04 | / | / |
Note 1: It includes fixed-term deposits of RMB30,000,000.00 that cannot be withdrawn at any time, andfrozen monetary capital of RMB17,214,185.31, including the L/C deposit of RMB8,800,000.00, thetransformer deposit of RMB250,000.00, ETC vehicle deposit of RMB70,000.00, Pinduoduo deposit ofRMB5,540,922.50, and the direct-sales store deposit of RMB2,553,262.81.
Note 2: It includes fixed-term deposits of RMB335,288,251.36 that cannot be withdrawn at any time,and frozen monetary capital of RMB16,529,594.68, including the L/C deposit of RMB8,800,000.00, thetransformer deposit of RMB250,000.00, ETC vehicle deposit of RMB70,000.00, Pinduoduo deposit ofRMB5,298,890.00, and the direct-sales store deposit of RMB2,110,704.68.Other explanations:
None
32. Short-term borrowings
(1). Classification of short-term borrowings
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Pledged borrowings | ||
| Mortgaged borrowings | ||
| Guaranteed borrowings | ||
| Credit loans | 200,155,555.56 | 200,155,555.56 |
| Total | 200,155,555.56 | 200,155,555.56 |
Explanation on classification of short-term borrowings:
None
(2). Information on overdue but yet unrepaid short-term borrowings
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
33. Financial liabilities held for trading
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
34. Derivative financial liabilities
□Applicable √Not applicable
35. Notes payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Type | Closing balance | Opening balance |
| Commercial acceptance bills | ||
| Bank acceptance bills | 36,959,074.14 | |
| Total | 36,959,074.14 |
The amount of notes payable due and unpaid at the end of the period is RMB0.00. The reason for failureto pay is that such notes do not exist.
36. Accounts payable
(1). Presentation of accounts payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Payment for goods | 603,767,792.09 | 524,325,866.69 |
| Expenses | 419,159,565.79 | 422,130,510.68 |
| Payment for acquisition of long-term assets | 38,745,200.22 | 72,065,981.23 |
| Total | 1,061,672,558.10 | 1,018,522,358.60 |
(2). Important accounts payable aged over one year or overdue
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
37. Receipts in advance
(1). Presentation of receipts in advance
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Rents receivable in advance | 152,319.76 | 30,514.45 |
| Total | 152,319.76 | 30,514.45 |
(2). Important receipts in advance aged over one year
□Applicable √Not applicable
(3). Amount of and reasons for significant changes in carrying amount during the ReportingPeriod
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
38. Contract liabilities
(1). Information on contract liabilities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Advance receipt of payment for goods | 142,044,740.50 | 116,005,079.06 |
| Unused membership points | 100,764,566.25 | 134,935,549.65 |
| Unused gifts for sold products | 50,074,244.87 | |
| Total | 242,809,306.75 | 301,014,873.58 |
(2). Important contract liabilities aged over one year
□Applicable √Not applicable
(3). Amount of and reasons for significant changes in carrying amount during the ReportingPeriod
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
39. Employee benefits payable
(1). Presentation of employee benefits payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| I. Short-term compensation | 164,821,126.73 | 352,420,473.70 | 421,243,404.50 | 95,998,195.93 |
| II. Post-employment benefits – Defined contribution plans | 984,404.74 | 14,377,449.66 | 13,285,239.85 | 2,076,614.55 |
| III. Dismissal benefits | 638,962.96 | 554,782.90 | 84,180.06 | |
| IV. Other benefits due within one year | ||||
| Total | 166,444,494.43 | 366,797,923.36 | 435,083,427.25 | 98,158,990.54 |
(2). Presentation of short-term compensation
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| I. Salaries, bonuses, allowances and subsidies | 162,178,043.80 | 318,523,164.31 | 386,019,856.74 | 94,681,351.37 |
| II. Welfare expense of employees | 15,069,347.76 | 15,062,656.20 | 6,691.56 | |
| III. Social insurance premium | 2,174,614.64 | 8,360,886.02 | 9,327,891.66 | 1,207,609.00 |
| Including: Medical insurance premium | 2,138,801.17 | 7,853,821.14 | 8,858,251.49 | 1,134,370.82 |
| Work-related injury insurance premium | 32,622.55 | 493,421.88 | 454,776.78 | 71,267.65 |
| Maternity insurance premium | 3,190.92 | 13,643.00 | 14,863.39 | 1,970.53 |
| IV. Housing provident fund | 468,468.29 | 8,117,855.00 | 8,483,779.29 | 102,544.00 |
| V. Trade union fund and staff education fund | 2,349,220.61 | 2,349,220.61 | ||
| VI. Short-term paid leave | ||||
| VII. Short-term profit sharing plan | ||||
| Total | 164,821,126.73 | 352,420,473.70 | 421,243,404.50 | 95,998,195.93 |
(3). Presentation by defined contribution plan
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| 1. Basic endowment insurance | 950,995.64 | 13,827,181.94 | 12,781,041.24 | 1,997,136.34 |
| 2. Unemployment insurance | 33,409.10 | 550,267.72 | 504,198.61 | 79,478.21 |
| 3. Enterprise annuity payment | ||||
| Total | 984,404.74 | 14,377,449.66 | 13,285,239.85 | 2,076,614.55 |
Other explanations:
□Applicable √Not applicable
40. Taxes payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Enterprise income tax | 69,154,206.36 | 127,005,079.31 |
| Value-added tax (VAT) | 51,885,239.65 | 71,556,095.69 |
| Consumption tax | ||
| Income tax | ||
| Urban maintenance and construction tax | 8,077,475.10 | 7,644,618.17 |
| Item | Closing balance | Opening balance |
| Property tax | 2,359,902.73 | 6,734,175.81 |
| Education surcharge | 4,051,808.62 | 4,287,830.76 |
| Surcharge for local education | 2,709,393.93 | 2,866,440.40 |
| Withholding of personal income tax | 12,109,797.82 | 1,867,193.08 |
| Stamp duties | 738,241.65 | 804,436.72 |
| Total | 151,086,065.86 | 222,765,869.94 |
Other explanations:
None
41. Other payables
(1). Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Interest payable | ||
| Dividends payable | ||
| Other payables | 151,600,173.08 | 155,345,148.68 |
| Total | 151,600,173.08 | 155,345,148.68 |
(2). Interest payable
□Applicable √Not applicable
Dividends payable
□Applicable √Not applicable
Other payables
(1). Other payables presented by nature of payment
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Security deposits | 39,553,436.39 | 41,092,318.36 |
| Restricted share repurchase obligations | 106,078,103.18 | 107,884,296.66 |
| Others | 5,968,633.51 | 6,368,533.66 |
| Total | 151,600,173.08 | 155,345,148.68 |
(2). Important other payables aged over one year or overdue
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Reason for failure to repay or carry forward |
| Restricted share repurchase obligations | 106,078,103.18 | Restricted share repurchase obligations have not been fulfilled yet |
| Total | 106,078,103.18 | / |
Other explanations:
□Applicable √Not applicable
42. Held-for-sale liabilities
□Applicable √Not applicable
43. Non-current liabilities due within one year
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Long-term borrowings due within one year | ||
| Bonds payable due within one year | ||
| Long-term payables due within one year | ||
| Lease liabilities due within one year | 4,561,267.98 | 3,970,060.11 |
| Total | 4,561,267.98 | 3,970,060.11 |
Other explanations:
None
44. Other current liabilities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Short-term bonds payable | ||
| Return payment payable | ||
| Tax on items to be resold | 18,495,292.07 | 15,022,173.42 |
| Total | 18,495,292.07 | 15,022,173.42 |
Changes in short-term bonds payable:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
45. Long-term borrowings
(1). Classification of long-term loans
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
46. Bonds payable
(1). Bonds payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Convertible corporate bonds | 770,198,904.64 | 753,119,902.88 |
| Total | 770,198,904.64 | 753,119,902.88 |
(2). Specific information on bonds payable: (excluding other financial instruments such aspreference shares and perpetual bonds classified as financial liabilities)
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Bond name | Face value (Yuan) | Coupon rate (%) | Issuance date | Bond period | Issuance amount | Opening balance | Current issuance | Interest accrued by face value | Premium or discount amortization | Current repayment | Closing balance | Default or not |
Proyaconvertible bond
| Proya convertible bond | 100.00 | 1.00 | December 8, 2021 | 6 years | 751,713,000.00 | 753,119,902.88 | 3,734,167.59 | 13,367,834.17 | 23,000.00 | 770,198,904.64 | No |
Total
| Total | / | / | / | / | 751,713,000.00 | 753,119,902.88 | 3,734,167.59 | 13,367,834.17 | 23,000.00 | 770,198,904.64 | / |
(3). Explanation on convertible corporate bonds
√Applicable □Not applicable
| Item | Share conversion conditions | Share conversion time |
| Proya convertible bond | With the approval of the CSRC, namely, the Reply on Approving Proya Cosmetics Co., Ltd.’s Public Issuance of Convertible Corporate Bonds (CSRC Approval [2021] No. 3408), the Company publicly issued 7,517,130 convertible bonds to non-specific targets on December 8, 2021, each bond with a face value of RMB100.00. The total amount of issuance is RMB751,713,000.00. The coupon rate of the aforesaid convertible corporate bonds is 0.30% for the first year, 0.50% for the second year, 1.00% for the third year, 1.50% for the fourth year, 1.80% for the fifth year and 2.00% for the sixth year. Annual interest payment dates are anniversaries of the date of initial offering of convertible bonds. The Company will, no later than five trading days after the interest payment day of each year, pay the interests of the year and, no later than five trading days after the maturity date of convertible corporate bonds, redeem all unconverted convertible bonds from investors at a price of 115% of the face value of the convertible bonds issued that time (including the annual interests of the last tranche). The convertible period of convertible bonds starts from the first trading day after the expiration of six months from the issuance date of convertible bonds until the maturity date of convertible bonds. The initial conversion price is RMB195.98/share, in no case, lower than the average trading price of A shares of the Company in the twenty trading days prior to the publication of the prospectus (if the stock price is adjusted for ex-rights or ex-dividend in the twenty trading days, the closing price of the trading day before such adjustment is calculated according to the price after the ex-rights or ex-dividend adjustment) or the average trading price of A shares of the Company in the previous trading day, and is not adjusted up. Due to the implementation of the equity distribution plan and the repurchase and cancellation of some equity incentive restricted shares by the Company, according to the relevant provisions of the Prospectus of Proya Cosmetics Co., Ltd. for Public Issuance of A-share Convertible Corporate Bonds and the relevant provisions of the CSRC on the issuance of convertible corporate bonds, the conversion price of Proya convertible bonds was adjusted from RMB195.98/share to RMB97.35/share, and the adjusted price took effect on June 25, 2024. | June 14, 2022 to December 7, 2027 |
Accounting treatment and judgment basis of share conversion rights
√Applicable □Not applicable
In the current period, a total of 230 convertible corporate bonds were converted, with an increase ofRMB231.00 in capital stock, an increase of RMB3,173.39 in capital reserve (capital stock premium),and a decrease of RMB1,559.11 in other equity instruments.
(4). Explanation on other financial instruments classified as financial liabilitiesBasic information on other financial instruments such as preference shares and perpetual bonds that areoutstanding at the end of the period
□Applicable √Not applicable
Statement of changes in financial instruments such as preference shares and perpetual bonds that areoutstanding at the end of the period
□Applicable √Not applicable
Explanation on the basis of classifying other financial instruments into financial liabilities
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
47. Lease liabilities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Payable operating lease payment | 13,043,408.26 | 11,172,403.17 |
| Unrecognized financing expenses | -1,310,088.36 | -1,202,096.30 |
| Total | 11,733,319.90 | 9,970,306.87 |
Other explanations:
None
48. Long-term payables
Presentation by item
□Applicable √Not applicable
Long-term payables
□Applicable √Not applicable
Special accounts payable
□Applicable √Not applicable
49. Long-term employee benefits payable
□Applicable √Not applicable
50. Estimated liabilities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Closing balance | Cause of formation |
| Provide external guarantees | |||
| Pending litigations | |||
| Product quality assurance | |||
| Restructuring obligation | |||
| Loss-making contract to be performed | |||
| Return payment payable | 33,063,299.45 | 30,541,670.83 | Estimated future potential return losses |
| Others | |||
| Total | 33,063,299.45 | 30,541,670.83 | / |
Other particulars, including the particulars on key assumptions and estimates concerning estimatedsignificant liabilities:
None
51. Deferred income
Information on deferred income
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | Cause of formation |
| Government grants | 6,383,359.33 | 1,000,000.00 | 517,738.80 | 6,865,620.53 | Government grants |
| Total | 6,383,359.33 | 1,000,000.00 | 517,738.80 | 6,865,620.53 | / |
Other explanations:
□Applicable √Not applicable
52. Other non-current liabilities
□Applicable √Not applicable
53. Share capital
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Opening balance | Increase or decrease in the change (+, -) | Closing balance | |||||
| Issuance of new shares | Bonus shares | Shares converted from provident fund | Others | Subtotal | |||
| Total shares | 396,757,184.00 | 231.00 | 231.00 | 396,757,415.00 | |||
Other explanations:
In the current period, a total of 230 convertible corporate bonds were converted, with an increase ofRMB231.00 in capital stock, an increase of RMB3,173.39 in capital reserve (capital stock premium),and a decrease of RMB1,559.11 in other equity instruments.
54. Other equity instruments
(1) Basic information on other financial instruments such as preference shares and perpetual
bonds that are outstanding at the end of the period
□Applicable √Not applicable
(2) Statement of changes in financial instruments such as preference shares and perpetual bondsthat are outstanding at the end of the period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
Information on changes of other equity instruments in the current period, explanation on reasons forchanges, and basis for relevant accounting treatment:
□Applicable √Not applicable
Other explanations:
√Applicable □Not applicable
In the current period, there was a decrease of RMB1,559.11 due to the current conversion of 230convertible corporate bonds into shares, with an increase of RMB231.00 in capital stock, an increase ofRMB3,173.39 in capital reserve (capital stock premium), and a decrease of RMB1,559.11 in otherequity instruments.
| Outstanding financial instruments | Opening | Increase in the current period | Decrease in the current period | Closing | ||||
| Number | Carrying value | Number | Carrying value | Number | Carrying value | Number | Carrying value | |
| Proya convertible bond | 7,507,890 | 50,893,986.60 | 230 | 1,559.11 | 7,507,660 | 50,892,427.49 | ||
| Total | 7,507,890 | 50,893,986.60 | 230 | 1,559.11 | 7,507,660 | 50,892,427.49 | ||
55. Capital reserve
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Capital premium (Equity premium) | 783,045,205.98 | 3,173.39 | 783,048,379.37 | |
| Other capital reserve | 81,105,768.45 | 886,255.50 | 81,992,023.95 | |
| Total | 864,150,974.43 | 889,428.89 | 865,040,403.32 |
Other explanations, including the information on current changes and the explanation on reasons for thechanges:
1) Changes in capital premium
The capital premium (equity premium) of the current period increased by RMB3,173.39, which was dueto the conversion of convertible corporate bonds in the current period. For details, refer to the particularscontained in “46. Bonds payable”, “VII. Notes to the Items in Consolidated Financial Statements”,“Section X Financial Report” of this Report.
2) Changes in other capital reserves
Other capital reserves of the current period increased by RMB886,255.50, which was due to therestricted stock incentives of RMB886,255.50 recognized under the Equity Incentive Plan and calculatedinto other capital reserves.
56. Treasury shares
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
| Restricted shares with repurchase obligation | 107,884,296.66 | 1,369,924.92 | 106,514,371.74 | |
| Share repurchase | 39,082,438.95 | 153,062,220.18 | 192,144,659.13 | |
| Total | 146,966,735.61 | 153,062,220.18 | 1,369,924.92 | 298,659,030.87 |
Other explanations, including the information on current changes and the explanation on reasons for thechanges:
RMB153,062,220.18 was increased in the current period due to the Company's repurchase of sharesthrough centralized bidding trading with its own funds according to the Proposal on Repurchasing theCompany's Shares Through Centralized Bidding Trading, which was approved at the 17th meeting ofthe third session of Board of Directors in December 13, 2023. As of June 30, 2024, the Company hadcompleted the share repurchase. The Company had cumulatively repurchased 2,210,825 shares of theCompany through centralized bidding trading, with a total payment of RMB192,115,703.57 (excludingthe transaction costs) and the transaction costs of RMB28,955.56.
The treasury stock of the current period decreased by RMB1,369,924.92, which was due to treasuryshares offset by cash dividends distributed on restricted shares that were expected to be released fromsales restrictions in the future and the corresponding adjustment of other accounts payable.
57. Other comprehensive income
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Amount incurred in the current period | Closing balance | |||||
| Amount incurred before income tax in the current period | Less: Included in other comprehensive income for the previous period and transferred in profit or loss for the current period | Less: Included in other comprehensive income for the previous period and transferred in retained earnings for the current period | Less: Income tax expenses | Attributed to parent company after tax | Attributed to minority shareholders after tax | |||
I. Othercomprehensiveincome that will notbe subsequentlyreclassified intoprofit and loss
| I. Other comprehensive income that will not be subsequently reclassified into profit and loss | -53,180,700.00 | -53,180,700.00 |
Including: Changesarising from there-measurement ofdefined benefitplans
| Including: Changes arising from the re-measurement of defined benefit plans |
Othercomprehensiveincome that can't bereversed throughprofit or loss underthe equity method
| Other comprehensive income that can't be reversed through profit or loss under the equity method | -20,250,000.00 | -20,250,000.00 |
Changes in the fairvalue of otherequity instrumentinvestments
| Changes in the fair value of other equity instrument investments | -32,930,700.00 | -32,930,700.00 |
Changes in the fairvalue of enterprise’sown credit risk
| Changes in the fair value of enterprise’s own credit risk |
II. Othercomprehensiveincome that will bereclassified intoprofit or loss
| II. Other comprehensive income that will be reclassified into profit or loss | -666,400.91 | -131,551.25 | -131,551.25 | -797,952.16 |
Including: Othercomprehensiveincome that can beconverted intoprofit or loss underthe equity method
| Including: Other comprehensive income that can be converted into profit or loss under the equity method |
Changes in the fairvalue of other debt
| Changes in the fair value of other debt |
investmentsAmount of financialassets reclassifiedinto othercomprehensiveincome
| Amount of financial assets reclassified into other comprehensive income |
Credit impairmentprovision of otherdebt investments
| Credit impairment provision of other debt investments |
Cash flow hedgereserve
| Cash flow hedge reserve |
Difference fromtranslation offinancial statementsin foreign currency
| Difference from translation of financial statements in foreign currency | -666,400.91 | -131,551.25 | -131,551.25 | -797,952.16 |
Total othercomprehensiveincome
| Total other comprehensive income | -53,847,100.91 | -131,551.25 | -131,551.25 | -53,978,652.16 |
Other explanations, including the adjustment of the effective part of cash flow hedging gains and lossesinto the initially recognized amount of the hedged item:
None
58. Special reserve
□Applicable √Not applicable
59. Surplus reserve
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance |
Legal surplusreserve
| Legal surplus reserve | 198,411,582.50 | 198,411,582.50 |
Discretionarysurplus reserve
| Discretionary surplus reserve |
Reserve fund
| Reserve fund |
Enterprisedevelopment fund
| Enterprise development fund |
Others
| Others |
Total
| Total | 198,411,582.50 | 198,411,582.50 |
Explanation on surplus reserves, including the current changes and the explanation on the reasons for thechanges:
None
60. Undistributed profits
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Current period | Previous year |
| Undistributed profits at the end of previous period before adjustment | 3,040,145,490.59 | 2,300,384,763.19 |
| Total undistributed profits at the beginning of the adjustment period (+ for increase, - for decrease) | ||
| Unappropriated earnings at the beginning of the period after adjustment | 3,040,145,490.59 | 2,300,384,763.19 |
| Plus: Net profit attributable to the owner of the parent company in the current period | 701,671,374.89 | 1,193,868,141.81 |
| Less: Withdrawal of statutory surplus reserve | 56,651,848.00 | |
| Withdrawal of discretionary surplus reserve | ||
| Withdrawal of general risk reserve | ||
| Dividends payable on common stock | 358,601,128.34 | 397,455,566.41 |
| Common stock dividends converted to share capital | ||
| Undistributed profits at the end of the period | 3,383,215,737.14 | 3,040,145,490.59 |
According to the Resolution of the 2023 Annual General Meeting of Shareholders of the Company, theCompany distributed cash dividends of RMB0.91 (tax inclusive) per share to all shareholders based onthe total share capital of 394,546,590 after deducting 2,210,825 shares in the Company's specialsecurities account for repurchase from the total share capital of 396,757,415 shares registered on theregistration date of dividend-paying equity, totaling RMB359,037,396.90 (tax inclusive).The difference between common stock dividends payable and actual cash dividends distributed wasRMB436,268.56, which was due to other payables offset by cash dividends of RMB436,268.56distributed on restricted shares that were not expected to be released from sales restrictions in the future.Details of the adjustment of the undistributed profits at the beginning of the period:
1. The undistributed profits affected by the retroactive adjustment in accordance with AccountingStandards for Business Enterprises and its related new regulations at the beginning of the period isRMB0.00.
2. The undistributed profits affected by the change of accounting policy at the beginning of the period isRMB0.00.
3. The undistributed profits affected by the correction of major accounting errors at the beginning of theperiod is RMB0.00.
4. The undistributed profits affected by the change of combination scope caused by common control atthe beginning of the period is RMB0.00.
5. The undistributed profits affected by other adjustments at the beginning of the period is RMB0.00.
61. Operating revenue and operating costs
(1). Information on operating revenue and operating costs
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period | ||
| Revenue | Cost | Revenue | Cost | |
| Primary business | 4,994,448,428.25 | 1,505,899,972.32 | 3,619,374,788.36 | 1,061,937,769.29 |
| Other business | 7,017,042.47 | 3,630,522.98 | 7,617,089.86 | 7,552,044.64 |
| Total | 5,001,465,470.72 | 1,509,530,495.30 | 3,626,991,878.22 | 1,069,489,813.93 |
(2). Breakdown of operating revenue and operating costs
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(3). Explanation on performance obligations
□Applicable √Not applicable
(4). Explanation on remaining performance obligations allocated
□Applicable √Not applicable
(5). Significant contract changes or significant transaction price adjustments
□Applicable √Not applicable
Other explanations:
Breakdown of revenue
1) Breakdown of income generated from contracts with clients by goods or service type
| Item | Amount for the current period | Amount for the same period last year | ||
| Revenue | Cost | Revenue | Cost | |
| Products sales | 4,994,448,428.25 | 1,505,899,972.32 | 3,619,374,788.36 | 1,061,937,769.29 |
| Others | 4,448,351.74 | 2,845,660.77 | 7,617,089.86 | 7,552,044.64 |
| Subtotal | 4,998,896,779.99 | 1,508,745,633.09 | 3,626,991,878.22 | 1,069,489,813.93 |
2) Breakdown of income generated from contracts with clients by goods or service transfer time
| Item | Amount for the current period | Amount for the same period last year |
| Income recognized at a certain point | 4,998,208,843.92 | 3,619,396,232.21 |
| Income recognized in a certain period | 687,936.07 | 7,595,646.01 |
| Subtotal | 4,998,896,779.99 | 3,626,991,878.22 |
3) Revenue recognized in the current period and included in the opening book value of contractliabilities is RMB301,014,873.58.
62. Taxes and surcharges
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Urban maintenance and construction tax | 17,943,891.92 | 18,641,207.09 |
| Education surcharge | 9,071,363.17 | 8,646,048.99 |
| Surcharge for local education | 6,047,575.39 | 5,764,032.69 |
| Stamp duties | 3,465,294.13 | 1,427,080.88 |
| Property tax | 3,609,939.77 | 3,793,909.73 |
| Land use tax | 1,621,149.00 | |
| Consumption tax | 59.75 | 184,238.97 |
| Vehicle and vessel use tax | 31,445.52 | 13,039.40 |
| Cultural undertaking construction tax | 109,491.54 | |
| Income tax | ||
| Resource tax | ||
| Total | 41,900,210.19 | 38,469,557.75 |
Other explanations:
None
63. Selling expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Image promotion expenses | 2,063,265,280.58 | 1,375,271,382.64 |
| Employee compensation and service fees | 220,539,736.18 | 160,955,637.56 |
| Office allowances | 23,824,926.89 | 18,803,085.77 |
| Travel expenses | 6,990,788.80 | 6,410,208.59 |
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Meeting affair charges | 6,203,280.37 | 4,299,563.82 |
| Equity incentive expenses for restricted shares | 1,409,139.57 | 2,582,590.71 |
| Survey consulting fees | 12,183,721.55 | 6,319,252.31 |
| Others | 5,245,048.37 | 5,355,553.86 |
| Total | 2,339,661,922.31 | 1,579,997,275.26 |
Other explanations:
None
64. General and administrative expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Employee compensation and service fees | 93,348,489.89 | 78,175,887.74 |
| Office allowance and business entertainment expenses | 49,824,234.51 | 34,943,670.30 |
| Equity incentive expenses for restricted shares | -2,220,910.90 | 42,040,845.63 |
| Expenses for depreciation, amortization and lease | 23,848,662.05 | 21,646,521.25 |
| Travel expense and conference fees | 3,536,158.74 | 4,740,467.63 |
| Consultation and intermediary fees | 7,581,867.14 | 6,340,974.78 |
| Others | 1,009,240.20 | 4,238,791.23 |
| Total | 176,927,741.63 | 192,127,158.56 |
Other explanations:
None
65. R&D expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Labor cost | 47,707,793.99 | 36,691,200.82 |
| Outsourced R&D expenses | 27,339,439.25 | 31,341,477.15 |
| Expenses for depreciation, amortization and lease | 9,073,764.54 | 4,277,735.35 |
| Direct input costs | 7,027,978.71 | 8,855,671.21 |
| Equity incentive expenses for restricted shares | 1,698,026.83 | 5,337,809.98 |
| Others | 1,766,239.20 | 5,016,970.64 |
| Total | 94,613,242.52 | 91,520,865.15 |
Other explanations:
None
66. Financial expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Interest income | -37,663,413.80 | -34,019,097.62 |
| Interest expenses | 10,601,806.58 | 5,817,515.18 |
| Handling fees | 398,294.82 | 317,082.93 |
| Exchange gains and losses | 2,013,990.08 | -2,469,067.40 |
| Total | -24,649,322.32 | -30,353,566.91 |
Other explanations:
None
67. Other incomes
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Classification by nature | Amount incurred in the current period | Amount incurred in the previous period |
| Government grants pertinent to assets | 517,738.80 | 1,039,545.00 |
| Government grants related to income | 41,996,899.59 | 33,599,531.23 |
| Refund of service charges for withholding personal income tax | 1,004,204.26 | 680,352.10 |
| Relief and additional deduction for VAT | 22,529,393.74 | 213,193.25 |
| Total | 66,048,236.39 | 35,532,621.58 |
Other explanations:
None
68. Investment income
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Long-term equity investment income calculated by equity method | -2,153,663.74 | -1,831,700.47 |
| Investment income from disposal of long-term equity investment | 667,073.59 | |
| Investment income of held-for-trading financial assets during the holding period | ||
| Dividend income from other equity instrument investments during the holding period | ||
| Interest income from debt investment during the holding period |
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Interest income from other debt investments during the holding period | ||
| Investment income from disposal of held-for-trading financial assets | ||
| Investment income from disposal of other equity instrument investments | ||
| Investment income from disposal of debt investment | ||
| Investment income from disposal of other debt investments | ||
| Gains from debt restructuring | ||
| Total | -2,153,663.74 | -1,164,626.88 |
Other explanations:
None
69. Net exposure hedging income
□Applicable √Not applicable
70. Gains on changes in fair value
□Applicable √Not applicable
71. Credit impairment loss
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Bad debt loss on notes receivable | ||
| Bad debt loss on accounts receivable | -2,460,128.17 | -372,328.93 |
| Bad debt loss on other receivables | 4,758,002.01 | 7,126,185.75 |
| Impairment losses on debt investment | ||
| Impairment losses on other debt investments | ||
| Bad debt loss on long-term receivables | ||
| Impairment losses related to financial guarantees | ||
| Total | 2,297,873.84 | 6,753,856.82 |
Other explanations:
None
72. Asset impairment losses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| I. Impairment losses on contract assets | ||
| II. Loss on devaluation of inventories and impairment loss on contract performance cost | -32,417,516.03 | -41,601,901.08 |
| III. Impairment loss on long-term equity investment | -10,576,298.67 | |
| IV. Impairment loss on investment property | ||
| V. Impairment loss on fixed assets | ||
| VI. Impairment loss on engineering materials | ||
| VII. Impairment loss on construction in progress | ||
| VIII. Impairment loss on productive biological assets | ||
| IX. Impairment loss on oil and gas assets | ||
| X. Impairment loss on intangible assets | ||
| XI. Impairment loss on goodwill | ||
| XII. Others | ||
| Total | -32,417,516.03 | -52,178,199.75 |
Other explanations:
None
73. Gains from disposal of assets
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Gains from disposal of fixed assets | -712,859.58 | -217,694.21 |
| Total | -712,859.58 | -217,694.21 |
Other explanations:
□Applicable √Not applicable
74. Non-operating revenue
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period | Amount included in current non-recurring gains and losses |
| Total profit from disposal of non-current assets | |||
| Including: Gains from disposal of fixed assets | |||
| Gains from disposal of intangible assets | |||
| Revenue from debt restructuring | |||
| Gains from non-monetary asset exchange | |||
| Receipt of donation | |||
| Government grants | |||
| Revenue from fines and liquidated damages | 34,990.95 | 80,499.36 | 34,990.95 |
| Amount not required to be paid | 132,267.59 | 819,297.29 | 132,267.59 |
| Income from right protection funds | 509,800.00 | 509,800.00 | |
| Others | 279,139.89 | 459,867.52 | 279,139.89 |
| Total | 956,198.43 | 1,359,664.17 | 956,198.43 |
Other explanations:
□Applicable √Not applicable
75. Non-operating expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period | Amount included in current non-recurring gains and losses |
| Total loss from disposal of non-current assets | |||
| Including: Loss from |
| disposal of fixed assets | |||
| Loss from disposal of intangible assets | |||
| Loss from debt restructuring | |||
| Loss from non-monetary asset exchange | |||
| External donation | 1,259,344.27 | 459,615.00 | 1,259,344.27 |
| Late payment fee | 132,634.13 | 2,347,897.07 | 132,634.13 |
| Loss from damage and scrapping of non-current assets | 648.90 | 100,854.99 | 648.90 |
| Others | 38,128.38 | 4,976.56 | 38,128.38 |
| Total | 1,430,755.68 | 2,913,343.62 | 1,430,755.68 |
Other explanations:
None
76. Income tax expenses
(1) Income tax expense statement
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Current income tax expense | 170,235,144.31 | 158,636,450.28 |
| Deferred income tax expense | 1,901,274.12 | -13,991,718.91 |
| Total | 172,136,418.43 | 144,644,731.37 |
(2) Adjustment process of accounting profit and income tax expense
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period |
| Total profit | 896,068,694.72 |
| Income tax expense calculated at statutory/applicable tax rate | 224,017,173.68 |
| Impact of different tax rates applicable to subsidiaries | -65,508,055.14 |
| Impact of adjusting income tax in previous periods | 3,316,978.00 |
| Impact of non-taxable income | |
| Impact of non-deductible costs, expenses and losses | 1,938,798.01 |
| Impact of using deductible losses of deferred | -5,185,895.06 |
| Item | Amount incurred in the current period |
| income tax assets unrecognized in the previous period | |
| Impact of deductible temporary differences or deductible losses of deferred income tax assets unrecognized in the current period | 24,686,039.73 |
| Additional deductions for R&D expenditures | -11,128,620.79 |
| Income tax expenses | 172,136,418.43 |
Other explanations:
□Applicable √Not applicable
77. Other comprehensive income
√Applicable □Not applicable
For details, refer to the particulars contained in “57. Other comprehensive income” in “VII. Notes to theItems in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
78. Items in the cash flow statement
(1). Cash related to operating activities
Other cash received related to operating activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Interest income from bank deposits | 37,087,699.04 | 34,019,097.62 |
| Government grants | 43,030,869.59 | 33,499,531.23 |
| Receivables and payables and others | 15,577,859.24 | 71,797,601.09 |
| Total | 95,696,427.87 | 139,316,229.94 |
Explanation on other cash received related to operating activities:
None
Other cash paid related to operating activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Expenses paid in cash | 2,144,901,217.47 | 1,352,917,250.79 |
| Receivables and payables | 35,164,399.38 | 17,254,242.10 |
| Total | 2,180,065,616.85 | 1,370,171,492.89 |
Explanation on other cash paid related to operating activities:
None
(2). Cash related to investing activities
Important cash received related to investing activities
□Applicable √Not applicable
Important cash paid related to investing activities
□Applicable √Not applicable
Other cash received related to investing activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Redemption of fixed-term deposits | 300,000,000.00 | |
| Total | 300,000,000.00 |
Explanation on other cash received related to investing activities:
None
Other cash paid related to investing activities
□Applicable √Not applicable
(3). Cash related to financing activities
Other cash received related to financing activities
□Applicable √Not applicable
Other cash paid related to financing activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Payment for operating lease rent | 3,671,046.46 | 3,017,591.46 |
| Repurchase of the Company’s shares | 153,062,220.18 | |
| Total | 156,733,266.64 | 3,017,591.46 |
Explanation on other cash paid related to financing activities:
None
Information on changes in liabilities arising from financing activities
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | ||
| Cash changes | Non-cash changes | Cash changes | Non-cash changes | |||
| Short-term borrowings | 200,155,555.56 | 200,155,555.56 | ||||
| Bonds payable | 753,119,902.88 | 17,079,001.76 | 770,198,904.64 | |||
| (including bonds payable due within one year) | ||||||
| Lease liabilities (including lease liabilities due within one year) | 13,940,366.98 | 6,025,267.36 | 3,671,046.46 | 16,294,587.88 | ||
| Total | 967,215,825.42 | 23,104,269.12 | 3,671,046.46 | 986,649,048.08 |
(4). Explanation on presentation of cash flows at net amount
□Applicable √Not applicable
(5). Significant activities and financial impacts that do not involve current cash receipts and
payments but affect the financial condition of the enterprise or may affect the cash flow of theenterprise in the future
√Applicable □Not applicable
| Item | Amount for the current period | Amount for the same period last year |
| Transfer amounts endorsed by commercial bills | 4,643,243.57 | 1,950,000.00 |
| Including: Payment for goods | 4,643,243.57 | 1,950,000.00 |
79. Supplementary information to cash flow statement
(1) Supplementary information to cash flow statement
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Supplementary information | Amount for the current period | Amount of previous period |
| 1. Reconciliation of net profits to cash flows from operating activities: | ||
| Net profit | 723,932,276.29 | 528,268,321.22 |
| Add: Provision for impairment of assets | 32,417,516.03 | 52,178,199.75 |
| Credit impairment loss | -2,297,873.84 | -6,753,856.82 |
| Depreciation of fixed assets, depletion of oil and gas assets and depreciation of productive biological assets | 35,429,876.22 | 17,248,552.10 |
| Amortization of right-to-use assets | 3,316,453.06 | 1,734,279.12 |
| Amortization of intangible assets | 8,967,362.97 | 9,008,229.23 |
| Amortization of long-term deferred expenses | 9,178,246.26 | 6,398,143.87 |
| Losses on disposal of fixed assets, intangible assets and other long-term assets (“-” for income) | 712,859.58 | 217,694.21 |
| Losses from scrapping of fixed assets (“-” for income) | 648.90 | 100,854.99 |
| Losses on changes in fair value (“-” for income) | ||
| Financial expenses (“-” for income) | 10,320,057.93 | 5,817,515.18 |
| Investment loss (“-” for income) | 2,153,663.74 | 1,164,626.88 |
| Decrease in deferred income tax assets (“-” for increase) | 1,124,671.65 | -18,921,309.65 |
| Increase in deferred income tax liabilities (“-” for decrease) | 776,602.47 | 4,929,590.74 |
| Decrease in inventory (“-” for increase) | -32,743,508.58 | -102,571,881.18 |
| Decrease in operating receivables (“-” for increase) | 19,731,991.89 | 69,128,299.79 |
| Increase in operating payables (“-”for decrease) | -151,804,305.68 | 563,359,566.28 |
| Others | 886,255.50 | 49,961,246.32 |
| Net cash flows from operating activities | 662,102,794.39 | 1,181,268,072.03 |
| 2. Major investment and financing activities that do not involve cash receipts and payments: | ||
| Conversion of debt into capital | ||
| Convertible corporate bonds due within one year | ||
| Fixed assets under finance lease | ||
| 3. Net changes in cash and cash equivalents: | ||
| Closing balance of cash | 4,005,586,605.59 | 3,952,864,158.35 |
| Less: Opening balance of cash | 3,659,267,712.03 | 3,125,333,085.05 |
| Add: Closing balance of cash equivalents | ||
| Less: Opening balance of cash equivalents | ||
| Net increase in cash and cash equivalents | 346,318,893.56 | 827,531,073.30 |
(2) Net cash paid to acquire subsidiaries in the current period
□Applicable √Not applicable
(3) Net cash received from disposal of subsidiaries in the current period
□Applicable √Not applicable
(4) Composition of cash and cash equivalents
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| I. Cash | 4,005,586,605.59 | 3,659,267,712.03 |
| Including: Cash on hand | 27,735.67 | 29,332.00 |
| Bank deposits that can be used for payment at any time | 3,965,884,295.71 | 3,448,037,161.01 |
| Other monetary capital that can be used for payment at any time | 39,674,574.21 | 211,201,219.02 |
| Funds deposited with the central bank for payment | ||
| Deposits in other banks | ||
| Funds for interbank lending | ||
| II. Cash equivalents | ||
| Including: Bond investment due within three months | ||
| III. Closing balance of cash and cash equivalents | 4,005,586,605.59 | 3,659,267,712.03 |
| Including: Cash and cash equivalents with restricted use by the parent company or a subsidiary of the group | 191,530,012.35 | 257,906,850.60 |
(5) Information on funds with restricted use but still presented as cash and cash equivalents
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount for the current period | Reason |
| Raised funds | 102,220,796.38 | Special account of raised funds |
| Cash subject to foreign exchange control of overseas operating subsidiaries | 89,309,215.97 | Subject to foreign exchange control |
| Total | 191,530,012.35 | / |
(6) Monetary capital not belonging to cash and cash equivalents
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount for the current period | Amount of previous period | Reason |
| Fixed-term deposit | 30,000,000.00 | 335,288,251.36 | Cannot be withdrawn at any time |
| L/C deposit | 8,800,000.00 | 8,800,000.00 | Cannot be withdrawn at any time |
| Transformer deposit | 250,000.00 | 250,000.00 | Cannot be withdrawn at any time |
| Vehicle ETC deposit | 70,000.00 | 70,000.00 | Cannot be withdrawn at any time |
| Pinduoduo deposit | 5,540,922.50 | 5,298,890.00 | Cannot be withdrawn at any time |
| Directly-operated store deposit | 2,553,262.81 | 2,110,704.68 | Cannot be withdrawn at any time |
| Total | 47,214,185.31 | 351,817,846.04 | / |
Other explanations:
□Applicable √Not applicable
80. Notes on items in the statement of changes in owners’ equity
Explanation on the names of “others” items for adjusting the closing balance of the previous year andadjustment amounts:
□Applicable √Not applicable
81. Foreign-currency monetary items
(1). Foreign-currency monetary items
√Applicable □Not applicable
Unit: Yuan
| Item | Ending foreign currency balance | Converted exchange rate | Converted RMB balance at the end of period |
| Monetary capital | - | - | 84,214,058.26 |
| Including: USD | 2,717,188.18 | 7.1268 | 19,364,856.72 |
| HKD | 16,764,366.38 | 0.91268 | 15,300,501.91 |
| EUR | 5,322,957.74 | 7.6617 | 40,782,905.32 |
| JPY | 135,182,395.00 | 0.044738 | 6,047,789.99 |
| KRW | 59,304,853.00 | 0.0052 | 308,385.24 |
| SGD | 121,319.75 | 5.2790 | 640,446.96 |
| MYR | 1,027,456.29 | 1.5095 | 1,550,945.27 |
| SF | 22,953.86 | 7.9471 | 182,416.62 |
| VND | 4,805,159.00 | 0.0003 | 1,441.55 |
| TWD | 150,740.00 | 0.2234 | 33,675.32 |
| THB | 3,552.05 | 0.1952 | 693.36 |
| Accounts receivable | - | - | 4,573,351.94 |
| Including: EUR | 218,942.52 | 7.6617 | 1,677,471.91 |
| JPY | 64,725,983.00 | 0.044738 | 2,895,711.03 |
| KRW | 32,500.00 | 0.0052 | 169.00 |
| Other receivables | - | - | 22,346,251.32 |
| Including: USD | 17,955.43 | 7.1268 | 127,964.76 |
| EUR | 2,832,778.86 | 7.6617 | 21,703,901.79 |
| JPY | 11,052,626.00 | 0.044738 | 494,472.38 |
| SGD | 3,772.00 | 5.2790 | 19,912.39 |
| Accounts payable | - | - | 11,840,505.24 |
| Including: USD | 3,375.09 | 7.1268 | 24,053.59 |
| HKD | 22,500.00 | 0.91268 | 20,535.30 |
| EUR | 1,085,276.03 | 7.6617 | 8,315,059.36 |
| JPY | 73,989,473.00 | 0.044738 | 3,310,141.04 |
| MYR | 113,094.37 | 1.5095 | 170,715.95 |
| Other payables | - | - | 11,792,856.63 |
| Including: EUR | 1,377,166.74 | 7.6617 | 10,551,438.41 |
| HKD | 437,972.65 | 0.91268 | 399,728.88 |
| JPY | 1,023,581.00 | 0.044738 | 45,792.97 |
| KRW | 153,056,995.00 | 0.0052 | 795,896.37 |
Other explanations:
None
(2). Explanation on overseas operating entities, including the main overseas operating location,
bookkeeping currency, selection criteria, and reasons for change in the bookkeepingcurrency of important overseas operating entities, which should be disclosed
√Applicable □Not applicable
Hapsode Co., Ltd. and Hanna Cosmetics Co., Ltd. operate in South Korea, and their business incomeand expenditures are mainly in KRW, thus they choose KRW as the bookkeeping currency. Hong KongXinghuo Industry Limited, Hong Kong Zhongwen Electronic Commerce Co., Limited, Hong KongXuchen Trading Limited, Hong Kong Keshi Trading Co., Ltd., Boya (Hong Kong) InvestmentManagement Co., Limited and Hong Kong Wanyan Electronic Commerce Co., Limited operate in HongKong, thus they choose RMB as the bookkeeping currency. OR Off&Relax operates in Japan and itsbusiness income and expenditures are mainly in JPY, thus it chooses JPY as the bookkeeping currency.PROYA PTE. LTD. operates in Singapore, and its business income and expenditures are mainly in SGD,thus it chooses SGD as the bookkeeping currency. PROYA BEAUTY MALAYSIA SDH. BHD.operates in Malaysia and its business income and expenditures are mainly in MYR, thus it chooses MYRas the bookkeeping currency.
82. Lease
(1) The Company as the lessee
√Applicable □Not applicable
1) For details on right-of-use assets, refer to the particulars contained in “25. Right-of-use assets” in “VII.Notes to the Items in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
2) For the details on accounting policies for short-term leases and low-value asset leases of the Company,refer to the particulars contained in “38. Lease” in “V. Significant Accounting Policies and AccountingEstimates”, “Section X Financial Report” of this Report.Variable lease payments not included in the measurement of lease liabilities
□Applicable √Not applicable
Lease expenses of short-term leases or low-value asset leases subject to simplified treatment
√Applicable □Not applicable
| Item | Amount for the current period | Amount for the same period last year |
| Short-term lease expenses | 1,263,050.54 | |
| Low-value asset lease expenses (except for short-term lease expenses) | 105,249.31 | 238,389.59 |
| Total | 1,368,299.85 | 238,389.59 |
Sale and leaseback transactions and judgment basis
□Applicable √Not applicable
Total cash outflows related to leases is 5,697,457.87 (Unit: Yuan Currency: RMB)
(2) The Company as the lessor
Operating lease where the Company is the lessor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Lease income | Including: Income related to variable lease payments not included in lease receipts |
| Investment property | 3,308,644.06 | |
| Total | 3,308,644.06 |
For the details of fixed assets leased out through operating lease, refer to the particulars contained in “20.Investment property” in “VII. Notes to the Items in Consolidated Financial Statements”, “Section XFinancial Report” of this Report.
Financing lease where the Company is the lessor
□Applicable √Not applicable
Reconciliation Statement of undiscounted lease receipts and net lease investments
□Applicable √Not applicable
Undiscounted lease receipts in the next five years
□Applicable √Not applicable
(3) Profits and losses of financial lease sales recognized by the Company as a manufacturer ordistributor
□Applicable √Not applicable
Other explanationsNone
83. Data resources
□Applicable √Not applicable
84. Others
□Applicable √Not applicable
VIII. R&D expenditures
(1). Presentation by nature of expenses
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Labor cost | 47,707,793.99 | 36,691,200.82 |
| Outsourced R&D expenses | 27,339,439.25 | 31,341,477.15 |
| Expenses for depreciation, amortization and lease | 9,073,764.54 | 4,277,735.35 |
| Direct input costs | 7,027,978.71 | 8,855,671.21 |
| Equity incentive expenses for restricted shares | 1,698,026.83 | 5,337,809.98 |
| Others | 1,766,239.20 | 5,016,970.64 |
| Total | 94,613,242.52 | 91,520,865.15 |
| Including: Expensed R&D expenditures | 94,613,242.52 | 91,520,865.15 |
| Capitalized R&D expenditures |
Other explanations:
None
(2). R&D project development expenditures eligible for capitalization
□Applicable √Not applicable
Important capitalized R&D project
□Applicable √Not applicable
Impairment provision of development expenditures
□Applicable √Not applicable
Other explanations
None
(3). Important outsourcing projects under research
□Applicable √Not applicable
IX. Change of Consolidation Scope
1. Business combination not under common control
□Applicable √Not applicable
2. Business combination under common control
□Applicable √Not applicable
3. Counter purchase
□Applicable √Not applicable
4. Disposal of subsidiaries
Were there any transactions or events that resulted in the loss of control over a subsidiary in the currentperiod
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Was there a stepwise disposal of investment to subsidiaries through multiple transactions and a loss ofcontrol in the current period
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
5. Change of combination scope for other reasons
Explanation of the changes in the consolidation scope caused by other reasons (for example, newly established subsidiary, liquidated subsidiary, etc.) and thespecific information:
√Applicable □Not applicable
1. Increase of consolidation scope
| Company name | Equity acquisition method | Time point of equity acquisition | Contribution amount | Contribution ratio |
| Ningbo Jingzhe Cosmetics Co., Ltd. | Newly established subsidiary | January 2024 | 1,000,000.00 | 100.00% |
| Hangzhou Gloris Trading Co., Ltd. | Newly established subsidiary | March 2024 | 100.00% | |
| PROYA EUROPE SAS | Newly established subsidiary | June 2024 | 100.00% |
2. Decrease in consolidation scope
| Company name | Equity disposal method | Time point of equity disposal | Net assets as at the disposal date | Net profits from the beginning of the period to the disposal date |
| Huzhou Younimi Cosmetics Co., Ltd. | Cancel | January 2024 | 25,563,529.57 | 2,599.62 |
| Guangzhou Qianxi Network Technology Co., Ltd. | Cancel | April 2024 | -1,350,735.34 | 72.90 |
6. Others
□Applicable √Not applicable
X. Equity in Other Entities
1. Equity in subsidiaries
(1). Composition of enterprise group
√Applicable □Not applicable
Unit: RMB'0,000 Currency: RMB
| Subsidiary name | Main place of business | Registered capital | Registration place | Nature of business | Shareholding ratio (%) | Mode of acquisition | |
| Direct | Indirect | ||||||
| Hangzhou Proya Trade Co., Ltd. | Hangzhou | 5,000.00 | Hangzhou | Wholesale and retail | 100.00 | Establishment | |
| Zhejiang Meiligu Electronic Commerce Co., Ltd. | Hangzhou | 1,000.00 | Hangzhou | Wholesale and retail | 100.00 | Establishment | |
| Ningbo TIMAGE Cosmetics Co., Ltd. | Ningbo | 100.00 | Ningbo | Wholesale and retail | 71.36 | Establishment | |
| Proya (Zhejiang) Cosmetics Co., Ltd. | Huzhou | 1,000.00 | Huzhou | Manufacturing | 100.00 | Establishment | |
Explanation on the shareholding ratio in subsidiaries different from the voting ratio:
None
Basis for holding half or less voting rights but still controlling the investee, and holding more than halfvoting rights but not controlling the investee:
None
Basis for controlling the important structured entities included in the consolidation scope:
None
Basis for determining whether a company is an agent or a principal:
None
Other explanations:
None
(2). Important non-wholly owned subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Name of subsidiary | Shareholding ratio of the minority shareholders (%) | Profit or loss attributable to minority shareholders in the current period | Dividends declared and distributed to minority shareholders in the current period | Balance of minority interests at the end of the period |
| Ningbo TIMAGE Cosmetics Co., Ltd. | 28.64 | 22,485,442.67 | 77,934,781.78 |
Explanation on the shareholding ratio of minority shareholders in subsidiaries different from the votingratio:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
(3). Major financial information of important non-wholly owned subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Name of subsidiary | Closing balance | Opening balance | ||||||||||
| Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | Current assets | Non-current assets | Total assets | Current liabilities | Non-current liabilities | Total liabilities | |
| Ningbo TIMAGE Cosmetics Co., Ltd. | 388,400,063.74 | 9,182,378.98 | 397,582,442.72 | 123,174,878.70 | 123,174,878.70 | 297,733,820.74 | 11,052,026.21 | 308,785,846.95 | 111,987,809.76 | 1,079,017.49 | 113,066,827.25 | |
| Name of subsidiary | Amount incurred in the current period | Amount incurred in the previous period | ||||||
| Operating revenue | Net profit | Total comprehensive income | Cash flows generated from operating activities | Operating revenue | Net profit | Total comprehensive income | Cash flows generated from operating activities | |
| Ningbo TIMAGE Cosmetics Co., Ltd. | 583,568,251.38 | 78,510,623.85 | 78,510,623.85 | 80,370,846.40 | 429,841,111.95 | 98,618,452.96 | 98,618,452.96 | 77,958,227.70 |
Other explanations:
None
(4). Major restrictions on using enterprise group assets and paying off enterprise group debts:
□Applicable √Not applicable
(5). Financial support or other support provided to structured entities included in the scope ofconsolidated financial statements:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
2. Transactions where the share of owners' equity in a subsidiary changes and the subsidiary is
still controlled
□Applicable √Not applicable
3. Rights and interests in joint ventures or associates
√Applicable □Not applicable
(1). Important joint ventures or associates
□Applicable √Not applicable
(2). Major financial information of important joint ventures
□Applicable √Not applicable
(3). Major financial information of important associates
□Applicable √Not applicable
(4). Summary financial information of unimportant joint ventures and associates
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Closing balance/amount incurred in the current period | Opening balance/amount incurred in the previous period | |
| Joint ventures: | ||
| Total carrying value of investment | 3,053,932.83 | 3,066,898.78 |
| Total of the following items calculated according to the shareholding ratio | ||
| – Net profit | -6,059.09 | -2,049.38 |
| – Other comprehensive income | ||
| – Total comprehensive income | -6,059.09 | -2,049.38 |
| Associates: | ||
| Total carrying value of investment | 109,520,225.67 | 129,876,661.36 |
| Total of the following items calculated according to the shareholding ratio | ||
| – Net profit | -993,940.92 | -1,829,651.09 |
| – Other comprehensive income | ||
| – Total comprehensive income | -993,940.92 | -1,829,651.09 |
Other explanationsNone
(5). Explanation on major restrictions on the ability of joint ventures or associates to transfer
capital to the Company
□Applicable √Not applicable
(6). Excess losses incurred by joint ventures or associates
□Applicable √Not applicable
(7). Unconfirmed commitments related to investments in joint ventures
□Applicable √Not applicable
(8). Contingent liabilities related to investments in joint ventures or associates
□Applicable √Not applicable
4. Important joint operations
□Applicable √Not applicable
5. Rights and interests in structured entities not included in the scope of consolidated financialstatementsExplanation on structured entities not included in the scope of consolidated financial statements:
□Applicable √Not applicable
6. Others
□Applicable √Not applicable
XI. Government grants
1. Government grants recognized by amount receivable at the end of the Reporting Period
□Applicable √Not applicable
Reasons for failure to receive the expected amount of government grants at the expected time point
□Applicable √Not applicable
2. Liability items involving government grants
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Items in financial statements | Opening balance | Amount of new subsidies in the current period | Amount included in non-operating revenue in the current period | Amount transferred in other income in the current period | Other changes in the current period | Closing balance | Related to assets or income |
| Deferred income | 6,383,359.33 | 1,000,000.00 | 517,738.80 | 6,865,620.53 | Related to assets | ||
| Total | 6,383,359.33 | 1,000,000.00 | 517,738.80 | 6,865,620.53 | / |
3. Government grants included in current profit or loss
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Type | Amount incurred in the current period | Amount incurred in the previous period |
| Related to income | 41,996,899.59 | 33,599,531.23 |
| Related to assets | 517,738.80 | 1,039,545.00 |
| Total | 42,514,638.39 | 34,639,076.23 |
Other explanations:
None
XII. Risks Related to Financial Instruments
1. Risks of financial instruments
√Applicable □Not applicable
The Company's risk management aims to reach balancing between risks and benefits, to minimize thenegative impact of risks on the Company's operating results, and to maximize the interests ofshareholders and other equity investors. Based on these risk management goals, the Company's basicstrategy for risk management is to determine and analyze various risks faced by the Company, establishan appropriate risk tolerance bottom line and conduct risk management, and supervise various risks in atimely and reliable manner to control the risks within a limited scope.The Company faces various risks related to financial instruments in its daily activities, mainly includingcredit risk, liquidity risk and market risk. The management has considered and approved the policiesgoverning these risks as outlined below.(I) Credit riskCredit risk refers to the risk that one party of a financial instrument fails to fulfill its obligations,resulting in financial losses to the other party.
1. Credit risk management practice
(1) Assessment method of credit risk
The Company, on each balance sheet date, assesses whether the credit risk of relevant financialinstruments has increased significantly since initial recognition. In determining whether the credit riskhas increased significantly since initial recognition, the Company takes into account the reasonable andwell-founded information available without unnecessary additional costs or efforts, including qualitativeand quantitative analyses based on historical data, external credit risk rating and forward-lookinginformation. The Company determines the changes that may result in default risk of financialinstruments within their expected duration by comparing the default risk of the financial instruments onthe balance sheet date and the initial recognition date based on an individual financial instrument orcombined financial instruments with similar credit risk characteristics.The Company deems that the credit risk of the financial instruments has increased significantly if one ormore of the following quantitative or qualitative standards are reached:
1) The quantitative standard is mainly that the probability of default within the remaining duration on thebalance sheet date has increased by more than a certain proportion compared with that at the initialrecognition;
2) The qualitative standard is mainly that there are material adverse changes occurring to the business orfinancial conditions of the debtor and changes in the exiting or anticipated technology, market, economic
or legal environment which have a material adverse effect on the debtor's ability to make repayment tothe Company.
(2) Definitions of default and assets with credit impairment
If the financial instruments meet one or more of the following conditions, the Company defines thefinancial assets as in default, with its standard consistent with the definition of credit impairment:
1) The debtor faces major financial difficulties;
2) The debtor breaches the provisions governing it in the contract;
3) The debtor is very likely to become bankrupt or go into other financial restructuring proceedings;
4) The creditor makes a concession to the debtor which it will not make under any other circumstancesfor the economic or contractual considerations in connection with the debtor’s financial difficulties.
2. Measurement of expected credit loss
The key parameters for measurement of expected credit loss include the probability of default, loss givendefault and default risk exposure. The Company builds the models of probability of default, loss givendefault and default risk exposure considering the quantitative analysis of historical statistical data (suchas counterparty rating, guarantee type, category of collateral and pledge, repayment method) andforward-looking information.
3. For the details on the reconciliation statement of opening balance and closing balance of financialinstrument loss reserve, refer to the particulars contained in “5. Accounts receivable”, “7. Receivablesfinancing” and “9. Other receivables” in “VII. Notes to the Items in Consolidated Financial Statements”,“Section X Financial Report” of this Report.
4. Credit risk exposure and credit risk concentration
The credit risk of the Company is derived mainly from the monetary capital and accounts receivable. Tocontrol the above related risk, the Company has respectively taken the following measures.
(1) Monetary capital
The bank deposit and other monetary capitals of the Company were deposited with financial institutionswith high credit rating. Therefore, the credit risk was low.
(2) Accounts receivable
The Company continuously carries out credit assessments on customers who trade in credit. Accordingto the results of credit assessments, the Company deals with approved and credible customers, andmonitors the balance of its accounts receivable, so as to prevent significant bad debt risk.No guarantee is required as the Company only transacts with recognized and reputable third parties.Credit risk concentration is managed on a per-customer basis. As of June 30, 2024, the Company had acertain credit concentration risk of 93.09% (as of December 31, 2023: 93.36%) of the Company'saccounts receivable originating from the top five customers in the balance. The Company had noguarantee or other credit enhancement on the balance of the accounts receivable.The maximum credit risk exposure of the Company is the carrying value of the financial assets in thebalance sheet.(II) Liquidity riskLiquidity risk refers to the risk of shortage of funds when the Company fulfills its obligation to settle bydelivering cash or other financial assets. Liquidity risk may arise from the inability to sell financialassets at fair value as soon as possible, or the counterparty's inability to pay off its contractual debts, orearly maturity of debt, or the inability to generate expected cash flows.To control such risk, the Company applies various financing methods, such as bill settlements and bankloans, in appropriate combination of long-term and short-term financing to optimize the financingstructure and keep the balance between financing sustainability and flexibility. The Company has
obtained lines of credit from several commercial banks to satisfy its working capital demand and capitalexpenditure.Classification of financial liabilities by the remaining due days
| Item | Closing amount | ||||
| Carrying value | Undiscounted contract amount | Within 1 year | 1-3 years | Above 3 years | |
| Short-term borrowings | 200,155,555.56 | 201,344,596.66 | 201,344,596.66 | ||
| Notes payable | |||||
| Accounts payable | 1,061,672,558.10 | 1,061,672,558.10 | 1,061,672,558.10 | ||
| Other payables | 151,600,173.08 | 151,600,173.08 | 151,600,173.08 | ||
| Bonds payable | 770,198,904.64 | 895,663,838.00 | 7,507,660.00 | 24,775,278.00 | 863,380,900.00 |
| Lease liabilities | 11,733,319.90 | 13,043,408.26 | 5,524,298.17 | 7,519,110.09 | |
| Non-current liabilities due within one year | 4,561,267.98 | 5,055,572.39 | 5,055,572.39 | ||
| Subtotal | 2,199,921,779.26 | 2,328,380,146.49 | 1,427,180,560.23 | 30,299,576.17 | 870,900,010.09 |
(Continued)
| Item | Balance at the end of the previous year | ||||
| Carrying value | Undiscounted contract amount | Within 1 year | 1-3 years | Above 3 years | |
| Short-term borrowings | 200,155,555.56 | 204,136,925.42 | 204,136,925.42 | ||
| Notes payable | 36,959,074.14 | 36,959,074.14 | 36,959,074.14 | ||
| Accounts payable | 1,018,522,358.60 | 1,018,522,358.60 | 1,018,522,358.60 | ||
| Other payables | 155,345,148.68 | 155,345,148.68 | 155,345,148.68 | ||
| Bonds payable | 753,119,902.88 | 902,651,337.03 | 7,500,387.51 | 31,446,772.75 | 863,704,176.77 |
| Lease liabilities | 9,970,306.87 | 14,684,876.69 | 5,269,969.69 | 9,414,907.00 | |
| Non-current liabilities due within one year | 3,970,060.11 | 4,213,792.92 | 4,213,792.92 | ||
| Subtotal | 2,178,042,406.84 | 2,336,513,513.48 | 1,426,677,687.27 | 36,716,742.44 | 873,119,083.77 |
(III) Market riskMarket risk refers to the risk of fluctuations in the fair value or future cash flow of financial instrumentsdue to changes in market prices. Market risks mainly include interest rate risk and foreign exchange risk.
1. Interest rate risk
Interest rate risk refers to the risk of fluctuations in the fair value or future cash flow of financialinstruments due to changes in market interest rates. Interest-bearing financial instruments with a fixedinterest rate expose the Company to the interest rate risk of fair value, and those with a floating interestrate expose the Company to the interest rate risk of cash flow. The Company determines the proportionof financial instruments with a fixed interest rate and a floating interest rate according to the market
environment, and maintains an appropriate combination of financial instruments through regular reviewand monitoring.
2. Foreign exchange risk
Foreign exchange risk refers to the risk of fluctuations in the fair value or future cash flow of financialinstruments due to the change of foreign exchange rates. The risk of changes in foreign exchange ratesfaced by the Company is mainly related to the Company's foreign currency assets and liabilities. TheCompany carries out business in the Chinese mainland, and therefore has main activities valuated inRMB. Therefore, the market risk of foreign exchange changes faced by the Company is minor.For the details on foreign-currency monetary assets and liabilities of the Company at the end of theperiod, refer to the particulars contained in “81. Foreign-currency monetary items” in “VII. Notes to theItems in Consolidated Financial Statements”, “Section X Financial Report” of this Report.
2. Hedging
(1) The Company carries out hedging business for risk management
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(2) The Company carries out qualified hedging business and applies hedging accounting
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(3) The Company carries out hedging business for risk management, and expects to achieve risk
management objectives, but does not apply hedging accounting
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
3. Transfer of financial assets
(1) Classification of transfer methods
□Applicable √Not applicable
(2) Financial assets derecognized due to transfer
□Applicable √Not applicable
(3) Financial assets transferred due to continued involvement
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
XIII. Disclosure of Fair Value
1. Closing fair value of assets and liabilities measured at fair value
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing fair value | |||
| The first level of fair value measurement | The second level of fair value measurement | The third level of fair value measurement | Total | |
| I. Continuous fair value measurement | ||||
| (I) Financial assets held for trading | ||||
| 1. Financial assets measured at fair value through profit or loss | ||||
| (1) Debt instrument investment | ||||
| (2) Equity instrument investment | ||||
| (3) Derivative financial assets | ||||
| 2. Financial assets designated as measured at fair value through profit or loss | ||||
| (1) Debt instrument investment | ||||
| (2) Equity instrument investment | ||||
| (II) Other debt investments | ||||
| (III) Other equity instrument investments | 107,660,400.00 | 107,660,400.00 | ||
| (IV) Investment property | ||||
| 1. Land use rights for lease | ||||
| 2. Leased buildings | ||||
| 3. Land use rights that are held for transfer upon appreciation | ||||
| (V) Biological assets | ||||
| 1. Consumable biological assets | ||||
| 2. Productive biological | ||||
| Item | Closing fair value | |||
| The first level of fair value measurement | The second level of fair value measurement | The third level of fair value measurement | Total | |
| assets | ||||
| Receivables financing | 3,695,843.86 | 3,695,843.86 | ||
| Total assets continuously measured at fair value | 111,356,243.86 | 111,356,243.86 | ||
| (VI) Financial liabilities held for trading | ||||
| 1. Financial liabilities measured at fair value through profit or loss | ||||
| Including: Trading bonds issued | ||||
| Derivative financial liabilities | ||||
| Others | ||||
| 2. Financial liabilities designated as measured at fair value through profit or loss | ||||
| Total liabilities continuously measured at fair value | ||||
| II. Non-continuous fair value measurement | ||||
| (I) Assets held for sale | ||||
| Total assets not continuously measured at fair value | ||||
| Total liabilities not continuously measured at fair value | ||||
2. Determination basis for the market price of continuous and non-continuous first-level fairvalue measurement items
□Applicable √Not applicable
3. Qualitative and quantitative information on the valuation techniques and important
parameters used in continuous and non-continuous second-level fair value measurementitems
□Applicable √Not applicable
4. Qualitative and quantitative information on the valuation techniques and important
parameters used in continuous and non-continuous third-level fair value measurement items
√Applicable □Not applicable
1. For bank acceptance bills held by the Company, the fair value is determined by the par value.
2. As for investments in other equity instruments held by the Company, due to the fact that there were noimportant changes in business environment, operating conditions, financial conditions and externalvaluation of the investees, including Hangzhou Regenovo Biotechnology Co., Ltd. and LIPOTRUE, S.L.,the Company takes the investment cost as a reasonable estimate of fair value for measurement. Due tothe difference between the financial condition of the investee Golong Holdings Co., Ltd. and theexpectations at the time of investment, the Company determines the fair value at the end of the periodbased on the asset evaluation report issued by a professional evaluation agency, the valuation techniqueadopted by the Company is the market method, and the important parameters adopted include theinvestee EBITDA, and the EV/EBITDA value ratio of listed companies in the same industry.
5. Adjustment information and sensitivity analysis of non-observable parameters betweenopening and closing book value for continuous third-level fair value measurement items
□Applicable √Not applicable
6. For continuous fair value measurement items, if the conversion occurs among different levelswithin the current period, the reasons for the conversion and the policy for determining theconversion time point
□Applicable √Not applicable
7. Changes in valuation techniques during the current period and the reasons for the changes
□Applicable √Not applicable
8. Information on fair value of financial assets and financial liabilities not measured at fair value
□Applicable √Not applicable
9. Others
□Applicable √Not applicable
XIV. Related Parties and Related Party Transactions
1. Information on the parent company of the Company
□Applicable √Not applicable
2. Information on subsidiaries of the Company
Refer to the notes for the details on subsidiaries of the Company
√Applicable □Not applicable
For the details on subsidiaries of the Company, refer to the particulars contained in “X. Equity in OtherEntities”, “Section X Financial Report” of this Report.
3. Information on joint ventures and associates of the Company
Refer to the notes for details of the important joint ventures or associates of the Company
√Applicable □Not applicable
For the details on the important joint ventures or associates of the Company, refer to the particularscontained in “X. Equity in Other Entities”, “Section X Financial Report” of this Report.
Information on other joint ventures or associates that have related party transactions with the Companyin the current period, or have balance resulting from related party transactions with the Company in theprevious period is as follows
□Applicable √Not applicable
4. Information on other related parties
√Applicable □Not applicable
| Name of other related party | Relationship between other related party and the Company |
| Huzhou Beauty Town Technology Incubation Park Co., Ltd. | Others |
| Ningbo Weiman Cosmetics Co., Ltd. | Others |
| Beijing Xiushi Cultural Development Co., Ltd. | Others |
| Hangzhou Slow Coral Cultural Tourism Planning and Design Co., Ltd. | Others |
| Zhejiang Proya Public Welfare Foundation | Others |
| PARISEZHAN HK LIMITED | Others |
| EURL PHARMATICA | Others |
| SARL ORTUS | Others |
| S.A.S AREDIS | Others |
| Beauty Hi-tech Innovation Co., Ltd. | Others |
Other explanationsNone
5. Information on related party transactions
(1). Related party transactions in purchasing and selling goods, and rendering and receiving laborservicesStatement of purchasing goods/receiving labor services
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Related parties | Details of related party transactions | Amount incurred in the current period | Approved transaction limit (if applicable) | Exceeding the transaction limit or not (if applicable) | Amount incurred in the previous period |
| Beauty Hi-tech Innovation Co., Ltd. | Agent operation service fee | 152,982.54 | 2,504,700.00 |
| Related parties | Details of related party transactions | Amount incurred in the current period | Approved transaction limit (if applicable) | Exceeding the transaction limit or not (if applicable) | Amount incurred in the previous period |
| Beijing Xiushi Cultural Development Co., Ltd. | Promotion expense | 4,716,981.14 | |||
| Hangzhou Slow Coral Cultural Tourism Planning and Design Co., Ltd. | Design fee | 107,639.89 | |||
| Huzhou Beauty Town Technology Incubation Park Co., Ltd. | Water and electricity fee | 157,873.57 |
Statements of sales of goods/rendering of services
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Related parties | Details of related party transactions | Amount incurred in the current period | Amount incurred in the previous period |
| Ningbo Weiman Cosmetics Co., Ltd. | Sales of goods | 464.60 |
Explanation on related party transactions in purchasing and selling goods, and rendering and receivinglabor services
□Applicable √Not applicable
(2). Related entrusted management/contracting and entrusted management/outsourcingStatement of entrusted management/contracting of the Company:
□Applicable √Not applicable
Explanation on related trusteeship/contracting
□Applicable √Not applicable
Statement of entrusted management/outsourcing of the Company:
□Applicable √Not applicable
Explanation on related management/outsourcing
□Applicable √Not applicable
(3). Information of related lease
The Company as the lessor:
□Applicable √Not applicable
The Company as the lessee:
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Name of lessor | Types of leased assets | Rent expenses of short-term leases and low-value asset leases subject to simplified treatment (if applicable) | Variable lease payments not included in the measurement of lease liabilities (if applicable) | Rent paid | Interest expenses on lease liabilities assumed | Right-of-use assets increased | |||||
| Amount incurred in the current period | Amount incurred in the previous period | Amount incurred in the current period | Amount incurred in the previous period | Amount incurred in the current period | Amount incurred in the previous period | Amount incurred in the current period | Amount incurred in the previous period | Amount incurred in the current period | Amount incurred in the previous period | ||
| Huzhou Beauty Town Technology Incubation Park Co., Ltd. | Site | 495,928.96 | 517,536.00 | 7,222.26 | 13,976.20 | ||||||
Explanation on related lease
□Applicable √Not applicable
(4). Information on related guarantees
The Company as the guarantor
□Applicable √Not applicable
The Company as the guarantee
□Applicable √Not applicable
Explanation on related guarantees
□Applicable √Not applicable
(5). Borrowing of related party funds
□Applicable √Not applicable
(6). Information on asset transfer and debt restructuring of related parties
□Applicable √Not applicable
(7). Remuneration of key management personnel
√Applicable □Not applicable
Unit: RMB'0,000 Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Remuneration of key management personnel | 974.06 | 654.49 |
Note: The above remuneration excludes the relevant remuneration recognized by share-based payment
(8). Other related party transactions
√Applicable □Not applicable
During the current period, the Company donated cash totaling RMB1,000,000.00 to the Zhejiang ProyaPublic Welfare Foundation.
6. Information on unsettled items such as accounts receivable from and accounts payable torelated parties
(1). Receivable items
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Related parties | Closing balance | Opening balance | ||
| Book balance | Provision for bad debts | Book balance | Provision for bad debts | ||
| Accounts receivable | |||||
| Ningbo Weiman Cosmetics Co., Ltd. | 13,902.00 | 695.10 | 15,052.00 | 752.60 | |
| Beauty Hi-tech | 165,724.00 | 8,286.20 | |||
| Innovation Co., Ltd. | |||||
| Subtotal | 179,626.00 | 8,981.30 | 15,052.00 | 752.60 | |
| Prepayments | Beauty Hi-tech Innovation Co., Ltd. | 21,021.52 | |||
| Subtotal | 21,021.52 | ||||
| Other receivables | |||||
| EURL PHARMATICA [Note] | 18,084,211.41 | 18,084,211.41 | 18,169,451.02 | 18,169,451.02 | |
| Huzhou Beauty Town Technology Incubation Park Co., Ltd. | 131,568.20 | 131,568.20 | 132,568.20 | 132,568.20 | |
| Beauty Hi-tech Innovation Co., Ltd. | 421,356.89 | 91,123.81 | 82,767.74 | 4,138.39 | |
| Subtotal | 18,637,136.50 | 18,306,903.42 | 18,384,786.96 | 18,306,157.61 |
[Note] Other receivables from EURL PHARMATICA are the consolidated statistics of receivables fromPAN Xiang and receivables from EURL PHARMATICA, PARISEZHAN HK LIMITED, SARLORTUS, and S.A.S AREDIS controlled by PAN Xiang.
(2). Items payable
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Related parties | Closing book balance | Opening book balance |
| Accounts payable | |||
| Hangzhou Slow Coral Cultural Tourism Planning and Design Co., Ltd. | 199,622.64 | ||
| Ningbo Weiman Cosmetics Co., Ltd. | 121,884.94 | 121,884.94 | |
| Subtotal | 121,884.94 | 321,507.58 | |
| Other payables | |||
| HOU Juncheng | 2,000,000.00 | ||
| Subtotal | 2,000,000.00 |
(3). Other items
□Applicable √Not applicable
7. Commitment of related parties
□Applicable √Not applicable
8. Others
□Applicable √Not applicable
XV. Share-based Payments
1. Equity instruments
√Applicable □Not applicable
Quantity unit: Share Amount unit: Yuan Currency: RMB
| Categories of granted objects | Awarded in the current period | Exercised in the current period | Released in the current period | Invalid in the current period | ||||
| Number | Amount | Number | Amount | Number | Amount | Number | Amount | |
| Management | ||||||||
| R&D personnel | ||||||||
| Sales specialists | ||||||||
| Total | ||||||||
Outstanding stock options or other equity instruments at the end of the period
√Applicable □Not applicable
| Categories of granted objects | Outstanding stock options at the end of the period | Outstanding other equity instruments at the end of the period | ||
| Scope of exercise price | Remaining term of contract | Scope of exercise price | Remaining term of contract | |
| Management | Not applicable | Not applicable | RMB78.56/Share | 25 months |
| R&D personnel | Not applicable | Not applicable | RMB78.56/Share | 25 months |
| Sales specialists | Not applicable | Not applicable | RMB78.56/Share | 25 months |
Other explanationsOn July 25, 2022, the Company, according to the Proposal on the 2022 Restricted Shares Incentive Planof the Company (Draft) and Its Summary deliberated and approved at the First Extraordinary GeneralMeeting of Shareholders of the Company in 2022, under the Incentive Plan, proposed to grant up to2,100,000 restricted shares to incentive objects. The grant date of restricted shares is July 25, 2022, andthe incentive objects are 101 persons including senior managers, middle managers and core backbonepersonnel of the Company (excluding independent directors, supervisors and shareholders or actualcontrollers holding more than 5% of the Company's shares alone or in total, as well as their spouses,parents and children). The grant price is RMB78.56 per share. The subject shares under the IncentivePlan are derived from the A-share ordinary shares of the Company privately issued by the Company tothe incentive objects. The validity period of the Incentive Plan begins from the date when theregistration of the grant of restricted shares is completed to the date when all the restricted sharesgranted to the incentive objects are released or repurchased and de-registered, in no case taking longerthan 48 months. The granted restricted shares will be released in three tranches (30%, 30%, 40%) over
36 months after the expiration of 12 months from the date of the initial grant of the restricted shares. Theperformance condition for the initial release is that: On the basis of the operating revenue and net profitin 2021, the growth rate of operating revenue and net profit in 2022 was no less than 25% and 25%,respectively. The performance condition for the second release is that: On the basis of the operatingrevenue and net profit in 2021, the growth rate of operating revenue and net profit in 2023 was no lessthan 53.75% and 53.75%, respectively. The performance condition for the third release is that: On thebasis of the operating revenue and net profit in 2021, the growth rate of operating revenue and net profitin 2024 was no less than 87.58% and 87.58%, respectively.According to the Proposal on Satisfying the Conditions for Release from Sales Restrictions in the FirstRelease Period under the 2022 Restricted Shares Incentive Plan deliberated and approved at the 14thmeeting of the third session of Board of Directors of the Company in 2023, the Company released the811,398 restricted shares held by the incentive objects who had satisfied the first release conditions (andissued 0.40 shares for every one share to all shareholders through capitalization of the capital reserve, sothis number is the number of shares after the capitalization of the capital reserve). The circulating date ofthe sales was September 26, 2023.
2. Equity-settled share-based payment
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Determination method of the fair value of equity instruments on the grant date | Determined as per the share price on the grant date and the grant price of restricted shares |
| Important parameters of fair value of equity instruments on the grant date | Determined as per the share price on the grant date and the grant price of restricted shares |
| Basis for determining the quantity of feasible equity instruments | Determined according to the estimated performance conditions in the release period |
| Reason for significant difference with estimation in the current period and estimation in the previous period | Not applicable |
| Cumulative amount of equity-settled share-based payments included in the capital reserve | 164,451,068.48 |
Other explanationsNone
3. Information on cash-settled share-based payments
□Applicable √Not applicable
4. Share-based payment expenses in the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Categories of granted objects | Equity-settled share-based payment expenses | Cash-settled share-based payment expenses |
| Management | -2,220,910.90 | |
| R&D personnel | 1,698,026.83 | |
| Sales specialists | 1,409,139.57 | |
| Total | 886,255.50 |
Other explanationsNone
5. Information on modification and termination of share-based payments
□Applicable √Not applicable
6. Others
□Applicable √Not applicable
XVI. Commitments and Contingencies
1. Important commitments
√Applicable □Not applicable
Important external commitments, nature and amount on the balance sheet dateAs of June 30, 2024, the investment projects with raised funds conducted by the Company throughpublic issuance of convertible bonds were as follows:
Unit: RMB '0,000
| Item | Total investment amount | Committed investment amount of raised funds upon adjustment | Closing accumulated investment | Project filing or approval No. |
| Huzhou Production Base Expansion Project (Phase I) | 43,752.54 | 33,850.00 | 29,007.15 | 2011-330502-04-01-178735 |
| Longwu R&D Center Construction Project | 21,774.45 | 19,450.00 | 19,700.80 | 2101-330106-04-02-307916 |
| Information System Upgrade Project | 11,239.50 | 8,801.27 | 4,552.07 | |
| Additional working capital | 18,000.00 | 12,349.60 | 12,567.30 | |
| Total | 94,766.49 | 74,450.87 | 65,827.32 |
2. Contingencies
(1). Important contingencies on the balance sheet date
□Applicable √Not applicable
(2). Even if the Company does not have important contingencies that need to be disclosed, it mustalso state:
√Applicable □Not applicable
As of June 30, 2024, the Company had no important contingencies that need to be disclosed.
3. Others
□Applicable √Not applicable
XVII. Events after the balance sheet date
1. Important non-adjustment matters
□Applicable √Not applicable
2. Information on profit distribution
□Applicable √Not applicable
3. Sales return
□Applicable √Not applicable
4. Explanation on other events after the balance sheet date
□Applicable √Not applicable
XVIII. Other Important Matters
1. Correction of early accounting errors
(1). Retrospective restatement method
□Applicable √Not applicable
(2). Prospective application method
□Applicable √Not applicable
2. Important debt restructuring
□Applicable √Not applicable
3. Asset replacement
(1). Exchange of non-monetary assets
□Applicable √Not applicable
(2). Replacement of other assets
□Applicable √Not applicable
4. Annuity plan
□Applicable √Not applicable
5. Termination of operation
□Applicable √Not applicable
6. Segment information
(1). Determination basis and accounting policy of reportable segment
√Applicable □Not applicable
The Company's main business is the production and sale of cosmetics. The Company regards thisbusiness as a whole to implement management and evaluate business results. Therefore, the Companyhas no need to disclose segment information. For the details on revenue breakdown of the Company,refer to the particulars contained in “61. Operating revenue and operating cost” in “VII. Notes to theItems in Consolidated Financial Statements”, “Section X Financial Report” of this Report.The details of primary business revenue and primary business cost of the Company classified by brandsare as follows:
January - June 2024
| Brand | Primary business revenue | Primary business cost | Gross profit |
| Proya brand | 3,980,976,357.20 | 1,199,974,564.49 | 2,781,001,792.71 |
| Other brands | 1,013,472,071.05 | 305,925,407.83 | 707,546,663.22 |
| Subtotal | 4,994,448,428.25 | 1,505,899,972.32 | 3,488,548,455.93 |
January - June 2023
| Brand | Primary business revenue | Primary business cost | Gross profit |
| Proya brand | 2,891,721,842.83 | 828,597,188.97 | 2,063,124,653.86 |
| Other brands | 727,652,945.53 | 233,340,580.32 | 494,312,365.21 |
| Subtotal | 3,619,374,788.36 | 1,061,937,769.29 | 2,557,437,019.07 |
(2). Financial information of the reportable segment
□Applicable √Not applicable
(3). If the Company has no reportable segment, or cannot disclose the total assets and liabilities of
each reportable segment, the reasons must be explained
□Applicable √Not applicable
(4). Other explanations
□Applicable √Not applicable
7. Other important transactions and matters that have an impact on investors' decisions
□Applicable √Not applicable
8. Others
□Applicable √Not applicable
XIX. Notes on Main Items of the Financial Statements of the Parent Company
1. Accounts receivable
(1). Disclosed by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Account age | Closing book balance | Opening book balance |
| Within 1 year | ||
| Including: Sub-items within 1 year | ||
| Within 1 year | 758,250,529.25 | 601,922,452.45 |
| Subtotal within 1 year | 758,250,529.25 | 601,922,452.45 |
| 1-2 years | 36,239,732.87 | 21,289,087.90 |
| 2-3 years | 1,402,185.10 | |
| Above 3 years | 1,839,188.71 | |
| 3-4 years | ||
| 4-5 years | ||
| Above 5 years | ||
| Total | 797,731,635.93 | 623,211,540.35 |
(2). Disclosed by classification of bad debt provisions
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Category | Closing balance | Opening balance | ||||||||
| Book balance | Provision for bad debts | Book value | Book balance | Provision for bad debts | Book value | |||||
| Amount | Percentage (%) | Amount | Provision ratio (%) | Amount | Percentage (%) | Amount | Provision ratio (%) | |||
| Provision for bad debts accrued individually | ||||||||||
| Including: | ||||||||||
| Provision for bad debts accrued by portfolio | 797,731,635.93 | 100.00 | 51,324,727.59 | 6.43 | 746,406,908.34 | 623,211,540.35 | 100.00 | 36,482,849.00 | 5.85 | 586,728,691.35 |
| Including: | ||||||||||
| Account age portfolio | 797,731,635.93 | 100.00 | 51,324,727.59 | 6.43 | 746,406,908.34 | 623,211,540.35 | 100.00 | 36,482,849.00 | 5.85 | 586,728,691.35 |
| Total | 797,731,635.93 | / | 51,324,727.59 | / | 746,406,908.34 | 623,211,540.35 | / | 36,482,849.00 | / | 586,728,691.35 |
Provision for bad debts accrued individually:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
√Applicable □Not applicable
Provision by portfolio: aging portfolio
Unit: Yuan Currency: RMB
| Item | Closing balance | ||
| Accounts receivable | Provision for bad debts | Provision ratio (%) | |
| Within 1 year | 758,250,529.25 | 37,912,526.47 | 5.00 |
| 1-2 years | 36,239,732.87 | 10,871,919.86 | 30.00 |
| 2-3 years | 1,402,185.10 | 701,092.55 | 50.00 |
| Above 3 years | 1,839,188.71 | 1,839,188.71 | 100.00 |
| Total | 797,731,635.93 | 51,324,727.59 | 6.43 |
Explanation on provision for bad debts accrued by portfolio:
□Applicable √Not applicable
Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
Classification basis and provision ratio of provision for bad debts for each stageNone
Explanation on significant changes in book balance of accounts receivable with changes in provision forloss in the current period:
□Applicable √Not applicable
(3). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Category | Opening balance | Amount of changes in the current period | Closing balance | |||
| Provision | Withdrawal or write-back | Charge-off or write-off | Other changes | |||
| Provision for bad debts accrued by portfolio | 36,482,849.00 | 14,857,000.14 | 15,121.55 | 51,324,727.59 | ||
| Total | 36,482,849.00 | 14,857,000.14 | 15,121.55 | 51,324,727.59 | ||
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations
None
(4). Information on accounts receivable actually written off in the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Written off amount |
| Accounts receivable actually written off | 15,121.55 |
Among them, information on accounts receivable significantly written off
□Applicable √Not applicable
Explanation on the write-off of the accounts receivable:
□Applicable √Not applicable
(5). Information on accounts receivable and contract assets of the top five closing balancescollected by debtor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Company name | Closing balance of accounts receivable | Closing balance of contract assets | Closing balance of accounts receivable and contract assets | Proportion of total closing balance of accounts receivable and contract assets (%) | Closing balance of provision for bad debts |
| Proya (Zhejiang) Cosmetics Co., Ltd. | 492,564,537.02 | 492,564,537.02 | 61.75 | 24,628,226.85 | |
| Huzhou Hapsode Trading Co., Ltd. | 86,573,697.71 | 86,573,697.71 | 10.85 | 4,328,684.89 | |
| Huzhou UZERO Trading Co., Ltd. | 54,071,984.73 | 54,071,984.73 | 6.78 | 5,601,057.67 | |
| Ningbo Tangyu Trading Co., Ltd. | 51,506,035.64 | 51,506,035.64 | 6.46 | 2,575,301.78 |
| Company name | Closing balance of accounts receivable | Closing balance of contract assets | Closing balance of accounts receivable and contract assets | Proportion of total closing balance of accounts receivable and contract assets (%) | Closing balance of provision for bad debts |
| Hangzhou Proya Commercial Management Co., Ltd. | 43,567,943.67 | 43,567,943.67 | 5.46 | 8,831,093.09 | |
| Total | 728,284,198.77 | 728,284,198.77 | 91.30 | 45,964,364.28 |
Other explanationsNone
Other explanations:
□Applicable √Not applicable
2. Other receivables
Presentation by item
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance |
| Interest receivable | ||
| Dividends receivable | ||
| Other receivables | 63,315,069.88 | 80,702,024.60 |
| Total | 63,315,069.88 | 80,702,024.60 |
Other explanations:
□Applicable √Not applicable
Interest receivable
(1). Classification of interest receivable
□Applicable √Not applicable
(2). Significant overdue interest
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
(4). Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Information on interest receivable actually written off in the current period
□Applicable √Not applicable
Among them, information on interest receivable significantly written off
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Dividends receivable
(1). Dividends receivable
□Applicable √Not applicable
(2). Important dividends receivable aged over one year
□Applicable √Not applicable
(3). Disclosed by classification of bad debt provisions
□Applicable √Not applicable
Provision for bad debts accrued individually:
□Applicable √Not applicable
Explanation on provision for bad debts by item:
□Applicable √Not applicable
Provision for bad debts accrued by portfolio:
□Applicable √Not applicable
(4). Provision for bad debts accrued according to the general model of expected credit loss
□Applicable √Not applicable
(5). Information on provision for bad debts
□Applicable √Not applicable
Among them, significant amount of bad debt provision withdrawn or written back in the current period:
□Applicable √Not applicable
Other explanations:
None
(6). Dividends receivable actually written off in the current period
□Applicable √Not applicable
Among them, information on dividends receivable significantly written off
□Applicable √Not applicable
Explanation on write-off:
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
Other receivables
(1). Disclosed by account age
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Account age | Closing book balance | Opening book balance |
| Within 1 year | ||
| Including: Sub-items within 1 year | ||
| Within 1 year | 17,671,274.41 | 36,258,395.66 |
| Subtotal within 1 year | 17,671,274.41 | 36,258,395.66 |
| 1-2 years | 35,037,784.48 | 32,135,546.26 |
| 2-3 years | 44,001,820.13 | 47,523,332.69 |
| Above 3 years | 137,174,554.01 | 135,780,112.99 |
| 3-4 years | ||
| 4-5 years | ||
| Above 5 years | ||
| Total | 233,885,433.03 | 251,697,387.60 |
(2). Classification by nature of payment
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Nature of payment | Closing book balance | Opening book balance |
| Current accounts receivable | 226,213,233.04 | 244,184,515.37 |
| Security deposits | 5,211,614.72 | 6,322,669.24 |
| Suspense payment receivables | 1,074,563.95 | 234,768.29 |
| Others | 1,386,021.32 | 955,434.70 |
| Total | 233,885,433.03 | 251,697,387.60 |
(3). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Provision for bad debts | First stage | Second stage | Third stage | Total |
| Expected credit losses over the next 12 months | Expected credit loss for the entire duration (credit impairment not occurred) | Expected credit loss for the entire duration (credit impairment occurred) | ||
| Balance as of January 1, 2024 | 1,812,919.79 | 9,640,663.88 | 159,541,779.34 | 170,995,363.00 |
| Balance as of January 1, 2024 in the current period | ||||
| – Transferred into the second stage | -342,432.46 | 342,432.46 | ||
| – Transferred into the third stage | -66,210,469.65 | 66,210,469.65 | ||
| – Transferred back to the second stage | ||||
| – Transferred back to the first stage | ||||
| Amount accrued in the current period | -586,923.60 | 88,739,618.72 | -88,577,694.98 | -424,999.85 |
| Amount written-back in the |
| current period | ||||
| Amount charged-off in the current period | ||||
| Amount written-off in the current period | ||||
| Other changes | ||||
| Balance as of June 30, 2024 | 883,563.73 | 32,512,245.41 | 137,174,554.01 | 170,570,363.15 |
| Provision ratio of provision for bad debts at the end of the period (%) | 5.00 | 41.13 | 100.00 | 72.93 |
Classification basis and provision ratio of provision for bad debts for each stageNone
Explanation on significant changes in book balance of other receivables with changes in provision forloss in the current period:
□Applicable √Not applicable
The amount of provision for bad debts in the current period and the basis for evaluating whether thecredit risk of financial instruments increases significantly:
□Applicable √Not applicable
(4). Information on provision for bad debts
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Category | Opening balance | Amount of changes in the current period | Closing balance | |||
| Provision | Withdrawal or write-back | Charge-off or write-off | Other changes | |||
| Provision for bad debts accrued by portfolio | 170,995,363.00 | -424,999.85 | 170,570,363.15 | |||
| Total | 170,995,363.00 | -424,999.85 | 170,570,363.15 | |||
Among them, significant amount of bad-debt provision written back or withdrawn in the current period:
□Applicable √Not applicable
Other explanationsNone
(5). Information on other receivables actually written-off in the current period
□Applicable √Not applicable
Among them, information on write-off of other important receivables:
□Applicable √Not applicable
Explanation on write-off of other receivables:
□Applicable √Not applicable
(6). Information on other receivables of the top five closing balances collected by debtor
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Company name | Closing balance | As a proportion of total closing balance in other receivables (%) | Nature of payment | Account age | Closing balance of provision for bad debts |
| Hong Kong Xinghuo Industry Limited | 159,756,399.11 | 68.31 | Current accounts receivable | [Note 1] | 138,884,605.19 |
| Boya (Hong Kong) Investment Management Co., Limited | 36,776,160.00 | 15.72 | Current accounts receivable | 2-3 years | 18,388,080.00 |
| Hangzhou Yizhuo Culture Media Co., Ltd. | 7,619,561.66 | 3.26 | Current accounts receivable | [Note 2] | 2,490,682.04 |
| Ningbo Keshi Trading Limited | 7,083,833.48 | 3.03 | Current accounts receivable | [Note 3] | 2,392,500.06 |
| Shanghai Zhongwen Electronic Commerce Co., Ltd. [Note 4] | 5,400,000.00 | 2.31 | Current accounts receivable | 870,000.00 | |
| Total | 216,635,954.25 | 92.63 | / | / | 163,025,867.29 |
[Note 1] RMB2,538,103.00 with an account age within 1 year, RMB25,296,150.57 with an account ageof 1 to 2 years, RMB1,506,581.35 with an account age of 2 to 3 years, and RMB130,415,564.19 with anaccount age of above 3 years.[Note 2] RMB2,380,745.84 with an account age within 1 year, RMB1,238,815.82 with an account ageof 1 to 2 years, and RMB4,000,000.00 with an account age of 2 to 3 years.[Note 3] RMB61,000.02 with an account age within 1 year, RMB5,609,833.36 with an account age of 1to 2 years, and RMB1,413,000.10 with an account age of 2 to 3 years.[Note 4] RMB3,000,000.00 with an account age within 1 year, and RMB2,400,000.00 with an accountage of 1 to 2 years.
(7). Presented as other receivables due to centralized fund management
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
3. Long-term equity investments
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Closing balance | Opening balance | ||||
| Book balance | Impairment provision | Carrying value | Book balance | Impairment provision | Carrying value | |
| Investments in subsidiaries | 334,101,391.15 | 42,500,000.00 | 291,601,391.15 | 347,674,082.74 | 42,500,000.00 | 305,174,082.74 |
| Investments in associates and joint ventures | 192,862,707.97 | 81,442,213.22 | 111,420,494.75 | 195,016,371.71 | 81,442,213.22 | 113,574,158.49 |
| Total | 526,964,099.12 | 123,942,213.22 | 403,021,885.90 | 542,690,454.45 | 123,942,213.22 | 418,748,241.23 |
(1) Investments in subsidiaries
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Invested entity | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | Provision for impairment in the current period | Closing balance of provision for impairment |
| Hangzhou Proya Trade Co., Ltd. | 33,111,337.20 | 810,627.61 | 33,921,964.81 | |||
| Hanna Cosmetics Co., Ltd. | 2,094,048.00 | 2,094,048.00 | ||||
| Zhejiang Meiligu Electronic Commerce Co., Ltd. | 43,575,783.68 | 1,227,722.97 | 44,803,506.65 | |||
| Yueqing Laiya Trading Co., Ltd. | 1,000,000.00 | 1,000,000.00 | ||||
| Hapsode (Hangzhou) Cosmetics Co., Ltd. | 42,500,000.00 | 42,500,000.00 | 42,500,000.00 | |||
| Mijing Siyu | 18,000,000.00 | 18,000,000.00 |
| Invested entity | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | Provision for impairment in the current period | Closing balance of provision for impairment |
| (Hangzhou) Cosmetics Co., Ltd. | ||||||
| Huzhou UZERO Trading Co., Ltd. | 5,460,276.70 | 5,460,276.70 | ||||
| Huzhou Niuke Technology Co., Ltd. | 3,500,000.00 | 3,500,000.00 | ||||
| Hangzhou Proya Commercial Management Co., Ltd. | 5,000,000.00 | 5,000,000.00 | ||||
| Huzhou Younimi Cosmetics Co., Ltd. | 21,393,476.00 | 21,393,476.00 | ||||
| Shanghai Zhongwen Electronic Commerce Co., Ltd. | 6,866,196.47 | 292,622.88 | 7,158,819.35 | |||
| Hong Kong Keshi Trading Co., Ltd. | 24,736,491.00 | 24,736,491.00 | ||||
| Hong Kong Xinghuo Industry Limited | 10,185,924.00 | 10,185,924.00 | ||||
| Ningbo TIMAGE Cosmetics Co., Ltd. | 62,087,635.42 | 115,660.27 | 62,203,295.69 | |||
| Ningbo Keshi Trading Limited | 520,000.00 | 520,000.00 | ||||
| Zhejiang Beauty Cosmetics Co., Ltd. | 10,181,983.21 | 10,181,983.21 | ||||
| Ningbo Proya Enterprise Consulting Management Co., Ltd. | 43,898,974.38 | 761,250.48 | 44,660,224.86 | |||
| Hangzhou Yizhuo Culture Media Co., Ltd. | 1,000,000.00 | 1,000,000.00 |
| Invested entity | Opening balance | Increase in the current period | Decrease in the current period | Closing balance | Provision for impairment in the current period | Closing balance of provision for impairment |
| Hangzhou Oumisi Trade Co., Ltd. | 3,900,000.00 | 3,900,000.00 | ||||
| Guangzhou Qianxi Network Technology Co., Ltd. | 1,000,000.00 | 1,000,000.00 | ||||
| Zhejiang Qingya Culture Art Communication Co., Ltd. | 1,650,000.00 | 152,840.00 | 1,802,840.00 | |||
| Hangzhou Weiluoke Cosmetics Co., Ltd. | 500,000.00 | 500,000.00 | ||||
| Singuladerm (Hangzhou) Cosmetics Co., Ltd. | 5,000,000.00 | 5,000,000.00 | ||||
| Proya (Hainan) Cosmetics Co., Ltd. | 100,000.00 | 100,000.00 | ||||
| Hangzhou TIMAGE Cosmetics Co., Ltd. | 311,956.68 | 62,260.20 | 374,216.88 | |||
| Hubei Laibo Technology Co., Ltd. | 100,000.00 | 100,000.00 | ||||
| Ningbo Jingzhe Cosmetics Co., Ltd. | 1,000,000.00 | 1,000,000.00 | ||||
| PROYA PTE LTD | 3,604,900.00 | 3,604,900.00 | ||||
| PROYA EUROPE SAS | 792,900.00 | 792,900.00 | ||||
| Total | 347,674,082.74 | 8,820,784.41 | 22,393,476.00 | 334,101,391.15 | 42,500,000.00 |
(2) Investments in associates and joint ventures
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Investment Unit | Opening balance | Changes in the current period | Closing balance | Closing balance of provision for impairment | |||||||
| Additional investment | Investment decrease | Recognized investment gain and loss under the equity method | Other comprehensive income adjustments | Other changes in equity | Declaration of cash dividends or profits | Provision for impairment | Others | ||||
I. Joint Venture
I. Joint VentureHuzhou Panrui IndustryInvestment Partnership(Limited Partnership)
| Huzhou Panrui Industry Investment Partnership (Limited Partnership) | 3,059,991.91 | -6,059.09 | 3,053,932.82 |
Subtotal
| Subtotal | 3,059,991.91 | -6,059.09 | 3,053,932.82 |
II. Associates
II. AssociatesXiongke Culture Media(Hangzhou) Co., Ltd.
| Xiongke Culture Media (Hangzhou) Co., Ltd. | 2,617,834.89 | -13,338.97 | 2,604,495.92 |
Jiaxing WoyongInvestment Partnership(Limited Partnership)
| Jiaxing Woyong Investment Partnership (Limited Partnership) | 100,964,443.84 | -784,658.16 | 100,179,785.68 |
Zhuhai HaishilongBiotechnology Co., Ltd.
| Zhuhai Haishilong Biotechnology Co., Ltd. | 2,401,207.78 | -1,179,976.41 | 1,221,231.37 | 81,442,213.22 |
Beijing Xiushi CulturalDevelopment Co., Ltd.
| Beijing Xiushi Cultural Development Co., Ltd. | 4,530,680.07 | -169,631.11 | 4,361,048.96 |
Subtotal
| Subtotal | 110,514,166.58 | -2,147,604.65 | 108,366,561.93 | 81,442,213.22 |
Total
| Total | 113,574,158.49 | -2,153,663.74 | 111,420,494.75 | 81,442,213.22 |
(3). Information on impairment testing of long-term equity investments
□Applicable √Not applicable
Other explanations:
□Applicable √Not applicable
4. Operating revenue and operating costs
(1). Information on operating revenue and operating costs
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period | ||
| Revenue | Cost | Revenue | Cost | |
| Primary business | 2,457,017,125.15 | 1,152,454,471.96 | 1,710,497,142.80 | 814,221,197.64 |
| Other business | 18,373,463.43 | 4,933,709.68 | 20,047,982.29 | 9,555,378.31 |
| Total | 2,475,390,588.58 | 1,157,388,181.64 | 1,730,545,125.09 | 823,776,575.95 |
(2). Breakdown of operating revenue and operating costs
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
(3). Explanation on performance obligations
□Applicable √Not applicable
(4). Explanation on remaining performance obligations allocated
□Applicable √Not applicable
(5). Significant contract changes or significant transaction price adjustments
□Applicable √Not applicable
Other explanations:
1) Breakdown of income generated from contracts with clients by goods or service type
| Item | Amount for the current period | Amount for the same period last year | ||
| Revenue | Cost | Revenue | Cost | |
| Products sales | 2,457,017,125.15 | 1,152,454,471.96 | 1,710,497,142.80 | 814,221,197.64 |
| Others | 2,502,856.41 | 1,393,243.82 | 20,047,982.29 | 9,555,378.31 |
| Subtotal | 2,459,519,981.56 | 1,153,847,715.78 | 1,730,545,125.09 | 823,776,575.95 |
2) Breakdown of income generated from contracts with clients by goods or service transfer time
| Item | Amount for the current period | Amount for the same period last year |
| Income recognized at a certain point | 2,457,017,125.15 | 1,713,705,273.22 |
| Income recognized in a certain period | 16,839,851.87 | |
| Subtotal | 2,457,017,125.15 | 1,730,545,125.09 |
(3) Revenue recognized in the current period and included in the opening carrying value of contractliabilities is RMB220,349,629.19.
5. Investment income
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount incurred in the current period | Amount incurred in the previous period |
| Long-term equity investment income calculated by cost method | ||
| Long-term equity investment income calculated by equity method | -2,153,663.74 | -1,600,000.00 |
| Investment income from disposal of | 3,992,247.56 | -2,545,129.34 |
| long-term equity investment | ||
| Investment income of held-for-trading financial assets during the holding period | ||
| Dividend income from other equity instrument investments during the holding period | ||
| Interest income from debt investment during the holding period | ||
| Interest income from other debt investments during the holding period | ||
| Investment income from disposal of held-for-trading financial assets | ||
| Investment income from disposal of other equity instrument investments | ||
| Investment income from disposal of debt investment | ||
| Investment income from disposal of other debt investments | ||
| Gains from debt restructuring | ||
| Total | 1,838,583.82 | -4,145,129.34 |
Other explanations:
None
6. Others
□Applicable √Not applicable
XX. Supplementary Information
1. Statement of non-recurring gains and losses for the current period
√Applicable □Not applicable
Unit: Yuan Currency: RMB
| Item | Amount | Notes |
| Gains or losses from disposal of non-current assets, including write-offs of provision for asset impairment accrued | -712,859.58 | |
| Government grants included in current profit or loss (excluding government grants that are closely related to the Company’s normal business operations, compliant with national policies, granted at set standards, and imposing sustaining influence on the Company’s profit or loss) | 41,996,899.59 | |
| Gains or losses from change in fair value generated by financial assets and financial liabilities held by non-financial businesses as well as gains or losses from disposal of financial assets |
| and financial liabilities, except for valid hedging business related to the Company’s normal business operations | ||
| Capital occupation fees charged to non-financial enterprises included in current profit or loss | ||
| Gains or losses on authorizing others to invest or manage assets | ||
| Gains or losses from outward entrusted loaning | ||
| Asset loss incurred by force majeure such as natural disasters | ||
| Reversal of provision for impairment of accounts receivable individually tested for impairment | ||
| Gains when the investment cost of acquiring a subsidiary, an associate or a joint venture is less than the fair value of the identifiable net assets of the invested entity | ||
| Current net gains or losses of subsidiaries established by business combination under common control from the beginning of the period to the combination date | ||
| Gains or losses from exchange of non-monetary assets | ||
| Gains or losses from debt restructuring | ||
| One-time expenses incurred due to the cessation of relevant business activities, such as staffing expenses | ||
| One-time impact on current gains or losses due to the adjustments of taxes and accounting laws and regulations | ||
| One-time share-based payment recognized for cancellation and modification of equity incentive plans | ||
| Gains or losses from changes in the fair value of employee compensation payable for share-based payment in cash after the exercise date | ||
| Gains or losses arising from changes in the fair value of investment property subsequently measured with the fair value model | ||
| Gains arising from transactions with unreasonable transaction price | ||
| Gains or losses arising from contingencies unrelated to the Company’s normal operations | ||
| Custody fee income from entrusted operations | ||
| Other non-operating revenue and expenses besides the above items | -474,557.25 |
| Other items that conform to the definition of non-recurring gains and losses | ||
| Less: Effect of income tax | 10,032,617.51 | |
| Impact of minority interests (after tax) | 8,102,008.69 | |
| Total | 22,674,856.56 |
The reasons should be explained for the Company defining items not listed in the ExplanatoryAnnouncement on Information Disclosure for Companies Offering Their Securities to the Public No. 1 –Non-Recurring Gains and Losses as non-recurring gains and losses items of high value and defining thenon-recurring gains and losses items listed in the same document as recurring gains and losses items.
□Applicable √Not applicable
Other explanations
□Applicable √Not applicable
2. ROE and earnings per share
√Applicable □Not applicable
| Profit during the Reporting Period | Weighted average ROE (%) | Earnings per share | |
| Basic earnings per share | Diluted earnings per share | ||
| Net profits attributable to ordinary shareholders of the Company | 15.34 | 1.78 | 1.72 |
| Net profits attributable to ordinary shareholders of the Company after deducting non-recurring gains and losses | 14.85 | 1.72 | 1.66 |
3. Differences in Accounting Data under Chinese and International Accounting Standards
□Applicable √Not applicable
4. Others
□Applicable √Not applicable
Chairman: HOU JunchengDate of submission approved by the Board of Directors: August 26, 2024
Revision information
□Applicable √Not applicable