Annual Report 2022
Stock Code: 603195 Stock Name: Gongniu Group
公牛集团股份有限公司
GONGNIU GROUP CO., LTD.
Annual Report 2022
Annual Report 2022
Important Notes
supervisors and senior management of Gongniu Group Co., Ltd. (hereinafter referred to as the
“Company”) hereby guarantee that the contents of this Report are true, accurate and complete
and free of any misrepresentations, misleading statements or material omissions, and collectively
and individually accept legal responsibility for such contents.
unmodified unqualified opinion for the Company.
Officer, and Luo Yuebo, head of the Company’s financial department (equivalent to financial
manager) hereby guarantee that the financial statements carried in this Report are true, accurate
and complete.
As audited by Pan-China Certified Public Accountants LLP, net profit attributable to shareholders
of the Company as the parent stood at RMB3,188,619,359.56 for 2022, and the cumulative distributable
profit of the Company as the parent was RMB4,693,667,008.01 as at 31 December 2022. The 2022 final
dividend plan is as follows: Based on the total share capital (exclusive of the shares in the Company’s
repurchased share account) at the record date of the dividend payout, the Company intends to pay a cash
dividend of RMB33 (tax inclusive) per 10 shares to shareholders, with a bonus issue of 4.8 additional
shares for every 10 shares held by shareholders from capital reserves.
According to the total share capital of 601,077,590 shares minus the 46 shares in the repurchased
share account at the date when this Report was authorized for issue, the total cash dividend amount is
RMB1,983,555,895.20 (tax inclusive), and the total share capital will increase to 889,594,811 shares
upon the bonus issue (share capital subject to the number registered with the Shanghai branch of China
Securities Depository and Clearing Co., Ltd., with tail difference, if any, due to rounding).
Where any change occurs to the total share capital before the record date of the dividend payout,
the cash dividend and bonus issue per share shall remain the same while the total payout and bonus issue
amount shall be adjusted accordingly.
The final dividend plan is subject to final approval by the 2022 Annual General Meeting of
Shareholders.
√ Applicable □ Not applicable
Annual Report 2022
Any plans, development strategies and other forward-looking statements mentioned in this Report
shall not be considered as promises to investors. Investors and those concerned shall be sufficiently
aware of the risks and understand the differences between plans and forecasts and promises.
Company’s capital for non-operating purpose.
N/A
prescribed decision-making procedure.
N/A
completeness of this Report.
N/A
The Company has described the possible risks in this Report. For further information, please refer
to the contents under the heading “Possible risks” under Item VI (IV) in “Part III Management
Discussion and Analysis”.
□ Applicable √ Not applicable
Annual Report 2022
To Shareholders
In 2022, we surmounted a multitude of adversities, cultivating vitality amid crises and pioneering
new paths in the face of change, ultimately achieving a robust growth in performance. Our traditional
business strengthened its competitive advantages, while our initial ventures into new markets and
industries began to reveal their potential. The Company’s overall operational quality experienced a
comprehensive enhancement. We extend our gratitude to our shareholders for their unwavering support
and companionship, as well as to our devoted employees for their relentless efforts and persistence.
Throughout this year, we have diligently kept up with the evolving trends in consumer preferences,
placing customer needs at the forefront of our priorities and actively pursuing product innovation. We
introduced a range of state-of-the-art products, such as orbital socket, ultra-thin switches with
aerospace-level safety features, eye-friendly desk lamps, intelligent door locks with integrated peephole
cameras, and fan lights. This has enabled us to offer our customers a diverse selection of top-quality,
trendy, and visually attractive products.
We enthusiastically pursued the advancement of renewable energy and intelligent headless lamp.
Upon its launch, our charging gun rapidly became the top-selling online product among independent
brands. Additionally, our portable outdoor energy storage experienced swift growth, and our intelligent
headless lamp achieved more than RMB 100 million turnover during its inaugural year on the market,
demonstrating a highly promising beginning.
In our extensive brand upgrade, we achieved remarkable progress by unveiling Gongniu’s fresh
logo in 2022 and reinforcing our brand’s core message: “Gongniu is used by 7 out of 10 Chinese
families.” Additionally, we launched the novel “Muguang” brand and proudly became the first China
space affiliate in the civil electrical industry. Our cutting-edge orbital socket quickly gained prominence,
emerging as the unrivaled leader among individual products, owing to innovative media promotion. This
success sets a robust foundation for our brand’s continued growth in 2023.
We diligently endeavored to strengthen our management reforms and augment the development of
our Bull Business System (BBS), and comprehensively implanted the improved BBS gene into the
whole value chain consisting of production, research, sales, and service from point to surface and from
inside to outside, and thus enabled the BBS to be a powerful engine for our innovation, growth, cost
reduction and efficiency improvement. In 2022, we established a top-tier Audit and Risk Committee,
focusing on addressing ten major risks and effectively enhancing our internal control management.
Furthermore, we persistently advocated for organizational innovation and cultivated our talent pool to
ensure our company’s ongoing, healthy growth.
We stayed true to our founding mission, proactively embraced our social responsibility, and in 2022,
we established the “Gongniu Charity Trust”, the largest annual charity trust in the country. Additionally,
we actively contributed to Shanghai’s epidemic prevention and control efforts, supported the
construction of cabin hospitals in Hong Kong, and participated in other crucial initiatives. Our efforts
Annual Report 2022
made a positive impact in various fields, including epidemic prevention and control, culture, education,
health, poverty alleviation, disaster relief, and employee well-being.
As we enter a new year, we also embrace new opportunities. China’s economic fundamentals are
steadily improving, the new energy industry is booming and expanding, and China’s supply chain and
brand have gained global edge in some emerging sectors, all of which lay a solid foundation for our
company’s growth. In 2023, we will prioritize the following three areas of work:
Firstly, we will diligently work to refine our brand, heightening the professionalism and premium
appeal of the Gongniu brand to meet the domestic market’s demand for superior quality consumption.
We will further raise awareness of our flagship products, including converters, wall switches, and
sockets, while increasing visibility for our eco-friendly offerings, such as LED lighting, clothes dryers,
and smart door locks. Additionally, we will bolster the promotion of our “Muguang” brand for strategic
new ventures, including headless lamp solutions, and establish a professional brand image.
Secondly, we will fortify the core competitive edge of Gongniu’s new energy business by
mastering critical technologies, including power modules, group charging, and intelligent control. We
will expedite the development of our marketing network and establish a swift-response service
capability to accelerate our charging pile business growth and delve into the home energy storage market.
This will take Gongniu’s new energy business to the next level.
Thirdly, we are passionately advancing the internationalization of the Gongniu brand. We are
capitalizing on the new wave of new energy development in European and American markets by swiftly
entering with our core new energy charging and home energy storage businesses. Simultaneously, we
are embracing the new cycle of household electrification development in Southeast Asia and other
countries by overcoming the development bottleneck of Chinese brands in emerging markets with core
products like converters.
Though the journey ahead may be lengthy and filled with challenges, we will reach our destination
by persistently pressing onward. We will maintain our business philosophy of “taking the long way with
professionalism and devotion” as we forge ahead. Our commitment lies in generating high-quality and
sustainable value returns for our shareholders and striving relentlessly to achieve our vision of
“becoming a leader in the international civil electrical industry”.
Board of Directors of Gongniu Group Co., Ltd.
Annual Report 2022
Contents
The financial statements for the year ended 31 December 2022 signed and
stamped by the legal representative, the Chief Financial Officer, and the head
of the financial department
The Independent Auditor’s Report for the year ended 31 December 2022
Documents available for
stamped by the CPA firm, as well as signed and stamped by the relevant
reference
certified public accountants
The originals of all the Company’s documents and announcements disclosed
on newspapers and websites designated by CSRC during the Reporting
Period
Annual Report 2022
Part I Definitions
I Definitions
The expressions in the left column in the table below refer to the contents in the right column unless
otherwise specified.
Definitions of frequently used terms
The “Company”,
refers to Gongniu Group Co., Ltd.
“Gongniu”, or “we”
Reporting Period refers to The period from 1 January 2022 to 31 December 2022
Ningbo Liangji Industrial Co., Ltd., the Company’s controlling
Liangji Industrial refers to
shareholder
Ningbo Ninghui Investment Management Partnership (Limited
Ninghui Investment refers to
Partnership) , the Company’s shareholder
Ningbo Suiyuan Investment Management Partnership (Limited
Suiyuan Investment refers to
Partnership) , the Company’s shareholder
Ningbo Qiyuanbao Investment Management Partnership
Qiyuanbao refers to
(Limited Partnership) , the Company’s shareholder
Cixi Gongniu Electrics Co., Ltd., a wholly-owned subsidiary
Cixi Gongniu refers to
of the Company
Shanghai Gongniu Electrics Co., Ltd., a wholly-owned
Shanghai Gongniu refers to
subsidiary of the Company
Ningbo Gongniu Electrics Co., Ltd., a wholly-owned
Ningbo Gongniu refers to
subsidiary of the Company
Banmen Electric Ningbo Banmen Electric Appliance Co., Ltd., a wholly-owned
refers to
Appliance subsidiary of the Company
Ningbo Gongniu Photoelectric Technology Co., Ltd., a
Gongniu Photoelectric refers to
wholly-owned subsidiary of the Company
Ningbo Gongniu Precision Manufacturing Co., Ltd., a
Gongniu Precision refers to
wholly-owned subsidiary of the Company
Ningbo Gongniu Digital Technology Co., Ltd., a
Gongniu Digital refers to
wholly-owned subsidiary of the Company
Ningbo Bull International Trading Co., Ltd., a wholly-owned
Bull International Trading refers to
subsidiary of the Company
Ningbo Xingluo Trading Co., Ltd., a wholly-owned subsidiary
Xingluo Trading refers to
of the Company
Ningbo Gongniu Electric Sales Co., Ltd., a wholly-owned
Electric Sales refers to
subsidiary of the Company
Bull International Trading (HK) Limited, a wholly-owned
Bull HK refers to
subsidiary of the Company
Ningbo Gongniu Low Voltage Electric Co., Ltd., a
Gongniu Low Voltage refers to
wholly-owned subsidiary of the Company
Hainan Dacheng Supply Chain Management Co., Ltd., a
Hainan Dacheng refers to
wholly-owned subsidiary of the Company
Guangdong Murora Intelligent Lighting Co., Ltd., a
Murora Intelligent refers to
wholly-owned subsidiary of the Company
Ningbo Gongniu New Energy Technology Co., Ltd., a
Gongniu New Energy refers to
wholly-owned subsidiary of the Company
Shanghai Gongniu Information Technology Co., Ltd., a
Information Technology refers to
wholly-owned subsidiary of the Company
Shenzhen Gongniu Intelligent Information Co., Ltd., a
Shenzhen Intelligent refers to
wholly-owned subsidiary of the Company
Domestic Electrical Ningbo Gongniu Domestic Electrical Appliance Co., Ltd., a
refers to
Appliance wholly-owned subsidiary of the Company
Ningbo Gongniu Marketing Co., Ltd., a wholly-owned
Gongniu Marketing refers to
subsidiary of the Company
Annual Report 2022
Hangniu Hardware refers to Hangzhou Hangniu Hardware and Electrical Co., Ltd.
Dalitek Intelligent Technology (Shanghai) Inc., a
Dalitek refers to
majority-owned subsidiary of the Company
Liangniu Hardware refers to Hangzhou Liangniu Hardware and Electrical Co., Ltd.
Feiniu Hardware refers to Hangzhou Feiniu Hardware and Electrical Co., Ltd.
Niuweiwang Trading refers to Suzhou Niuweiwang Trading Co., Ltd.
Cixi Libo refers to Cixi Libo Electric Co., Ltd.
Yaoyang Trading refers to Yichang Yaoyang Trading Co., Ltd.
Huantian Technology refers to Hubei Huantian Technology Co., Ltd.
Jianke Trading refers to Changde Jianke Trading Co., Ltd.
Chenhao Electronic refers to Beijing Chenhao Electronic Technology Co., Ltd.
Guoxin Trading refers to Changde Guoxin Trading Co., Ltd.
Qiudi Trading refers to Hebei Qiudi Trading Co., Ltd.
The “Articles of
refers to The Articles of Association of Gongniu Group Co., Ltd.
Association”
The “Company Law” refers to The Company Law of the People’s Republic of China
The “Securities Law” refers to The Securities Law of the People’s Republic of China
A-stock refers to RMB-denominated ordinary stock
CSRC refers to China Securities Regulatory Commission
The Ministry of Finance refers to The Ministry of Finance of the People’s Republic of China
The State Taxation Administration of the People’s Republic of
STA refers to
China
Sinolink Securities refers to Sinolink Securities Co., Ltd.
PCCPA or the
refers to Pan-China Certified Public Accountants LLP
“Independent Auditor”
RMB Expressed in the Chinese currency of Renminbi
RMB’000 Expressed in thousands of Renminbi
refers to
RMB’0,000 Expressed in tens of thousands of Renminbi
RMB’00,000,000 Expressed in hundreds of millions of Renminbi
II Terminology
Products that are typically purchased at the discretion of consumers and
are suitable for use at home, in the office and on other occasions for
Civil electrical
refers to power connection, transmission, storage, conversion, control and other
appliances
functions, such as adaptors, wall switches and sockets, circuit breakers,
distribution boxes, LED lamps, etc.
Products that are produced in accordance with GB/T 2099.3-2015 Plugs
and Socket-outlets for Household and Similar Purposes -- Parts 2-5:
Particular Requirements for Adaptors, GB/T 2099.7-2015 Plugs and
Socket-outlets for Household and Similar Purposes -- Parts 2-7:
Particular Requirements for Extension-cord Sockets and GB/T
Adaptors refers to
Purposes -- Part 1: General Requirements, as well as similar foreign
standards, and are commonly referred to as adaptors in the Company.
Consumers or peer companies often call adaptors socket-outlets, power
strips, portable sockets, extension-cord sockets, or power converters.
Power Distribution Unit. PDU is an electric connection product suitable
for power distribution at the data center end that can make power
PDU refers to
distribution more orderly, reliable, safe, professional and beautiful and
make power supply maintenance more convenient and reliable.
Wall switches and wall sockets. Specifically, a wall switch refers to a
device mounted on the wall for switching on/off the current of one or
Wall switches more circuits and is commonly used to control the on/off status of
refers to
and sockets lighting lamps. A wall socket, also known as a fixed socket, is an
electrical accessory mounted on the wall, with a socket inserted with a
pin of a plug and installed with terminals for connecting soft cables and
Annual Report 2022
hard wires, and is often used to provide a power supply interface for
electrical products.
Smart A novel, intelligent household appliance network that builds an
refers to
ecosystem interconnected smart home ecosystem.
Light sources that are produced using light-emitting diodes (such as LED
LED lighting refers to
bulb lamps), or luminaries that are produced using LED as a light source.
A lighting design style and lighting without the main light source, that is,
No-main-lamp a lighting design technique through which downlights, spotlights, light
refers to
lighting belts, track lights and other luminaries are used to create a light (light
and shadow) atmosphere in a point-line-surface combination manner.
Portable chargers that are suitable for AC charging of new energy
vehicles and special protectors used to connect household sockets and
Charging plugs refers to
electric vehicles, with such functions as over-voltage and under-voltage
protection, over-current protection and leakage protection.
Fixed charging devices for AC charging of new energy vehicles that
often require special wiring and installation in garages and special
Charging points refers to parking spaces, with such functions as over-voltage and under-voltage
protection, over-current protection, leakage protection, insulation
detection, electricity billing, timed charging and reserved charging.
A mechanical switching device that can connect, carry and disconnect
the current both under normal circuit conditions and under specified
Circuit breakers refers to abnormal circuit conditions. They are also known as automatic switches
and are widely used in households, factories and other distribution
circuits.
Distribution, A sales model in which specialized vehicles are used to provide retail
delivery, visit refers to stores with goods distribution, goods delivery, visit services and
and sales door-to-door sales on a regular basis along a fixed planned route.
BBS refers to Bull Business System
Annual Report 2022
Part II General Information of the Company and Key Financial
Indicators
I Corporate Information
Company name in Chinese 公牛集团股份有限公司
Abbr. 公牛集团
Company name in English GONGNIU GROUP CO.,LTD.
Abbr. GONGNIU
Legal representative Ruan Liping
II Contact Information
Board Secretary Securities Representative
Name Liu Shengsong Jin Xiaoxue
Tower 20, Baoshi Plaza, 487 Tianlin Tower 20, Baoshi Plaza, 487 Tianlin Road,
Address
Road, Xuhui District, Shanghai Xuhui District, Shanghai
Tel. 021-33561091 021-33561091
Fax 021-33561091 021-33561091
E-mail
liushengsong@gongniu.cn jinxx@gongniu.cn
address
III General Company Information
East Zone of Guanhaiwei Town Industrial Park, Cixi City,
Registered address
Zhejiang Province
Changes of registered address N/A
Tower 20, Baoshi Plaza, 487 Tianlin Road, Xuhui District,
Office address
Shanghai
Zip code 201103
Company website http://www.gongniu.cn
Email address ir@gongniu.cn
IV Media for Information Disclosure and Place where this Report Is Lodged
Media and websites where this Report is China Securities Journal, Shanghai Securities News,
disclosed Securities Daily, and Securities Times
Stock exchange website where this Report is
http://www.sse.com.cn
disclosed
Place where this Report is lodged The Securities Department of the Company
V Stock Profile
Stock profile
Formerly used stock
Class of stock Stock exchange Stock name Stock code
name
Shanghai Stock
A-stock Gongniu Group 603195 /
exchange
VI Other Information
Domestic CPA firm appointed Name Pan-China Certified Public Accountants LLP
by the Company Office address Block B, China Resources Building, 1366
Annual Report 2022
Qianjiang Road, Jianggan District, Hangzhou
Accountants
Qian Zhongxian, and Liu Chong
writing signatures
Name Sinolink Securities Co., Ltd.
Office address
Sponsor that exercised Road, Pudong New District, Shanghai
supervision over the Company Representatives
Du Chunjing, and Feng Bing
in the Reporting Period writing signatures
Supervision
From 6 February 2020 to 31 December 2022
period
VII Key Financial Information for the Past Three Years
(I) Key accounting information
Unit: RMB
Key accounting 2022-over-2021
information change (%)
Operating revenue 14,081,373,030.94 12,384,916,337.51 13.70 10,051,128,834.05
Net profit attributable
to the listed
company’s
shareholders
Net profit attributable
to the listed
company’s
shareholders before
exceptional gains and
losses
Net cash generated
from/used in 3,057,914,218.16 3,014,326,741.14 1.45 3,437,202,711.65
operating activities
Change of 31
December 2022
over 31
December 2021
(%)
Equity attributable to
the listed company’s 12,398,865,675.75 10,755,751,576.63 15.28 9,137,392,569.09
shareholders
Total assets 16,650,497,198.32 15,473,904,666.62 7.60 12,437,541,574.38
(II) Key financial indicators
Key financial indicator 2022 2021 2020
change (%)
Basic earnings per share
(RMB/share)
Diluted earnings per share
(RMB/share)
Basic earnings per share before
exceptional gains and losses 4.84 4.39 10.25 3.73
(RMB/share)
Down by 0.40
Weighted average return on equity
(%)
int
Annual Report 2022
Weighted average return on equity Down by 1.38
before exceptional gains and losses 25.39 26.77 percentage po 25.81
(%) ints
Explanations about the key accounting and financial information for the past three years:
□ Applicable √ Not applicable
VIII Accounting Data Differences under China’s Accounting Standards for Business Enterprises
(CAS) and International Financial Reporting Standards (IFRS) and Foreign Accounting
Standards
(I) Differences in net profit and equity attributable to the listed company’s shareholders under
CAS and IFRS
□ Applicable √ Not applicable
(II) Differences in net profit and equity attributable to the listed company’s shareholders under
CAS and foreign accounting standards
□ Applicable √ Not applicable
(III) Reasons for accounting data differences above
□ Applicable √ Not applicable
IX Key Financial Information for 2022 by Quarter
Unit: RMB
Q1 Q2 Q3 Q4
(January-March) (April-June) (July-September) (October-December)
Operating
revenue
Net profit
attributable to
the listed 641,426,707.25 866,370,913.31 853,623,027.81 827,198,711.19
company’s
shareholders
Net profit
attributable to
the listed
company’s
shareholders
before
exceptional gains
and losses
Net cash
generated
from/used in 433,646,077.61 711,246,493.62 836,250,178.68 1,076,771,468.25
operating
activities
Indicate whether any of the quarterly financial data in the table above differs from what have been
disclosed in the Company’s past periodic reports.
□ Applicable √ Not applicable
X Exceptional Gains and Losses
√ Applicable □ Not applicable
Unit: RMB
Item 2022 Notes (if 2021 2020
Annual Report 2022
applicable)
Gain or loss on disposal of
-3,980,890.27 -9,714,625.18 -669,979.13
non-current assets
Exceptional tax rebates,
reductions and exemptions
given with ultra vires approval,
in lack of official approval
documents or for other reasons
Government grants through
profit or loss (exclusive of
government grants consistently
given in the Company’s
ordinary course of business at
fixed quotas or amounts as per
governmental policies or
standards)
Capital occupation charges on
non-financial enterprises that 590,062.34 8,121,324.51 407,671.23
are recognized in profit or loss
Gain equal to the amount by
which investment costs for the
Company to obtain
subsidiaries, associates and
joint ventures are lower than
the Company’s enjoyable fair
value of identifiable net assets
of investees when making
investments
Gain or loss on non-monetary
asset swaps
Gain or loss on assets
entrusted to other entities for 279,374,491.92 171,623,256.63 166,225,979.47
investment or management
Allowance for asset
impairments due to acts of
God such as natural disasters
Gain or loss on debt
restructuring
Restructuring costs in staff
arrangement, integration, etc.
Gain or loss on the over-fair
value amount as a result of
transactions with distinctly
unfair prices
Current profit or loss on
subsidiaries obtained in
business combinations
involving entities under
common control from the
period-begin to combination
dates, net
Gain or loss on contingencies
that do not arise in the
Company’s ordinary course of
business
Gain or loss on fair-value -7,385,680.00 11,107,836.63 -114,631,050.00
Annual Report 2022
changes on held-for-trading
and derivative financial assets
and liabilities & income from
disposal of held-for-trading
and derivative financial assets
and liabilities and other debt
investments (exclusive of the
effective portion of hedges that
arise in the Company’s
ordinary course of business)
Reversed portions of
impairment allowances for
receivables and contract assets
which are tested individually
for impairment
Gain or loss on loan
entrustments
Gain or loss on fair-value
changes in investment property
of which subsequent
measurement is carried out
using the fair value method
Effects of all adjustments
required by taxation,
accounting and other
applicable laws and
regulations on current profit or
loss
Income from charges on
entrusted management
Non-operating income and
-58,763,095.61 -327,898,293.86 -47,932,397.93
expense other than the above
Other gains and losses that
meet the definition of 1,712,485.52 2,739,167.53 1,014,971.00
exceptional gain/loss
Less: Income tax effects 57,894,123.94 96,291,397.10 38,967,887.77
Non-controlling interests
effects (net of tax)
Total 284,470,942.06 147,884,243.10 91,611,646.62
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed
in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their
Securities to the Public—Exceptional Gain/Loss Items:
□ Applicable √ Not applicable
XI Items Measured at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Change in the Effect on current
Item Opening balance Closing balance
period profit
Held-for-trading
financial assets
Derivative financial
assets
Receivables
financing
Annual Report 2022
Held-for-trading
financial liabilities
Total 5,931,140,073.00 6,968,879,901.70 1,037,739,828.70
XII Other Information
□ Applicable √ Not applicable
Annual Report 2022
Part III Management Discussion and Analysis
I Discussion and Analysis on Operations
Amid a complex and changeable external environment in 2022, the Company adopted an operating
strategy of seeking progress in stability. As a result, it achieved steady growth in operating results and
maintained good resilience for development. For the year, operating revenue increased 13.70% year on
year to RMB14.081 billion and the net profit attributable to the Company’s shareholders amounted to
RMB3.189 billion, up 14.68% from the previous year.
During the Reporting Period, the Company focused closely on the three major businesses of electric
connection, smart electrical lighting and new energy, continuously promoted product innovation and
brand upgrading of traditional advantageous businesses such as adaptors and wall switches and sockets,
and accelerated the expansion of new businesses such as new energy connection and smart
no-main-lamps, achieving a good start. These efforts have helped further enhance the Company's
comprehensive competitiveness in product, channel, brand and supply chain, laying a solid foundation
for long-term sustainable and healthy development.
In 2022, the presence and reputation of the Bull brand were further enhanced, with the Company
ranking 70th on the 2022 Hurun Brand List China's Top 300 Brands by Brand Value, becoming the first
civil electric manufacturer to establish a partnership with the aerospace sector in China, and winning the
"China Brand Annual Award for Wall Switches and Sockets No.1" by the World Brand Lab. The
Company and its subsidiaries Ningbo Gongniu, Gongniu Photoelectric, Gongniu Digital, and Gongniu
Domestic Electrical Appliance were certified as high-tech enterprises, and the Company was named
"2022 Pilot Demonstration of Integration of New Generation Information Technology and
Manufacturing Industry " by the Ministry of Industry and Information Technology, and "2022 National
Intellectual Property Demonstration Enterprise" by the China National Intellectual Property
Administration, and was recognised as Top 100 Manufacturing Enterprises of Zhejiang Province. In
(I) Seized the trend of consumption upgrading, intelligent transformation and new energy,
and developed innovative products centering on user needs
In 2022, the Company firmly captured the major trends of consumption upgrade, intelligent
transformation, and new energy. With deep insight into user needs, it continued to launch innovative
products such as smart and ecosystem-based home appliances and new energy-based electrical products.
Throughout the year, up to 13 design awards were earned at home and abroad. As of the end of the
Reporting Period, the Company has won a total of 64 design awards at home and abroad, including the
Red Dot Award (Germany), the iF Award (Germany), the G-Mark Award (Japan), the IDEA Award, the
Red Star Design Award (China), the AWE Award, and the Design Intelligence Award. In addition,
technical strengths were further enhanced, with 565 new patents and 23 new software copyrights granted
in 2022. As of the end of the Reporting Period, the Company boasts 2,379 valid patents and 59 software
copyrights.
Annual Report 2022
In the electric connection business in 2022, the Company made continuous exploration and
individualised innovation fully focusing on scenario-based electricity use, and was committed to
providing consumers with a safe, comfortable and pleasant experience of electricity use. This business
recorded revenue of RMB7,051 million for the year, an increase of 4.22% year on year.
(1) Adaptor business
In product innovation in the adaptor business, the Company focused on satisfying user needs in
segmented electricity scenarios and extending channel-related categories in 2022.
In terms of satisfying user needs in segmented electricity scenarios, the Company further optimised
the consumer experience through trend-based user research, and focused on the development and
implementation of mainstream USB fast charging, table lamp power strips and decorative track sockets;
based on research on consumer trends and concerns, the Company rapidly extended its product coverage
in retractable power strips, textured decorative power strips and retro power strips, which well satisfied
the young consumers' pursuit of quality and personalised life.
In the extension of channel-related products, based on the characteristics of hardware, decoration
and e-commerce channels and the differences in user groups, the Company has further enriched the
product lines of track sockets, electrical wire products and electrical accessories (plugs, electrical tape,
etc.) to provide consumers with a convenient "one-stop" purchasing experience in multi-channel
dimensions and multi-category sets; in the emerging business-end channels such as industrial terminal
power distribution, data centre and embedded home, the Company has continued to enrich and iterate its
product lines, further exploring and implementing product families such as track sockets, industrial
connectors, PDUs and embedded power strips, which have gained market recognition and user
popularity.
(2) Digital accessories business
In 2022, Gongniu Digital, by following the industry and user trends, successfully listed a series of
self-developed new products with profound user insight, leading fast-charging technology and exquisite
industrial design.
Based on the charging concept of "safe and fast charging", and relying on the unique miniaturised
stacking technology and the exclusively patented "APO Technology", the good-looking charger series
based on advanced technology are launched, which save more energy than traditional chargers and can
effectively extend the life of mobile phone batteries, giving users differentiated smart charging
experience; to meet consumers' needs for fast charging in multiple scenarios, the compact 67W portable
fast charging power strip is launched based on the combination of the professional electric connection
technology and distinctive gallium nitride fast-charging technology; based on the desktop electricity
scenario, the Company optimised the wave crest design through ergonomic research and the golden
plugging angle of the power strip, and launched the 67W Mountain Peak fast charging power strip; in
addition, in response to needs of female users, the Company launched the Planet fast-charging power
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strip which is innovative and upgraded in appearance, which have realised new exploration and sales
growth in fast charging power strips.
Furthermore, by leveraging its digital and hardware channels, the Company continued to develop
business segments such as audio, mobile phone cells, and dry cells, thereby achieving accurate inbound
marketing, enhancing channel and customer royalty, and systematically arranging products for mobile
phones and laptops.
In the smart electrical lighting business, the Company focuses on the process before household
decoration is completed (referred to as "pre-decoration"), providing wall switches and sockets, LED
lighting, bathroom heaters, circuit breakers, and smart door locks to meet consumers' upgraded needs for
whole-house smart home appliances. In 2022, the business reported revenue of RMB6.849 billion, an
increase of 23.39% year on year.
(1) Wall switches and sockets
In 2022, the Company continued to lead the way in terms of decorative wall switches and sockets,
optimised the product layout based on the strategy of "steadily establishing the foundation, responding to
the trend; making insights into new opportunities and layout in the high-end market", and deepened the
construction of different product systems as informed by the differentiated needs of customers in
different channels.
With the development of industry trends, the Company has taken the initiative to make layouts in
large-panel and ultra-thin products in the mainstream price range and successfully launched the Linea
switch series, and used the original design by Italian design masters to create a new ultra-thin platform to
enhance product power as well as brand power with high-end texture, technology and industrial design.
In order to better meet the home decoration needs of consumers and solve the pain points of user
needs, the Company innovatively used radar scanning tools to open up key nodes and stages such as
demand management, project establishment and development, promoted lean commodity planning and
management, and launched innovative products that have received good market response. At the same
time, in view of the characteristics and needs of weak channels, the Company closely followed its
development and changes, actively carried out targeted product planning and layout, and successfully
listed G35 series switches, with remarkable market integration effects.
In addition, in order to meet the differentiated needs of customers in the business-side market, the
Company further improved product flexibility and scalability by strengthening platform and modular
structure design, and continued to build a tiered combination of basic products, high-end products and
intelligent products to enhance market competitiveness.
(2) LED lighting
Adhering to the positioning of "eye-caring", and oriented to meeting the needs for light in space and
behaviour, the Company has continued to push forward the research of "light" and the innovation and
application of optical design. According to the segmented customer group profile, different application
scenarios for demand mining, the Company made technological innovation in the directions of
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"anti-blue light", "visible flicker-free", "full spectrum", "high index", "anti-glare", "comfortable colour
temperature", etc., and is committed to providing consumers with a comfortable, healthy light
environment.
The Company followed the market trend in basic light source business; in 2022, starting with the
new demand of users for product cost performance and functions, the Company further improved the
product layout for segmented scenario-based lighting needs, iteratively launched the Wanjiang-series
projector lamps, ceiling fittings, and Yue-series panel lights, and launched the commercial lighting series
of downlights, induction bulbs, can lights, and lamp tube products for commercial lighting, quickly
supplementing the product line and significantly enhancing the competitiveness in commercial lighting.
In 2022, the Company continued to make breakthroughs in technology of lighting business,
prepositioned the research and development of "control mode" and "eye-caring technology" to establish
technical barriers to products and strengthen the construction of platforms to enhance the level of
standardisation. The Company upgraded lighting products to be "ultra-thin" in appearance, deepened
intelligent control in terms of functionality, and upgraded the "offline voice" system to address user pain
points such as complicated and unresponsive operation of intelligent voice control, and launched a
number of collections of "modern and simple" line products that meet the needs of the markets in larger
communities and are popular with consumers. In order to meet the higher requirements of users for the
appearance and quality of lamps and lanterns, new products such as S02 ceiling spotlights and T02Plus
can lights were launched for ambient lighting of homes. These products have good wall washing effect,
natural light spot transition, high texture, and possess such advantages as being bright and uniform, and
deeply anti-glare, and have received a good market response.
In mobile lighting business, the Company focused on the pain points and needs of consumers in
reading and light-filling scenarios, and strove to achieve the best light experience. Focusing on the
reading scenarios, in 2022, the Company launched the Eye-Caring Desk Lamp with honeycomb
anti-glare technology at its core, which can better block the harsh light by shading treatment; the product
is equipped with personalised interactive functions such as stepless dimming, rest reminder and delayed
light-off, creating a comfortable, healthy and intelligent reading light environment for consumers at
home. Focusing on the light-filling scenarios, the Company has developed light-filling products such as
night light, cabinet light and clip light by following the market trend and gaining insight into user needs
in 2022, and is committed to bringing good light to every corner of home.
(3) Smart no-main-lamps
Focusing on consumers' upgraded demand for minimalist decoration style and intelligent light
experience, the Company has made smart no-main-lamps a key development direction for its lighting
business and is committed to creating a comfortable and professional light environment and convenient
control experience for users, better interpreting the lighting levels and light atmosphere of a space.
Upholding the concept of modular and standardised product design, the Company launched S03
magnetic rail light and T03 downlight series and other products for smart no-main-lamps in 2022. The
magnetic rail light can be flexibly adjusted to the position of the light source on the rail according to user
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needs, and different modules can meet different lighting needs respectively; the downlight series
includes embedded downlights, bezel-less downlights, surface mounted downlights, single/dual-ended
grille lights and mini grille lights. The high-CRI light source, coupled with professional optical lens,
highly reproduces the real colour of objects, and the innovative industrial design ensures uniform light
effect and natural visual comfort.
In 2022, the Company created "Murora", a new brand that is positioned as a professional brand in
no-main-lamp lighting, with a product layout covering downlight, rail light, strip light, ambient light,
Murora MOS system and so on. Murora's products, by employing high colour rendering light sources,
have industry-leading optical performance indicators; adopting user-friendly design with user experience
at its core, Murora products won the G-Mark Design Award upon its launch; the Company's
self-developed Murora MOS system, together with the intelligent large screen and peripheral ecological
products, further enhance the convenience, safety and stability of product use through continuous
optimisation and software iteration.
(4) Ecosystem-based products
To meet consumers' needs for one-stop shopping during pre-decoration, the Company proactively
builds a pre-decoration intelligent ecosystem, transforming from providing products that meet users'
needs to providing better scenario-based solutions, constantly iterating and innovating ecosystem-based
products such as bathroom heaters, smart door locks, smart clothes drying racks, smart curtain machines,
fan lights and circuit breakers.
In 2022, Domestic Electrical Appliance fully researched the user habits and pain points of electrical
appliances in various household scenarios and gradually improved the category layout. In the bathroom
scenario, based on the decoration problem of users with needs in replacement, and taking into account
the product use scenario, the Company launched a ceiling-mounting-free, plug-and-use wall-mounted
bathroom heater solution to meet users' heating needs; at the same time, the Company launched a series
of electric towel racks in 2022, so that the drying needs of users in humid and cold areas can be better
met. In the dining and bedroom scenarios, through insight and understanding of users' differentiated
demand for different space wind, the Company extended the fan light layout, and launched a
differentiated product in the industry - 07A wide-area wind fan light. Also, the Company kept
innovation in the fan light around the core needs of users; the ultra-thin fan light launched in 2022 won
the international design awards of iF and G-Mark, and the industry's first centrifugal bladeless fan light
was successfully launched by the Company. In the balcony scenario, with the continuous upgrade and
change of consumer groups and home space aesthetics, the Company launched the Yuebian series of
clothes drying racks in 2022, which are more in line with the consumer aesthetics of young people,
increasing the attributes of living scenarios on top of satisfying users with easy drying. In the light and
shadow scenario, in 2022, the Company launched the new one-line smart retractable rail curtain, which
brings a better experience to users in terms of quick collection, one-off installation, smoothness of
product operation, and user experience.
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Circuit breakers are constantly iterated and innovated on the basis of home decoration and civil
product technology platform, and the existing product lines are constantly enriched for factory and
engineering project users. In 2022, LC2 contactors, LW3 frame circuit breakers and LQ3 dual power
adaptors were launched to meet the needs of new scenarios and applications, while helping customers to
further improve the reliability of electricity consumption.
In 2022, the Company completed the layout of two major platforms--the fully automatic type and
the handle type, for smart door locks, and added the remote cat-eye model, 3D face model and WiFi
model product series to achieve the layout of the full-product and full-function architecture. The
Company's latest flagship product combines the functions of AI intelligent cat-eye, 3D face recognition,
and intelligent doorbell to continuously improve product integration. In addition, the Company
introduced WiFi low-power preservation technology across the industry, and equipped AliCloud video
streaming technology and distributed forwarding technology, breaking the technical difficulties of the
industry's visual cat-eye category, and bringing consumers a highly smooth and reliable visual
experience. The continued strengthening of the smart door lock product iteration capability will become
an important guarantee for the Company to enhance market competitiveness.
With years of accumulation of electricity technology and brand advantages, the Company's new
energy business has been running smoothly as it conducted product iterations and technological
innovation based on users' pain points and concerns, and gradually built up a complete product layout
and system. Revenue for the year was RMB153 million in this business, an increase of 638.62% year on
year.
In the new energy vehicle charging plug and charging point business, for the customer-side market,
the Company has fully researched the characteristics of cars and consumer application scenarios, and has
successively launched a number of innovative products such as the high-power in-car charger, Mini
charging point for A00-class cars and the Smart Link version of the charging point to meet the
differentiated scenario-based charging needs of mainstream car models in the market; for the
business-side operator market, the Company has launched flexible DC charging points that support the
full power range from 20kW to 240kW. The output voltage bandwidth can fully meet the battery
charging needs of DC150V-1000V and can operate at maximum power output for a long time. The
modular and highly-integrated design ensures stable and reliable performance, and the networked
operation and independent deployment technology enables remote supervision and maintenance, which
can effectively meet the core requirements of operators for product functionality, operational efficiency
and post-maintenance. The listed products have been widely praised by the market for their superior
technology, standard quality, innovative appearance and experience design.
The Company accelerated energy storage product innovation and technology research and
development, and in 2022, the portable energy storage business focused on camping scenarios, and
deepened its expansion in outdoor power supply and outdoor power accessories. Through demand
insight, the Company launched a small-size and good-looking portable power supply product for
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camping users, with bi-directional inverter fast charging and dimension-raising power technology; for
senior users concerned about the characteristics of power, the Company launched a high-energy lithium
iron phosphate power supply, advancing product capacity from 1kWh to 2kWh, which has received wide
attention in the market; to address senior users' concerns about the low efficiency of battery discharge at
low temperature, the Company carried out research and development on the underlying technology and
took the lead in applying low-temperature-resistant lithium iron phosphate batteries to its products,
leading the innovation trend of the industry. At the same time, the Company has launched solar charging
panels, car-mounted chargers, outdoor bracket lighting and other camping products to provide
consumers with a complete solution for outdoor electricity use.
(II) Deepened channel integration and lean marketing, and focused on building a new sales
system
In 2022, the Company continued to promote marketing reforms according to the changes in
consumer needs, further establishing the ToC and ToB marketing systems and clarifying the synergy and
complementarity strategies of channels including offline hardware, decoration, digital, and online
e-commerce. The hardware channel was primarily for the sales of adaptors, circuit breakers, basic light
source products, among others. Serving as a shared channel for all categories in smart electrical lighting,
the decoration channel focused on the sales of domestic decorative products, including wall switches and
sockets, LED lighting, circuit breakers, bathroom heaters, smart door locks, smart clothes drying racks,
and curtain machines. The digital channel was primarily for the sales of digital accessories. In 2022, the
Company built a new offline energy distribution channel around the development of the new energy
business, and has begun to see results. At the same time, the Company accelerated the expansion of
overseas channels and increased the pace of internationalisation.
In terms of the consumer-side decoration channel, to meet the needs for one-stop purchase during
pre-decoration, the Company deepened a specialised and comprehensive decoration channel, promoted
the downward sales of a range of electrical lighting products such as wall switches and sockets, LED
lighting, circuit breakers, domestic electrical appliances, and smart door locks in the county and town
markets; the Company also launched the construction layout of the full-category flagship shops, which
has strongly driven the development of the whole category business. In 2022, the Company carried out
the construction of core outlets for no-main-lamps in the decoration channel in a timely manner and
achieved good market feedback. In line with the development trend of the industry, the Company has
made comprehensive efforts to develop small and medium-sized decoration enterprises as its customers
to create a new strategic growth channel. In addition, the Company further expanded new channels such
as integrated suspended ceiling shops and integrated kitchen and bath shops, and achieved an important
breakthrough in the channel system. In terms of capacity building, the Company further deepened lean
marketing in the decorative channel, fully implemented lean dealer market planning, and improved
dealer market planning and daily management capabilities. Also, the Company began to promote and
replicate lean retailing after exploration and verification, and implemented regional classification and
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refinement management and top city management change innovation, making marketing strategies and
policies more accurate and effectively stimulating channel vitality.
The Company continued to strengthen its advantages in customer-side hardware channel, managed
its core customers precisely, improved the efficiency and output of a single shop by enhancing shop
displays and creating exclusive sales areas, consolidated the channel foundation, and with the help of a
nationwide network of distributors, continuously expanded product sales channels and optimised the
market structure; the Company entered the procurement platform for government and enterprises,
provided quality services for government, enterprises and public institutions, and further enhanced the
Bull brand's awareness and reputation. In order to meet the needs of young consumers, the Company has
launched good-looking youthful products one after another and further explored new channels such as
trendy shops, boutique bookstores and high-end supermarkets. At the same time, in the hardware
channel in 2022, the Company fully empowered dealer teams by lean marketing tools such as lean
operations and market planning in three dimensions: source-opening, cost-cutting and risk prevention,
and effectively improved the efficiency of market operations with marketing tools such as CRM and
new media.
For the consumer-side digital channel, a range of forms was introduced, including mobile phone
repair stores, digital accessories stores, small supermarket and convenient stores, the points mall, and the
gifts channel. Through measures such as enhancing the "distribution, delivery, visit and sales" service
capability, regional distribution and product improvement, the coverage of terminal outlets was
significantly increased and customer stickiness was strengthened. The Company also further upgraded
the CRM digital tools to improve the quality of sales services and enhance the channel operation and
management capabilities.
The construction of the new energy channel commenced in March 2022 to expand the offline new
energy charging point market; Relying on the marketing system capabilities accumulated during the
long-term service to distributed customers, the pilots summed up the methodology of precise and rapid
investment attraction, recruiting more than a hundred professional distributors nationwide, focusing on
covering first-, second- and third-tier cities. For customer-side users, the Company has formed standard
"distribution, delivery, visit and sales" method and process, and focused on developing more than 5,000
professional distributors such as new energy auto trade shops and auto beauty and decoration shops; for
business-side users, the Company has focused on developing pilot projects for clients such as public
institutions, enterprises, properties and charging stations, and summarised and formed a methodology to
establish the all-round capability of project development, solution design, installation service and
after-sales maintenance unique to the new energy channel, laying a solid foundation for the large-scale
promotion of the Company’s new energy charging point business in the country.
In terms of business-side channels, in 2022, the Company continued to refine its development
around the three major businesses of installation enterprises, engineering projects and houses with fine
decoration. With wall switches and sockets as the foundation and smart no-main-lamps as the core, and
with the advantage of a multi-category portfolio, the Company continued to broaden and deepen its
Annual Report 2022
cooperation with top domestic installers. In 2022, the Company established strategic partnerships with
about 200 well-known top installers and platforms, such as Yenova, Create Decoration, SD, ke.com and
LB, and enhanced the coverage of regional installer outlets around key cities; at the same time, the
Company made comprehensive efforts in the engineering project business and has become an important
partner of Xiong'an New Area, Hong Kong-Zhuhai-Macao Greater Bay Area and other construction
projects, and has been proactively building benchmark projects in the fields of provident housing,
education, hotels and logistics, etc. The Company has also continued to focus on the development of
houses with fine decoration, and has continued its solid cooperation with high-quality real estate
companies such as Taikang, Poly and China Construction.
In e-commerce channels, the Company continued to deepen its strategy of advancing digital
marketing across all categories and platforms in 2022 by focusing on strengthening its capabilities in
channel construction, demand insight and digital marketing promotion. In terms of channel construction,
the Company kept optimising its "1+Specialty+N" shop matrix by building flagship shops in lighting,
digital and new energy categories with benchmarking significance, and creating a healthy ecology for
channel development with distributors in 2022. Regarding demand insight, the Company leveraged
online big data to gain in-depth insight into the needs of consumer groups, and continued to seize
opportunities in segmented categories to make precise efforts, constantly layout and improve the product
matrix with strong competitiveness, successfully created a number of trendy models such as track
sockets and new energy charging plugs. With respect to digital marketing, in 2022, the Company formed
a digital marketing closed-loop system of "efficient off-site advertising and accurate in-site customer
attraction", deepening the relevance of products to users' life scenarios and gradually opening up a
crowd-expanding marketing method. In 2022, according to the data of Intelligence, the Company
continued to maintain the first place in the market share of two categories, namely adaptors and wall
switches and sockets on Tmall and consolidate the leading position; the market share of new energy and
other categories had a steady growth and made new breakthroughs.
In terms of overseas channels, the Company grasped the new trend of globalisation and
regionalisation of consumption, adopted differentiated strategies for different types of markets, and
accelerated the pace of internationalisation. In 2022, the Company focused on exploring the Southeast
Asian market for independent brand business, carried out in-depth research on the trend of upgrading
home decoration consumption in Southeast Asia, further identified potential opportunity markets,
categories and channels, and laid a good foundation for future strategic breakthroughs. In response to the
trend of increasing share of new energy in the energy mix of developed countries in Europe and the
United States, the Company has actively launched cross-border e-commerce business. Currently,
through platforms such as Amazon and independent overseas webs, products such as new energy vehicle
charging plugs and portable chargers have been launched and have achieved good market response. The
OEM business, as a window for communication and cooperation with international markets, also
continued its steady development during the Reporting Period.
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(III) Ongoing efforts were made to promote a lean, automated, and digital supply chain as
well as the transformation and upgrade to smart manufacturing in order to build a high-quality,
low-cost, and efficient green supply chain
In 2022, the Company improved intelligent manufacturing factories with a lean, automated, and
digital supply chain as the pillar, made the manufacturing technology innovation capability an important
carrier of the core competitiveness of the supply chain, deepened the layout of the supply chain in
vertical areas, and further enhanced the quality, cost and efficiency advantages.
The Company continued to promote lean improvements. In 2022, the adaptor factory continued to
improve its automation level with the help of BPD tools, identified waste through the VSM methodology
and promoted the implementation of an agile delivery system. The Company pioneered the direct
operations of the moulding factory and assembly factory, through which the production materials of the
previous process were directly distributed to the assembly workshop’s warehouse, achieving streamlined
logistics, warehousing and manpower and continuous improvement in production efficiency. The
intelligent logistics system of moulding-painting in the wall switch factory has made possible direct
delivery and direct distribution between different internal factories, reducing intermediate inventory and
significantly improving operational efficiency. In terms of digital factory, the Company continued to
build a lean and flexible factory and achieved a double reduction in finished goods and raw material
inventories through VSM's full value stream diagnostics, while initially building a smart delivery system
with the APS system as the core and multi-system collaboration. The moulding factory has upgraded its
injection moulding machines and ancillary equipment through lean tools such as BMS, SMED, DM and
TPM2.0 to achieve improved energy utilisation throughout the year, and has built industry-leading
models such as direct delivery of flat logistics and integration of painting. The new energy electric
connection factory insists on prioritising quality, and through the MES system, connects intelligent
electric batches, AI+vision, testing machines and ageing machines to establish a digital lean line to
continuously improve product quality.
The Company insisted on promoting automation upgrading and transformation, and in 2022, the
LED lighting factory continued to innovate in its business model, developing a characteristic lighting
production model combining automation, line flexibility and lean production. The digital factory
transformed into "unitised" flexible automation, focusing on process automation to increase the
proportion of automation; through lean gold panning, new product DFM implantation, mechanical arm +
vision + flexible vibration plate development and verification, it built the first charging head flexible
manufacturing line, and successfully achieved high-flexibility production. It also continued to deepen
CMF process research, accelerated the development and application of matching process technologies
for fast charging categories, introduced the glue-filling process, through-hole reflow process and glue
solder paste dual process, etc., and completed the construction of production capacity for "good-looking
black technology" trendy products, greatly enriching the product line. The introduction of automated
resistance welding equipment in the circuit breaker factory made available one-off multi-position
welding and helped carry out process innovations such as non-destructive welding of silver points and
Annual Report 2022
integrated welding of hot rivets; the automatic product testing line adopted a digital anti-dulling system
to realise real-time uploading, storage and analysis of test data of finished circuit breakers to improve
product yields in a targeted manner.
In 2022, the Company continued to vigorously promote digital transformation by focusing on the
digitisation of core business processes and improvement of factory digital construction, comprehensively
upgrading the MES system, integrating ERP, MES, QMS, PLM and other software and hardware
systems, fully developing and using MES application functions (internal control and safety, quality and
delivery, cost control) to make it more relevant to production; the Company also created the digital
management of "design and manufacturing integration, production and processing automation,
production process transparency, logistics control precision", realising the information-based and
systematic monitoring and management throughout the process covering raw materials (code-sweeping
material feeding, dummy prevention and error warning), injection production process (process upload,
CCD intelligent detection, intelligent logistics system), and warehouse management system (WMS). The
construction of APS2.0 in the wall switch factory has integrated the planning and scheduling of the
painting, injection moulding and assembly factories, realised the collaboration of sales, production and
procurement planning, and reshaped the business and operational processes of "human", "machine",
"material", "method", "environment" and "measurement" with digitalisation. The adaptor factory has
promoted digital infrastructure construction and put MES, WMS, QMS and APS into operation,
enabling digital management of core business and improving the delivery process by focusing on the
"T+2" project. LED and digital factories have also introduced the APS, achieving a significant reduction
in inventory and sluggish materials. The moulding factory has introduced such technologies as automatic
pallet, automatic cartoning, CCD, AGV and self-researched mechanical arms, and through an intelligent
logistics system that highly correlates the injection moulding business with the decorative painting
business, innovatively used an integrated production model, enabling injection moulding products to be
automatically received - identified - reported - allocated - stocked - discharged, and delivered to the
painting workshop fully automatically within a short period, reducing the process of handling and
warehousing, and significantly improving the turnaround rate.
(IV) Strengthened the construction of the BBS to build and enhanced the organisational
capacity of talents to support future development
After continuous strengthening and construction in recent years, the BBS has gradually become an
important methodology and operational system that drives the Company to improve the quality of its
operations. In 2022, the Company has made continued efforts to deepen its management changes,
implanting the BBS improvement gene from point to plane and from inside to outside into the entire
value chain of production, research, marketing and employment, becoming a powerful engine for the
Company's innovative growth and cost reduction; it also continuously promoted organisational
innovation and talent building, providing a solid guarantee for the Company's sustainable and healthy
development. Through improvement practices, 12 best practices as the lean benchmark were created, 40
BBS methodologies were precipitated and exported, 19 black-belt talents, 25 blue-belt talents and 729
Annual Report 2022
green-belt talents were trained, and the lean transformation was increased from 3 points to 4 points,
reaching an industry-leading level.
Driven by the strategic deployment breakthrough target, BBS fully utilised BBS methods (such as
lean product planning, BPD trending product development, 3P rapid self-production, etc.) to help
promote the continuous improvement of the competitiveness of existing businesses and accelerate the
rapid incubation and ground-breaking growth of strategic new businesses. At the same time, the BBS
has effectively facilitated the business integration and strategic synergy of the newly acquired companies,
helping the Company to quickly fill the capacity requirements of the new business of intelligent
no-main-lamp lighting.
After nearly two years of construction and cultivation, the Company has initially realised the layout
of a distributed headquarters around the high ground of talents in line with the Company's future
sustainable development needs for organisational capacity, talent training and new business development.
In 2022, the Company's Shanghai second headquarters project is progressing smoothly, positioning itself
as an important base and window for future research and development, product and brand presentation;
the Pearl River Delta Centre focused on core cities with obvious industrial clusters, such as Shenzhen
and Huizhou, to lay out the R&D and innovation and supply chain support of the no-main-lamp lighting
and intelligent and new energy businesses, and further build up the core competitiveness of the strategic
business for future development.
The Company keeps focusing on the "selection", "employment", "cultivation" and "retention" of
human resources. In addition to attracting outstanding talents from various industries, the Company also
brings in highly skilled talents with industry experience for new businesses under incubation and
cultivation, so as to quickly build up team capabilities; the Company stimulates the vitality and
motivation of employees under the framework of a synergistic assessment system that breaks down
organisational performance and individual performance, so as to support the effective implementation of
the Company's strategies with efficient organisational execution; based on the Gongniu Leadership
Model and BBS empowerment, the Company formulates competency development plans for
management and technical talents of different categories and levels, and provides all employees with
complete career development plans; the core management team and technical backbones are provided
with a regular incentive mechanism by means of restricted share Incentive Plans and special talent
shareholding plan, so as to better attract and retain talents to grow with the Company and provide an
inexhaustible source of power for organisational development.
(V) Fully launched the brand upgrade and built the new Murora brand while consolidating
the positioning of "Expert in Safe Electricity Use" for the Bull brand
In 2022, the Company initiated a comprehensive upgrade of the Bull brand, establishing the main
brand vision where “7 out of 10 Chinese households will be using Bull products”, and officially
becoming the first civil electric manufacturer to establish a partnership with the aerospace sector in
China. Relying on its core high-end product series, the Company carried out all-round brand promotion
using media channels with strong interaction, wide coverage and high accuracy as a communication
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bridge, leveraging the high popularity of hot celebrities, the high potential of China's aerospace IP and
the high authority of mainstream media, and systematically upgraded the terminal images of online and
offline channels, official websites, new media and other consumer touch points, further consolidating the
positioning of "Expert in Safe Electricity Use" for the Bull brand in 2022.
In order to support the development of the strategic business, the Company cultivated and
incubated the new brand "Murora", which is positioned as a professional and intelligent no-main-lamp
lighting brand, and established the brand's main appeal of "Works of Simplicity by International
Masters". In 2022, the Company systematically created a differentiated and recognisable brand VI and
SI visual system, deepened the online and offline brand channels’ image of being simple, professional,
and warm, laying a good foundation for the development of Murora brand. In March 2023, the brand
launch and the first flagship shop of Murora was released, attracting much attention from both industry
insiders and outsiders with a comprehensive brand promotion, exposing the brand efficiently to dealers
and customers and gaining a good market response.
II Introduction of the Industry where the Company Operates during the Reporting Period
According to the Industry Classification of National Economy (GB/T 4754--2017) issued by the
National Bureau of Statistics, the main type of the Company's business is assigned to “Manufacturing
Industry of C38 Electric Machine and Equipment”. Among them, adaptors, wall switches and sockets,
and digital accessories are all assigned to the specific type of “3899 Other Not Classified Manufacture of
Electric Machine and Equipment”. LED lighting is assigned to the specific type of “3872 Manufacture
of Lighting Devices”. And new energy charging plugs/points fall in the specific type of “3829
Manufacture of Other Power Distribution and Control Facilities”.
With the further improved economic structure as well as the continuous increase of the resident
discretionary income and consumption level in China, industries such as household appliances,
consumer electronics, real estate, home decoration, and new energy vehicles, grow continuously and
rapidly, promoting the market demand for products in electric connection, smart electrical lighting and
new energy charging and storage. Nowadays, China is the main producing base of adaptors across the
world. The brands of wall switches and sockets in China’s market are nationally leading as well as
internationally famous. In the field of lighting, China has become the workshop of the world with
products sold to around 220 countries and regions. In the field of new energy vehicles, China is the
world's largest producer and consumer. In general, traditional electric connection products such as
adaptors and digital accessories, as well as wall switches and sockets, LED lighting and electrical
lighting products, have entered a mature period of development, but the sub-categories, such as smart
ecosystem household products, and new energy products are in a growing period with increasing policy
support.
Products of electric connection, smart electrical lighting and new energy all have close connection
to people’s lives with no obvious characteristics of industry cycle and regions. Among them, some
Annual Report 2022
products of electric connection and smart electrical lighting have been affected by some factors
including cessation of business in major retail terminal end outlets (such as hardware stores, specialized
markets and so on) and the reduction of housing fixtures during the Spring Festival. Therefore, the first
quarter always has the fewer sales volume all over the year.
The Company concentrates on the civil electric industry and always upholds the business
philosophy of “Be Professional and Concentrated, and Go Further”. Since its establishment in 1995,
the Company has gradually formed three main businesses: electric connection, smart electrical lighting
and new energy. Relying on excellent product quality and sound word of mouth, the reputation of the
Bull brand has increased constantly and its sales volume has always been leading. During the Reporting
Period, the Company ranked 70th on the 2022 Hurun Brand List China's Top 300 Brands by Brand
Value, becoming the first civil electric manufacturer to establish a partnership with the aerospace sector
in China, and winning the "China Brand Annual Award for Wall Switches and Sockets NO.1" by the
World Brand Lab. The Company was recognised as a "2022 National Intellectual Property
Demonstration Enterprise" by the China National Intellectual Property Administration, named "2022
Pilot Demonstration of Integration of New Generation Information Technology and Manufacturing
Industry" by the Ministry of Industry and Information Technology, and awarded the honours of Top 100
Manufacturing Enterprises of Zhejiang Province and Top 100 Fastest Growing Enterprises in Zhejiang
Province.
According to the data provided by Info Master, in 2022, the Company’s products such as adaptors
and wall switches and sockets had the No. 1 online sales volume in Tmall market. In June 2021, the
Company successively launched new products such as new energy vehicle charging plugs and charging
points for e-commerce platforms, with the sales volume in a leading position among third-party brands.
III Principal Operations of the Company during the Reporting Period
During the Reporting Period, the Company focused on the three major businesses of electric
connection, smart electrical lighting and new energy towards its strategic objectives. The primary
products of electric connection are adaptors (power strips), digital accessories, etc. The products of
smart electrical lighting mainly include wall switches and sockets, LED lights (smart no-main-lamps),
safe circuit breakers, smart bathroom heaters, smart door locks, smart clothes drying racks, smart curtain
machines and so on. The products of new energy mainly include new energy vehicle charging
points/plugs, outdoor portable chargers, etc.
Annual Report 2022
Electric Connection Smart Electrical Lighting New Energy
The Company adheres to the vision of “Becoming a Leader in the International Civil Electric
Industry”, the mission of “providing safe and comfortable electricity experience for customers” and the
development philosophy of “be professional, concentrated and go further”. Since its establishment in
quality. The Company started to from the segmentation of power strips, constantly promoting the
innovation of functions, technology and design, and developing batches of new products popular among
consumers. Focusing on innovation, the Company has the comprehensive advantages of product R&D,
marketing, supply chain and branding. After years of developing and expanding, the Company has
formed three major business segments: electric connection, smart electrical lighting and new energy.
Besides, it has also formed sustainable business layout in the fields of civil electrical industry and
lighting.
(1) Procurement model: The procurement business of the Company mainly includes the
procurement of operating supplies including copper, silver, aluminum, tin, plastic granule, paper pulp,
etc., and the procurement of non-operating supplies such as IT materials, administrative supplies and so
on. The Company has established a procurement strategy with quality as the core. It has selected the
main supplier through the mechanism of strict supplier entrance and regular examination and inspection.
Besides, the Company established strategic cooperating relationships with the main suppliers to ensure
the quality and delivery. The Company has set up a procurement sharing platform with professional
personnel at the group level. It improves the ability of negotiating prices and debasing procurement costs
through central procurement. Furthermore, the Company has optimized and improved the suppliers
management system, ERP system, manufacturing and storage system, etc. Meanwhile, it has improved
the management of procurement and constantly improved the procurement efficiency.
The Company has performed central procurement of bulk raw materials such as copper, silver,
aluminum, tin, plastic granules, paper pulp and so on. In addition, the Company has locked the trading
Annual Report 2022
price through ways such as forward hedging to reduce the uncertain risk brought by the price fluctuation
in spot market of raw materials.
(2) Production model: The Company has adopted the manufacturing model of “Market Forecast +
Safe Inventory”. Products are mainly self-made. Some new products and supporting products have been
made by adopting the OEM manufacturing mode. Every factory is responsible for the production of
corresponding products and parts. They have ensured product quality, efficient management and on-time
delivery at the same time. Meanwhile, the Company has constantly promoted the innovation of
manufacturing model. By building a balanced production and sales system, continuously improving lean,
automated and intelligent levels, and insisting on technical process innovation, the Company has
gradually enhanced its "order-driven" flexible production model while ensuring product quality and
reducing inventory slow moving losses.
(3) Sales model: The Company has established online and offline integrated sales model through
omnichannel. The offline sales model is mainly based on distribution and partially based on direct
selling. The Company has promoted the innovative offline sales mode of “distribution, delivery, visit
and sales” in the field of civil electrical appliances and implemented refined management of channels.
Through efficiently organizing and transferring dealer resources around the country, and long-term
accumulation, the Company has established distribution network with 1.1 million retail stores covering
national urban and rural areas. The online channel has covered the mainstream e-commerce platforms
through direct selling + distribution, with which we have made every effort to build the flagship stores
into a brand promotion window. The Company has actively implemented digital marketing to realize
“diversion outside the online channel and sales inside the channel” with the help of each traffic inlet.
Additionally, the Company has beefed up development and sales in the B-end channels of decoration
and engineering projects. Besides, it has actively explored overseas markets to speed up the global
layout.
IV Analysis on Core Competitiveness during the Reporting Period
√ Applicable □ Not applicable
The Company has always adhered to the core values of “Honest, Faithful, Professional and
Concentrated”. It has gradually established strong and comprehensive competitive edges through
continual and comprehensive innovation and reform in product development, quality control, channel
development, marketing and supply chain construction. During the Reporting Period, the Company’s
core edges were continuously strengthened.
(I) The Company has established an edge of innovative product development based on
consumer demand, enabling constant product launches.
For long, the Company has attached great importance to research on consumer demand and the
innovation of product planning and research. It has always viewed the promotion of consumer
experience as the primary goal in product research. The Company has established an integrated
innovation system and teams of forward research, product planning and research. It has created and
Annual Report 2022
applied all kinds of new technologies, materials and crafts. Through the constant superposition of micro
innovation, the Company has promoted a batch of products of electric connection, smart electrical
lighting and new energy with new and different characteristics in the aspects of design, performance,
technology and function, which are popular among consumers. For years, the Company has participated
in drafting 118 national standards, industry standards and association standards. It is the vice chairman
unit of the Electrical Accessories and Household Controller Branch of the China Electrical Equipment
Industry Association. It is also the vice chairman unit of the National Technical Committee for
Standardization of Electrical Accessories. What’s more, it is the first electrical enterprise in the industry
to draft the “Made in Zhejiang” standard and attain certification.
As of the end of December 2022, the Company holds 2,379 valid patents, of which 565 were
granted during the Reporting Period. Meanwhile, the Company is a national industrial design center
approved by the Ministry of Industry and Information Technology of the People's Republic of China. It
is also a unit of national postdoctoral workstation.
(II) The Company has always adhered to the philosophy of winning through high quality and
put in place an efficient quality control system.
Since its founding, the Company has aimed to manufacture high-quality products. The idea of
winning through high quality has gained support among all in the Company. The Company has
established a good brand image and reputation on the market with reliable product quality.
In the aspects of selecting raw materials, procurement, research and production process control,
product testing and after-sales service, the Company has established a comprehensive and perfect quality
management system of product planning -- product design -- procurement -- production in batch quantity
-- post-sale strictly in line with the national standards, related laws and regulations, and enterprise
standards. In order to ensure the highly efficient operation of the quality management system, the
Company has been equipped with more than 900 professional personnel in quality management,
experiment testing, analysis and quality control. It has also had more than 7,000 sets of testing
equipment for experiment and production line automation, and established 10 high-standard laboratories
for R&D, development and quality testing in the industry. The related laboratories have acquired CNAS
National Laboratory Certification, UL WTDP Laboratory Certification and other product certificates
such as CCC, VDE, UL, NF, CE, and so on. It assures solid resources for management and control of
product quality.
With long-term accumulation, the Company has formed an efficient and systematic quality
management and control system. It has achieved the management system certification of IS09001,
ISO14001 and OHSAS18001. Besides, it has been successively awarded 20 prizes related to quality
such as “National Qualified Products of Stable Quality”, “Products with Reliable Quality”,
“Demonstration Enterprise of Export Quality and Safety in China”, “Famous Brand Products in
Zhejiang” and “Ningbo Mayor Quality Award”.
(III) The Company always adapts itself to market changes. Supported by the offline
marketing network of more than 1.1 million outlets covering urban and rural areas, as well as a
Annual Report 2022
professional online marketing network, the Company has established a marketing system
featuring coordinative online and offline channels in the civil electrical industry.
The Company has implemented an innovative offline sales model featuring “distribution, delivery,
visit and sales” in the civil electrical industry. In China, it has already developed more than 750,000
hardware channel retailers (including hardware stores, grocery stores, office supplies stores,
supermarkets and so on), more than 120,000 specialized decoration and lamp decoration retailers, and
more than 250,000 digital accessories channel retailers. These channels have expanded the selling points
to stores, large market places, professional markets in urban and rural areas, forming an offline
marketing network hard to be duplicated. At the same time, the Company has established a professional
e-commerce direct selling operational team and an online distributor system with strong ability.
Nowadays, the Company has comprehensively entered the leading e-commerce platforms such as Tmall,
Taobao, JD.com, Vipshop, Pinduoduo, and so on. It has dozens of authorized online distributors. On the
basis of maintaining the sales on traditional e-commerce platforms, the Company also worked on hobby
and content-oriented e-commerce channels to strengthen its brand presence while driving sales.
According to the data provided by Info Master, in 2022, the Company’s products of adaptors and wall
switches and sockets continued to maintain the first place in the Tmall online market share and
continued to consolidate the leading position, while the market share of new energy and other categories
grew steadily and made new breakthroughs.
The high quality coordinated development between offline and online channels has helped the
Company establish a comprehensive, multilevel and stereoscopic marketing network, which is the
advantage of the Company to maintain sustainable development and competitiveness in the industry.
Simultaneously, the Company has always adhered to the refined management of channels for years,
developing established systems in the aspects of development, management, operation, and so on. It has
had the advantage of exploring new channels.
(IV) The Company has put in place an integrated branding model with selling point
promotion as the core, making “Bull” a household name.
The Company has adhered to the branding model with selling point promotion as the core. Over the
past 20 years, the Company has made constant efforts to support the distributors to put the Bull brand in
retail stores and put advertising resources such as display inside and outside the stores, in so doing the
Bull brand has been disseminated to cities, towns and counties. It has formed a simple, efficient and
unique branding model. With an increasingly strong presence, Bull has become a household name.
Meanwhile, the Company has constantly enriched the brand connotation and improved the brand’s
penetration and loyalty among different consumers with the help of diversified, intelligent and young
new products and the Internet new media promotion.
(V) The Company boasts a supply chain system featuring advanced manufacturing
technologies and automation, helping it stay competitive with respect to quality, efficiency and
cost.
Annual Report 2022
The Company has regarded manufacturing technology as the important carrier of core
competitiveness in the supply chain. It has been equipped with a professional mold factory. The factory
has designed, developed and manufactured all kinds of high-precision mold for the Company’s
diversified products by adopting high-precision tolerance grade technology, advanced automatic pouring
technology and 3D print technology. At the same time, the factory has adopted manipulator technology
and post processing free technology to achieve automation of injection molding production and molding
integration as well as to greatly improve the product quality, production efficiency and production
innovation. At the same time, the Company has established a dust free electronic factory which has
adopted 3D image analysis technology and phase shifting AOI technology. The factory has also been
equipped with an independently developed four-axis manipulator. It has ensured the quality of PCBA
board products through image comparison after firing, greatly supporting the Company’s manufacturing
of digital accessories, lighting and smart products.
The Company has constantly improved the fine, automatic and smart manufacturing level and
established an industrial automatic team of integrated research, design and manufacturing. The
independent development and design, and the assembly application capability of automatic devices and
smart assembly devices have constantly improved. The flexible production mode of “man-machine
integration” has been promoted rapidly. With the help of a leading automatic stereoscopic warehouse
and smart sorting shipment system, the Company has achieved the mechanization and automation of
warehouse work, which greatly improves the speed of distribution and delivery, and the customer
response ability. The automatic stereoscopic warehouse has efficiently connected the front-end
automatic production. The smart manufacturing system for the whole process of feedstock -- production
-- storage -- shipment has been established, providing solid support for the sustainable development of
the Company’s business.
(VI) The Company has established the Bull Business System (BBS) with innovation and
growth as the core, driving growth and breakthroughs to create a stream of business growth
points.
The Company has continuously summarized, refined, iterated, and built the unique Bull Business
System (BBS) by importing and extracting the essence of advanced management modes at home and
abroad, and combining it with its own experience. It has also established a whole value chain of R&D,
manufacturing and marketing with value creation as the core, innovation increase as the key point and
cost reduction, efficiency increase as the base. Gongniu BBS takes “empowering everyone and every
business of Gongniu in pursuit of faster, higher and further growth” as the mission. It has constantly
strengthened the system development and promoted the ability internalization. Focusing on the
Company’s strategic goal, Gongniu has fully used the BBS instrumental methodology mode (such as 3P
quick self-manufacturing, BPD development of popular products, fine marketing and so on). Gongniu
BBS has driven the Company to constantly make breakthrough to promote the development of new
business, and facilitate the cost reduction and efficiency increase of the traditional business, and the
Annual Report 2022
innovation development. It has also promoted the achievement of high performance objectives, creating
a stream of business growth points for the Company.
V Major Operations during the Reporting Period
For the Reporting Period, operating revenue increased 13.70% year on year to RMB14.081 billion
and the net profit attributable to the Company’s shareholders amounted to RMB3.189 billion, up 14.68%
from the previous year.
(I) Analysis of Principal Operations
Unit: RMB
Item 2022 2021 Change (%)
Operating revenue 14,081,373,030.94 12,384,916,337.51 13.70
Cost of sales 8,730,082,585.08 7,808,540,666.84 11.80
Selling expense 800,387,659.41 560,187,002.80 42.88
Administrative expense 500,596,373.88 427,615,556.97 17.07
Finance costs 588,296,080.11 471,015,016.82 24.90
R&D expense -107,993,300.96 -87,842,281.32 Not applicable
Net cash generated from/used in
operating activities
Net cash generated from/used in
-1,746,083,657.48 -1,588,987,931.15 Not applicable
investing activities
Net cash generated from/used in
-1,945,455,689.54 -700,808,446.71 Not applicable
financing activities
The change in operating revenue was primarily driven by the steady growth in the traditional core
business and the fast growth in new businesses in the year.
The change in cost of sales was primarily driven by the increased costs along with the increased revenue.
The change in selling expense was primarily driven by the increased advertising and marketing
expenses.
The change in administrative expense was primarily driven by the increased employee salaries and
equity incentive expenditures.
The change in R&D expense was primarily driven by the increased R&D investments.
The change in finance costs was primarily driven by the increased interest income from bank deposits in
the year.
The change in net cash generated from/used in operating activities was primarily driven by the decreased
material procurement costs and inventories.
The change in net cash generated from/used in investing activities was primarily driven by the increased
purchases of financial products in the year.
The change in net cash generated from/used in financing activities was primarily driven by the decreased
bank borrowings in the year.
Particulars about any significant change to the Company’s business nature, profit composition or sources
in the current period.
□ Applicable √ Not applicable
√ Applicable □ Not applicable
In 2022, the Company continued to implement individualized innovation in electricity scenarios
and develop products based on customer demands for its electric connection business, and the business
saw steady growth as a result. For the smart electrical lighting business, the Company actively expanded
new product categories and accelerated the construction of a smart home ecosystem with no-main-lamp
Annual Report 2022
lighting as the core, which resulted in rapid growth in the business. And the new energy business
enriched the product portfolio to meet the needs of different customers and saw smooth channel
expansion, achieving a good start.
(1) Principal operations by operating division, product category, operating segment and sales
model
Unit: RMB
Principal operations by operating division
YoY
change
Gross YoY
in YoY change
Operating profit change
Operating revenue Cost of sales operati in gross profit
division margin in cost of
ng margin (%)
(%) sales (%)
revenu
e (%)
Up by 1.12
Civil electrical
appliances
points
Principal operations by product category
YoY
change
Gross YoY
in YoY change
Operating profit change
Operating revenue Cost of sales operati in gross profit
division margin in cost of
ng margin (%)
(%) sales (%)
revenu
e (%)
Electric Up by 1.61
connection 7,050,721,172.38 4,636,164,967.40 34.25 4.22 1.73 percentage
products points
Down by 0.09
Smart electrical
lighting products
point
Up by 4.93
New energy
products
points
Principal operations by operating segment
YoY
change
Gross YoY
in YoY change
Operating profit change
Operating revenue Cost of sales operati in gross profit
division margin in cost of
ng margin (%)
(%) sales (%)
revenu
e (%)
Up by 0.96
Domestic 13,791,305,035.94 8,486,294,382.03 38.47 14.36 12.60 percentage
point
Up by 3.43
Overseas 261,466,476.29 230,636,322.51 11.79 -5.78 -9.31 percentage
points
Notes:
As the product categories were adjusted in the current year, the financial data of the prior year were
adjusted accordingly based on the new categories.
accessories, etc.
Annual Report 2022
breaker, bathroom heaters, smart door locks, smart clothes drying racks, smart curtain machines and
other smart ecosystem products.
products, etc.
The performance of the Company’s principal operations by operating division, product category,
operating segment and sales model:
year, while the cost of sales stood at RMB4,636 million, up 1.73% year on year. Supported by the brand
advantage and the hardware channel advantage, the electric connection business, as the Company's core
business, maintained a steady growth.
year on year, while the cost of sales stood at RMB3,977 million, up 23.59% year on year. In this
business, the Company accelerated the development of new business and decoration channels were
expanded during the Reporting Period, achieving strong growth in all operations.
while the cost of sales stood at RMB103 million, up 588.48% year on year. The new energy business
enriched the product portfolio and focused on building a new offline sales channel system during the
Reporting Period, achieving a good start.
(2) Output and unit sales analysis
√ Applicable □ Not applicable
YoY YoY
YoY
Primary change in change in
Unit Output Unit sales Inventory change in
products unit sales inventory
output (%)
(%) (%)
Electricity
connecting 56,973.48 56,418.53 3,852.52 -1.24 -0.71 4.17
pieces
products
Electrical
lighting 80,362.34 74,716.25 6,042.97 12.19 11.62 -22.51
pieces
products
New
energy 25.65 23.90 4.96 228.73 435.63 19.04
pieces
products
Notes:
As the product categories were adjusted in the current year, the financial data of the prior year were
adjusted accordingly based on the new categories.
with last year.
year, mainly due to the strong sales in Q4.
mainly due to the strategic re-stocking due to strong sales this year.
(3) Execution of significant purchase or sales contracts
□ Applicable √ Not applicable
(4) Cost analysis
Unit: RMB
By operating division
Operating As % As % Change
Cost category 2022 2021 Note
division of of in
Annual Report 2022
total total amount
costs costs (%)
in in
(%) (%)
Direct
materials
Civil
Direct labor
electrical 597,581,598.69 6.85 494,515,730.18 6.33 20.84
cost
appliances
Manufacturing
expense
Notes:
The cost of direct materials as a percentage of total costs decreased year on year, primarily driven
by the falling prices of bulk materials in the current period.
The manufacturing expense increased year on year, primarily driven by the increased costs as a
result of the stronger sales in the current period.
(5) Changes to the consolidation scope due to changed ownership in principal subsidiaries in the
Reporting Period
√ Applicable □ Not applicable
For details, please refer to “VIII Changes in Consolidation Scope” in “Part X Financial
Statements”.
(6) Significant changes to the business scope or product or service range in the Reporting Period
□ Applicable √ Not applicable
(7) Major customers and suppliers
A. Major customers
√ Applicable □ Not applicable
Sales to the top five customers stood at RMB1,808.4866 million, accounting for 12.84% of the total
annual sales. Sales to the related-parties among the top five customers stood at RMB0, accounting for
Indicate whether sales to a single customer accounted for over 50% of the total sales, there was any new
customer in the top five customers, or the Company heavily relied on a few number of customers in the
Reporting Period.
□ Applicable √ Not applicable
B. Major suppliers
√ Applicable □ Not applicable
Purchases from the top five suppliers stood at RMB2,101.8552 million, accounting for 22.14% of the
total annual purchases. Purchases from the related-parties among the top five suppliers stood at RMB0,
accounting for 0% of the total annual purchases.
Indicate whether purchases from a single supplier accounted for over 50% of the total purchases, there
was any new supplier in the top five suppliers, or the Company heavily relied on a few number of
suppliers in the Reporting Period.
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Unit: RMB
Item 2022 2021 Amount of change Change
Selling expense 800,387,659.41 560,187,002.80 240,200,656.61 42.88%
Administrative 500,596,373.88 427,615,556.97 72,980,816.91 17.07%
Annual Report 2022
expense
R&D expense 588,296,080.11 471,015,016.82 117,281,063.29 24.90%
Finance costs -107,993,300.96 -87,842,281.32 -20,151,019.64 Not applicable
(1) Selling expense increased primarily driven by the increased advertising and marketing expenses.
(2) Administrative expense increased primarily driven by the increased employee salaries and equity
incentive expenditures.
(3) R&D expense increased primarily driven by the increased R&D investments.
(4) Finance costs decreased primarily driven by the increased interest income from bank deposits in the
year.
(1) R&D investments
√ Applicable □ Not applicable
Unit: RMB
Expensed R&D investments in the current
period
Capitalized R&D investments in the
current period
Total R&D investments 588,296,080.11
Total R&D investments as % of operating
revenue
Capitalized R&D investments as % of
total R&D investments
(2) R&D personnel
√ Applicable □ Not applicable
Number of R&D personnel 1,400
R&D personnel as % of total employees 11.34
Educational background of R&D personnel
Educational background Number of employees
Doctoral degree 0
Master’s degree 69
Bachelor’s degree 787
Junior colleges 465
Senior high school and below 79
Age structure of R&D personnel
Age Number of employees
Below 30 (exclusive) 319
(3) Other information
√ Applicable □ Not applicable
The Company, as a national industrial design center and a national postdoctoral workstation, has
always attached importance to product development and technological innovation. By establishing a
leading scientific research innovation platform and innovating mechanism, the Company focuses on the
research of industry basic and key common technologies to continuously improve product development
and technological innovation capability. Meanwhile, with great emphasis on cultivation and introduction
Annual Report 2022
of talents of R&D and product planning as well as adhering to market demand-oriented principle, the
Company continues to strengthen the insight and research on the potential consumer demands and
scenario-based requirements, constantly expands the areas by launching products that meet consumer
demands to lead the industry development. In addition, the Company continues reinforcing the
construction of the standardization system and the strategic layout of intellectual property rights, and
constantly promotes open innovation to set an excellent example with respect to innovation capability.
(4) Reasons for any significant change to the composition of R&D personnel and the impact on the
Company
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Unit: RMB
Item 2022 2021 Amount of change Change
Net cash generated
from/used in 3,057,914,218.16 3,014,326,741.14 43,587,477.02 1.45%
operating activities
Net cash generated
from/used in -1,746,083,657.48 -1,588,987,931.15 -157,095,726.33 Not applicable
investing activities
Net cash generated
from/used in -1,945,455,689.54 -700,808,446.71 -1,244,647,242.83 Not applicable
financing activities
(1) Net cash generated from operating activities increased primarily driven by the decreased material
procurement costs and inventories.
(2) Net cash generated from investing activities decreased primarily driven by the increased purchases of
financial products in the year.
(3) Net cash generated from financing activities decreased primarily driven by the decreased bank
borrowings in the year.
(II) Significant changes in profit incurred by non-core business
□ Applicable √ Not applicable
(III) Analysis of assets and liabilities
√ Applicable □ Not applicable
Unit: RMB
As % of As % of
closing opening
Change
Item Closing amount total Opening amount total Note
(%)
assets assets
(%) (%)
Derivative
financial assets
Notes
receivable
Prepayments 49,635,694.61 0.30 29,140,223.00 0.19 70.33
Other
receivables
Annual Report 2022
Other current
assets
Construction in
progress
Not
Goodwill 45,133,442.04 0.27 -
applicable
Short-term
borrowings
Held-for-trading
Not
financial 18,200,000.00 0.11 -
applicable
liabilities
Notes payable - 2,333,774.75 0.02 -100.00
Taxes and levies
payable
Current portion
of non-current 8,798,658.13 0.05 673,911,937.53 4.36 -98.69
liabilities
Deferred Not
income applicable
Treasury shares 129,612,354.00 0.78 80,711,540.00 0.52 60.59
Other
comprehensive 4,389,526.95 0.03 7,537,390.37 0.05 -41.76
income
Minority Not
interests applicable
Other notes:
Derivative financial assets decreased primarily driven by the decreased carrying closing amount of
floating income of hedges.
Notes receivable decreased primarily driven by the decreased closing balance of trade acceptance notes
receivable.
Prepayments increased primarily driven by the increased advance payments to suppliers.
Other receivables decreased primarily driven by the decreased closing balance of security deposit
payments.
Other current assets decreased primarily driven by the decreased closing balance of structured deposits
held.
Construction in progress increased primarily driven by the increased investments in infrastructure and
equipment of the raised funds investment projects.
Goodwill increased primarily driven by the goodwill arising from the acquisition of Dalitek.
Short-term borrowings increased primarily driven by additional short-term bank loan in the period.
Held-for-trading financial liabilities increased primarily driven by the unpaid investment amount for the
acquisition of Dalitek.
Notes payable decreased primarily driven by the decreased bank acceptance notes payable.
Taxes and levies payable decreased primarily driven by the substantial tax and levy deferral last year.
Current portion of non-current liabilities decreased primarily driven by the decreased current portion of
long-term borrowings.
Deferred income increased primarily driven by the increased special government subsidies.
Treasury shares increased primarily driven by the increased equity incentives.
Other comprehensive income decreased primarily driven by the decreased net gain (exclusive of tax)
recognized on futures contracts for hedging purposes.
Minority interests increased primarily driven by the inclusion of Dalitek in the consolidated financial
statements in the current period.
□ Applicable √ Not applicable
Annual Report 2022
√ Applicable □ Not applicable
For details, please refer to “81. Assets with restricted ownership or right to use” under “VII Notes
to the Consolidated Financial Statements” of “Part X Financial Statements”.
□ Applicable √ Not applicable
(IV) Industry environment analysis
√ Applicable □ Not applicable
For details, please refer to “(I) Industry landscape and trends” under “VI Outlook Discussion and
Analysis” of Part III Management Discussion and Analysis”.
Annual Report 2022
(V) Investments made
Equity investments in other entities
□ Applicable √ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
For details, please refer to “(2) Changes in significant constructions in progress in the current period” under “22. Construction in progress” in “VII Notes to the
Consolidated Financial Statements” of “Part X Financial Statements”.
√ Applicable □ Not applicable
For details, please refer to “XI Items Measured at Fair Value” in “Part II Corporate Information and Key Financial Information”.
Securities investments:
□ Applicable √ Not applicable
Investments in private equity funds:
□ Applicable √ Not applicable
Derivatives investments:
□ Applicable √ Not applicable
Annual Report 2022
□ Applicable √ Not applicable
(VI) Sale of significant assets and equity investments
□ Applicable √ Not applicable
(VII) Principal subsidiaries
√ Applicable □ Not applicable
Unit: RMB’0,000
Full
Registe
name of Operating
Principal activities red Total assets Net assets Net profit
subsidiar revenue
capital
y
Household appliances manufacturing;
manufacturing of mechanical and
electrical equipment; manufacturing
of distribution switch control
equipment; lighting apparatus
manufacturing; general
merchandising of hardware products;
electrical materials manufacturing;
manufacturing of electronic
components and electromechanical
components and equipment;
manufacturing of intelligent home
consumption equipment;
communication equipment
manufacturing; network equipment
Ningbo
manufacturing; IoT equipment
Gongniu
manufacturing; technical services, 10,000 477,118.57 168,090.09 446,008.40 144,878.09
Electrics
technical development, technical
Co., Ltd.
consulting, technical communication,
technical transfer, and technical
promotion (business activities shall
be conducted independently in
accordance with laws with the
business license, except the items that
require approval in accordance with
laws). Items permitted: Import and
export of products; and import and
export of technologies (business
activities that require approval in
accordance with laws shall be subject
to the approval by relevant
authorities. Specific business items
are indicated on the approval results).
Ningbo
Gongniu
Manufacturing, processing and sales
Precisio
of mold, plastic products, hardware
n 10,000 53,375.22 19,614.63 230,303.32 4,648.98
accessories, and electronic
Manufac
components.
turing
Co., Ltd.
Ningbo General merchandising, retailing and 10,000 223,545.26 21,670.47 1,328,447.7 62,555.96
Annual Report 2022
Gongniu online sales of electrical materials, 9
Electric electronic products, hardware
Sales products, household appliances,
Co., Ltd. communication apparatus, lamps, and
articles of everyday use; import and
export businesses of self-owned and
commissioned goods and
technologies (excluding those limited
or prohibited by state laws and
regulations). (business activities that
require approval in accordance with
laws shall be subject to the approval
by relevant authorities)
Unit: RMB’0,000
Full name Net profit in
How it was Registered Closing net
of Principal activities the current
obtained capital assets
subsidiary period
General operations: Technical services,
technical development, technical consulting,
technical communication, technical transfer,
and technical promotion; software
development; information consultant
services(excluding the information
consultant services requiring any license);
sales of household appliances; sales of
mechanical and electrical equipment; sales of
power distribution switch control equipment;
Shanghai wholesale of hardware products; sales of
Gongniu electrical equipment; sales of electrical
Information accessories; sales of electronic components Incorporated 10,000.00 829.23
Technology and electromechanical component
Co., Ltd. equipment; sales of electronic products; sales
of plastic products; sales of lighting
apparatus; sales of lamps; non-residential
real estate leasing; sales of charging points;
sales of intelligent vehicle-mounted
equipment; sales of electric accessories for
new energy vehicles (business activities shall
be conducted independently in accordance
with laws with the business license, except
the items that require approval in accordance
with laws).
General operations: Technical services,
technical development, technical consulting,
technical communication, technical transfer,
and technical promotion; sales of wind and
Ningbo power tools; sales of electronic products;
Gongniu sales of electrical equipment; wholesale of
Tool hardware products; sales of mechanical and Incorporated 4,800.00 0.00 0.00
Technology electrical equipment; sales of communication
Co., Ltd. equipment; sales of lamps; sales of general
merchandise; sales of daily necessities
(business activities shall be conducted
independently in accordance with laws with
the business license, except the items that
Annual Report 2022
require approval in accordance with laws).
General operations: Engineering and
technological research and experimental
development; technical services, technical
development, technical consulting, technical
communication, technical transfer, and
technical promotion; manufacturing of new
energy primary-power equipment;
manufacturing of power transmission and
distribution and control equipment;
manufacturing of power and electronic
components; operations of electric vehicle
Ningbo
charging infrastructure; sales of intelligent
Gongniu
power transmission and distribution and
New
control equipment; sales of charging points; Incorporated 1,000.00 56.36 -3.64
Energy
centralised fast charging station; information
Technology
consultant services(excluding the
Co., Ltd.
information consultant services requiring any
license); sales of new energy vehicle power
exchange facilities; sales of motor vehicle
chargers; manufacturing of electronic
components; installation services for
household appliances; engineering
management services (business activities
shall be conducted independently in
accordance with laws with the business
license, except the items that require
approval in accordance with laws).
General operations: Software development;
information technology consulting services;
manufacturing of lighting apparatus;
manufacturing of distribution switch control
equipment; manufacturing of electrical
Shenzhen
equipment; manufacturing of hardware
Gongniu
products; manufacturing of household
Intelligent Incorporated 1,000.00 32.73 -94.45
appliances; manufacturing of other electronic
Information
devices; manufacturing of plastic products;
Co., Ltd.
manufacturing of electronic components
(business activities shall be conducted
independently in accordance with laws with
the business license, except the items that
require approval in accordance with laws).
General operations: Manufacturing of
lighting apparatus; sales of lighting
apparatus; manufacturing of special
equipment for the production of lighting
apparatus; manufacturing of distribution
Guangdong switch control equipment; manufacturing of
Murora electronic components; manufacturing of
Intelligent special electronic equipment; manufacturing Incorporated 1,000.00 543.49 424.28
Lighting of hardware products; manufacturing of
Co., Ltd. household appliances; information
technology consulting services;
manufacturing of intelligent household
consumption equipment (business activities
shall be conducted independently in
accordance with laws with the business
Annual Report 2022
license, except the items that require
approval in accordance with laws).
General operations: Wholesale of hardware
products; sales of electrical accessories; sales
of household appliances; sales of
communication equipment; sales of
electronic products; sales of daily necessities;
sales of special equipment for lighting
apparatus production; sales of mechanical
and electrical equipment; sales of lighting
Ningbo apparatus; sales of general merchandise;
Gongniu sales of lamps; sales of wind and power
Incorporated 1,000.00 0.00 0.00
Marketing tools; sales of metal tools; wholesale of
Co., Ltd. electronic components; sales of plastic
products; sales of motor vehicle chargers;
sales of charging points; sales of household
goods; installation services for household
appliances (business activities shall be
conducted independently in accordance with
laws with the business license, except the
items that require approval in accordance
with laws).
Research and development, design,
assembly, manufacturing and sales of
intelligent electrical systems, lighting control
systems and related ancillary equipment,
development and design of software systems,
design of intelligent lighting systems,
Dalitek installation and maintenance of
Intelligent self-produced products, import and export of
Business
Technology the above products and related technologies, 1,500.00 5,499.49 -1,052.88
combination
(Shanghai) and provision of related consultancy and
Inc. technical services (not related to the
state-operated trade and management
commodities; if it is related to the
commodities under quota or license
management, application must be filed
according to the relevant national
regulations).
(VIII) Structured entities controlled by the Company
□ Applicable √ Not applicable
VI Discussion and Analysis on the Company’s Future Development
(I) Industry landscape and trends
√ Applicable □ Not applicable
According to the National Bureau of Statistics, the national GDP grew by 3.0% year on year in
the national per capita consumption expenditure for the year was RMB24,538, up by 1.8% compared to
the previous year; the urbanisation rate of the resident population was 65.22% at the end of the year, up
by 0.50 percentage points compared to the end of the previous year. In 2022, the report of the 20th CPC
National Congress and the Central Economic Work Conference reaffirmed the status of real estate as a
Annual Report 2022
pillar industry of the national economy; real estate regulation and control policies focusing on
"preserving the delivery of buildings and stabilising people's livelihood" were one after another
introduced; policies emphasised strengthening the housing security system, strongly supporting rigid and
improved housing demand, and accelerating the renovation of old neighbourhoods and dilapidated
houses, thus fuelling the steady and healthy development of the real estate industry. We expect that the
steady growth of the national economy and the stable operation of the real estate industry will provide a
good environment for the sustainable and healthy development of the Company.
The domestic lighting market size is more than RMB200 billion, but the industrial pattern is
scattered. In recent years, under the influence of complex changes in the social and economic
environment and rising bulk raw materials, small and medium-sized lighting enterprises are facing
greater pressure to survive, and the advantages of leading enterprises will be more prominent. With the
popularity of minimalist decoration style, as well as the rising concern of consumers for the home light
environment and light effect, both light quality and intelligent no-main-lamp lighting products are
emerging and enter gradually into the mass market and become a trend from the previous commercial
lighting and high-end home decoration field. At the same time, LED lighting technology innovation
drives the cost reduction so that LED light has the basic conditions to become mass consumer goods; on
this basis, the Company judges that no-main-lamp lighting will be expected to grow into an important
opportunity category in the lighting field. After incubation and cultivation, the Company's no-main-lamp
lighting business has started well and is in the process of rapidly building core capabilities. In the future,
the Company will continue to vigorously promote it to seize the minds of consumers, bring into play
the advantages of industrial synergy and achieve ground-breaking development.
The smart home industry has undergone a transformation from single product to system and
interaction after the integration and evolution in recent years. With the increasing maturity of the
supply-side solutions and the gradual increase in consumer acceptance on the demand side, smart home
products are increasingly coming into homes and bringing convenient use experience. AVC monitoring
data suggest that in 2022, China's smart home overall (smart home system, smart switch, smart door lock)
refined decoration market size reaches 1,661,000 sets, of which the smart home system configuration
rate is 13.6%, up 4.0% year-on-year; smart switch configuration rate is 17.6%, up 2.7% year-on-year;
smart door lock configuration rate is 79.2%, up 5.1% year-on-year. The brand pattern of the smart home
industry has not yet been formed, and there is a huge market space behind the rapid development. As the
core of the smart home system, the lighting control system has obvious user interaction perception and
high usage frequency. The Company makes intelligent no-main-lamp lighting and self-developed control
system the entry point, takes into account smart door locks, smart curtain machines, smart clothes drying
racks and other eco-categories to build a front-loading smart ecology, which will be an important
development direction for the future smart electrical lighting business.
In 2022, under the dual impacts of policy and market, the new energy vehicle industry continued to
grow explosively. According to the China Association of Automobile Manufacturers, in 2022, 7,058,000
new energy vehicles were produced and 6,887,000 were sales in China, up 96.9% and 93.4%
Annual Report 2022
year-on-year, and the market share on the sales side increased by 12.1 percentage points to 25.6%,
reaching ahead of schedule the goal that by 2025, the sales of new energy vehicles will reach about 20%
of the total sales of new vehicles in the New Energy Automobile Development Plan (2021-2035) issued
by the General Office of the State Council. With the continuous refinement and implementation of
policies such as the Implementation Opinions on Further Improving the Service Guarantee Capability of
Electric Vehicle Charging Infrastructure by the National Development and Reform Commission and
other ten ministries, and the Notice on Organizing the Pilot Work of the Comprehensive Electrification
of Vehicles in the Public Sector by the Ministry of Industry and Information Technology and other eight
ministries, China's new energy vehicles will enter an accelerated development stage in various
application areas. Following the trends of the industry and policy, the Company has quickly completed
the layout of new energy vehicle charging plugs and charging points for individual consumers and small
and medium-sized operators over the past two years, and our business development is now in good
shape. In the future, the Company will respond to market demand, accelerate product innovation and
technology reserves, proactively explore new business directions, meet the storage and charging needs
of more user groups in a wider variety of scenarios, and seize the historical opportunities of the
development of the new energy industry.
(II) Development strategies of the Company
√ Applicable □ Not applicable
With the vision of “Becoming a Leader in the International Civil Electric Industry”, the Company
will grasp the opportunities of the times brought by consumption upgrading, new energy and
internationalisation, focus on the three major businesses of electric connection, smart electrical lighting
and new energy, promote the upgrading of the Bull brand and the construction of the new Murora brand
in all aspects, accelerate the building of the core competitiveness of the new energy business, and
proactively explore the international market by providing consumers with better electrical products and
services across the world.
(III) Business plans
√ Applicable □ Not applicable
In order to achieve its operating goals in 2023, the Company will work on the following priorities:
Safe Electricity Use” to provide consumers with a safe and comfortable electricity use experience.
(1) Adaptors are the foundation of the Company. The Company will continue to study the market
and consumer trends in depth, carry out product innovation around the needs of segmented electricity
scenarios, launch more high-value products by focusing on scenario fit, smart upgrade and intelligent
power distribution, and promote product structure upgrade. On the basis of consolidating the advantages
of the original hardware channel, the Company will focus on developing the offline industrial decoration
market, and continue to enhance digital marketing in the e-commerce channel. In terms of supply chain,
the Company will pilot the "T+2" production and sales model reform, which is centred on customer
Annual Report 2022
demand, to strengthen delivery capacity, enhance business efficiency and improve operational indicators.
With regard to the brand, the Company will further consolidate the brand positioning of Bull as the
"Expert in Safe Electricity Use" in consumers' minds through a series of marketing and promotion.
(2) In terms of digital accessories business, the Company adheres to the third-party boutique
strategy and complies with the mainstreaming and civilianisation trend of high-power devices. Bull
Digital will focus on the field of fast charging. Relying on good-looking black-technology chargers, fast
charging power strips and other product platforms, and "overcharge protection" + gallium nitride and
other technology accumulation, Gongniu Digital will innovate in products, strengthen the user
perception of "safe and fast charging". At the same time, the Company will explore the "exquisite
lifestyle" to meet consumers' needs for convenient power consumption in multiple scenarios.
consumer upgrading demand, accelerate the construction of the whole-house intelligent ecology with
no-main-lamp lighting as the core.
(1) In terms of wall switches and sockets, the Company will, in the product side, uphold the
decorative line, grasp the intelligent, ultra-thin and other industry trends, and accelerate high-end,
intelligent product layout, so as to further enhance brand power and competitiveness through products
with a strong sense of design and high value, and lead consumption upgrade in the wall switch industry.
Regarding the channel side, the Company will continue to increase the marketing and promotion efforts
in the high-end market and lower markets, and comprehensively expand the market shares through
flagship shop construction, disadvantaged market support, expansion of installer project channel,
channel product planning, lean marketing and other measures. With respect to the supply chain, the
Company will promote the comprehensive transformation from automation to digitalisation, amplify the
productivity of the end-to-end process, and enhance the comprehensive competitiveness of the supply
chain brought about by the synergy of research, production and marketing. In terms of brand, the
Company will, taking series of products as the carrier, further enhance the visibility and reputation of the
Bull brand in the wall switch and socket industry.
(2) In terms of LED lighting and light source business, the Company will continue to lay out
product lines in outdoor, office, commercial chain and other segments, keep developing engineering
channels, and further explore the industrial and commercial basic light source market. As for lighting
business, the Company will continue to study the light needs of users in different scenarios such as
living room, dining room, bedroom, kitchen and bathroom, differentiate product layout based on the
characteristics of user needs in different channels, integrate intelligence into modern and simple product
innovation and solution provision, and strengthen the construction of the "Eye-Caring" brand positioning
in the minds of consumers. Mobile lighting will continue to focus on users' reading and light-filling
needs in the home environment to further enhance the competitiveness of products in the professional
reading and writing field; safe eye-caring will be combined with convenient access to electricity and
other usage trends to continue to improve the use experience.
Annual Report 2022
(3) In terms of no-main-lamp lighting business, the Company will focus on creating a high-quality,
low-cost and high-efficiency supply chain through whole value chain integration and innovation. It will
also enrich and perfect no-main-lamp lighting product lines, build a closed-loop system with
standardised and simple hardware and software to improve product user experience. On the basis of
accelerating the coordinated sales of no-main-lamps in existing decoration channels, the Company will
build a new intelligent no-main-lamp lighting brand "Murora" to quickly reach and seize consumers'
minds with independent channel system construction, professional and complete product lines, agile and
stable MOS light control system, and high investment in brand construction.
(4) With respect to ecosystem-based products, Domestic Electrical Appliance will upgrade and
extend product categories through functional differentiation, intelligence and conceptual innovation, lead
the development of the industry based on creation of new categories and quality leadership with the
thinking of building trending products, and drive business growth relying on the upgrade of integrated
and exclusive decoration channels and the development of associated new channels through online and
offline synergy. Regarding circuit breaker business, the Company will take into account the
diversification of application scenarios and product technology specialisation, continue to enhance the
power of residential products for home decoration, and develop and improve factory engineering product
lines to further expand customer groups. For smart door lock business, the Company will focus on
security and technology, build a professional brand image, focus on improving the terminal sales of the
main sales channels, and accelerate the improvement of the service system and the building of capacity.
In terms of intelligent ecosystems, the Company will continue to focus on smart lighting, rely on the
cloud platform and local control technology starting with user needs, optimise the interactive experience
and accelerate the system layout, creating a more comfortable home electricity environment for
consumers.
accelerate the layout of products and channel development for more customer groups and more use
scenarios.
With respect to new energy vehicle charging plugs and points, customer-end products will move
from "complete" to "refined", further improving compatibility, stability and durability in extreme
environments to support brand positioning. In terms of business-side products, the Company will
continue to build core technical capabilities in the DC charging field to support remarkable growth of
operators' business, and provide high-quality, reliable and safe products for different user groups.
Regarding new energy channel, the Company will continue the construction of a nationwide distribution
channel network, improve the coverage of terminal outlets, focus on expanding customers such as
operators, establish a nationwide after-sales operation system to improve the quality and satisfaction of
after-sales service, build benchmark shops and establish the online competitive advantage of new energy
charging products relying on a complete e-commerce channel system. The Company will also continue
to integrate its vertical supply chain system and accelerate its self-research and self-production of key
core components and processes, such as power modules. As for charger products, the Company will
Annual Report 2022
continue to gain deep insight into consumer demand, enrich its technical reserves in the field of higher
capacity and power, and launch high-quality products suitable for more scenarios. Also, the Company
will accelerate its technological research and product layout in the field of energy systems to provide
consumers with more and better electricity products and services for the future household electricity
ecology.
In response to the increasingly widespread application of new energy in homes, household transportation
and other fields in developed countries in Europe and the United States, as well as the trend of
consumption upgrading and the rise of the real estate industry in some emerging markets, the Company
will focus on promoting the overseas business expansion of new energy and electric connection products
through cross-border e-commerce and offline channels of its own brand.
full value chain empowerment system based on its strategic objectives, and consolidate the Company's
comprehensive competitive advantages in products, channels, brands and supply chains. The Company
will stimulate organisational vitality through innovation in organisational design and process mechanism
for the implementation of strategic objectives and future business development, and effectively integrate
quality resources such as human resources, technology research and development, and industrial supply
chain by relying on the headquarters laid out in the talent hub, so as to continuously enhance the
Company's business innovation and value creation capabilities.
(IV) Possible risks
√ Applicable □ Not applicable
Domestic and overseas political and economic environments are undergoing profound changes. The
main products of the Company are consumer goods widely used at home, office, and other places
needing electricity. The cyclical fluctuation of economy will directly influence the actual discretionary
income of consumers, consumers' income structure, and the consumer confidence index. Then,
consumers' demand for consumer goods including electric connection products and smart electrical
lighting products will be affected. If the growth rate of the domestic macroeconomy is sluggish or slides,
it will lead to a decrease in discretionary income and the power of consumption of residents. It will also
decrease consumers' demand and purchasing capacity for the Company's products. As a result, the
business development and the growth of results of the Company.
The civil electrical industry demonstrates full market competition. There are not only many
domestic enterprises, but also some famous international brands. Meanwhile, adaptors, wall switches
and sockets, and other products, as the main controlled entrance of future smart home, also have
attracted many powerful new enterprises to join in the competition. In the future, the civil electrical and
lighting industry is expected to remain its relatively fierce competition. There are uncertainties in the
Annual Report 2022
changes of market competition. If the Company cannot adapt to the new competition situation, intensify
and expand its original competition advantages, it will face the risk of losing market shares.
At the time of intensifying and expanding the original competition advantages, centering on the
scenarios of electric vehicle charging and home decoration, the Company developed new business such
as charging plugs/points, no main lamps, circuit breakers, bathroom heaters, smart door locks, smart
clothes drying racks, and smart curtain machines. However, considering uncertain factors including the
development trend, market competition, and changes of consumer preferences in relevant fields, the
possibility that the development of new businesses will fail to reach expectation cannot be excluded.
According to the differences and changes of consumers' purchasing habits, the Company continued
to improve the layout of channels. Regarding the B-end business with decoration companies as the core,
the overlap of the channels such as the vehicle after-markets for new energy charging plugs/points and
B-end operators and the existing competitive channels is relatively low. The possibility that the
development of new channels will fail to reach expectation cannot be excluded.
The main materials that the Company needs for production are copper, plastic, assembly, hardware,
packaging materials, electronic parts, etc. There is certain relevance between the procurement prices of
raw materials and the prices of bulk commodities such as copper and plastic. The procurement prices of
raw materials have a relatively big impact on the cost of sales of the Company. If the procurement prices
of raw materials rise significantly or fluctuate sharply in the future, it will be harmful to the cost control
of the Company and then influence the Company's results.
There is a small amount of undue loans for some real estate enterprises in other receivables of the
Company. The Company has disclosed it in the periodic report and the bad debt provision has been
accrued with prudence. The possibility that such receivables will not be recovered cannot be excluded.
(V) Other information
□ Applicable √ Not applicable
VII Explanation of circumstances and reasons for non-disclosure by the company inconsideration
of inapplicable regulations, state secrets and commercial secrets.
□ Applicable √ Not applicable
Annual Report 2022
Part IV Corporate Governance
I Overview of Corporate Governance
√ Applicable □ Not applicable
In accordance with the requirements of the Company Law, the Securities Law, the Code of
Corporate Governance for Listed Companies and other relevant national laws and regulations, and based
on the business development, the Company has established a governance structure consisting of the
General Meeting of Shareholders, the Board of Directors, the Supervisory Committee and the
Management, and formed a mechanism of mutual coordination and checks and balances among the
authority, decision-making body, supervisory body and the management to promote modern corporate
governance and system building.
In accordance with the relevant laws and regulations and the Articles of Association, the Company
has formulated policies such as the Rules of Procedure of the General Meeting of Shareholders, the
Rules of Procedure of the Board of Directors, the Rules of Procedure of the Supervisory Committee, the
Work Policy for Independent Directors, the Working Rules for the Board Secretary, the Working Rules
for the General Manager (President), the Related-Party Transaction Management System, Foreign
Investment Management System and the External Guarantee Management System, and amended the
Articles of Association, the Rules of Procedure of the General Meeting of Shareholders, the Rules of
Procedure of the Board of Directors, the Raised Funds Management Methods, the Information
Disclosure Management System, the Internal Reporting System Regarding Significant Information, the
Investor Relations Management System, and the Management System for Changes in Shareholdings of
Directors, Supervisors and Senior Management during the Reporting Period to comply with the latest
laws and regulations and further improve the management level.
(I) General Meeting of Shareholders
The General Meeting of Shareholders of the Company has clear duties and rules of procedure,
which are effectively implemented. The procedures for convening, holding and proposing the General
Meeting of Shareholders of the Company are in line with laws and regulations and the Company's
internal systems and other relevant regulations.
(II) Directors and the Board of Directors
The duties of the Board of Directors of the Company are clear and all directors are able to perform
their duties conscientiously and responsibly. The procedures for convening and holding the meeting of
the Board of Directors are in line with relevant laws, regulations and systems.
During their tenure, all directors were diligent and attended the meeting of the Board of Directors
conscientiously and responsibly. They were familiar with the relevant laws and regulations, and able to
fully exercise and perform their rights, obligations and responsibilities as directors, safeguarding the
legitimate rights and interests of the Company and all shareholders.
In order to align with the Company’s development, the Audit Committee under the Board of
Directors was renamed the Audit and Risk Committee during the Reporting Period with more
responsibilities to accommodate the development of the Company and strengthen its risk prevention
Annual Report 2022
capability. Except for the Strategy Committee, all other specialized committees are chaired by
independent directors, who play an important role in the performance of major decision-making and
monitoring functions by the Board of Directors, making the Company's decision-making more efficient,
standardized and scientific.
(III) Supervisors and the Supervisory Committee
The duties of the Supervisory Committee of the Company are clear and all supervisors are able to
perform their duties conscientiously and responsibly. The procedures for convening and holding the
meeting of the Supervisory Committee are in line with relevant laws, regulations and systems.
During the tenure, the Supervisors were diligent, actively attended the meetings of the Supervisory
Committee of the Company and performed their duties conscientiously. In line with the attitude of being
responsible to shareholders, they supervised the financial affairs of the Company as well as the legality
and compliance of the performance of duties by directors and senior management personnel of the
Company, and safeguarded the legitimate rights and interests of the Company and all shareholders.
In addition, the Company has established a relatively sound internal management and control
system, and has formulated relevant management systems in the areas of technology research and
development, procurement management, safe production, marketing management, quality control and
financial accounting. It conducted internal audit and supervision of the organization and management,
operating activities, financial revenues and expenditures and economic benefits of its subsidiaries, and
regularly inspected and evaluated the establishment and implementation of its internal control system to
ensure the effectiveness of internal control.
Indicate whether there was any material incompliance with the applicable laws and regulations, as well
as the CSRC’s requirements in corporate governance. If yes, please explain.
□ Applicable √ Not applicable
II Specific Measures Taken by the Controlling Shareholder and Actual Controller to Guarantee
the Asset, Personnel, Financial, Organizational and Business Independence of the Company, as
well as Solutions, Progress and Subsequent Plans when the Company’s Independence Is
Intervened
√ Applicable □ Not applicable
The Company is independent of its controlling shareholder in assets, personnel, finance,
organization, business, etc.
Indicate whether the controlling shareholder, the actual controller, or any entity under their control is
engaged in the same or similar business with the Company. Please explain the impact of horizontal
competition or any significant change to horizontal competition on the Company, solutions taken,
progress and subsequent plans.
□ Applicable √ Not applicable
III General Meetings of Shareholders
Index to disclosed Disclosure
Meeting Date Resolutions
resolutions date
The First The Proposal on the Change of
Extraordi 12 January http://www.sse.co 13 January Registered Capital and Amendment to
nary 2022 m.cn 2022 the Articles of Association was
General approved.
Annual Report 2022
Meeting
of
Sharehold
ers of
The Proposal on the Work Report of
the Board of Directors in 2021,
Proposal on the Work Report of the
Supervisory Committee in 2021,
Proposal on the Financial Final
Account Report of 2021, Proposal on
the Annual Report and its Summary for
Distribution Plan for 2021, Proposal on
The 2021
the Renewal of the Annual Auditor for
Annual
General
Meeting 6 May 2022
of
Compensation Scheme for Directors,
Sharehold
Proposal on the Restricted Share
ers
Incentive Plan for 2022 (Draft) and its
Summary, Proposal on the
Management Measures for the
Assessment of the Restricted Share
Incentive Plan for 2022, and Proposal
on the Request to the General Meeting
to Authorize the Board of Directors to
Handle Share Incentive-Related
Matters were approved.
Extraordinary general meetings of shareholders convened at the request of preference shareholders with
resumed voting rights:
□ Applicable √ Not applicable
Notes to general meetings of shareholders:
√ Applicable □ Not applicable
For details, please refer to the Announcement on the Resolutions of the First Extraordinary General
Meeting of Shareholders of 2022 (Announcement No.: 2022-004), and the Announcement on the
Resolutions of the 2021 Annual General Meeting of Shareholders (Announcement No.: 2022-047)
published by the Company on the website of the Shanghai Stock Exchange (http://www.sse.com.cn).
Annual Report 2022
IV Directors, Supervisors and Senior Management
(I) Shareholding changes and remunerations of incumbent directors, supervisors and senior management and those who resigned before the end of their
tenures during the Reporting Period
√ Applicable □ Not applicable
Unit: share
Total pre-tax
remuneration
Change in received Remuneration
shareholding from the received from
Opening Closing
Office title Start of End of in the Reason for Company in any of the
Name Gender Age shareholding shareholding
(note) tenure tenure Reporting change the Company’s
(share) (share)
Period Reporting related parties
(share) Period (yes/no)
(RMB’
Chairman
Ruan of the
Male 59 2017-12-23 2024-1-6 96,864,199 96,864,199 287.17 No
Liping Board and
President
Vice
Ruan Chairman
Male 51 2017-12-23 2024-1-6 96,864,199 96,864,199 248.00 No
Xueping of the
Board
Granted
under the
Director 2022
Cai
and Vice Male 60 2017-12-23 2024-1-6 25,300 43,800 Restricted 239.75 No
Yingfeng 18,500
President Share
Incentive
Plan
Director, Granted
Liu Vice under the
Male 53 2017-12-23 2024-1-6 18,800 42,400 23,600 293.47 No
Shengsong President 2022
and Board Restricted
Annual Report 2022
Secretary Share
Incentive
Plan
Granted
under the
Director 2022
Zhou
and Vice Male 51 2017-12-23 2024-1-6 13,100 42,600 29,500 Restricted 409.90 No
Zhenghua
President Share
Incentive
Plan
Zhou
Director Female 39 2021-5-20 2024-1-6 0 No
Wenchuan
Independent
Xie Tao Male 60 2017-12-23 2024-1-6 0 16.67 No
Director
Zhang Independent
Male 50 2017-12-23 2024-1-6 0 16.67 No
Zeping Director
Independent
He Hao Female 47 2017-12-23 2024-1-6 0 16.67 No
Director
Chairman
Shen of the
Male 59 2017-12-23 2024-1-6 0 244.89 No
Huiyuan Supervisory
Committee
Guan
Supervisor Male 45 2017-12-23 2024-1-6 0 215.77 No
Xuejun
Employee
Li Yu Male 40 2017-12-23 2024-1-6 0 121.84 No
Supervisor
Granted
under the
Li Vice
Male 56 2017-12-23 2024-1-6 24,400 44,200 19,800 Restricted 245.96 No
Guoqiang President
Share
Incentive
Plan
Zhang Vice Granted
Female 63 2017-12-23 2024-1-6 7,500 21,600 14,100 151.14 No
Lina President under the
Annual Report 2022
and CFO 2022
Restricted
Share
Incentive
Plan
Total / / / / / 193,817,498 193,922,998 105,500 / 2,507.90 /
Name Main work experience
Born in 1964, Bachelor's degree, Chinese nationality, with permanent residence in Singapore and a Hong Kong Identity Card. He once served as an
engineer at Hangzhou Mechanical Design Institute of the Ministry of Water Resources, and Chairman of the Board and President of Gongniu Group
Ruan Liping Co., Ltd. (the former private company). He is currently the Chairman of the Board and President of Gongniu Group and a member of the 13th
National People's Congress of Zhejiang Province. Also, he is the Executive Director and General Manager of Gongniu Photoelectric, and the
Executive Director of Liangji Industrial, among others.
Born in 1972, junior secondary education, Chinese nationality, with permanent residence in Singapore and a Hong Kong Identity Card. He once
Ruan served as the Production Manager of Cixi Gongniu, Vice Chairman of the Board of Gongniu Group Co., Ltd. (the former private company). He is
Xueping currently the Vice Chairman of the Board of Gongniu Group. Also, he is the Executive Director of Cixi Gongniu, and the Supervisor of Liangji
Industrial.
Born in 1963, Bachelor's degree, professor-level senior engineer, Chinese nationality, with permanent residence in Singapore. He once served as the
Director Engineer of the Crane Room of Hangzhou Mechanical Design Institute of the Ministry of Water Resources, Senior Engineer of Portek
Cai Yingfeng
International Pte Ltd (Singapore), Vice President and Chief Engineer of Gongniu Group Co., Ltd. (the former private company). He is currently a
director and Vice President of Gongniu Group.
Born in 1970, Bachelor's degree, engineer, Chinese nationality, no permanent residence abroad. He once served as the Director's Assistant of the
Science and Technology Department of Kmk Group, Senior Manager of Midea Group Co., Ltd., Director of strategic operations and Deputy
Liu
General Manager of the Business Division of AUX Group Co., Ltd., President's Assistant and General Manager of the Business Division of Jiangxi
Shengsong
Zhengbang Technology Co., Ltd., and Vice President of Gongniu Group Co., Ltd. He is currently a director, Vice President and Board Secretary of
Gongniu Group, with the professional qualification of Board Secretary of the Shanghai Stock Exchange.
Born in 1972, Master's degree, Chinese nationality, no permanent residence abroad. He once served as a technician of incoming material quality
Zhou control (IQC) at Zhongshan Kawa Electronic(Group)Co., Ltd., the Managing Officer of quality control (QC) at One Earth Group Limited, General
Zhenghua Manager of the product company of Midea Group Co., Ltd., and Vice President of Gongniu Group Co., Ltd. (the former private company). He is
currently a director, Vice President and General Manager of the Wall Opening Division of Gongniu Group.
Born in 1983, Master's degree, Ph.D. in progress, permanent resident of Hong Kong. She is currently the Vice Chairman and President of Meilleure
Zhou
Health International Group, Assistant President of U-Home Group, General Manager of Shenzhen Xiaozhou Investment Co., Ltd., and a member of
Wenchuan
the Standing Executive Committee of Shenzhen Federation of Industry & Commerce (Chamber of Commerce), and a director of Gongniu Group.
Xie Tao Born in 1963, Bachelor's degree, member of the Institute of Chartered Accountants, Singaporean nationality. He once served as a partner of PwC.
Annual Report 2022
He is currently a director of Shanghai Vico Precision Mold &Plastics Co., Ltd., an independent director of China Yuchai International Limited,
Zhejiang Wanfeng Auto Wheel Co., Ltd. and Gongniu Group.
Born in 1973, doctoral degree, Chinese nationality, no permanent residence abroad. He once served as a teacher at the School of Basic Education of
Shanghai University of Engineering Science, a teacher at the School of International Law of East China University of Political Science and Law,
and the Director of the Consular Department of the China Embassy in Macedonia. He is currently a professor at the School of International Law of
Zhang East China University of Political Science and Law, an arbitrator of Shanghai International Economic and Trade Arbitration Commission (SHIAC),
Zeping Shanghai Arbitration Commission and Shenzhen Court of International Arbitration, a part-time lawyer of Shanghai Zhonglian Law Firm, an
independent director of Shenzhen Soocas Technology Co., Ltd., an independent director of CTS International Logistics Corporation Limited, an
independent director of Shanghai Allied Industrial Co., Ltd., a director of Suzhou Kelinyuan Electronics Co., Ltd. and an independent director of
Gongniu Group.
Born in 1976, Master's degree, Chinese nationality, no permanent residence abroad. He once served as a senior auditor of Arthur Andersen LLP, an
audit manager of PwC LLP, Vice President of Deutsche Bank (China) Co., Ltd., and Chief Controller of the Corporate Customer Department of
Standard Chartered Bank (China) Limited. He is currently the CEO of Hang Fun International Group Limited, a managing partner of Shanghai
He Hao
Xingduo Investment Partnership Enterprise (Limited Partnership), executive director of Shanghai Heyue Intelligent Technology Co., Ltd., an
executive director of Shanghai Lihao Creative Design Co., Ltd., executive director and manager of Beijing Xinghao Kairui Technology Co., Ltd.,
and independent director of Gongniu Group.
Born in 1964, Bachelor's degree, Chinese nationality, no permanent residence abroad. He once served as the project leader of the International
Electrical Development Department of TCL Group Co., Ltd, head of the Electrical R&D Department of Huizhou IDV Electrical Technology Co.,
Shen Ltd., head of Electrical Accessories Department of Gongniu Group Co., Ltd. (the former private company), Executive Deputy General Manager and
Huiyuan Deputy General Manager of R&D of Ningbo Gongniu Electrics Co., Ltd., and Director of the Research Institute of Gongniu Group Co., Ltd. (the
former private company). He is currently the Chairman of the Supervisory Committee of Gongniu Group Co., Ltd., head of the R&D and
Technology Management Center and Director of the Research Institute of Gongniu Group.
Born in 1978, Master's degree, Chinese nationality, no permanent residence abroad. He once served as the procurement manager of Foshan Shunde
District MiTAC Computer (Shunde) Limited, senior procurement manager of Ningbo Franta Kitchenware Co., Ltd., senior procurement manager of
Guan Xuejun
Quanyou Furniture Co., Ltd., and Director of the New Business Management Center of Gongniu Group Co., Ltd. (the former private company). He
is currently a supervisor of Gongniu Group and the General Manager of the decoration channel marketing system.
Born in 1983, Bachelor's degree, intermediate auditor, international certified internal auditor, Chinese nationality, no permanent residence abroad.
He once served as the Manager of the Audit Department, Manager of the Operation Department, Executive President of Gongniu University and
Li Yu
Director of Human Resources Center of Gongniu Group Co., Ltd. (the former private company). He is currently the General Manager of the
Low-voltage Electrical Appliances Division of Gongniu Group.
Born in 1967, junior college’s degree, Chinese nationality, no permanent residence abroad. He used to be a regional manager for TCL International
Li Guoqiang Electrical (Huizhou) Co., Ltd., the Marketing Director of Aidiwei International Electrical (Huizhou) Co., Ltd., and the Marketing Vice President of
Gongniu Group. He is now the Marketing Vice President of Gongniu Group.
Born in 1960, junior college’s degree, Chinese nationality, no permanent residence abroad. She used to be the Finance Director at the Cixi branch of
Zhang Lina
China Telecom Corporation Limited, and the Financial Manager and CFO of Gongniu Group. She is now a Vice President and the CFO of Gongniu
Annual Report 2022
Group.
Other information:
□ Applicable √ Not applicable
Annual Report 2022
(II) Offices held by incumbent directors, supervisors and senior management and those who
resigned before the end of their tenures during the Reporting Period
√ Applicable □ Not applicable
Office held in the
Name Shareholding entity Start of tenure End of tenure
shareholding entity
Ningbo Liangji Currently
Ruan Liping Executive Director November 2011
Industrial Co., Ltd. ongoing
Ningbo Liangji Currently
Ruan Xueping Supervisor November 2011
Industrial Co., Ltd. ongoing
Note Not applicable
√ Applicable □ Not applicable
Office held in other Start of End of
Name Other entity
entity tenure tenure
Ruan Vice Chairman of the Currently
Shanghai Minshen Property Co., Ltd. July 1999
Liping Board ongoing
Ruan Currently
Ningbo Gongniu Property Co., Ltd. Executive Director June 2010
Liping ongoing
Ruan Qingdao Haili Commercial Currently
Director May 2009
Liping Appliances Co., Ltd. ongoing
Ruan Currently
Cixi Gongniu Electrics Co., Ltd. General Manager January 2008
Liping ongoing
Ruan December Currently
Wuhan Fenjin Power Tech Co., Ltd. Executive Director
Liping 2006 ongoing
Ningbo Meishan Bonded Port
Ruan November Currently
Shuojin Investment Management Executive Director
Liping 2017 ongoing
Co., Ltd.
Ruan Wuhan Zhongjia Hongyi Technology Currently
Director January 2019
Liping Information Industrial Park Co., Ltd. ongoing
Ruan Dalitek Intelligent Technology Chairman of the Currently
October 2021
Liping (Shanghai) Inc. Board ongoing
Ruan Ningbo Gongniu Precision Executive Director September Currently
Liping Manufacturing Co., Ltd. and General Manager 2015 ongoing
Ruan Ningbo Gongniu Photoelectric Executive Director Currently
June 2014
Liping Technology Co., Ltd. and General Manager ongoing
Ruan Shenzhen Gongniu Intelligent Executive Director Currently
July 2022
Liping Information Co., Ltd. and General Manager ongoing
Ruan Guangdong Murora Intelligent Currently
Executive Director July 2022
Liping Lighting Co., Ltd. ongoing
Ruan Executive Director December February
Ningbo Gongniu Electrics Co., Ltd.
Liping and General Manager 2008 2023
Ruan Ningbo Gongniu Digital Technology Executive Director February
October 2016
Liping Co., Ltd. and General Manager 2023
Ruan Ningbo Bull International Trading Executive Director February
March 2017
Liping Co., Ltd. and General Manager 2023
Ruan Ningbo Gongniu Supply Chain Executive Director December January
Liping Management Co., Ltd. and General Manager 2016 2023
Ruan Ningbo Gongniu Electric Sales Co., December
Executive Director August 2017
Liping Ltd. 2022
Ruan January
Ningbo Xingluo Trading Co., Ltd. Executive Director August 2017
Liping 2023
Ruan February
Cixi Shenghui Electronics Co., Ltd. Executive Director January 2016
Liping 2023
Annual Report 2022
Ruan Ningbo Golden Mango Ecological December February
Executive Director
Liping Manor Co., Ltd. 2013 2023
Ruan Ningbo Gongniu Domestic Electrical Executive Director February
April 2020
Liping Appliance Co., Ltd. and Manager 2023
Executive Director
Ruan Shanghai Gongniu Information February March
and General
Liping Technology Co., Ltd. 2022 2023
Manager
Ruan Ningbo Gongniu Smart Technology Executive Director February
October 2021
Liping Co., Ltd. and Manager 2023
Ruan Currently
Cixi Gongniu Electrics Co., Ltd. Executive Director January 1995
Xueping ongoing
Ruan Currently
Shanghai Minshen Property Co., Ltd. Director July 1999
Xueping ongoing
Ruan Shanghai Dumin Real Estate Co., Chairman of the Currently
March 2006
Xueping Ltd. Board ongoing
Ruan Shanghai Minshen Real Estate Currently
Director August 2005
Xueping Management Co., Ltd. ongoing
Ningbo Meishan Bonded Port
Ruan November Currently
Shuojin Investment Management Supervisor
Xueping 2017 ongoing
Co., Ltd.
Ruan Dalitek Intelligent Technology September Currently
Supervisor
Xueping (Shanghai) Inc. 2021 ongoing
Cai Hainan Dacheng Supply Chain Executive Director Currently
January 2021
Yingfeng Management Co., Ltd. and General Manager ongoing
Zhou Ningbo Gongniu Intelligent Executive Director February Currently
Zhenghua Technology Co., Ltd. and General Manager 2023 ongoing
Zhou Executive Director February Currently
Ningbo Gongniu Electrics Co., Ltd.
Zhenghua and General Manager 2023 ongoing
Liu Wuhan Gongniu Investment Currently
Supervisor October 2021
Shengsong Management Co., Ltd. ongoing
Liu Shanghai Gongniu Information Currently
Supervisor January 2022
Shengsong Technology Co., Ltd. ongoing
Liu Wuhan Gongniu Venture Capital Currently
Supervisor January 2021
Shengsong Co., Ltd. ongoing
Liu Currently
Yangtze Optical Electronic Co., Ltd. Director August 2020
Shengsong ongoing
Liu September Currently
Qingdao Soar Automobile Co., Ltd. Director
Shengsong 2022 ongoing
Liu Dalitek Intelligent Technology September Currently
Director
Shengsong (Shanghai) Inc. 2021 ongoing
Zhou Meilleure Health International Group Vice Chairman of the Currently
August 2013
Wenchuan Co., Ltd. Board and President ongoing
Zhou Currently
U-Home Group Co., Ltd. Supervisor June 2010
Wenchuan ongoing
Zhou Shenzhen Xiaozhou Investment Co., Currently
General Manager January 2009
Wenchuan Ltd. ongoing
Zhou Yunnan Hansu Biotechnology Co., Currently
Director June 2018
Wenchuan Ltd. ongoing
Zhou Shenzhen Yinguan Biological February Currently
Director
Wenchuan Technology Co., Ltd. 2019 ongoing
Zhou Shenzhen Meiray Vap Technology Chairman of the December Currently
Wenchuan Co., Ltd. Board 2019 ongoing
Zhou Zhuhai Fuhai Canyang Investment December Currently
Director
Wenchuan Development Co., Ltd. 2009 ongoing
Zhou Wuhu Meilleure Health Management Currently
General Manager April 2018
Wenchuan Co., Ltd. ongoing
Annual Report 2022
Zhou Shenzhen Skin Analysis Medical Chairman of the Currently
June 2017
Wenchuan Beauty Clinic Board ongoing
Zhou Shenzhen Ruima Electric September Currently
General Manager
Wenchuan Technology Co., Ltd. 2019 ongoing
Zhou Beijing Meiaikang Technology Co., February Currently
Director
Wenchuan Ltd. 2020 ongoing
Zhou Currently
Wuhu Xiaozhou Investment Co., Ltd. General Manager October 2019
Wenchuan ongoing
Zhang December Currently
Shanghai Allied Industrial Co., Ltd. Independent Director
Zeping 2022 ongoing
Zhang Shenzhen Soocas Technology Co., Currently
Independent Director October 2020
Zeping Ltd. ongoing
Zhang Suzhou Kelinyuan Electronics Co., Currently
Director January 2022
Zeping Ltd. ongoing
Zhang CTS International Logistics Currently
Independent Director January 2023
Zeping Corporation Limited ongoing
Shanghai Vico Precision Mold Currently
Xie Tao Director May 2021
&Plastics Co., Ltd. ongoing
September Currently
Xie Tao China Yuchai International Limited Independent Director
Zhejiang Wanfeng Auto Wheel Co., Currently
Xie Tao Independent Director June 2020
Ltd. ongoing
Hang Fun International Group Currently
He Hao CEO March 2023
Limited ongoing
Shanghai Xingduo Investment
Currently
He Hao Partnership Enterprise (Limited Executive Partner July 2018
ongoing
Partnership)
Shanghai Heyue Intelligent Currently
He Hao Executive Director June 2022
Technology Co., Ltd. ongoing
Shanghai Lihao Creative Design Co., Currently
He Hao Executive Director July 2019
Ltd. ongoing
Beijing Xinghao Kairui Technology Executive Director December Currently
He Hao
Co., Ltd. and Manager 2018 ongoing
December Currently
Li Yu Ningbo Gongniu Electrics Co., Ltd. Supervisor
December Currently
Li Yu Cixi Gongniu Electrics Co., Ltd. Supervisor
Ningbo Gongniu Low Voltage Executive Director December Currently
Li Yu
Electric Co., Ltd. and Manager 2022 ongoing
Ningbo Banmen Electric Appliance December Currently
Li Yu Supervisor
Co., Ltd. 2017 ongoing
Ningbo Gongniu Digital Technology December Currently
Li Yu Supervisor
Co., Ltd. 2017 ongoing
Ningbo Bull International Trading December Currently
Li Yu Supervisor
Co., Ltd. 2017 ongoing
Ningbo Gongniu Supply Chain December Currently
Li Yu Supervisor
Management Co., Ltd. 2017 ongoing
Ningbo Gongniu Photoelectric December Currently
Li Yu Supervisor
Technology Co., Ltd. 2017 ongoing
December Currently
Li Yu Shanghai Gongniu Electrics Co., Ltd. Supervisor
Ningbo Gongniu Precision November Currently
Li Yu Supervisor
Manufacturing Co., Ltd. 2019 ongoing
Ningbo Gongniu Domestic Electrical Currently
Li Yu Supervisor April 2020
Appliance Co., Ltd. ongoing
Shen Hainan Dacheng Supply Chain Supervisor January 2021 Currently
Annual Report 2022
Huiyuan Management Co., Ltd. ongoing
Guan Ningbo Gongniu Electric Sales Co., Executive Director December Currently
Xuejun Ltd. and General Manager 2022 ongoing
Li Ningbo Bull International Trading Executive Director Currently
January 2023
Guoqiang Co., Ltd. and General Manager ongoing
Zhang Dalitek Intelligent Technology September Currently
Supervisor
Lina (Shanghai) Inc. 2021 ongoing
Note Not applicable
(III) Remunerations of directors, supervisors and senior management
√ Applicable □ Not applicable
Decision-making procedures for The remuneration of directors and supervisors shall be deliberated
the remuneration of directors, and determined by the General Meeting of Shareholders. The
supervisors and senior remuneration of senior management personnel shall be reviewed
management personnel and determined by the Board of Directors.
Internal directors, supervisors and senior management personnel
are paid remuneration in accordance with the specific management
Basis for determining the positions they hold in the Company, taking into account the
remuneration of directors, Company's business picture, relevant remuneration system and
supervisors and senior results of performance appraisals. The remuneration of independent
management personnel directors is based on an allowance system, and directors who do not
hold specific management positions in the Company will not
receive remuneration.
Actual payment of remuneration The earnings disclosed in the report represent the actual
for directors, supervisors and remuneration of the directors, supervisors and senior management
senior management personnel personnel.
Total actual remuneration
received by all directors,
supervisors and senior RMB25.0790 million
management personnel at the end
of the Reporting Period
(IV) Changes of directors, supervisors and senior management
□ Applicable √ Not applicable
(V) Punishments imposed by securities regulators in the past three years
□ Applicable √ Not applicable
(VI) Other information
□ Applicable √ Not applicable
V Board Meetings Convened during the Reporting Period
Meeting Date Resolutions
The Proposal on the Work Report of the President (General
Manager) in 2021, Proposal on the Financial Final Account
Report of 2021, Proposal on the Work Report of the Board of
Directors in 2021, Proposal on the Annual Report and its
The 10th Meeting Summary for 2021, Proposal on the Profit Distribution Plan for
of the Second 2021, Proposal on the 2021 Annual Internal Control Evaluation
Board of Directors Report, Proposal on Renaming the Audit Committee of the Board
of Directors as the Audit and Risk Committee of the Board of
Directors and Revising the Implementation Rules, Proposal on the
the Work Report of Independent Directors for 2021, Proposal on
Annual Report 2022
the Report on the Performance of the Audit Committee of the
Board of Directors for 2021, Proposal on the Estimated Routine
Related-party Transactions of the Company in 2022, Proposal on
the Renewal of the Annual Auditor for 2022, Proposal on the Use
of Equity Funds for Entrusting Wealth Management, Proposal on
the Special Report on the Deposit and Actual Use of Raised Funds
for 2021, Proposal on Repurchasing the Company's Shares
through Call Auction, Proposal on Authorizing the Management
of the Company to Handle Matters Related to the Share
Repurchase, Proposal on the Restricted Share Incentive Plan in
Measures for the Assessment of the Restricted Share Incentive
Plan for 2022, Proposal on the Request to the General Meeting to
Authorise the Board of Directors to Handle Share
Incentive-Related Matters, Proposal on the Compensation
Schemes for Directors and Senior Management Personnel,
Proposal on the Appointment of Securities Affairs Representative,
and Proposal on Holding 2021 Annual General Meeting were
approved by the resolution.
The 11th Meeting The Proposal on the Report for the First Quarter of 2022 and
of the Second Proposal on the Repurchase and Write-off of Certain Restricted
Board of Directors Shares were approved by the resolution.
The Proposal on the Adjustment of the Repurchase Price of the
The 12th Meeting of the Repurchase Price of the 2021 Restricted Share Incentive
of the Second 20 May 2022 Plan, Proposal on Adjusting the List of Awardees, the Number of
Board of Directors Grants and the Grant Price of the Restricted Share Incentive Plan
in 2022, and Proposal on Granting Restrictive Shares to Awardees
were approved by the resolution.
The Proposal on the Achievement of Lifting the Restriction
Conditions in the Second Lifting Period of the 2020 Restricted
The 13th Meeting
Share Incentive Plan and Proposal on the Achievement of Lifting
of the Second 17 June 2022
the Restriction Conditions in the First Lifting Restriction Period of
Board of Directors
the 2021 Restricted Share Incentive Plan were approved by the
resolution.
The Proposal on the Semi-Annual Report for 2022 and its
The 14th Meeting
of the Second
Board of Directors
were approved by the resolution.
The Proposal on the Report for the Third Quarter of 2022,
The 15th Meeting
of the Second
Board of Directors
Policies were approved by the resolution.
The Proposal on the Continued Use of Part of Temporarily Idle
Raised Funds for Cash Management, Proposal on the Continued
Use of Part of Idle Raised Funds for Temporary Replenishment of
Working Capital, Proposal on the Application for Comprehensive
Credit Line from Banks, Proposal on Conducting Bulk Raw
Material Futures Business, Proposal on the Extension of Some
The 16th Meeting
of the Second
Board of Directors
Funds, Proposal on the Change of Registered Capital and
Domicile, Modification of Business Scope, and Amendment to the
Articles of Association, Proposal on Amending the Rules of
Procedure for General Meeting, Proposal on Revising the
Management Measures for the Use of Raised Funds, and Proposal
on the Convening of the 1st Extraordinary General Meeting of
Annual Report 2022
VI Performance of Duty by Directors
(I) Attendance of directors at board meetings and general meetings of shareholders during the
Reporting Period
Attendanc
e at
general
Attendance at board meetings meetings
of
sharehold
ers
Independ Total Total
Name of ent number The number of
Board
director director of director general
Board Board meetin
or not board failed to meetings
meetin meetings gs
meetin attend of
gs attended by attende Absen
gs the two sharehold
attende way of d ce
directo consecuti ers the
d on telecommunica throug
r was ve board director
site tion ha
suppos meetings was
proxy
ed to (yes/no) supposed
attend to attend
Ruan
No 7 7 1 0 0 No 2
Liping
Ruan
No 7 7 5 0 0 No 2
Xueping
Cai
Yingfen No 7 7 4 0 0 No 2
g
Liu
Shengso No 7 7 3 0 0 No 2
ng
Zhou
Zhenghu No 7 7 2 0 0 No 2
a
Zhou
Wenchu No 7 7 7 0 0 No 2
an
Xie Tao Yes 7 7 7 0 0 No 2
Zhang
Yes 7 7 7 0 0 No 2
Zeping
He Hao Yes 7 7 7 0 0 No 2
Explain why any director failed to attend two consecutive board meetings.
□ Applicable √ Not applicable
Total number of board meetings convened in the
Reporting Period
Of which: on-site meetings 0
Meetings convened by way of telecommunication 1
Meetings where on-site attendance and attendance
by telecommunication were both allowed
Annual Report 2022
(II) Objections raised by directors on matters of the Company
□ Applicable √ Not applicable
(III) Other information
□ Applicable √ Not applicable
VII Specialized Committees under the Board of Directors
√ Applicable □ Not applicable
(1) Members of the specialized committees
Specialized committee Members
Audit and Risk Committee He Hao (convener), Xie Tao, and Ruan Xueping
Nomination Committee Xie Tao (convener), Ruan Liping, and Zhang Zeping
Remuneration and
Zhang Zeping (convener), Ruan Liping, and He Hao
Appraisal Committee
Ruan Liping (convener), Liu Shengsong, Zhou Zhenghua, Zhou
Strategy Committee
Wenchuan, and Xie Tao
(2) The Audit and Risk Committee held five meetings during the Reporting Period.
Important comments and
Date Contents Other performance of duties
suggestions
The Proposal on the
Financial Final Account
Report of 2021, Proposal on
the 2021 Annual Report and
the Summary, Proposal on
the 2021 Annual Internal
The Audit and Risk
Control Evaluation Report,
Committee carried out its
Proposal on the Estimated
work in strict accordance
Continuing Related-party
with laws, regulations and
Transactions in 2022, For details, please refer to
relevant rules and policies
Proposal on the Renewal of the Report of Gongniu
with diligence. It put
forward relevant opinions
based on the reality of the
Special Report on the and Risk Committee of the
Company. Upon full
Deposit and Actual Use of Board of Directors in 2022.
communication and
Raised Funds for 2021, and
discussion, all proposals
Proposal on the Audit
were unanimously
Committee under the Board
approved.
of Directors Being
Renamed the Audit and
Risk Committee and
Amendments to the Specific
Implementation Rules were
approved.
The Audit and Risk
Committee carried out its
work in strict accordance
For details, please refer to
with laws, regulations and
the Report of Gongniu
The Proposal on the First relevant rules and policies
Quarterly Report 2022 was with diligence. It put
approved. forward relevant opinions
and Risk Committee of the
based on the reality of the
Board of Directors in 2022.
Company. Upon full
communication and
discussion, all proposals
Annual Report 2022
were unanimously
approved.
The Audit and Risk
The Proposal on the 2022 Committee carried out its
Interim Report and the work in strict accordance
Summary, Proposal on the with laws, regulations and
For details, please refer to
Special Report on the relevant rules and policies
the Report of Gongniu
Deposit and Actual Use of with diligence. It put
Raised Funds for H1 2022, forward relevant opinions
and Proposal on the Work based on the reality of the
and Risk Committee of the
Report of the Audit and Company. Upon full
Board of Directors in 2022.
Risk Management Joint communication and
Office for H1 2022 were discussion, all proposals
approved. were unanimously
approved.
The Audit and Risk
Committee carried out its
work in strict accordance
with laws, regulations and
For details, please refer to
relevant rules and policies
the Report of Gongniu
The Proposal on the Third with diligence. It put
Quarterly Report 2022 was forward relevant opinions
approved. based on the reality of the
and Risk Committee of the
Company. Upon full
Board of Directors in 2022.
communication and
discussion, all proposals
were unanimously
approved.
The Audit and Risk
Committee carried out its
work in strict accordance
with laws, regulations and
For details, please refer to
relevant rules and policies
The Annual Audit Plan of the Report of Gongniu
Pan-China Certified Public Group Co., Ltd. On the Duty
December forward relevant opinions
Accountants LLP was Performance of the Audit
approved. and Risk Committee of the
Company. Upon full
Board of Directors in 2022.
communication and
discussion, all proposals
were unanimously
approved.
(3) The Remuneration and Appraisal Committee held two meetings during the Reporting Period.
Important comments and
Date Contents Other performance of duties
suggestions
The Proposal on the The Remuneration and
Remuneration Schemes for Appraisal Committee
Directors and Senior carried out its work in strict
Management Personnel, accordance with laws,
Proposal on the Restricted regulations and relevant
Summary, and Proposal on relevant opinions based on
the Management Measures the reality of the Company.
for the Appraisal of the Upon full communication
Restricted Share Incentive and discussion, all
Plan for 2022 were proposals were
Annual Report 2022
approved. unanimously approved.
The Proposal on the The Remuneration and
Achievement of Lifting the Appraisal Committee
Restriction Conditions in the carried out its work in strict
Second Lifting Restriction accordance with laws,
Period of the 2020 regulations and relevant
Restricted Share Incentive rules and policies with
Plan, and the Proposal on the diligence. It put forward
Achievement of Lifting the relevant opinions based on
Restriction Conditions in the the reality of the Company.
First Lifting Restriction Upon full communication
Period of the 2021 and discussion, all
Restricted Share Incentive proposals were
Plan were approved. unanimously approved.
(4) Objections
□ Applicable √ Not applicable
VIII Risks Detected by the Supervisory Committee
□ Applicable √ Not applicable
The Supervisory Committee raised no objections during the Reporting Period.
IX Employees of the Company as the Parent and Its Principal Subsidiaries at the Period-end
(I) Employees
Number of in-service employees of the Company
as the parent
Number of in-service employees of principal
subsidiaries
Total number of in-service employees 12,351
Number of retirees to whom the Company as the
parent or its principal subsidiaries need to pay 0
retirement pensions
Functions
Function Employees
Production 7,876
Sales 1,457
Technical 1,842
Financial 163
Administrative 1,013
Total 12,351
Educational background
Educational background Employees
Bachelor’s degree and above 2,113
Junior college 2,076
Technical secondary school and below 8,162
Total 12,351
(II) Remuneration policy
√ Applicable □ Not applicable
The Company further improved its remuneration management and incentive mechanism by revising
the management system related to remuneration and benefits to establish remuneration guide lines for all
levels and categories of employees, thus enhancing the competitiveness of employee remunerations with
Annual Report 2022
changes in the labor market taken into account. Following the establishment of the Company's new job
grade system, the welfare and incentive system for marketing staff was continuously improved. The
Company conducted comprehensive and objective appraisals of employees from dimensions such as
company operating performance, job value, personal performance and personal ability, and continued to
improve the performance-oriented system of assessment, training, promotion and incentive, fully
mobilizing the creativity and enthusiasm of employees and promoting the Company's performance
growth and personal career development while improving the remuneration and benefits.
(III)Training plans
√ Applicable □ Not applicable
The Company takes the needs of strategic development as the input for learning and development,
and is committed to the training of its cadre team and expert team. It continuously cultivates and builds
outstanding talents to help achieve the strategic goals of the Company. Adhering to the learning concept
of "combination of training and practice, with a focus on practice and supplemented by training", the
Company adopts the "721" talent training principle to systematically train talent in a stratified and
graded manner with the two-wheel drive of "BBS capacity" and "leadership development", so as to
comprehensively build a Gongniu talent team in line with the Company's cultural values and ability
requirements. So far, it has successfully developed a series of Gongniu leadership training programmes
to promote the leadership training of managers at all levels and their successors. Taking competency
model as the standard, the Company has carried out professional and general competence training,
pushed forward the building of an expert team, and developed an autonomous and shared learning
atmosphere in an all-round way based on the Gongniu online learning platform.
(IV) Labor outsourcing
□ Applicable √ Not applicable
X Dividend Payouts
(I) Formulation, execution and adjustments of the cash dividend policy
√ Applicable □ Not applicable
The Articles of Association clarifies the decision-making procedures and mechanism for profit
distribution, the principles of profit distribution, the conditions and proportion of cash dividends, etc.,
ensuring the transparency and operability of cash dividends to effectively safeguard the legitimate rights
and interests of small and medium shareholders and investors. The Company's profit distribution plan is
strictly implemented in accordance with the provisions of the Articles of Association and the resolutions
of the Company's General Meeting of Shareholders.
The Company will implement sustaining and stable profit distribution methods in line with the
provisions of the Articles of Association. The Company may distribute dividends by means of cash,
stocks, a combination of cash and stocks, or other means permitted by laws and regulations.
Annual Report 2022
Among the profit distribution methods, the Company gives priority to cash dividends over stock
dividends; if the Company adopts stock dividends for profit distribution, it shall have taken into account
factors such as its growth and stock liquidity.
Description of dividends in the Articles of Association: The Board of Directors of the Company
shall comprehensively consider factors such as the Company's industry characteristics, development
phase, business model, profitability, and whether there are arrangements for major capital expenditures,
distinguish the following circumstances, and propose differentiated cash dividend policies according to
the procedures set forth in the Articles of Association:
(1) If the Company is in the phase of mature development and there is no arrangement for major
capital expenditures, cash dividends shall account for at least 80% in the profit distribution;
(2) If the Company is in the phase of mature development and there are arrangements for major
capital expenditures, cash dividends shall account for at least 40% in the profit distribution;
(3) If the Company is in the growth period and there are arrangements for major capital
expenditures, cash dividends shall account for at least 20% in the profit distribution; where it is difficult
to distinguish the Company's development phase but there are arrangements for major capital
expenditures, it may be handled in accordance with the provisions of the preceding paragraph.
As approved at the 2021 Annual General Meeting of Shareholders on 5 May 2022, the 2021 final
dividend payout was carried out. Based on the total share capital of 601,180,520 shares at the record date
of the dividend payout (i.e. 18 May 2022), the Company paid out a cash dividend of RMB2.40 (tax
inclusive) per share to its shareholders. The total amount of the cash dividend payout was
RMB1,442,833,248.00 (tax inclusive), accounting for 51.89% of the net profit attributable to the
Company’s shareholders during 2021. The dividend payout was completed on 19 May 2022.
(II) Special statement on the cash dividend policy
√ Applicable □ Not applicable
In compliance with the Company’s Articles of Association or the relevant √ Yes □ No
resolutions of general meeting of shareholders
Specific and clear dividend standards and ratios √ Yes □ No
Complete decision-making procedure and mechanism √ Yes □ No
Independent directors have faithfully performed their duties and played their due √ Yes □ No
role
Non-controlling shareholders are able to fully express their opinion and demand √ Yes □ No
and their legal rights and interests are fully protected
(III) Where the Company fails to put forward a cash dividend proposal despite the facts that the
Company has made profits in the Reporting Period and the profits of the Company as the parent
distributable to shareholders are positive, it shall give a detailed explanation of why, as well as of
the purpose and use plan for the retained earnings.
□ Applicable √ Not applicable
(IV) Final dividend plan for the Reporting Period
√ Applicable □ Not applicable
Unit: RMB
Annual Report 2022
Bonus issue from profit (share/10 shares) /
Cash dividend/10 shares (tax inclusive) 33
Bonus issue from capital reserves (share/10
shares)
Cash dividends (tax inclusive) 1,983,555,895.20
Consolidated net profit attributable to the ordinary
shareholders of the listed company in the year
Cash dividends as % of consolidated net profit
attributable to the ordinary shareholders of the 62.21
listed company
Cash dividends in form of share repurchase in cash 215,219,556.49
Total dividend amount (tax inclusive) 2,198,775,451.69
Total dividend amount as % of consolidated net
profit attributable to the ordinary shareholders of 68.96
the listed company
XI Status and Impact of Share Incentive Plans, Employee Shareholding Plan or Other Incentive
Measures for Employees
(I)Relevant incentive matters disclosed in current announcement with no subsequent progress or
change
√ Applicable □ Not applicable
Overview Index to the disclosed information
For details, please refer to the following
announcements disclosed on the website of the
To further establish and improve its long-term
Shanghai Stock Exchange (www.sse.com.cn):
incentive mechanisms to attract and retain
The 2022 Restricted Share Incentive Plan (Draft)
outstanding talent, the Company formulated the
of Gongniu Group;
The Announcement on Adjusting the List of
Gongniu Group and its summary, completed the
Awardees, the Number of Grants and the Grant
registration of the grant of the 2022 Restricted
Price of the Restricted Share Incentive Plan in
Share Incentive Plan on 21 June 2022, and granted
a total of 1,501,800 restricted shares to 646 people
The Announcement on the Grant Results of the
at a price of RMB63.06/share.
(Announcement No.: 2022-071)
For details, please refer to the following
announcements disclosed on the website of the
Shanghai Stock Exchange (www.sse.com.cn):
The Announcement on the Repurchase and
Cancellation of Some Restricted Shares
According to the provisions of the 2020 Restricted
(Announcement No.: 2022-042);
Share Incentive Plan of Gongniu Group Co., Ltd.
The Announcement on Notifying Creditors of the
and 2021 Restricted Share Incentive Plan of
Repurchase and Cancellation of Some Restricted
Gongniu Group Co., Ltd., some awardees have
Shares (Announcement No.: 2022-043);
lost the incentive qualification of the Incentive
The Announcement on Adjusting the Repurchase
Plan due to their departure from the Company, and
Price for the 2020 Restricted Share Incentive Plan
the Company completed the repurchase and
(Announcement No.: 2022-055);
cancellation of 28,100 restricted shares held by
The Announcement on Adjusting the Repurchase
them which had been granted but not lifted from
Price for the 2021Restricted Share Incentive Plan
restricted sales on 29 July 2022.
(Announcement No.: 2022-056); and
The Announcement of Gongniu Group on the
Implementation of the Repurchase and
Cancellation of Some Restricted Incentive Shares
(Announcement No.: 2022-080)
Annual Report 2022
For details, please refer to the following
announcements disclosed on the website of the
Shanghai Stock Exchange (www.sse.com.cn):
According to the relevant provisions of the 2021
The Announcement on Satisfaction of the
Restricted Share Incentive Plan, the lifting of the
Conditions for Lifting Restriction in the Second
restriction conditions in the second lifting
Lifting Restriction Period of the 2020 Restricted
restriction period of the 2020 Restricted Share
Share Incentive Plan (Announcement No.:
Incentive Plan has been achieved, and a total of
The Announcement on Lifting the Restriction
conditions for lifting the sale restrictions, which
Conditions in the Second Lifting Restriction
were unlocked and listed on 6 July 2022.
Period of the 2020 Restricted Share Incentive
Plan and Trading in the Market (Announcement
No.: 2022-073)
For details, please refer to the following
announcements disclosed on the website of the
Shanghai Stock Exchange (www.sse.com.cn):
According to the relevant provisions of the 2021
The Announcement on Satisfaction of the
Restricted Share Incentive Plan, the lifting of the
Conditions for Lifting Restriction in the First
restriction conditions in the first lifting restriction
Lifting Restriction Period of the 2021 Restricted
period of the 2021 Restricted Share Incentive Plan
Share Incentive Plan (Announcement No.:
has been achieved, and a total of 251,680 held by
The Announcement on Lifting the Restriction
the sale restrictions, which were unlocked and
Conditions in the First Lifting Restriction Period
listed on 15 July 2022.
of the 2021 Restricted Share Incentive Plan and
Trading in the Market (Announcement No.:
For details, please refer to the following
announcements disclosed on the website of the
According to the relevant provisions of the 2020
Shanghai Stock Exchange (www.sse.com.cn):
Restricted Share Incentive Plan, 2021 Restricted
The Announcement on the Repurchase and
Share Incentive Plan and 2022 Restricted Share
Cancellation of Some Restricted Shares
Incentive Plan, 31 awardees have lost the
(Announcement No.: 2022-104);
incentive qualification of the Incentive Plan due to
The Announcement on Notifying Creditors of the
their departure from the Company, and the
Repurchase and Cancellation of Some Restricted
Company completed the repurchase and
Shares (Announcement No.: 2022-105); and
cancellation of 74,830 restricted shares held by
The Announcement of Gongniu Group on the
them which had been granted but not lifted from
Implementation of the Repurchase and
restricted sales on 23 December 2022.
Cancellation of Some Restricted Incentive Shares
(Announcement No.: 2022-121)
(II) Incentive Plans undisclosed in current announcements or disclosed but with new progress
Equity Incentive Plans:
□ Applicable √ Not applicable
Other information:
□ Applicable √ Not applicable
Employee stock ownership plans:
□ Applicable √ Not applicable
Other incentive measures:
□ Applicable √ Not applicable
(III) Equity incentives granted to directors and senior management during the Reporting Period
√ Applicable □ Not applicable
Unit: share
Annual Report 2022
Restrict
Restricte Restricte
ed
d shares d shares Closing
shares Grant Shares
Office granted Unlocke held at market
Name held at price still in
title in the d shares the price
the (RMB) lockup
Reportin period-e (RMB)
period-
g Period nd
begin
Director
and
Cai
Vice 25,300 18,500 63.06 13,870 29,930 29,930 143.26
Yingfeng
Preside
nt
Director
, Vice
Preside
Liu
nt and 18,800 23,600 63.06 13,160 29,240 29,240 143.26
Shengsong
Board
Secretar
y
Director
and
Zhou
Vice 13,100 29,500 63.06 9,170 33,430 33,430 143.26
Zhenghua
Preside
nt
Vice
Li
Preside 24,400 19,800 63.06 13,900 30,300 30,300 143.26
Guoqiang
nt
Vice
Preside
Zhang Lina 7,500 14,100 63.06 5,250 16,350 16,350 143.26
nt and
CFO
Total / 89,100 105,500 / 55,350 139,250 139,250 /
(IV) Establishment and formulation of appraisal and incentive mechanisms for senior
management during the Reporting Period
√ Applicable □ Not applicable
The remuneration of the senior management personnel of the Company is implemented based on
the actual operations and the relevant rules of the Company.
XII Development and implementation of internal control systems during the Reporting Period
√ Applicable □ Not applicable
In strict compliance with the Company Law, Securities Law, Code of Corporate Governance for
Listed Companies, Guidelines for Evaluation of Enterprise Internal Control and other relevant laws and
regulations, the Company continuously establishes and improves its internal control system and
enhances the level of internal control management. During the Reporting Period, in order to further
promote the standardized operation of the Company, the Audit Committee under the Board of Directors
was renamed the Audit and Risk Committee with more responsibilities, and the Specific Implementation
Rules for the Audit and Risk Committee was amended accordingly. And the Audit and Risk
Management Joint Office has been established to further strengthen internal control.
Explanation of material weaknesses in internal control during the Reporting Period:
Annual Report 2022
□ Applicable √ Not applicable
XIII Management and control over subsidiaries during the Reporting Period
√ Applicable □ Not applicable
During the Reporting Period, the Company strictly followed the requirements of the Shanghai
Stock Exchange and various rules and regulations of the Board of Directors of the Company to regulate
the management and risk control of subsidiaries. Subsidiaries reported significant information such as
operations to the Company, and there were no undisclosed matters that should have been disclosed.
XIV Independent auditor’s report on internal control
√ Applicable □ Not applicable
Upon its audit on the effectiveness of the Company’s internal control over financial reporting for
material respects, effective internal control over financial reporting as of 31 December 2022, based on
the Basic Rules on Enterprise Internal Control and other applicable regulations. For further information,
see the Independent Auditor’s Report on Internal Control for 2022, which has been disclosed together
with this Report on the website of the Shanghai Stock Exchange (www.sse.com.cn).
Whether the Independent Auditor’s Report on Internal Control is disclosed: Yes
Type of the independent auditor’s opinion: Unmodified unqualified opinion
XV Remediation of problems identified by self-inspection in the special action on the governance
of the Company
Not applicable
XVI Other information
□ Applicable √ Not applicable
Annual Report 2022
Part V Environmental and Social Responsibility
I Environmental information
Whether any environment protecting mechanism
Yes
has been established
Spending on environmental protection during the
Reporting Period (unit: RMB’0,000)
(I) Description of the environmental protection of the company and its major subsidiaries that are
key emission units as declared by the environmental protection authorities
√ Applicable □ Not applicable
√ Applicable □ Not applicable
Ningbo Gongniu Electrics Co., Ltd. is a key unit supervised for soil environmental pollution in
Ningbo, with a commissioned disposal volume of 530 tons of hazardous waste in 2022. The company's
hazardous waste disposal is in compliance with relevant regulations and administrative plans.
During the Reporting Period, the Company discharged in strict accordance with the requirements of
the implemented pollutant discharge standards, with no environmental pollution incidents and no
penalties imposed by the environmental protection authorities. None of the Company's units, other than
Ningbo Gongniu Electrics Co., Ltd., is a key emission unit as declared by the environmental protection
authorities.
√ Applicable □ Not applicable
As a state-level Green Factory, Ningbo Gongniu Electrics Co., Ltd. actively implements the green
development strategy, practices the concept of green, low-carbon and ecological development, increases
investment in safety and environmental protection, applies green technologies of green, energy
conservation, environmental protection and resource reuse, promotes innovation and transformation in
manufacturing processes and business procedures, reduces wastewater, waste gas emissions and noise
pollution, vigorously carries out energy-saving technology reform and eliminates backward equipment
with high energy consumption, and continuously develops a green manufacturing system.
In 2022, the Company spent a total of RMB9.605 million in operation costs of environmental
protection equipment, and the majority of the waste gas pollution treatment facilities have been
upgraded to the international advanced “zeolite rotary adsorption + RTO combustion” technology,
with the treatment effect of VOC reduced to 30mg/m3 and below. In addition, an online monitoring
system has been put in place to monitor the exhaust gas emissions in real time, and monitor the pollutant
data in real time to make sure that the exhaust gas emissions meet the applicable standards and
regulations at all time.
Annual Report 2022
licenses of environmental protection
√ Applicable □ Not applicable
All the Company's construction projects have fulfilled the environmental impact evaluation and
other environmental protection administrative licensing procedures in accordance with the requirements
of national environmental protection laws and regulations.
√ Applicable □ Not applicable
The Company has established an effective emergency response mechanism for environmental
emergencies, and the chemical intermediate warehouse of each base and each plant involving hazardous
waste and hazardous chemicals rehearse the contingency plan at least twice a year. In order to improve
the corporate ability to respond to environmental pollution accidents, the Company formulated the
Contingency Plan of Ningbo Gongniu Electrics Co., Ltd. for Environmental Emergencies (File No.
Environmental Protection Law of the People's Republic of China and based on the actual situation.
√ Applicable □ Not applicable
In accordance with the pollutant discharge permits and the requirements of self-monitoring of
environmental protection, the Company has formulated the Management System for Self-monitoring of
Pollution Sources and regularly carries out self-monitoring work. In 2022, it commissioned qualified
third-party testing units to orderly carry out tests on spraying exhaust gas, noise at the factory boundary,
domestic sewage, etc., and made sure that the test reports issued were all valid.
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Ningbo Gongniu Electrics Co., Ltd. is among the first batch of Ningbo 2022 positive list of
enterprises for ecological and environmental supervision and enforcement. Also, the company was rated
A in the environmental credit evaluation of enterprises in Zhejiang Province in 2022.
(II) Environmental protection of companies other than key emission units
√ Applicable □ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Annual Report 2022
Except for Ningbo Gongniu Electrics Co., Ltd., all other units of the Group are not key emission
units and have strictly implemented relevant laws and regulations on environmental protection, installed
additional environmental protection equipment for processes that generate environmental pollution in
accordance with the requirements of the environmental credit evaluation, which passed the acceptance
and met the discharge standards. All three wastes were discharged in accordance with the standard.
There was no environmental pollution accident and no punishment by the environmental protection
authorities, and all the units were rated A in the environmental credit evaluation of enterprises in
Zhejiang Province. In particular, Ningbo Gongniu Photoelectric Technology Co., Ltd. is among the first
batch of Ningbo 2022 positive list of enterprises for ecological and environmental supervision and
enforcement.
□ Applicable √ Not applicable
(III) Efforts and results in ecological protection, pollution prevention and environmental
responsibility performance
√ Applicable □ Not applicable
To strengthen the awareness of environmental protection among employees, the Company
organized a photographic event at the World Environment Day on 5 June 2022. Promotional photos and
videos were taken on themes such as low carbon living and green factories, and winning works were
exhibited to motivate employees.
The Company has strengthened the environmental management on the spraying lines with the
internationally advanced “zeolite rotary adsorption + RTO combustion” technologies. The
environmental protection equipment operated in an efficient manner during the Reporting Period, with
the VOC removal rate reaching over 95%.
Meanwhile, the spraying plants have increased research into source substitution - water-based
paints instead of oil-based paints - during the Reporting Period. The substantial investment is expected
to produce results by 2023. Adhering to its business philosophy of "Strive for No. 1" in everything it
does, the Company is committed to environmental responsibility.
In order to practice a circular economy and make effective use of resources, the molding plants
have set up a recycling mechanism for plastic pellets.
(IV) Measures taken to reduce carbon emissions during the Reporting Period and their effects
Whether any measure was taken to
Yes
reduce carbon emissions
Emissions of CO2 equivalent reduced
Not applicable
(unit: ton)
Type of carbon reduction measures (for During the Reporting Period, the Company actively
example, use of clean energy in power enhanced the management and conservation of energy
generation, use of carbon reducing resources and took necessary measures, including
technologies in production processes, vigorously increasing the proportion of clean energy use
development and production of novel such as photovoltaic, with a total of 5.94 million kilowatt
Annual Report 2022
products that can help reduce carbon hours of photovoltaic power use; strengthening the energy
emissions, etc.) consumption management of equipment and the
conservation management of water resources; promoting
green office and issuing office rules, etc.
Meanwhile, the Company is vigorously developing its new
energy business and has launched various products such as
new energy vehicle charging plugs/points and portable
products to actively contribute to the national strategy of
"carbon peaking and carbon neutrality".
Detailed description:
√ Applicable □ Not applicable
For details, please refer to the 2022 Environmental, Social and Governance Report of Gongniu
Group Co., Ltd. published by the Company on the website of the Shanghai Stock Exchange
(www.sse.com.cn).
II Fulfillment of Social Responsibility
(I) Indicate whether a separate social responsibility report, sustainability report or ESG report has
been disclosed.
√ Applicable □ Not applicable
For details, please refer to the 2022 Environmental, Social and Governance Report of Gongniu
Group Co., Ltd. published by the Company on the website of the Shanghai Stock Exchange
(www.sse.com.cn).
(II) Specific efforts in relation to social responsibility
√ Applicable □ Not applicable
Donations and public welfare
Number/content Description
programs
Total spending (RMB’0,000) 6,250
Of which: Funds Gongniu Group Charitable Trust,
(RMB’0,000) Medical and Health Fund, etc.
Worth of supplies
(RMB’0,000)
Number of beneficiaries
Detailed description:
√ Applicable □ Not applicable
For details, please refer to the 2022 Environmental, Social and Governance Report of Gongniu
Group Co., Ltd. published by the Company on the website of the Shanghai Stock Exchange
(www.sse.com.cn).
III Efforts in Poverty Alleviation, Rural Revitalization, etc
□ Applicable √ Not applicable
Detailed description:
□ Applicable √ Not applicable
Annual Report 2022
Part VI Significant Events
I Fulfillment of Commitments
(I) Commitments of the Company's actual controller, shareholders, related parties and acquirers, as well as the Company and other entities during the
Reporting Period or commitments continuing to the Reporting Period
√ Applicable □ Not applicable
If it is not If it is not
Whether timely timely
Time of Whether it is performed, performed,
Commitment Commitment commitment there is a timely the the plan
Promisor Commitment contents
background category making and deadline for and specific for the
term performance strictly reasons next step
performed shall be shall be
stated stated
Within 36 months from the date of listing of
the Company's shares, the promisor will not
transfer or entrust others to manage the shares
he/she directly or indirectly holds in the
Company which were issued before the IPO,
nor will the Company repurchase such shares.
If the shares held by the promisor are reduced
Within 36
Liangji within two years after the expiry of the
months
Industrial, lock-up period, the price of such reduction
from the
Commitments Restricted Ninghui shall not be lower than the issue price of the Not Not
date of Yes Yes
related to IPO share sales Investment, IPO (if the Company's shares are subject to applicable applicable
listing of the
Suiyuan ex-rights and ex-dividend matters such as
Company's
Investment dividend distribution, share bonus and capital
shares
reserves to share capital, the issue price will
be adjusted ex-rights and ex-dividend, the
same below); if the closing price of the
Company's shares for 20 consecutive trading
days is lower than the issue price within six
months after the listing of the Company, or
the closing price at the end of six months after
Annual Report 2022
the listing is lower than the issue price, the
lock-up period for holding the Company's
shares will be automatically extended for at
least six months.
Within 36
Within 36 months from the date of listing of
months
the Company's shares, the promisor will not
from the
Restricted transfer or entrust others to manage the shares Not Not
Qiyuanbao date of Yes Yes
share sales he/she directly or indirectly holds in the applicable applicable
listing of the
Company which were issued before the IPO,
Company's
nor will the Company repurchase such shares.
shares
Within 36 months from the date of listing of
the Company's shares, the promisor will not
transfer or entrust others to manage the shares
he/she directly or indirectly holds in the
Company which were issued before the IPO,
nor will the Company repurchase such shares.
Ruan
If the Company's shares directly or indirectly
Liping,
held by the promisor are reduced within two
Ruan
years after the expiry of the lock-up period,
Xueping, Within 36
the price of such reduction shall not be lower
Cai months
than the issue price (if the Company's shares
Yingfeng, from the
Restricted are subject to ex-rights and ex-dividend Not Not
Liu date of Yes Yes
share sales matters such as dividend distribution, share applicable applicable
Shengsong, listing of the
bonus and capital reserves to share capital, the
Zhou Company's
issue price will be adjusted ex-rights and
Zhenghua, shares
ex-dividend, the same below); if the closing
Li
price of the Company's shares for 20
Guoqiang,
consecutive trading days is lower than the
Zhang Lina
issue price within six months after the listing
of the Company, or the closing price at the
end of six months after the listing is lower
than the issue price, the lock-up period for
holding the Company's shares will be
automatically extended for at least six months.
Annual Report 2022
After the expiry of the above-mentioned
commitment lock-up period, during my term
of office as a director, supervisor or senior
management personnel of the Company, if I
leave the Company before the expiry of my
term of office, during the term of office
determined at the time of my assumption of
office and within six months after the expiry
of my term of office: 1) I will transfer no more
than 25% of the total number of shares of the
Company held directly or indirectly by me
each year; 2) I will not transfer the shares of
the Company held directly or indirectly by me
within six months after leaving the Company;
regulations, departmental rules and
regulations, regulatory documents and other
regulations for the transfer of shares by
directors, supervisors and senior management
personnel of the business rules of the stock
exchange.
Within 36 months from the date of listing of
the Company's shares, the promisor will not
transfer or entrust others to manage the shares
he/she directly or indirectly holds in the
Within 36
Company which were issued before the IPO,
Shen months
nor will the Company repurchase such shares.
Huiyuan, from the
Restricted After the expiry of the above-mentioned Not Not
Guan date of Yes Yes
share sales commitment lock-up period, during my term applicable applicable
Xuejun, listing of the
of office as a director, supervisor or senior
Li Yu Company's
management personnel of the Company, if I
shares
leave the Company before the expiry of my
term of office, during the term of office
determined at the time of my assumption of
office and within six months after the expiry
Annual Report 2022
of my term of office: 1) I will transfer no more
than 25% of the total number of shares of the
Company held directly or indirectly by me
each year; 2) I will not transfer the shares of
the Company held directly or indirectly by me
within six months after leaving the Company;
regulations, departmental rules and
regulations, regulatory documents and other
regulations for the transfer of shares by
directors, supervisors and senior management
personnel of the business rules of the stock
exchange.
price stabilisation measures: Within three
years of the Company’s IPO and listing, if the
closing price of the Company's shares is lower
than the latest audited net asset value per share
for 20 consecutive trading days (hereinafter
referred to as the "initiation condition"), the
Company shall initiate the measures for
stabilizing its stock prices in line with relevant Three years
provisions. In the event of changes in the from the
Gongniu Company's net assets or the total number of date of the Not Not
Other Yes Yes
Group shares due to matters such as capitalisation Company’s applicable applicable
from capital reserve, distribution of stock or IPO and
cash dividends, follow-on offering, share listing
allotment and stock reverse split-up after the
latest audit base day, the net assets per share
shall be adjusted accordingly.
specific measures to stabilise stock prices is
triggered, the Company shall, in accordance
with laws and regulations, normative
documents, and relevant plans of the Articles
Annual Report 2022
of Association, take one or more of the
following measures to stabilise stock prices at
the same time or in steps in the light of the
actual situation of the Company and the stock
market, and based on the principle of
protecting the interests of the Company and
investors: (1) The Company repurchases
shares from the public; (2) Controlling
shareholders, directors who receive
remuneration from the Company (except
independent directors) and senior managers
increase their holdings of the Company's
shares.
In strict accordance with the Proposal on the
Stabilization of Share Price within Three
Years of Listing, Ningbo Liangji Industrial
Co., Ltd. will fully and effectively fulfill its
obligations and responsibilities under the
Three years
Proposal, and strongly urge the joint stock
from the
company and the relevant parties to fully and
Liangji date of the Not Not
Others effectively fulfill their obligations and Yes Yes
Industrial Company’s applicable applicable
responsibilities under the Proposal. When the
IPO and
General Meeting of the Company resolves on
listing
the repurchase of shares in accordance with
the provisions of the Proposal, Ningbo Liangji
Industrial Co., Ltd. undertakes to vote in favor
of the proposal on the repurchase at the
General Meeting.
In strict accordance with the Proposal on the
Three years
Stabilization of Share Price within Three
Ruan from the
Years of Listing, I will fully and effectively
Liping, date of the Not Not
Others fulfill its obligations and responsibilities under Yes Yes
Ruan Company’s applicable applicable
the Proposal, and strongly urge the company
Xueping IPO and
and the relevant parties to fully and effectively
listing
fulfill the obligations and responsibilities
Annual Report 2022
under the Proposal. When the General
Meeting of the Company resolves on the
repurchase of shares in accordance with the
provisions of the Proposal, I undertake that I
and those acting in concert will vote in favor
of the proposal on the repurchase at the
General Meeting.
In strict accordance with the Proposal on the
Stabilization of Share Price within Three Three years
Senior Years of Listing, I will fully and effectively from the
management fulfill its obligations and responsibilities under date of the Not Not
Others Yes Yes
of the the Proposal, and strongly urge the company Company’s applicable applicable
Company and the relevant parties to fully and effectively IPO and
fulfill the obligations and responsibilities listing
under the Proposal.
be performed within 36 months after the
Company's shares are listed. 2. The methods
of shareholding reduction include but are not
Liangji limited to call auction on exchanges, block Three years
Industrial, trade, and negotiating transfer. 3. When from the
Ruan reducing shareholdings, information such as date of the Not Not
Others Yes Yes
Liping, and the amount and method of reduction shall be Company’s applicable applicable
Ruan notified to the Company in writing in advance, IPO and
Xueping and the Company shall make an listing
announcement in a timely manner.
Shareholding reduction shall be performed
after three trading days from the date of the
Company's announcement.
(1) The company and companies or other
organizations controlled by the company are
Settlement
Liangji not engaged in the same or similar business as Not Not Not
of horizontal No Yes
Industrial the issuer and its subsidiaries, with no applicable applicable applicable
competition
horizontal competition. (2) The company and
companies or other organizations controlled
Annual Report 2022
by the company will not engage in the same or
similar business as the existing business of the
issuer and its subsidiaries in any form outside
China, including not investing in, acquiring or
merging with companies or other economic
organizations outside China that compete with
the existing principal business of the issuer
and its subsidiaries. (3) If the issuer and its
subsidiaries engage in new business in the
future, the company and companies or other
organizations controlled by the company will
not engage in business activities in direct
competition with the new business of the
issuer and its subsidiaries by share holding or
participating in but having substantial control
over the shares of the issuer and its
subsidiaries within or outside China, including
investing in, acquiring or merging with
companies or other economic organizations
within or outside China that directly compete
with the new business of the issuer and its
subsidiaries in the future. (4) If the company
and legal entities controlled by the company
have business operations in direct competition
with the issuer and its subsidiaries, the issuer
and its subsidiaries shall have the right to
centralize the competing businesses to the
operations of the issuer and its subsidiaries
through preferential acquisition or
entrustment. (5) The company undertakes not
to use its position as a shareholder of the
issuer and its subsidiaries to seek improper
benefits and thereby harm the rights and
interests of other shareholders of the issuer
and its subsidiaries. If the rights and interests
Annual Report 2022
of the issuer and its subsidiaries are damaged
due to a breach of the above statements and
commitments by the company and companies
or other organizations controlled by the
company, the company agrees to be liable to
the issuer and its subsidiaries for the
corresponding damages.
(1) I and companies or other organizations
controlled by me are not engaged in the same
or similar business as the issuer and its
subsidiaries, with no horizontal competition.
(2) I and companies or other organizations
controlled by me will not engage in the same
or similar business as the existing business of
the issuer and its subsidiaries in any form
outside China, including not investing in,
acquiring or merging with companies or other
economic organizations outside China that
compete with the existing principal business
Ruan of the issuer and its subsidiaries. (3) If the
Settlement
Liping, issuer and its subsidiaries engage in new Not Not Not
of horizontal No No
Ruan business in the future, I and companies or applicable applicable applicable
competition
Xueping other organizations controlled by me will not
engage in business activities in direct
competition with the new business of the
issuer and its subsidiaries by share holding or
participating in but having substantial control
over the shares of the issuer and its
subsidiaries within or outside China, including
investing in, acquiring or merging with
companies or other economic organizations
within or outside China that directly compete
with the new business of the issuer and its
subsidiaries in the future. (4) If I and legal
entities controlled by me have business
Annual Report 2022
operations in direct competition with the
issuer and its subsidiaries, the issuer and its
subsidiaries shall have the right to centralize
the competing businesses to the operations of
the issuer and its subsidiaries through
preferential acquisition or entrustment. (5) I
undertake not to use its position as a
shareholder of the issuer and its subsidiaries to
seek improper benefits and thereby harm the
rights and interests of other shareholders of
the issuer and its subsidiaries. If the rights and
interests of the issuer and its subsidiaries are
damaged due to a breach of the above
statements and commitments by me and
companies or other organizations controlled
by me, I agree to be liable to the issuer and its
subsidiaries for the corresponding damages.
The company will minimize and standardize
the related-party transactions with Gongniu
Group Co., Ltd. and its wholly-owned or
controlled subsidiaries. For related-party
transactions that are inevitable or occur for
reasonable reasons, the company will strictly
comply with the provisions of relevant laws,
Settlement regulations and the Articles of Association of
of Liangji the company, follow the principles of Not Not Not
No Yes
related-party Industrial equitable, remunerative and fair transactions, applicable applicable applicable
transactions perform legal procedures, and determine the
transaction prices in accordance with
reasonable prices recognized by the market to
ensure the fairness of the related-party
transactions. The company will not leverage
its shareholder status to induce the General
Meeting or the Board of Directors of the
Company to make resolutions that infringe
Annual Report 2022
upon the legitimate rights and interests of the
Company and other shareholders. In operating
decisions, the company will strictly follow the
relevant provisions of the Company Law and
the Articles of Association to implement the
avoidance system of related shareholders to
safeguard the legitimate rights and interests of
all shareholders.
I will minimize and standardize the
related-party transactions with Gongniu Group
Co., Ltd. and its wholly-owned or controlled
subsidiaries. For related-party transactions
that are inevitable or occur for reasonable
reasons, I will strictly comply with the
provisions of relevant laws, regulations and
the Articles of Association of the company,
follow the principles of equitable,
remunerative and fair transactions, perform
legal procedures, and determine the
Settlement Ruan
transaction prices in accordance with
of Liping, Not Not Not
reasonable prices recognized by the market to No Yes
related-party Ruan applicable applicable applicable
ensure the fairness of the related-party
transactions Xueping
transactions. I will not leverage its shareholder
status to induce the General Meeting or the
Board of Directors of the Company to make
resolutions that infringe upon the legitimate
rights and interests of the Company and other
shareholders. In operating decisions, I will
strictly follow the relevant provisions of the
Company Law and the Articles of Association
to implement the avoidance system of related
shareholders to safeguard the legitimate rights
and interests of all shareholders.
Commitments Gongniu The Company will not provide loans and any Not Not Not
Others No Yes
related to Group other forms of financial assistance, including applicable applicable applicable
Annual Report 2022
equity provision of guarantees for loans, to the
incentives awardees of the Restricted Share Incentive
Plan for acquiring the relevant restricted
shares under the Incentive Plan.
If the Company is not eligible for the grant of
equity or exercise of equity arrangement due
to a false record, misleading statement or
Awardees of
material omission in the information
restricted
disclosure document, the awardee shall return Not Not Not
Others share No Yes
to the Company all the benefits received from applicable applicable applicable
Incentive
the share Incentive Plan after the false record,
Plans
misleading statement or material omission are
confirmed in relevant information disclosure
documents.
Annual Report 2022
(II) Where there had been an earnings forecast for an asset or project and the Reporting Period
was still within the forecast period, explain why the forecast has or has not been reached for the
Reporting Period.
□ Forecast reached □ Forecast unreached √ Not applicable
(III) Fulfillment of performance commitments and the impact on goodwill impairment tests
□ Applicable √ Not applicable
II Occupation of the Company’s Capital by the Controlling Shareholder or Other Related Parties
for Non-Operating Purposes during the Reporting Period
□ Applicable √ Not applicable
III Irregularities in the Provision of Guarantees
□ Applicable √ Not applicable
Annual Report 2022
IV Explanation Given by the Board of Directors Regarding “Independent Auditor’s Report with
Modified Opinion”
□ Applicable √ Not applicable
V Reasons for Accounting Policy or Estimate Changes or Correction of Material Accounting
Errors and the Impact
(I) Reasons for accounting policy or estimate changes and the impact
√ Applicable □ Not applicable
For details, see “44. Changes to critical accounting policies and estimates” under “V Critical
Accounting Policies and Estimates” of “Part X Financial Statements”.
(II) Reasons for correction of material accounting errors and the impact
□ Applicable √ Not applicable
(III) Communications with the former CPA firm
□ Applicable √ Not applicable
(IV) Other information
□ Applicable √ Not applicable
VI Appointment and Dismissal of CPA Firm
Unit: RMB’0,000
In service
Name of the domestic CPA firm Pan-China Certified Public Accountants LLP
The Company’s payment to the domestic CPA
firm
How many years the domestic CPA firm has
provided audit service for the Company
Name of certified public accountants of the
Qian Zhongxian, and Liu Chong
domestic CPA firm
How many consecutive years the certified public
Qian Zhongxian: 2 years
accountants of the domestic CPA firm have
Liu Chong: 1 year
provided audit service for the Company
Name Payment
CPA firm for the audit of Pan-China Certified Public
internal control Accountants LLP
Note: The audit fees of the Company for the year 2022 amounted to RMB2,780,000, of which the
audit fee for the financial statements of the Company for the year 2022 amounted to RMB2,180,000, the
internal control audit fee amounted to RMB500,000 and the raised funds authentification fee amounted
to RMB100,000.
Appointment and dismissal of CPA firm:
√ Applicable □ Not applicable
As resolved by the 2021 Annual General Meeting of Shareholders, the Company decided to
re-appoint Pan-China Certified Public Accountants LLP as the independent auditor for the financial
statements and internal control of 2022.
Change of the CPA firm during the audit:
□ Applicable √ Not applicable
Annual Report 2022
VII Delisting Risk
(I) Reasons for the delisting risk warning
□ Applicable √ Not applicable
(II) The Company’s response
□ Applicable √ Not applicable
(III) Risk of termination of listing and the reasons
□ Applicable √ Not applicable
VIII Insolvency and Reorganization
□ Applicable √ Not applicable
IX Significant Legal Matters
□ The Company has material litigation and arbitration this year
√ The Company has no material litigation and arbitration this year
X Punishments on the Company as well as Its Directors, Supervisors, Senior Management,
Controlling Shareholder and Actual Controller for Violation of Laws or Regulations, as well as the
Relevant Rectifications
□ Applicable √ Not applicable
XI Credit Standings of the Company as well as Its Controlling Shareholder and Actual Controller
during the Reporting Period
□ Applicable √ Not applicable
XII Major Related-Party Transactions
(I) Continuing related-party transactions
□ Applicable √ Not applicable
√ Applicable □ Not applicable
The Proposal on Estimated Continuing Related-Party Transactions for 2022 was approved at the
Tenth Meeting of the Second Board of Directors. For details, please refer to the Announcement on
Estimated Continuing Related-Party Transactions for 2022 (Announcement No. 2022-024) disclosed by
the Company on the website of the Shanghai Stock Exchange (www.sse.com.cn). For the actual
execution of the aforesaid estimated related-party transactions, see the Announcement on Estimated
Continuing Related-Party Transactions for 2023 (Announcement No. 2023-018).
□ Applicable √ Not applicable
(II) Related-party transactions regarding purchase or sale of assets or equity investments
□ Applicable √ Not applicable
Annual Report 2022
□ Applicable √ Not applicable
□ Applicable √ Not applicable
performance results for the Reporting Period shall be disclosed.
□ Applicable √ Not applicable
(III) Major related-party transactions regarding joint investments in third parties
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(IV) Amounts due to and from related parties
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(V) Financial transactions between the Company and related finance companies, or between
finance companies under the Company’s control and related parties
□ Applicable √ Not applicable
(VI) Other information
□ Applicable √ Not applicable
XIII Major Contracts and the Execution
(I) Entrustment, Contracting and Leases
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
Annual Report 2022
(II) Guarantees
□ Applicable √ Not applicable
Annual Report 2022
(III) Cash entrusted to other entities for management
(1) Total cash entrusted for wealth management
√ Applicable □ Not applicable
Unit: RMB’0,000
Unrecovered overdue
Type Funding source Amount Undue amount
amount
Bank’s financial
Self-funded 209,450.00 191,900.00
product
Structured
Self-funded 50,001.00 3,001.00
deposits
Structured
Raised funds 60,000.00 15,000.00
deposits
Trust product Self-funded 126,000.00 126,000.00
Securities firm’s
Self-funded 342,000.00 342,000.00
product
Securities firm’s
Raised funds 78,000.00 45,000.00
product
Other information
□ Applicable √ Not applicable
(2) Single Wealth Management Entrustment
□ Applicable √ Not applicable
Other information:
□ Applicable √ Not applicable
(3) Impairment allowances for wealth management entrustment
□ Applicable √ Not applicable
(1) Total entrustment loans
□ Applicable √ Not applicable
Other information:
□ Applicable √ Not applicable
(2) Single entrustment loans
□ Applicable √ Not applicable
Other information:
□ Applicable √ Not applicable
(3) Impairment allowances for entrustment loans
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(IV) Other significant contracts
□ Applicable √ Not applicable
Annual Report 2022
XIV Other Significant Events for Investors’ Judgment of Value and Investment Decision-making
□ Applicable √ Not applicable
Annual Report 2022
Part VII Changes in Ordinary Shares and Information about Shareholders
I Share Changes
(I) Share changes
Unit: share
Before Increase/decrease in the current period (+/-) After
Bonus
Bonus
issue
Percentage issue Percentage
Shares New issue from Other Subtotal Shares
(%) from (%)
capital
profit
reserves
I Restricted shares 525,579,506 87.42 995,000 995,000 526,574,506 87.61
corporations
investors
Including: Shares held by domestic
corporations
Shares held by domestic individuals 194,693,398 32.38 995,000 995,000 195,688,398 32.56
Including: Shares held by overseas
corporations
Shares held by overseas individuals
II Unrestricted shares 75,601,014 12.58 -1,097,930 -1,097,930 74,503,084 12.39
shares
III Total shares 601,180,520 100.00 -102,930 -102,930 601,077,590 100.00
Annual Report 2022
√ Applicable □ Not applicable
(1) On 11 April 2022, the Company held the 10th meeting of the 2nd Board of Directors and the 10th meeting of the 2nd Supervisory Committee, and reviewed
and approved the Proposal on the Restricted Share Incentive Plan for 2022 (Draft) and its Summary, and Proposal on the Management Measures for the Assessment
of the Restricted Share Incentive Plan for 2022. On 20 May 2022, the Company held the 12th meeting of the 2nd Board of Directors and the 12th meeting of the 2nd
Supervisory Committee, and review and approved the Proposal on Adjusting the List of Awardees, the Number of Grants and the Grant Price of the Restricted Share
Incentive Plan in 2022, and Proposal on Granting Restrictive Shares to Awardees, agreeing to grant a total of 1,501,800 shares (ordinary shares repurchased by the
Company from the secondary market) to awardees. After this change, the total share capital of the Company remained unchanged, and the number of restricted
tradable shares changed from 525,579,506 to 527,081,306, while that of non-restricted tradable shares changed from 75,601,014 to 74,099,214. For details, please
refer to the Announcement on the Grant Results of the 2022 Restricted Share Incentive Plan (Announcement No.: 2022-071) published by the Company on the
website of the Shanghai Stock Exchange (www.sse.com.cn) on 23 June 2022;
(2) According to the relevant provisions, the lifting of the restriction conditions in the second lifting restriction period of the 2020 Restricted Share Incentive
Plan has been achieved, and a total of 152,190 shares held by 367 awardees have met the conditions for lifting the sale restrictions. After this change, the total share
capital of the Company remained unchanged, and the number of restricted tradable shares changed from 527,081,306 to 526,929,116, while that of non-restricted
tradable shares changed from 74,099,214 to 74,251,404. For details, please refer to the Announcement on Lifting the Restriction Conditions in the Second Lifting
Restriction Period of the 2020 Restricted Share Incentive Plan and Trading in the Market (Announcement No.: 2022-073) published by the Company on the website
of the Shanghai Stock Exchange (www.sse.com.cn) on 1 July 2022;
(3) According to the relevant provisions, the lifting of the restriction conditions in the first lifting restriction period of the 2021 Restricted Share Incentive Plan
has been achieved, and a total of 251,680 shares held by 486 awardees have met the conditions for lifting the sale restrictions. After this change, the total share
capital of the Company remained unchanged, and the number of restricted tradable shares changed from 526,929,116 to 526,677,436, while that of non-restricted
tradable shares changed from 74,251,404 to 74,503,084. For details, please refer to the Announcement on Lifting the Restriction Conditions in the First Lifting
Restriction Period of the 2021 Restricted Share Incentive Plan and Trading in the Market (Announcement No.: 2022-077) published by the Company on the website
of the Shanghai Stock Exchange (www.sse.com.cn) on 12 July 2022;
Annual Report 2022
(4) As 22 awardees of the 2020 Restricted Share Incentive Plan and 2021 Restricted Share Incentive Plan have lost the incentive qualification of the Incentive
Plan due to their departure from the Company, the Company repurchased and cancelled 28,100 restricted shares held by them, which had been granted but not lifted
from restricted sales. After that, the total share capital of the Company changed from 601,180,520 to 601,152,420, and the number of restricted tradable shares
changed from 526,677,436 to 526,649,336. For details, please refer to the Announcement of Gongniu Group on the Implementation of the Repurchase and
Cancellation of Some Restricted Incentive Shares (Announcement No.: 2022-080) published by the Company on the website of the Shanghai Stock Exchange
(www.sse.com.cn) on 27 July 2022;
(5) As 31 awardees of the 2020 Restricted Share Incentive Plan, 2021 Restricted Share Incentive Plan and 2022 Restricted Share Incentive Plan have left the
Company, the Company repurchased and cancelled 74,830 restricted shares held by them, which had been granted but not lifted from restricted sales. After that, the
total share capital of the Company changed from 601,152,420 to 601,077,590, and the number of restricted tradable shares changed from 526,649,336 to
Incentive Shares (Announcement No.: 2022-121) published by the Company on the website of the Shanghai Stock Exchange (www.sse.com.cn) on 21 December
Annual Report 2022
per share for the most recent year and the most recent period (if any)
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(II) Change of restricted shares
√ Applicable □ Not applicable
Unit: Share
Number of Number
shares of new Reasons
Opening Shares Closing
Name of lifted from restricted for Date of
restricted repurchased restricted
shareholder restrictions shares restricted unlocking
shares and retired shares
during the during the sales
year year
Conditions
Awardees
for
of the 2020
unlocking 6 July
Equity 296,600 152,190 0 8,610 135,800
the equity 2022
Incentive
incentives
Plan
are unmet
Conditions
Awardees
for
of the 2021
unlocking 15 July
Equity 668,400 251,680 0 41,920 374,800
the equity 2022
Incentive
incentives
Plan
are unmet
Conditions
Awardees
for
of the 2022
unlocking
Equity 0 0 1,501,800 52,400 1,449,400 In lockup
the equity
Incentive
incentives
Plan
are unmet
Total 965,000 403,870 1,501,800 102,930 1,960,000 / /
II Issuance and Listing of Securities
(I) Securities issued during the Reporting Period
□ Applicable √ Not applicable
Description of securities issued during the Reporting Period (for bonds with different interest rates over
the lifetime, please specify separately):
□ Applicable √ Not applicable
(II) Changes in Total Shares and Shareholder Structure, as well as in Asset and Liability
Structures
√ Applicable □ Not applicable
For changes in the shareholder structure, see “(I) Share changes” under “I Share Changes” of “Part
VII Share in Ordinary Shares and Information about Shareholders”.
Annual Report 2022
For changes in asset and liabilities structures, see “(III) Analysis of assets and liabilities” under “V
Business Overview for the Reporting Period” of “Part III Management Discussion and Analysis”.
(III) Existing staff-held shares
□ Applicable √ Not applicable
III Shareholders and Actual Controller
(I) Total number of shareholders
Number of ordinary shareholders at the period-end 21,987
Number of ordinary shareholders at the month-end
prior to the disclosure of this Report
Number of preference shareholders with resumed
Not applicable
voting rights at the period-end
Number of preference shareholders with resumed
voting rights at the month-end prior to the Not applicable
disclosure of this Report
(II) Top 10 shareholders and public shareholders (or unrestricted shareholders) at the period-end
Unit: share
Top 10 shareholders
Shares in
Shareholding
Full name Shareholdi pledge,
increase/decre Closing Restricted
of ng marked or Nature of
ase in the shareholdi shares
shareholde percentage frozen shareholder
Reporting ng held
r (%) Statu Share
Period
s s
Ningbo
Domestic
Liangji 324,000,00 324,000,0
Industrial 0 00
ed corporation
Co., Ltd.
Ruan 96,864,19 Domestic
Liping 9 individual
Ruan 96,864,19 Domestic
Xueping 9 individual
Hong
Kong
Securities
-5,122,251 8,920,301 1.48 0 N/A Other
Clearing
Company
Limited
Ningbo
Ninghui
Investment
Manageme
nt 0 4,072,954 0.68 4,072,954 N/A Other
Partnership
(Limited
Partnership
)
Annual Report 2022
China
Merchants
Bank Co.,
Ltd.－
Xingquan 478,840 3,949,515 0.66 0 N/A Other
Herun
Mixed
Securities
Investment
Fund
China
Merchants
Bank Co.,
Ltd.－
Xingquan
Heyi
Dynamic 0 2,600,615 0.43 0 N/A Other
Asset
Allocation
Mixed
Securities
Investment
Fund
(LOF)
Schroder
Investment
Manageme
nt (Hong
Kong)
Limited－
Schroder 0 2,465,095 0.41 0 N/A Other
Internation
al
Selection
Fund
-Emerging
Asia (ETF)
Industrial
Bank Co.,
Ltd.－
Xingquan
New View
Dynamic
Asset
Allocation 9,731 1,878,106 0.31 0 N/A Other
Regularly
Open-ende
d Mixed
Initiated
Securities
Investment
Fund
Annual Report 2022
China
Everbright
Bank
Company
Limited－
Xingquan
Business
Model
Selected
Mixed
Securities
Investment
Fund
(LOF)
Top 10 unrestricted shareholders
Unrestricted public Type and number of shares
Name of shareholder
shares held Class Shares
Hong Kong Securities RMB-denominated ordinary
Clearing Company Limited stock
China Merchants Bank Co.,
Ltd.－Xingquan Herun RMB-denominated ordinary
Mixed Securities Investment stock
Fund
China Merchants Bank Co.,
Ltd.－Xingquan Heyi
RMB-denominated ordinary
Dynamic Asset Allocation 2,600,615 2,600,615
stock
Mixed Securities Investment
Fund (LOF)
Schroder Investment
Management (Hong Kong)
RMB-denominated ordinary
Limited－Schroder 2,465,095 2,465,095
stock
International Selection Fund
-Emerging Asia (ETF)
Industrial Bank Co., Ltd.－
Xingquan New View
Dynamic Asset Allocation RMB-denominated ordinary
Regularly Open-ended stock
Mixed Initiated Securities
Investment Fund
China Everbright Bank
Company Limited Co., Ltd.
RMB-denominated ordinary
－Xingquan Business Model 1,819,850 1,819,850
stock
Selected Mixed Securities
Investment Fund (LOF)
Schroder Investment
Management (Hong Kong)
RMB-denominated ordinary
Limited－Schroder 1,562,700 1,562,700
stock
International Selection Fund
-China A (ETF)
Basic Endowment Insurance RMB-denominated ordinary
Fund—Portfolio 807 stock
National Social Security RMB-denominated ordinary
Fund—Portfolio 114 stock
Annual Report 2022
Schroder Investment
Management (Hong Kong)
RMB-denominated ordinary
Limited－Schroder 1,076,041 1,076,041
stock
International Selection Fund
-Greater China (ETF)
Share repurchase account
among the top 10 Not applicable
shareholders
Shareholders above
entrusting/entrusted with or Not applicable
waiving voting rights
Ruan Liping and Ruan Xueping are brothers and acting-in-concert
parties. They jointly control Ningbo Liangji Industrial Co., Ltd., the
Company’s controlling shareholder. Ningbo Meishan Bonded Port Area
Shuo Jin Investment Management Co., Ltd., under the joint control of
Related or acting-in-concert
Ruan Liping and Ruan Xueping, is an executive partner of Ningbo
parties among shareholders
Ninghui Investment Management Partnership (Limited Partnership), one
above
of the Company’s shareholders. Save as disclosed above, the Company
is not aware of any other related parties or acting-in-concert parties as
defined in the Administration Methods for Acquisition of Listed
Companies among the shareholders above.
Preference shareholders with
resumed voting rights and Not applicable
their shareholdings
Shareholdings of the top 10 restricted shareholders and the restrictions:
√ Applicable □ Not applicable
Unit: share
Restricted shares allowed for public
trading
Increase in
Name of restricted Restricted
No. restricted Restriction
shareholder shares held Date when public
shares
trading is allowed
allowed for
public trading
Non-tradable
Ningbo Liangji for 36
Industrial Co., Ltd. months from
the IPO
Non-tradable
for 36
months from
the IPO
Non-tradable
for 36
months from
the IPO
Ningbo Ninghui Non-tradable
Investment Management for 36
Partnership (Limited months from
Partnership) the IPO
Ningbo Suiyuan Non-tradable
Investment Management for 36
Partnership (Limited months from
Partnership) the IPO
Annual Report 2022
Ningbo Qiyuanbao Non-tradable
Investment Management for 36
Partnership (Limited months from
Partnership) the IPO
In the lockup
To be unlocked
period
when the
according to
the equity
equity incentives
Incentive
are met
Plan
In the lockup
To be unlocked
period
when the
according to
the equity
equity incentives
Incentive
are met
Plan
In the lockup
To be unlocked
period
when the
according to
the equity
equity incentives
Incentive
are met
Plan
In the lockup
To be unlocked
period
when the
according to
the equity
equity incentives
Incentive
are met
Plan
Ruan Liping and Ruan Xueping are brothers and acting-in-concert
parties. They jointly control Ningbo Liangji Industrial Co., Ltd., the
Company’s controlling shareholder. Ningbo Meishan Bonded Port
Area Shuo Jin Investment Management Co., Ltd., under the joint
control of Ruan Liping and Ruan Xueping, is an executive partner of
Ningbo Ninghui Investment Management Partnership (Limited
Partnership) and Ningbo Suiyuan Investment Management
Partnership (Limited Partnership), both shareholders of the
Company. Ruan Liping and Ruan Xueping are both limited partners
Related or acting-in-concert of Ningbo Suiyuan Investment Management Partnership (Limited
parties among shareholders Partnership). The Company’s shareholder Ningbo Qiyuanbao
above Investment Management Partnership (Limited Partnership) is under
the control of Ruan Shuhong and Zhu Funing, both near relatives of
Ruan Liping. Zhou Zhenghua is a director and senior executive of
the Company. And Li Guoqiang, a senior executive of the Company,
is a limited partner of the Company’s shareholder Ningbo Suiyuan
Investment Management Partnership (Limited Partnership). Save as
disclosed above, the Company is not aware of any other related
parties or acting-in-concert parties as defined in the Administration
Methods for Acquisition of Listed Companies among the
shareholders above.
(III) Indicate whether any strategic investor or general corporation has become a top-10
shareholder in a rights issue.
□ Applicable √ Not applicable
Annual Report 2022
IV Controlling Shareholder and Actual Controller
(I) Controlling shareholder
√ Applicable □ Not applicable
Name Ningbo Liangji Industrial Co., Ltd.
Legal representative/company
Ruan Liping
principal
Date of establishment 23 November 2011
Principal activities Investment management
Interests held in other domestically
and overseas listed companies in the Not applicable
Reporting Period
Other information Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Ningbo Liangji Industrial Co., Ltd.
Gongniu Group Co., Ltd.
(II) Actual controller
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Name Ruan Liping
Nationality Chinese
Residency in other countries or regions
Yes
(yes/no)
Chairman of the Board and President of Gongniu Group
Main occupations and positions
Co., Ltd.
Controlling interests in other domestically
and overseas listed companies in the past Not applicable
Name Ruan Xueping
Annual Report 2022
Nationality Chinese
Residency in other countries or regions
Yes
(yes/no)
Vice Chairman of the Board of Gongniu Group Co.,
Main occupations and positions Ltd. and General Manager of Shanghai Gongniu
Electrics Co., Ltd.
Controlling interests in other domestically
and overseas listed companies in the past Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Ruan Liping Ruan Xueping
Ningbo Meishan Bonded Port Area Shuo
Jin Investment Management Co., Ltd.
Ningbo Liangji Industrial Co., Ltd.
Gongniu Group Co., Ltd.
management.
□ Applicable √ Not applicable
(III) Other information about the controlling shareholder and the actual controller
□ Applicable √ Not applicable
V Indicate whether the cumulative number of shares put in pledge by the Company’s controlling
shareholder or the largest shareholder and its acting-in-concert parties accounts for over 80% of
their shareholdings in the Company.
□ Applicable √ Not applicable
VI Other 10% or Greater Corporate Shareholders
□ Applicable √ Not applicable
VII Restrictions on Shareholding Reduction
□ Applicable √ Not applicable
Annual Report 2022
VIII Share Repurchases during the Reporting Period
√ Applicable □ Not applicable
Unit: RMB’0,000
Title of the share repurchase plan The Plan for a Share Repurchase on the Open Market
Date of the disclosure of the plan 12 April 2022
To-be-repurchased shares as % of
the total share capital
Amount to be used 20,000-30,000
Intended period for the repurchase Within 12 months from 11 April 2022
Purpose of the repurchase For the implementation of equity Incentive Plan
Number of shares already
repurchased
Number of shares already
repurchased (if any) as % of all the
target shares of the equity Incentive
Plan
Progress on any reduction of
repurchased shares on the open Not applicable
market
Note: The repurchase plan has been carried out. A total of 1,501,846 shares were repurchased, of
which 1,501,800 shares were granted under the 2022 Restricted Share Incentive Plan and the rest of 46
shares were in the Company’s securities account for repurchased shares. For further information, see the
Announcement on the Results of the Implementation of the Share Repurchase Plan & the Changes in
Shares (announcement No.: 2022-106) disclosed by the Company on the website of the Shanghai Stock
Exchange (www.sse.com.cn).
Annual Report 2022
Part VIII Relevant Information of Corporate Bonds
I Enterprise Bonds, Corporate Bonds and Debt Financing Instruments of Non-financial
Enterprise
□ Applicable √ Not applicable
II Convertible Corporate Bonds
□ Applicable √ Not applicable
Annual Report 2022
Part IX Relevant Information of Preference shares
□ Applicable √ Not applicable
Annual Report 2022
Part X Financial Statements
I Independent Auditor’s Report
√ Applicable □ Not applicable
Independent Auditor’s Report
PCCPA Audit〔2023〕No. 5588
To the shareholders of Gongniu Group Co., Ltd.:
I Opinion
We have audited the financial statements of Gongniu Group Co., Ltd. (“Gongniu” or the
“Company”), which comprise the consolidated and parent company (the Company as the parent
exclusive of subsidiaries) balance sheets as at 31 December 2022, the consolidated and parent company
statements of income, cash flows and changes in owners’ equity for the year then ended, as well as the
notes to the financial statements.
In our opinion, the financial statements referred to above present fairly, in all material respects, the
consolidated and parent company financial position of the Company at 31 December 2022, and the
consolidated and parent company operating results and cash flows for the year then ended, in conformity
with the Chinese Accounting Standards (CAS).
II Basis for Opinion
We conducted our audits in accordance with the Audit Standards for Chinese Registered
Accountants. Our responsibilities under those standards are further described in the Auditor’s
Responsibilities for Audit of Financial Statements section of our report. We are independent of the
Company in accordance with the China Code of Ethics for Certified Public Accountants, and we have
fulfilled our other ethical responsibilities in accordance with the said Code of Ethics. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
III Key Audit Matters
Key audit matters are matters that, based on our professional judgment, are deemed most important
to the audit of the financial statements of the current period. These matters were addressed in the context
of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
(I) Revenue recognition
For relevant information disclosed, please refer to "38. Revenue" in "V Significant Accounting
Policies and Accounting Estimates" and "61. Operating revenue and cost of sales" in "VII Notes to the
Consolidated Financial Statements" of "Part X Financial Statements".
The revenue of Gongniu Group is mainly derived from the sale of adaptors, wall switches, LEDs
and digital accessories. In 2022, Gongniu Group achieved operating revenue of RMB14.081 billion.
Gongniu Group has identified different specific methods of revenue recognition for different sales
methods.
Annual Report 2022
As operating revenue is one of the key performance indicators of Gongniu Group, we have
identified revenue recognition as a key audit matter.
The audit procedures we performed in relation to revenue recognition primarily include:
(1) Understanding the key internal controls relating to revenue recognition, evaluating the design of
those controls, determining whether they are implemented and testing the effectiveness of the operation
of the relevant internal controls;
(2) Examining major sales contracts for major contractual terms and evaluating whether the
revenue recognition policy is in line with the provisions of the Accounting Standard for Business
Enterprises;
(3) Implementing substantive analysis procedures for operating revenue and gross margin on a
monthly, product and customer basis to identify any significant or abnormal fluctuations and analyze the
causes of fluctuations;
(4) For domestic sales revenue, conducting sample-check on supporting documents related to
revenue recognition, including sales contracts, orders, sales invoices, outbound delivery orders, delivery
notes, transportation orders and customer sign-off sheets; for export revenue, obtaining information from
the Administration of Foreign Exchange and reconciling it with the carrying records, and checking
supporting documents such as sales contracts, export customs declarations, freight bills of lading and
sales invoices on a sample basis;
(5) Confirming with key customers on a sample basis regarding sales for the period based on the
accounts receivable letter;
(6) Verifying operating revenue recognized around the balance sheet date on a sample basis to
supporting documents such as outbound delivery orders, delivery notes, customer sign-off sheets and
freight bills of lading, and evaluating whether operating revenue is recognized in the appropriate period;
(7) Checking whether the information relating to operating revenue is properly presented in the
financial statements.
(II) Recognition, measurement and presentation of wealth management products
For relevant information disclosed, please refer to "10. Financial instruments" in "V Significant
Accounting Policies and Accounting Estimates" and "2. "Held-for-trading financial assets", "13. Other
current assets" and "68. Return on investment" in "VII Notes to the Consolidated Financial Statements"
of "Part X Financial Statements".
As at 31 December 2022, the wealth management balance of held-for-trading financial assets of
Gongniu Group was RMB6,949 million, the wealth management balance of other current assets was
RMB284 million, and the cumulative return on investment for wealth management products in 2022
amounted to RMB279 million. We determined the recognition, measurement and presentation of wealth
management products as a key audit matter due to the large amount of wealth management products and
Annual Report 2022
the fact that the return on investment of the relevant products had a significant impact on the net profit of
Gongniu Group for 2022.
The audit procedures we performed in relation to the recognition, measurement and presentation of
wealth management products primarily include:
(1) Understanding the key internal controls relating to investments in wealth management products,
evaluating the design of those controls, determining whether they are implemented and testing the
effectiveness of the operation of the relevant internal controls;
(2) Checking whether the classification of wealth management products is correct based on the
contractual cash flow characteristics of the wealth management products and the business model of
Gongniu Group in managing the wealth management products;
(3) Obtaining statements of account related to wealth management products, reconciling them with
the carrying amount and writing to banks, securities companies and trust companies to confirm the asset
balance and the existence of balances of wealth management products;
(4) Checking the supporting documents for increase and reduction in wealth management products
during the period on a sample basis, checking whether they have been authorized and approved, and
confirming that the amounts relating to the purchase, sale and return on investment of wealth
management products are correct and fully recorded;
(5) Reviewing the valuation method of wealth management products to check whether the basis for
obtaining their fair value, the measurement of their value at the end of the period and the accounting
treatment are correct;
(6) Checking whether information related to the recognition, measurement and presentation of
wealth management products has been properly presented in the financial statements.
IV Other Information
The Company’s management is responsible for the other information. The other information
comprises all of the information included in the Company’s 2021 Annual Report other than the financial
statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the audit or otherwise appears to be materially
misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
V Responsibilities of Management and Those Charged with Governance for Financial
Statements
Annual Report 2022
The Company’s management is responsible for the preparation of the financial statements that give
a fair view in accordance with CAS, and for designing, implementing and maintaining such internal
control as the management determines is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the Company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern (if
applicable) and using the going concern basis of accounting unless the management either intends to
liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting
process.
VI Auditor’s Responsibilities for Audit of Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with CAS will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with CAS, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
(I) Identify and assess the risks of material misstatement of the financial statements, whether due to
fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
(II) Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances.
(III) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the management.
(IV) Conclude on the appropriateness of the management’s use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to
events or conditions that may cast significant doubt on the Company’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required by CAS to draw users’
attention in our auditor’s report to the related disclosures in the financial statements or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions may cause the
Company to cease to continue as a going concern.
Annual Report 2022
(V) Evaluate the overall presentation, structure and content of the financial statements, and whether
the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation.
(VI) Obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Company to express an opinion on the financial statements. We are
responsible for the direction, supervision and performance of the Company audit. We remain solely
responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned
scope and timing of the audit and significant audit findings, including any noteworthy deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with
relevant ethical requirements regarding independence, and communicate with them all relationships and
other matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with those charged with governance, we determine those matters
that were of most significance in the audit of the financial statements of the current period and are
therefore the key audit matters. We describe these matters in our auditor’s report unless law or
regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse consequences of
doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Pan-China Certified Public Accountants LLP Chinese certified public accountant: Qian Zhongxian
(engagement partner)
Hangzhou·China Chinese certified public accountant: Liu Chong
II Financial Statements
Consolidated Balance Sheet
Prepared by Gongniu Group Co., Ltd.
Unit: RMB
Item Note 31 December 2022 31 December 2021
Current assets：
Monetary assets 4,611,966,169.54 4,377,228,556.74
Settlement reserve
Loans to other banks and
financial institutions
Held-for-trading financial
assets
Annual Report 2022
Derivative financial assets 643,100.00 3,613,050.00
Notes receivable 750,723.35
Accounts receivable 226,808,699.19 219,259,743.25
Receivables financing 1,036,801.70 927,023.00
Prepayments 49,635,694.61 29,140,223.00
Premiums receivable
Reinsurance receivables
Receivable reinsurance
contract reserve
Other receivables 71,887,692.32 195,924,505.99
Of which: Interest receivable
Dividends
receivable
Financial assets purchased
under resale agreements
Inventories 1,285,218,456.09 1,376,987,122.60
Contract assets
Assets held for sale
Current portion of
non-current assets
Other current assets 363,825,426.89 1,126,520,898.44
Total current assets 13,560,022,040.34 13,256,951,846.37
Non-current assets：
Loans and advances to
customers
Debt investments
Other debt investments
Long-term receivables
Long-term equity
investments
Other equity investments
Other non-current financial
assets
Investment property
Fixed assets 1,854,494,510.57 1,493,733,120.82
Construction in progress 611,457,850.54 198,364,136.97
Productive living assets
Oil and gas assets
Right-of-use assets 13,312,707.57 18,809,799.71
Intangible assets 325,725,286.18 295,769,642.48
Development costs
Goodwill 45,133,442.04
Long-term prepaid expense 20,364,230.78 17,750,835.99
Deferred income tax assets 143,479,114.53 116,456,369.78
Other non-current assets 76,508,015.77 76,068,914.50
Total non-current assets 3,090,475,157.98 2,216,952,820.25
Total assets 16,650,497,198.32 15,473,904,666.62
Current liabilities：
Short-term borrowings 845,374,749.03 500,430,555.55
Borrowings from the central
bank
Loans from other banks and
financial institutions
Held-for-trading financial 18,200,000.00
Annual Report 2022
liabilities
Derivative financial liabilities
Notes payable 2,333,774.75
Accounts payable 1,643,661,963.53 1,701,686,564.14
Advances from customers
Contract liabilities 431,654,611.71 437,999,921.93
Financial assets sold under
repurchase agreements
Customer deposits and
deposits from other banks and
financial institutions
Payables for acting trading of
securities
Payables for underwriting of
securities
Employee benefits payable 335,092,159.01 279,463,472.43
Taxes and levies payable 300,308,365.64 533,077,969.51
Other payables 446,413,870.85 430,813,760.10
Of which: Interest payable
Dividends payable
Fees and commissions
payable
Reinsurance payables
Liabilities directly associated
with assets held for sale
Current portion of
non-current liabilities
Other current liabilities 56,140,971.75 56,939,989.86
Total current liabilities 4,085,645,349.65 4,616,657,945.80
Non-current liabilities：
Insurance contract reserve
Long-term borrowings
Bonds payable
Of which: Preference shares
Perpetual bonds
Lease liabilities 4,544,619.22 5,089,837.39
Long-term payables
Long-term employee benefits
payable
Provisions
Deferred income 53,820,328.00
Deferred income tax
liabilities
Other non-current liabilities 34,814,148.70 46,125,187.50
Total non-current
liabilities
Total liabilities 4,235,133,055.62 4,718,153,089.99
Owners’ equity (or shareholders’ equity)：
Paid-in capital (or share
capital)
Other equity instruments
Of which: Preference shares
Perpetual bonds
Capital reserves 3,863,547,883.54 3,914,068,288.56
Annual Report 2022
Less: Treasury shares 129,612,354.00 80,711,540.00
Other comprehensive income 4,389,526.95 7,537,390.37
Specific reserve
Surplus reserves 302,797,998.73 302,797,998.73
General reserve
Retained earnings 7,756,665,030.53 6,010,878,918.97
Total equity attributable to
owners (or shareholders) of the 12,398,865,675.75 10,755,751,576.63
Company as the parent
Non-controlling interests 16,498,466.95
Total owners’ equity (or
shareholders’ equity)
Total liabilities and
owners’ equity (or 16,650,497,198.32 15,473,904,666.62
shareholders’ equity)
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Balance Sheet of the Company as the Parent
Prepared by Gongniu Group Co., Ltd.
Unit: RMB
Item Note 31 December 2022 31 December 2021
Current assets：
Monetary assets 2,558,169,565.15 2,815,595,132.13
Held-for-trading financial
assets
Derivative financial assets
Notes receivable
Accounts receivable 341,413,356.20 3,783,723.14
Receivables financing
Prepayments 60,568,126.16 302,683,310.52
Other receivables 2,756,026,303.85 3,038,980,082.79
Of which: Interest receivable
Dividends
receivable
Inventories 292,728,441.34 409,900,890.43
Contract assets
Assets held for sale
Current portion of
non-current assets
Other current assets 253,744,657.54 610,271,780.82
Total current assets 9,262,650,450.24 8,881,214,919.83
Non-current assets：
Debt investments
Other debt investments
Long-term receivables
Long-term equity
investments
Other equity investments
Other non-current financial
assets
Investment property
Annual Report 2022
Fixed assets 812,047,460.58 805,605,614.22
Construction in progress 517,776,172.33 171,842,155.89
Productive living assets
Oil and gas assets
Right-of-use assets 2,707,156.94 7,057,187.09
Intangible assets 244,677,232.50 258,323,362.23
Development costs
Goodwill
Long-term prepaid expense 19,172,452.61 17,750,835.99
Deferred income tax assets 7,810,872.95 3,735,033.97
Other non-current assets 58,509,382.81 72,827,494.50
Total non-current assets 2,350,878,941.24 1,779,101,184.06
Total assets 11,613,529,391.48 10,660,316,103.89
Current liabilities：
Short-term borrowings 611,169,986.13
Held-for-trading financial
liabilities
Derivative financial liabilities
Notes payable 100,000,000.00
Accounts payable 596,911,385.90 450,634,960.80
Advances from customers
Contract liabilities 550,246,157.68 424,645,030.61
Employee benefits payable 108,720,042.83 101,482,634.41
Taxes and levies payable 70,631,710.25 205,109,507.99
Other payables 196,246,589.96 126,829,316.67
Of which: Interest payable
Dividends payable
Liabilities directly associated
with assets held for sale
Current portion of
non-current liabilities
Other current liabilities 71,532,000.50 55,203,853.98
Total current liabilities 2,225,318,489.46 2,129,987,141.12
Non-current liabilities：
Long-term borrowings
Bonds payable
Of which: Preference shares
Perpetual bonds
Lease liabilities 1,074,013.26 2,163,270.25
Long-term payables
Long-term employee benefits
payable
Provisions
Deferred income
Deferred income tax
liabilities
Other non-current liabilities 34,814,148.70 46,125,187.50
Total non-current
liabilities
Total liabilities 2,286,550,688.86 2,200,525,337.17
Owners’ equity (or shareholders’ equity)：
Paid-in capital (or share
capital)
Other equity instruments
Annual Report 2022
Of which: Preference shares
Perpetual bonds
Capital reserves 3,859,048,459.88 3,909,568,864.90
Less: Treasury shares 129,612,354.00 80,711,540.00
Other comprehensive income
Specific reserve
Surplus reserves 302,797,998.73 302,797,998.73
Retained earnings 4,693,667,008.01 3,726,954,923.09
Total owners’ equity (or
shareholders’ equity)
Total liabilities and
owners’ equity (or 11,613,529,391.48 10,660,316,103.89
shareholders’ equity)
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Consolidated Income Statement
January-December 2022
Unit: RMB
Item Note 2022 2021
I Total revenues 14,081,373,030.94 12,384,916,337.51
Of which: Operating revenue 14,081,373,030.94 12,384,916,337.51
Interest income
Insurance premium income
Fee and commission
income
II Total costs and expenses 10,627,127,457.42 9,262,301,258.59
Of which: Cost of sales 8,730,082,585.08 7,808,540,666.84
Interest expense
Fee and commission
expense
Surrenders
Net insurance claims paid
Net amount provided as
insurance contract reserve
Expenditure on policy
dividends
Reinsurance premium
expense
Taxes and levies 115,758,059.90 82,785,296.48
Selling expense 800,387,659.41 560,187,002.80
Administrative expense 500,596,373.88 427,615,556.97
R&D expense 588,296,080.11 471,015,016.82
Finance costs -107,993,300.96 -87,842,281.32
Of which: Interest expense 35,925,352.09 39,763,491.76
Interest income 137,795,215.87 128,887,165.64
Add: Other income 132,940,722.76 390,936,141.47
Return on investment (“－” for
loss)
Of which: Share of profit or
loss of joint ventures and associates
Income from the
derecognition of financial assets at
amortized cost
Annual Report 2022
Exchange gain (“－” for loss)
Net gain on exposure hedges
(“－” for loss)
Gain on changes in fair value
(“－” for loss)
Credit impairment loss (“－”
-30,470,523.21 -24,746,561.94
for loss)
Asset impairment loss (“－”
-11,504,455.94 -16,257,123.26
for loss)
Asset disposal income (“－”
-3,139,686.69 -11,308,464.89
for loss)
III Operating profit (“－” for loss) 3,814,060,442.36 3,651,264,379.11
Add: Non-operating income 3,784,363.32 4,353,269.76
Less: Non-operating expense 63,388,662.51 330,657,723.91
IV Gross profit (“－” for gross loss) 3,754,456,143.17 3,324,959,924.96
Less: Income tax expense 568,995,412.93 544,599,192.30
V Net profit (“－” for net loss) 3,185,460,730.24 2,780,360,732.66
(I) By operating continuity
operations (“－” for net loss)
operations (“－” for net loss)
(II) By ownership
of the Company as the parent (“－” for 3,188,619,359.56 2,780,360,732.66
net loss)
non-controlling interests (“－” for net -3,158,629.32
loss)
VI Other comprehensive income, net
-3,147,863.42 -21,326,379.54
of tax
(I) Other comprehensive income,
net of tax attributable to owners of the -3,147,863.42 -21,326,379.54
Company as the parent
that will not be reclassified to profit or
loss
（1）Changes caused by
remeasurements on defined benefit
schemes
（2）Other comprehensive income
that will not be reclassified to profit or
loss under the equity method
（3）Changes in the fair value of
other equity investments
（4）Changes in the fair value
arising from changes in own credit risk
that will be reclassified to profit or -3,147,863.42 -21,326,379.54
loss
（1）Other comprehensive income
that will be reclassified to profit or
loss under the equity method
Annual Report 2022
（2）Changes in the fair value of
other debt investments
（3）Other comprehensive income
arising from the reclassification of
financial assets
（4）Credit impairment allowance
for other debt investments
（5）Reserve for cash flow hedges -3,182,910.54 -21,324,986.08
（6）Differences arising from the
translation of foreign 35,047.12 -1,393.46
currency-denominated financial
statements
（7）Others
(II) Other comprehensive income,
net of tax attributable to
non-controlling interests
VII Total comprehensive income 3,182,312,866.82 2,759,034,353.12
(I) Total comprehensive income
attributable to owners of the Company 3,185,471,496.14 2,759,034,353.12
as the parent
(II) Total comprehensive income
-3,158,629.32
attributable to non-controlling interests
VIII Earnings per share：
(I) Basic earnings per share
(RMB/share)
(II) Diluted earnings per share
(RMB/share)
Where business combinations involving entities under common control occurred in the current period,
the net profit achieved by the acquirees before the combinations was nil, with the amount for last year
being nil.
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Income Statement of the Company as the Parent
January-December 2022
Unit: RMB
Item Note 2022 2021
I Operating revenue 5,527,593,701.30 5,306,290,224.15
Less: Cost of sales 4,279,629,067.01 3,876,062,056.48
Taxes and levies 29,964,139.67 27,736,575.48
Selling expense 24,152,009.03 22,442,913.93
Administrative expense 257,770,302.62 237,296,868.57
R&D expense 243,157,154.27 190,443,988.85
Finance costs -41,364,078.62 -31,504,593.32
Of which: Interest expense 24,239,236.11 24,790,531.90
Interest income 66,036,418.38 56,305,098.21
Add: Other income 18,055,681.70 266,969,614.03
Return on investment (“－” for
loss)
Of which: Share of profit or
loss of joint ventures and associates
Income from the
Annual Report 2022
derecognition of financial assets at
amortized cost
Net gain on exposure hedges
(“－” for loss)
Gain on changes in fair value
(“－” for loss)
Credit impairment loss (“－”
-54,867,900.40 -18,213,104.15
for loss)
Asset impairment loss (“－”
-1,215,659.46 -2,744,147.10
for loss)
Asset disposal income (“－”
-1,475,418.41 -3,937,217.96
for loss)
II Operating profit (“－” for loss) 2,506,694,291.96 3,305,011,976.56
Add: Non-operating income 2,547,612.90 602,007.58
Less: Non-operating expense 10,152,903.02 317,803,063.92
III Gross profit (“－” for gross loss) 2,499,089,001.84 2,987,810,920.22
Less Income tax expense 89,543,668.92 172,118,152.88
IV Net profit (“－” for net loss) 2,409,545,332.92 2,815,692,767.34
(I) Net profit from continuing
operations (“－” for net loss)
(II) Net profit from discontinued
operations (“－” for net loss)
V Other comprehensive income, net of
tax
(I) Other comprehensive income
that will not be reclassified to profit or
loss
remeasurements on defined benefit
schemes
that will not be reclassified to profit or
loss under the equity method
other equity investments
arising from changes in own credit risk
(II) Other comprehensive income
that will be reclassified to profit or
loss
that will be reclassified to profit or
loss under the equity method
other debt investments
arising from the reclassification of
financial assets
for other debt investments
translation of foreign
currency-denominated financial
statements
Annual Report 2022
VI Total comprehensive income 2,409,545,332.92 2,815,692,767.34
VII Earnings per share：
(I) Basic earnings per share
(RMB/share)
(II) Diluted earnings per share
(RMB/share)
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Consolidated Cash Flow Statement
January-December 2022
Unit: RMB
Item Note 2022 2021
I Cash flows from operating activities:
Proceeds from sale of goods
and rendering of services
Net increase in customer
deposits and deposits from other
banks and financial institutions
Net increase in borrowings
from the central bank
Net increase in loans from other
financial institutions
Premiums received on original
insurance contracts
Net proceeds from reinsurance
Net increase in deposits and
investments of policy holders
Interest, fees and commissions
received
Net increase in loans from other
banks and financial institutions
Net increase in proceeds from
repurchase transactions
Net proceeds from acting
trading of securities
Tax and levy rebates 25,583,045.08 25,804,052.16
Cash generated from other
operating activities
Subtotal of cash generated
from operating activities
Payments for goods and
services
Net increase in loans and
advances to customers
Net increase in deposits in the
central bank and other banks and
financial institutions
Payments for claims on original
insurance contracts
Net increase in loans to other
banks and financial institutions
Interest, fees and commissions
paid
Annual Report 2022
Policy dividends paid
Cash paid to and for employees 1,902,469,445.47 1,741,129,477.86
Taxes and levies paid 1,783,549,323.16 1,161,567,823.93
Cash used in other operating
activities
Subtotal of cash used in
operating activities
Net cash generated
from/used in operating activities
II Cash flows from investing activities:
Proceeds from disinvestment
Return on investment 290,169,702.87 203,660,051.16
Net proceeds from the disposal
of fixed assets, intangible assets 3,462,880.79 22,285,265.83
and other long-term assets
Net proceeds from the disposal
of subsidiaries and other business
units
Cash generated from other
investing activities
Subtotal of cash generated
from investing activities
Payments for the acquisition
and construction of fixed assets,
intangible assets and other
long-term assets
Payments for investments
Net increase in pledged loans
granted
Net payments for the
acquisition of subsidiaries and 19,107,492.09
other business units
Cash used in other investing
activities
Subtotal of cash used in
investing activities
Net cash generated
-1,746,083,657.48 -1,588,987,931.15
from/used in investing activities
III Cash flows from financing activities:
Capital contributions received 94,703,508.00 58,919,460.00
Of which: Capital contributions
by non-controlling interests to
subsidiaries
Borrowings received 1,685,000,000.00 1,229,444,657.64
Cash generated from other
financing activities
Subtotal of cash generated
from financing activities
Repayment of borrowings 2,010,000,000.00 733,145,768.73
Interest and dividends paid 1,478,511,496.88 1,235,638,745.39
Of which: Dividends paid by
subsidiaries to non-controlling
interests
Cash used in other financing
activities
Subtotal of cash used in 3,725,159,197.54 1,989,172,564.35
Annual Report 2022
financing activities
Net cash generated
-1,945,455,689.54 -700,808,446.71
from/used in financing activities
IV Effect of foreign exchange
rate changes on cash and cash 6,251,850.30 -1,365,206.44
equivalents
V Net increase in cash and cash
-627,373,278.56 723,165,156.84
equivalents
Add: Cash and cash
equivalents, beginning of the 2,552,716,453.54 1,829,551,296.70
period
VI Cash and cash equivalents,
end of the period
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Cash Flow Statement of the Company as the Parent
January-December 2022
Unit: RMB
Item Note 2022 2021
I Cash flows from operating activities:
Proceeds from sale of goods
and rendering of services
Tax and levy rebates
Cash generated from other
operating activities
Subtotal of cash generated
from operating activities
Payments for goods and
services
Cash paid to and for employees 632,474,762.15 622,109,797.27
Taxes and levies paid 433,295,397.95 262,378,388.50
Cash used in other operating
activities
Subtotal of cash used in
operating activities
Net cash generated from/used in
operating activities
II Cash flows from investing activities:
Proceeds from disinvestment
Return on investment 2,118,439,604.49 1,095,128,801.14
Net proceeds from the disposal
of fixed assets, intangible assets 5,068,195.56 17,822,095.19
and other long-term assets
Net proceeds from the disposal
of subsidiaries and other business
units
Cash generated from other
investing activities
Subtotal of cash generated
from investing activities
Payments for the acquisition
and construction of fixed assets,
intangible assets and other
long-term assets
Annual Report 2022
Payments for investments 148,409,344.00 11,000,000.00
Net payments for the
acquisition of subsidiaries and
other business units
Cash used in other investing
activities
Subtotal of cash used in
investing activities
Net cash generated
from/used in investing activities
III Cash flows from financing activities:
Capital contributions received 94,703,508.00 58,919,460.00
Borrowings received 1,010,000,000.00 633,145,768.73
Cash generated from other
financing activities
Subtotal of cash generated
from financing activities
Repayment of borrowings 1,060,000,000.00 633,145,768.73
Interest and dividends paid 1,466,589,386.88 1,225,366,634.27
Cash used in other financing
activities
Subtotal of cash used in
financing activities
Net cash generated
-1,647,335,458.44 -1,177,779,477.65
from/used in financing activities
IV Effect of foreign exchange
rate changes on cash and cash
equivalents
V Net increase in cash and cash
-541,672,416.30 835,098,336.98
equivalents
Add: Cash and cash
equivalents, beginning of the 1,729,210,241.72 894,111,904.74
period
VI Cash and cash equivalents,
end of the period
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina
Head of the financial department: Luo Yuebo
Annual Report 2022
Consolidated Statements of Changes in Owners’ Equity
January-December 2022
Unit: RMB
Equity attributable to owners of the Company as the parent
Other equity
instruments Non-contro Total
Item Paid-in Other Speci Gene
Pref Per Less: lling owners’
capital Capital comprehen fic Surplus ral Retained Othe Subto interests equity
eren pet Treasury rs tal
(or share Othe reserves sive reser reserves reser earnings
ce ual shares
capital) rs income ve ve
shar bon
es ds
I Balance as 10,75
at the end of 601,180, 3,914,068,2 80,711,540. 7,537,390. 302,797,99 6,010,878,91 5,751, 10,755,751,5
the prior year 520.00 88.56 00 37 8.73 8.97 576.6 76.63
Add:
Adjustments
for changes in
accounting
policies
Adjustments
for correction
of previous
errors
Adjustments
for business
combinations
involving
entities under
common
control
Other
adjustments
II Balance as 601,180, 3,914,068,2 80,711,540. 7,537,390. 302,797,99 6,010,878,91 10,75 10,755,751,5
at the 520.00 88.56 00 37 8.73 8.97 5,751, 76.63
Annual Report 2022
beginning of 576.6
the year 3
III
Increase/decr 1,643,
-102,93 -50,520,405. 48,900,814. -3,147,863 1,745,786,11 16,498,466. 1,659,612,56
ease in the 114,0
period (“-” 99.12
for decrease)
(I) Total 3,185,
-3,147,863 3,188,619,35 -3,158,629. 3,182,312,86
comprehensiv 471,4
.42 9.56 32 6.82
e income 96.14
(II) Capital -99,5
increased and -102,93 -50,520,405. 48,900,814. 24,14 19,657,096. -79,867,052.
reduced by 0.00 02 00 9.02 27 75
owners
-343,
shares -102,93 -127,989,88 215,286,33 -343,379,146
increased by 0.00 1.86 4.56 .42
owners
increased by
other equity
holders
ed payments 243,8
recognized in 54,99
owners’ 7.40
equity
(III) Profit -1,44
distribution -1,442,833,2 2,833, -1,442,833,2
tion to
surplus
reserves
tion to
general
reserve
Annual Report 2022
tion to -1,442,833,2 2,833, -1,442,833,2
owners (or 48.00 248.0 48.00
shareholders) 0
(IV)
Transfers
within
owners’
equity
capital (or
share capital)
from capital
reserves
capital (or
share capital)
from surplus
reserves
reserves used
to offset loss
defined
benefit
schemes
transferred to
retained
earnings
comprehensiv
e income
transferred to
retained
earnings
(V) Specific
reserve
Annual Report 2022
the period
period
(VI) Others
IV Balance as 12,39
at the end of 601,077, 3,863,547,8 129,612,35 4,389,526. 302,797,99 7,756,665,03 8,865, 16,498,466. 12,415,364,1
the period 590.00 83.54 4.00 95 8.73 0.53 675.7 95 42.70
Equity attributable to owners of the Company as the parent
Other equity
instruments Non-contro
Item Paid-in Other Speci Gene Total owners’
Pref Per Less: lling
capital Capital comprehen fic Surplus ral Retained Othe Subto equity
eren petu Treasury interests
(or share Othe reserves sive reserv reserves reser earnings rs tal
ce al shares
capital) rs income e ve
shar bon
es ds
I Balance as 9,137,
at the end of 392,5
the prior year 69.09
Add:
Adjustments
for changes in
accounting
policies
Adjustments
for correction
of previous
errors
Adjustments
for business
combinations
involving
entities under
common
control
Other
Annual Report 2022
adjustments
II Balance as
at the 600,613, 3,820,175,60 46,728,59 28,863,769 302,797,99 4,431,669,98 9,137,392,56
beginning of 800.00 8.14 4.00 .91 8.73 6.31 9.09
the year
III
Increase/decr 1,618,
ease in the 359,0
period (“-” 07.54
for decrease)
(I) Total 2,759,
-21,326,37 2,780,360,73 2,759,034,35
comprehensiv 034,3
e income 53.12
(II) Capital
increased and 566,720. 93,892,680.4 33,982,94 60,476,454.4
reduced by 00 2 6.00 2
owners
shares 566,720. 50,544,523.6 51,111,243.6
increased by 00 0 0
owners
increased by
other equity
holders
ed payments 9,365,
recognized in 210.8 9,365,210.82
owners’ 2
equity
(III) Profit -1,20
distribution -1,201,151,8 1,151, -1,201,151,80
tion to
surplus
reserves
tion to
Annual Report 2022
general
reserve
tion to -1,201,151,8 1,151, -1,201,151,80
owners (or 00.00 800.0 0.00
shareholders) 0
(IV)
Transfers
within
owners’
equity
capital (or
share capital)
from capital
reserves
capital (or
share capital)
from surplus
reserves
reserves used
to offset loss
defined
benefit
schemes
transferred to
retained
earnings
comprehensiv
e income
transferred to
retained
earnings
(V) Specific
reserve
Annual Report 2022
the period
period
(VI) Others
IV Balance as 10,75
at the end of 601,180, 3,914,068,28 80,711,54 7,537,390. 302,797,99 6,010,878,91 5,751, 10,755,751,5
the period 520.00 8.56 0.00 37 8.73 8.97 576.6 76.63
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina Head of the financial department: Luo Yuebo
Statements of Changes in Owners’ Equity of the Company as the Parent
January-December 2022
Unit: RMB
Paid-in Other equity instruments Other
Less: Total
Item capital (or Capital comprehen Specific Surplus Retained
Preference Perpetual Treasury owners’
share Others reserves sive reserve reserves earnings
shares bonds shares equity
capital) income
I Balance as at the end of the 601,180,52 3,909,568, 80,711,540 302,797,9 3,726,954, 8,459,790,
prior year 0.00 864.90 .00 98.73 923.09 766.72
Add: Adjustments for changes
in accounting policies
Adjustments for
correction of previous errors
Other adjustments
II Balance as at the beginning 601,180,52 3,909,568, 80,711,540 302,797,9 3,726,954, 8,459,790,
of the year 0.00 864.90 .00 98.73 923.09 766.72
III Increase/ decrease in the -102,930.0 -50,520,40 48,900,814 966,712,0 867,187,93
period (“-” for decrease) 0 5.02 .00 84.92 5.90
(I) Total comprehensive 2,409,545, 2,409,545,
income 332.92 332.92
(II) Capital increased and -102,930.0 -50,520,40 48,900,814 -99,524,14
reduced by owners 0 5.02 .00 9.02
by owners 0 81.86 4.56 46.42
equity holders
Annual Report 2022
recognized in owners’ equity .11 20.56 4.67
.73 .73
-1,442,833 -1,442,833
(III) Profit distribution
,248.00 ,248.00
reserves
shareholders) ,248.00 ,248.00
(IV) Transfers within owners’
equity
capital) from capital reserves
capital) from surplus reserves
offset loss
schemes transferred to
retained earnings
income transferred to retained
earnings
(V) Specific reserve
(VI) Others
IV Balance as at the end of the 601,077,59 3,859,048, 129,612,35 302,797,9 4,693,667, 9,326,978,
period 0.00 459.88 4.00 98.73 008.01 702.62
Paid-in Other equity instruments Other
Less: Total
Item capital (or Capital comprehen Specific Surplus Retained
Preference Perpetual Treasury owners’
share Others reserves sive reserve reserves earnings
shares bonds shares equity
capital) income
I Balance as at the end of the 600,613,80 3,815,676, 46,728,594 302,797,9 2,112,413, 6,784,773,
Annual Report 2022
prior year 0.00 184.48 .00 98.73 955.75 344.96
Add: Adjustments for
changes in accounting
policies
Adjustments for
correction of previous errors
Other adjustments
II Balance as at the beginning 600,613,80 3,815,676, 46,728,594 302,797,9 2,112,413, 6,784,773,
of the year 0.00 184.48 .00 98.73 955.75 344.96
III Increase/ decrease in the 93,892,680 33,982,946 1,614,540, 1,675,017,
period (“-” for decrease) .42 .00 967.34 421.76
(I) Total comprehensive 2,815,692, 2,815,692,
income 767.34 767.34
(II) Capital increased and 70,456,679 33,982,946 37,040,453
reduced by owners .24 .00 .24
by owners .60 .60
equity holders
recognized in owners’ equity .64 .00 0.36
-1,201,151 -1,201,151
(III) Profit distribution
,800.00 ,800.00
reserves
(or shareholders) ,800.00 ,800.00
(IV) Transfers within owners’
equity
capital) from capital reserves
capital) from surplus reserves
offset loss
schemes transferred to
Annual Report 2022
retained earnings
income transferred to retained
earnings
(V) Specific reserve
(VI) Others
.18 .18
IV Balance as at the end of 601,180,52 3,909,568, 80,711,540 302,797,9 3,726,954, 8,459,790,
the period 0.00 864.90 .00 98.73 923.09 766.72
Legal representative: Ruan Liping Chief Financial Officer: Zhang Lina Head of the financial department: Luo Yuebo
Annual Report 2022
III Company Profile
√ Applicable □ Not applicable
Gongniu Group Co., Ltd (hereinafter referred to as “the Company” or “Gongniu”) is a joint stock
limited company transformed from the former Gongniu Group Limited with 31 August 2017 as the base
date. It was registered with Ningbo Municipal Market Supervision Administration on 27 December 2017
and is headquartered in Ningbo City, Zhejiang Province. The Company now holds a business license
with a unified social credit code of 91330282671205242Y, with a registered capital of RMB601.0776
million and a total of 601.0776 million shares (each with a par value of RMB1). Among them, there are
Company’s shares were listed for public trading on the Shanghai Stock Exchange on 6 February 2020.
The Company pertains to the electrical machinery and equipment manufacturing industry. It is
mainly engaged in the research, development, production and sales of power connection and power
extension products such as adaptors, wall switches and sockets, LED lighting and digital accessories.
Products mainly include adaptors, wall switches and sockets, LED lighting and digital accessories.
These financial statements have been authorized for issue by the 17th Meeting of the Second Board
of Directors of the Company on 27 April 2023.
The Company included 23 subsidiaries including Ningbo Gongniu Electrics Co., Ltd. in the
consolidated financial statements for the current period. For further information, see “VII Notes to the
Consolidated Financial Statements” and “IX Interests in Other Entities” under “Part X Financial
Statements” herein.
For the sake of conciseness, the subsidiaries and other related companies of the Company are
hereinafter referred to by their abbreviations as follows:
Full name Abbreviation
Subsidiaries
Ningbo Gongniu Electrics Co., Ltd. Ningbo Gongniu
Ningbo Gongniu Photoelectric Technology Co., Ltd. Gongniu Photoelectric
Ningbo Gongniu Digital Technology Co., Ltd. Gongniu Digital
Ningbo Gongniu Precision Manufacturing Co., Ltd. Gongniu Precision
Ningbo Banmen Electric Appliance Co., Ltd. Banmen Electric Appliance
Cixi Gongniu Electrics Co., Ltd. Cixi Gongniu
Shanghai Gongniu Electrics Co., Ltd. Shanghai Gongniu
Bull International Trading (HK) Limited Bull HK
Ningbo Gongniu Supply Chain Management Co., Ltd. Gongniu Management
Ningbo Bull International Trading Co., Ltd. Bull International Trading
Ningbo Gongniu Electric Sales Co., Ltd. Electric Sales
Ningbo Xingluo Trading Co., Ltd. Xingluo Trading
Ningbo Gongniu Low Voltage Electric Co., Ltd. Gongniu Low Voltage
Ningbo Gongniu Domestic Electrical Appliance Co., Ltd. Domestic Electrical Appliance
Hainan Dacheng Supply Chain Management Co., Ltd. Hainan Dacheng
Ningbo Gongniu Intelligent Technology Co., Ltd. Intelligent Technology
Dalitek Intelligent Technology (Shanghai) Inc. Dalitek
Shanghai Gongniu Information Technology Co., Ltd. Information Technology
Ningbo Gongniu Tool Technology Co., Ltd. Gongniu Tool
Ningbo Gongniu New Energy Technology Co., Ltd. Gongniu New Energy
Annual Report 2022
Shenzhen Gongniu Intelligent Information Co., Ltd. Shenzhen Intelligent
Guangdong Murora Intelligent Lighting Co., Ltd. Murora Intelligent
Ningbo Gongniu Marketing Co., Ltd. Gongniu Marketing
Other related parties
Ningbo Liangji Industrial Co., Ltd. Liangji Industrial
Hangzhou Liangniu Hardware and Electrical Co., Ltd. Liangniu Hardware
Hangzhou Hangniu Hardware and Electrical Co., Ltd. Hangniu Hardware
Hangzhou Feiniu Hardware and Electrical Co., Ltd. Feiniu Hardware
Shanghai Baidi Electrics Co., Ltd. Baidi Electrics
Yichang Yaoyang Trading Co., Ltd. Yaoyang Trading
Hubei Huantian Technology Co., Ltd. Huantian Technology
Cixi Libo Electric Co., Ltd. Cixi Libo
Suzhou Niuweiwang Trading Co., Ltd. Niuweiwang Trading
Beijing Chenhao Electronic Technology Co., Ltd. Chenhao Electronic
Shanghai Minshen Property Co., Ltd. Minshen Property
Hebei Qiudi Trading Co., Ltd. Qiudi Trading
Changde Jianke Trading Co., Ltd. Jianke Trading
Cixi Shenghui Electronics Co., Ltd. Shenghui Electronics
√ Applicable □ Not applicable
The Company included 23 subsidiaries, including Ningbo Gongniu Electrics Co., Ltd., Cixi
Gongniu Electrics Co., Ltd. and Shanghai Gongniu Electrics Co., Ltd. in the scope of consolidated
financial statements for the current period. For details, please refer to the notes of "VIII. Changes in
Consolidation Scope" and "IX. Interests in Other Entities" in "Section 10 Financial Report" of this
annual report.
IV Preparation Basis of Financial Statement
The financial statements of the Company are based on continuing operations.
√ Applicable □ Not applicable
The Company does not undergo any event or situation which may cause great concern about
sustainable operation ability within 12 months since the end of the reporting period.
V Significant Accounting Policies and Accounting Estimates
Specific accounting policies and accounting estimation hint:
□ Applicable √ Not applicable
The Company’s Financial Statements are prepared in accordance with Accounting Standards for
Business Enterprises, and indicate relevant information about the Company's financial status, business
results and cash flow truly and completely.
Annual Report 2022
The fiscal year of the Company is from January 1 to December 31 of every calendar year.
√ Applicable □ Not applicable
The operating cycle of the Company is short, and 12 months is taken as the liquidity criterion for
assets and liabilities.
The standard currency for accounting is RMB.
combination not under the same control
√ Applicable □ Not applicable
The Company’s assets and liabilities acquired from business combinations will be measured
according to the carrying value of the acquiree in financial statement of the final controlling party. The
Company will adjust capital reserves according to proportion of the acquiree’s carrying value in
consolidated financial statement of the final controlling party and the balance between carrying value
and the carrying value paid for combination consideration or total nominal value of issued shares; if the
capital reserve is insufficient to offset such difference, the difference will be offset against retained
earnings.
On the acquisition date, the difference between the combined cost and the fair value share of the
identifiable net assets of the acquiree obtained in the merger is recognized as goodwill. If the combined
cost is less than the fair value share of the identifiable net assets of the acquiree obtained in the
combination, firstly, the fair value of identifiable assets, liabilities and contingent liabilities of the
acquiree and the measurement of combined cost are reviewed. If the combined cost is still less than the
fair value share of identifiable net assets of the acquiree obtained in the merger after review, the
difference is recorded in profit and loss of the current period.
√ Applicable □ Not applicable
the consolidated financial statements. The consolidated financial statements are based on the financial
statements of the Company as the parent and its subsidiaries and are prepared by the Company as the
parent according to other relevant information and Accounting Standards for Enterprises No. 33 -
Consolidated Financial Statements.
Annual Report 2022
equity of the same subsidiary in two consecutive fiscal years
□ Applicable √ Not applicable
Cash listed in cash flow statement refers to cash on hand and reserves always available for payment.
Cash equivalents refer to investments that are held for short term, highly liquid, and readily convertible
to known amounts of cash and subject to insignificant risk of change in value.
√ Applicable □ Not applicable
At the initial recognition of foreign currency transactions, foreign currency shall be converted into
RMB at the approximate exchange rate of the spot exchange rate on the transaction date. On the balance
sheet date, foreign currency monetary items are converted at the spot exchange rate on the balance sheet
date, and the exchange difference arising from different exchange rates is recorded in profit and loss of
the current period except the exchange difference between the principal and interest of foreign currency
special loans related to the purchase and construction of assets eligible for capitalization. Foreign
currency non-monetary items measured at historical cost adopt the spot exchange rate on the transaction
date, without changing their RMB amount. Foreign currency non-monetary items measured at fair value
shall be converted at the spot exchange rate on the date when the fair value is determined, and the
difference shall be recorded in the profit and loss of the current period or other comprehensive income.
Assets and liabilities in the balance sheet shall be converted at the spot exchange rate on the
balance sheet date. Except for the “undistributed profit” item, other items of owner’s equity items are
converted at the spot exchange rate on the transaction date; the income and expense items in the income
statement are converted at the spot exchange rate on the transaction date. The differences arising from
the above conversion of foreign currency-denominated financial statements shall be recorded in other
comprehensive income.
√ Applicable □ Not applicable
Financial assets are classified into the following three categories when they are initially recognized:
(1) Financial assets measured at amortized cost; (2) financial assets at fair value through other
comprehensive income; (3) financial assets at fair value through current profit or loss.
Annual Report 2022
Financial liabilities are classified into the following four categories when they are initially
recognized: (1) Financial liabilities at fair value through current profit or loss; (2) financial liabilities
arising from the transfer of financial assets not meeting the de-recognition criteria or from the continuing
involvement in the transferred assets; (3) financial guarantee contracts which do not fall within the
category of (1) or (2) above, and loan commitments which do not fall within category (1) above and
made at an interest rate lower than the market rate; (4) financial liabilities measured at amortized cost.
financial liabilities
(1) Determination basis and measuring methods for financial assets and financial liabilities
A financial instrument is recognized as an asset or liability when the Company becomes a party
thereto. For financial assets or financial liabilities measured at fair value through profit or loss, the
transaction expenses are directly included in profit and loss of the current period; for financial assets or
financial liabilities in other categories, the transaction expenses are included in the amount initially
recognized. However, accounts receivable initially recognized by the Company that do not include a
significant financing component or where the Company does not consider the financing component in a
contract with a term not exceeding one year will be initially measured at the transaction price defined in
Accounting Standard for Business Enterprises No.14-Income.
(2) Subsequent measurement of financial assets
Financial assets are subsequently measured at amortized cost by the effective interest method.
Gains or losses arising from a financial asset measured at amortized cost which does not form part of
any hedging relationship are recorded in current profit or loss at the time of de-recognition,
reclassification, amortization according to the effective interest method or recognition of impairment.
Such financial assets shall be subsequently measured at fair value. Interest, impairment loss or gain
and exchange gain/loss calculated using the effective interest method are recorded in current profit or
loss, other gains or losses are recorded in other comprehensive income. On derecognition, cumulative
gains or losses that were previously recorded in other comprehensive income are transferred from other
comprehensive income and recorded in current profit or loss.
Such financial assets shall be subsequently measured at fair value. Dividend received (except for
the portion which forms part of investment cost recovered) is recorded in current profit or loss, other
gains or losses are recorded in other comprehensive income. On derecognition, cumulative gains or
losses that were previously recorded in other comprehensive income are transferred from other
comprehensive income and recorded in retained earnings.
Gains or losses (including interest income and dividend income) arising from the subsequent
measurement at fair value are recorded in current profit or loss, unless the financial asset forms part of a
Annual Report 2022
hedging relationship.
(3) Method for the subsequent measurement of financial liabilities
Such financial liabilities include transactional financial liabilities (including derivative instruments
which belong to the category of financial liabilities) and financial liabilities designated as at fair value
through current profit or loss. Such financial liabilities are subsequently measured at fair value. The
amount of changes in the fair value of financial liabilities designated as at fair value through profit or
loss, which arise from the change in the credit risk of the Company, is recorded in other comprehensive
income, unless such accounting treatment would result in or increase the accounting mismatch of gain
and loss. Other gains or losses (including interest expense, except for the fair value changes arising from
the change in credit risk of the Company) on such financial liabilities are recorded in current profit or
loss, unless such financial liabilities form part of a hedging relationship. On derecognition, cumulative
gains or losses that were previously recorded in other comprehensive income are transferred from other
comprehensive income and recorded in retained earnings.
de-recognition criteria or from the continuing involvement in the transferred assets are measured
according to the relevant provisions of the Accounting Standard for Business Enterprises No.23-Transfer
of Financial Assets.
commitments that do not fall within the category of 1) above and made at an interest rate lower than the
market rate, are subsequently measured at the higher of the two following amounts after initial
recognition: ① The amount of loss provision determined according to the rules related to the
impairment of financial instruments; ② The remaining balance of the initially recognized amount after
deducting the amount of cumulative amortization determined according to relevant rules of the
Accounting Standard for Business Enterprises No.14-Income.
Such financial liabilities are measured at amortized cost using the effective interest method. Gains
or losses arising from a financial liability measured at amortized cost which does not form part of any
hedging relationship are recorded in current profit or loss at the time of de-recognition or amortization
according to the effective interest method.
(4) Derecognition of financial assets and financial liabilities
① The contractual rights to receive the cash flows from the financial assets terminate; or
② The financial asset has been transferred, and such transfer satisfies the criteria set out in the
Accounting Standard for Business Enterprises No.23-Transfer of Financial Assets regarding the
de-recognition of financial assets.
the Company de-recognizes the financial liability (or a portion thereof).
Annual Report 2022
If the Company has transferred substantially all risks and rewards of ownership of the financial
asset, the financial asset is de-recognized, and the right and obligation arising from or retained in the
transfer are individually recognized as an asset or liability. If substantially all risks and rewards of
ownership of the financial asset are retained, the financial asset transferred remains recognized. If the
Company has not transferred or retained nearly all the risks and remunerations of ownership of the credit
assets, different measures should be taken in accordance with the following circumstances respectively:
(1) If the Company gives up the control of the financial assets, these financial assets shall be
derecognized; (2) if the Company does not give up the control of the financial assets, the relevant
financial assets shall be recognized and the relevant liabilities shall be recognized accordingly in
accordance with the extent of their continued involvement in the transferred financial assets.
If the overall transfer of financial assets meets the conditions for derecognition, the difference
between the following two amounts shall be recorded in profit and loss of the current period: (1) The
carrying value of the transferred financial asset as of the date of derecognition; (2) Sum of the
consideration received for the transfer of the financial asset, and the portion of the cumulative amount of
fair value changes previously recorded in other comprehensive income that corresponds with the portion
of the asset de-recognized (the transferred financial asset is an investment in debt instruments at fair
value through other comprehensive income). Where a portion of the financial asset has been transferred
and the transferred portion as a whole satisfies the derecognition criteria, the carrying value of the
financial asset as a whole prior to its transfer is allocated between the portion of the asset derecognized
and the portion that remains recognized, according to their relative fair value as of the transfer date, and
the difference between the two amounts mentioned below is recorded in current profit or loss: (1) The
carrying value of the derecognized portion; (2) Sum of the consideration received for the derecognition
portion, and the portion of the cumulative amount of fair value changes previously recorded in other
comprehensive income, which corresponds with the derecognized portion (the transferred financial asset
is an investment in debt instruments at fair value through other comprehensive income).
The Company applies valuation techniques that are applicable in the current situation and are
supported by sufficient available data and other information to determine the fair value of relevant
financial assets and financial liabilities. The Company classifies the inputs of valuation techniques into
the following levels and applies them accordingly:
(1) Level 1 inputs are the unadjusted quotation of the same assets or liabilities available on the
active market on the measurement day;
(2) Level 2 inputs are inputs for the relevant assets or liabilities other than the level 1 inputs, which
are directly or indirectly observable, including quotations for similar assets or liabilities in an active
market; quotations for the same or similar assets or liabilities in an inactive market; other observable
inputs other than quotations, such as interest rate and yield curve observable during normal quotation
intervals; and market-tested inputs;
Annual Report 2022
(3) Level 3 inputs are non-observable inputs for the relevant assets or liabilities, including interest
rate and stock volatility which cannot be directly observed or cannot be verified by observable market
data, the future cash flow of a retirement obligation assumed in a business combination, and financial
forecast performed based on internal data.
(1) Measurement and accounting treatment of impairment of financial instruments
Based on the expected credit loss, for financial assets measured in amortized cost, investment in
debt instruments measured at fair value and whose changes are recorded in other comprehensive income,
contract assets, lease receivables, loan commitments classified as financial liabilities measured at fair
value and whose changes are recorded in profit and loss of the current period, financial guarantee
contracts that do not belong to financial liabilities measured at fair value and whose changes are
recorded in the profits and losses of the current period or financial liabilities formed by the transfer of
financial assets that do not meet the conditions for derecognition or continue to be involved in the
transferred financial assets shall be impaired and loss reserves shall be recognized.
Expected credit loss refers to the weighted average of credit loss of financial instruments weighted
with default risks. Credit loss refers to the difference between all contractual cash flow receivable by the
Company under contracts which are discounted according to the original effective interest rate, and all
the cash flow expected to be received, namely the present value of all cash shortfall. Specifically,
financial assets acquired or derived to which credit impairment has occurred are discounted by the
Company according to the credit-adjusted effective interest rate.
For the acquired or derived financial assets with credit impairment, the Company only recognizes
the cumulative change of expected credit loss over the lifetime after initial recognition as the loss reserve
on the balance sheet date.
For receivables and contract assets formed by transactions regulated by Accounting Standards for
Business Enterprises No.14-Income, which do not contain significant financing components or the
Company does not consider the financing components in contracts not exceeding one year, the Company
uses simplified measurement methods to measure the loss reserve according to the expected credit loss
amount over the lifetime.
For financial assets other than the above measurement methods, at each balance sheet date, the
Company assesses the financial assets to see if the credit risk has significantly increased after initial
recognition. If the credit risk has significantly increased after initial recognition, the Company calculates
provision for loss according to the amount of expected credit loss over the lifetime of the assets; if credit
risk has not significantly increased after initial recognition, the Company calculates loss provision based
on expected credit loss in the future 12 months.
The Company uses available reasonable and well-founded information, including forward-looking
information, to determine whether the credit risk of financial instruments has increased significantly
since the initial recognition by comparing the default risk of financial instruments on the balance sheet
date with the default risk on the initial recognition date.
Annual Report 2022
On the balance sheet date, if the Company judges that the financial instrument only has low credit
risk, it is assumed that the credit risk of the financial instrument has not increased significantly since the
initial recognition.
The Company assesses the expected credit risk and measures the expected credit loss on the basis
of single financial instrument or portfolios of financial instruments. When based on the portfolio of
financial instruments, the Company classifies the financial instruments into different portfolios
according to the common risk characteristics.
The Company re-measures expected credit loss at each balance sheet date, and the amount of
increase in loss provision or the written-back amount of loss provision arising from re-measurement is
recorded in current profit or loss as an impairment loss or gain. For financial assets measured at
amortized cost, impairment losses were allocated to offset the carrying value of the financial asset
presented in the balance sheet. For the debt investments measured at fair value through other
comprehensive income, the Company recognized its loss reserves in other comprehensive income but
did not offset the carrying value of the financial asset.
(2) Financial instruments of which expected credit risk is assessed by portfolio and expected credit
loss is measured using the three-stage model
Basis for portfolio
Item Measurement of expected credit loss
recognition
With reference to historical credit loss
experience, combined with the current
situation and the forecast of future economic
Other receivables-aging Aging portfolio conditions, the expected credit loss is
portfolio
calculated through default risk exposure and
the expected credit loss rate in the next 12
months or over the lifetime.
(3) Receivables and contract assets with expected credit losses measured by portfolio using a
simplified approach
Basis for portfolio
Item Measurement of expected credit loss
recognition
With reference to historical credit loss
experience, combined with the current
situation and the forecast of future economic
Notes receivable--trade Type of notes conditions, the expected credit loss is
acceptance portfolio calculated through default risk exposure and
the expected credit loss rate or over the
lifetime. Commercial acceptance bills
receivable
With reference to historical credit loss
experience, combined with the current
situation and the forecast of future economic
Notes receivable--bank Type of notes conditions, the expected credit loss is
acceptance portfolio
calculated through default risk exposure and
the expected credit loss rate or over the
lifetime. Commercial acceptance bills
Annual Report 2022
receivable
With reference to historical credit loss
experience, combined with the current
situation and the forecast of future economic
Accounts receivable--aging
Aging portfolio conditions, the comparison table between the
portfolio
aging of accounts receivable and the expected
credit loss rate over the lifetime is prepared to
calculate the expected credit loss.
lifetime
Accounts receivable
Aging
Expected credit losses (%)
Within 1 year (inclusive, the same below) 5.00
Over 3 years 100.00
The financial assets and financial liabilities are respectively listed in the balance sheet, not
offsetting each other. However, when all the following criteria are met, financial assets and liabilities are
shown on a net basis after offsetting: (1) The Company has the statutory right to offset the recognized
amounts, and such right is currently enforceable; (2) The Company intends to settle the financial assets
and liabilities on a net basis, or to realize the assets and settle the liabilities simultaneously.
For the transfer of financial assets where the derecognition criteria are not met, the Company may
not offset the financial assets transferred against the related liabilities.
Determination methods and accounting methods of the expected credit losses of notes receivable
□ Applicable √ Not applicable
Determination methods and accounting methods of the expected credit losses of accounts
receivable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
Determination methods and accounting methods of the expected credit losses of other receivables
□ Applicable √ Not applicable
Annual Report 2022
√ Applicable □ Not applicable
Inventories refer to finished goods or commodities for sale held in daily activities, unfinished goods
in manufacturing process, and materials and supplies consumed in process of manufacturing products or
providing services, etc.
The cost measurement for the inventories delivered is made with a one-time weighted average
method at the end of the month.
On the balance sheet date, inventories should be measured whichever is lower in accordance with
the cost and net reliable value, and the provision for decline in value of inventories shall be made
according to the difference that the cost of each item of inventories higher than the net realizable value.
For inventories directly used for sale, the net realizable value shall be determined by the estimated
selling price of the inventory minus the estimated selling expenses and relevant taxes and fees in the
normal production and operation process. For materials inventory requiring processing during normal
process of production and operation, the net realizable value shall be determined by deducting estimated
costs occurring during completion, estimated selling expenses and related taxes from estimated sale
price of finished products. On the balance sheet date, some of the same inventory have contract price
agreed, others not; their net realizable value shall be recognized respectively and compared with the
corresponding cost to determine the amount of provision or write-back of inventory depreciation reserve.
The perpetual inventory system is adopted for the inventories of the Company.
(1) Low-value consumables
Low-value consumables are amortized with a one-time write-off method.
(2) Packing materials
Packing materials are amortized with a one-time write-off method.
(1). Method and criteria for determining contract assets
√ Applicable □ Not applicable
The Company presented contract assets or contract liabilities on the balance sheet in accordance
with the relationship between performance obligations and customer payment. The Company will set off
the contract assets and contract liabilities under the same contract and present them in net amount.
The right of the Company to receive consideration from its customers unconditionally (i.e. only
depending on the passage of time) is presented as receivables, and the right to receive consideration for
goods transferred to its customers (depending on factors other than the passage of time) is presented as a
contract asset.
Annual Report 2022
The obligation to transfer goods to customers for consideration received or receivable from
customers is presented as a contract liability.
(2). Determination methods and accounting methods of the expected credit losses of contract assets
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(1). Determination methods and accounting methods of the expected credit losses of debt
investments
□ Applicable √ Not applicable
(1). Determination methods and accounting methods of the expected credit losses of other debt
investments
□ Applicable √ Not applicable
(1). Determination methods and accounting methods of the expected credit losses of long-term
receivables
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Joint control refers to the control the Company shares with other entities over a certain arrangement
following relevant agreements by which any activity under the arrangement may be conducted only with
the unanimous agreement of all participants sharing the power of control. Significant influence refers to
the power to participate in making decisions on the financial and operating policies of an investee, but
not to control or do joint control together with other parties over the formulation of these policies.
(1) In case of a business combination under the same control, if the acquirer pays cash, transfers
non-cash assets, assumes debts or issues equity securities as merger consideration, the share of the
owner’s equity of the acquiree obtained on combination date in the carrying value of the financial
statements of the ultimate controlling party is deemed as an initial investment cost. Capital reserve is
adjusted based on the difference between initial investment cost of long-term equity investment and
carrying value of paid combination consideration or total nominal value of issued share; if the capital
Annual Report 2022
reserve is insufficient to offset such difference, the difference will be offset against retained earnings.
If business combination under the same control is realized step by step through multiple
transactions, whether the multiple transactions is a “Package Deal” is determined. If the deals fell into a
"Package Deal", all transactions shall be treated as a transaction to gain control. If it is not a “package
deal”, on the combination date, the initial investment cost of the long-term equity investment shall be
determined based on the share of net assets’ carrying value of the acquiree in the consolidated financial
statements of the ultimate controlling party. The capital reserve is adjusted based on the difference
between the initial investment cost of the long-term equity investment on the combination date and the
sum of the carrying value of the long-term equity investment before the acquisition and the carrying
value of the new payment consideration on the acquisition date. If the capital reserve is insufficient to
offset such difference, the difference will be offset against retained earnings.
(2) For business combinations not under the same control, the fair value of the combination
consideration paid by it on the acquisition date shall be its initial investment cost.
For long-term equity investment formed by a business combination achieved step by step through
multiple transactions, relevant accounting treatment is performed with distinctions made between
separate financial statements and consolidated financial statements:
investment and the additional investment cost shall be taken as the initial investment cost when
converting to using the cost method.
deals fell into a "Package Deal", all transactions shall be treated as a transaction to gain control. If it is
not a “Package Deal”, the equity of the acquiree held prior to the acquisition date shall be re-measured
according to the fair value of the equity at the acquisition date, and the difference between the fair value
and the carrying value shall be recorded in the current investment income. Where the equity of the
acquiree held prior to the acquisition date involves other comprehensive income accounted for based on
the equity method, etc., the other comprehensive income related to it shall be converted into the current
investment income of the acquisition date. However, other comprehensive income arising from the
re-measurement of net liabilities or changes in net assets of defined benefit plans by the investee is
excluded.
(3) Except for business combination: If it is acquired by paying cash, the actual acquisition price
shall be taken as its initial investment cost; if it is acquired by issuing equity securities, the fair value of
the issued equity securities shall be taken as its initial investment cost; if it is acquired by means of debt
restructuring, the initial investment cost shall be determined according to the Accounting Standards for
Business Enterprises No. 12-Debt Restructuring; if it is acquired by exchange of non-monetary assets,
the initial investment cost shall be determined according to the Accounting Standards for Business
Enterprises No. 7-Exchange of Non-monetary Assets.
The long-term equity investment controlled by the investee shall be accounted for by the cost
Annual Report 2022
method; the long-term equity investment of associated enterprises and joint ventures shall be accounted
for by the equity method.
multiple transactions
(1) Separate financial statements
For the disposal of long-term equity investments, the difference between the carrying value and the
actual price acquired shall be recorded into profit and loss of the current period. For the remaining equity,
if it still has a significant impact on the investee or implements joint control with other parties, it shall be
accounted for by the equity method; if it is no longer possible to exercise control, joint control or
significant influence on the investee, accounting shall be carried out in accordance with the relevant
provisions of Accounting Standards for Business Enterprises No. 22-Recognition and Measurement of
Financial Instruments.
(2) Consolidated financial statements
until loss of control right. If it is not a "package deal", before the loss of control right, the difference
between the disposal price and the share of net assets is continuously calculated by the subsidiary from
the acquisition date or combination date corresponding to the disposal of long-term equity investment
shall be adjusted, and the capital reserve (capital premium) shall be adjusted. If the capital premium is
insufficient to offset, the retained earnings shall be offset.
In case of loss of control over the original subsidiary, the remaining equity shall be re-measured
according to its fair value on the date of loss of control. The aggregate of the consideration obtained by
disposing of the equity and the fair value of the remaining equity less the portion of the net assets of the
subsidiary that has been measured, as calculated at the original shareholding proportion, from the
acquisition date or combination date is recognized in profit and loss of the current period on investments
in which the control is lost, and goodwill shall be offset. Other comprehensive income, etc. related to the
original subsidiary’s equity investment will be converted into income from investment for the current
period when the control is lost.
until loss of control right. If it is a “package deal”, the Company treats each transaction as a transaction
that disposes of a subsidiary and loses control. However, the difference between each disposal price
before losing control and the share of subsidiaries’ net assets corresponding to the disposed investment
shall be recognized as other comprehensive income in the consolidated financial statements, and shall be
transferred into the profits and losses of the current period in case of loss of control.
Not applicable
Annual Report 2022
(1). recognition criteria
√ Applicable □ Not applicable
The fixed assets of the Company refer to tangible assets held for production of goods, provision of
labor services, lease or business with a service life of over a fiscal year. Fixed assets shall be recognized
when the economic benefits are flowing in and the cost can be measured reliably.
(2). Depreciation method
√ Applicable □ Not applicable
Depreciation Depreciable life Residual value Annual
Category
method (year) rate depreciation rate
Straight-line
Houses and
depreciation 20 3% 4.85%
buildings
method
Straight-line
Machinery
depreciation 4-10 3% 9.70%-24.25%
equipment
method
Straight-line
Means of
depreciation 2-10 3% 9.70%-48.50%
transportation
method
Straight-line
Electronic and
depreciation 2-10 3% 9.70%-48.50%
other equipment
method
Straight-line
Fixed assets
depreciation 5 0 20%
fixtures
method
(3). Recognition basis, valuation and depreciation method for fixed assets under financing lease
□ Applicable √ Not applicable
√ Applicable □ Not applicable
measured reliably. The construction in progress is measured according to the actual cost incurred before
the construction of the asset reaches its intended serviceable condition.
into fixed assets based on its actual cost. For those that have reached their intended serviceable status but
have not yet completed the settlement, they shall be transferred to fixed assets according to the estimated
value, and the original provisional value shall be adjusted according to the actual cost after the final
accounts are completed, but the depreciation already accrued shall not be adjusted.
√ Applicable □ Not applicable
Annual Report 2022
The borrowing costs that have occurred and can be directly attributed to the acquisition,
construction or production of assets eligible for capitalization are capitalized by the Company and
recorded in relevant cost of assets; other borrowing costs are recognized as expenses based on the
amount incurred when they occur, and shall be recorded in profit and loss of current period.
(1) When all the following conditions are met by the borrowing costs, capitalization will start: 1)
asset expenditure has occurred; 2) borrowing costs have occurred; 3) acquisition, construction or
production activities have started in order to make the fixed asset be ready for the intended use or sale.
(2) If the acquisition, construction or production of an asset eligible for capitalization is
continuously suspended for over 3 months for abnormal reasons, capitalization of the borrowing costs
shall be suspended; borrowing costs incurred during the suspension shall be recognized as the current
expenses until the acquisition, construction or production of the asset is resumed.
(3) When the assets with the purchase, construction or production meeting the capitalization
conditions reach the expected available or marketable state, the borrowing cost ceases to be capitalized.
For a specifically borrowed fund for the acquisition, construction or production of an asset eligible for
capitalization, the amount of interest that shall be capitalized is determined based on the interest
expenses incurred in the period when a specifically borrowed fund is obtained (including the
amortization of discounts or premiums recognized according to the effective interest method) less any
income earned on the unused borrowing fund as a deposit in a bank or as a temporary investment. Where
a general borrowing is used for the acquisition, construction and production of an asset eligible for
capitalization, the amount of interest that shall be capitalized is determined by multiplying the part of the
accumulative asset disbursements in excess of the weighted average asset disbursement for the
specifically borrowed fund by the capitalization rate of the general borrowing used.
□ Applicable √ Not applicable
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(1). Pricing method, service life, and impairment test
√ Applicable □ Not applicable
Annual Report 2022
the expected method to realize economic benefits relating to the intangible assets. Where the expected
realization method cannot be reliably determined, Straight-line Amortization Method is adopted. The
detailed period is as follows:
Item Amortization period (year)
Land use right Duration of land use
Software 2-5
Intangible assets with indefinite useful lives are not amortised and the Company reviews the useful
life of the intangible asset in each accounting period.
(2). Accounting policies for internal research and development costs
√ Applicable □ Not applicable
The expenditures occurring during the research period of internal R&D items are included in the
profit or loss for the current period at the time of occurrence. Expenditure on internal research and
development projects in the research stage shall be recognized as intangible assets when the following
conditions are met at the same time: (1) It is technically feasible to complete the intangible assets so that
they can be used or sold; (2) it has the intention of completing the intangible asset and using or selling it;
(3) the ways in which intangible assets generate economic benefits include the existence of a market for
the products produced by using such intangible assets or the existence of a market for the intangible
assets themselves, and intangible assets that will be used internally shall be proven their usefulness; (4)
there should be sufficient technical, financial and other resources to complete the development of the
intangible asset and have the ability to use or sell the intangible assets; (5) the expenditure attributed to
the development stage of intangible assets can be measured reliably.
√ Applicable □ Not applicable
For long-term equity investments, fixed assets, construction in progress, right-of-use assets,
long-term assets with limited service life and other long-term assets, if there are signs of impairment on
the balance sheet date, the recoverable amount shall be estimated. Goodwill and intangible assets with
uncertain service life formed by business combinations are tested for impairment every year regardless
of whether there are signs of impairment. Goodwill is tested for impairment in conjunction with the asset
group or combination of asset groups to which it relates.
If the recoverable amount of the above-mentioned long-term assets is lower than its carrying value,
the asset impairment reserve shall be recognized according to the difference and recorded in profit and
loss of the current period.
Annual Report 2022
√ Applicable □ Not applicable
Long-term prepaid expenses are accounted for all expenses that have been paid and have an
amortization period of more than one year (excluding one year). The long-term prepaid expenses are
accounted for according to the actual amount incurred and are amortized averagely over the benefit
period or the specified period. If the long-term deferred expenses item cannot bring benefit in the
subsequent accounting period, the amortized value of the item that has not been amortized will be
transferred to the profit or loss for the current period.
(1). Method for determining contract liabilities
√ Applicable □ Not applicable
The Company presented contract assets or contract liabilities on the balance sheet in accordance
with the relationship of performance obligations and customer payment. The Company will set off the
contract assets and contract liabilities under the same contract and present them in net amount.
The obligations of transferring goods to customers as a result of the consideration that the Company
had received or shall receive from customers were presented as contract liabilities.
(1). Accounting treatment methods of short-term remuneration
√ Applicable □ Not applicable
benefits and other long-term employee benefits.
Within the accounting period when employees provide service, the actual short-term remuneration
shall be recognized as liabilities and be recorded in profit and loss of the current period or relevant asset
costs.
(2). Accounting treatment method for post-employment benefits
√ Applicable □ Not applicable
The Company classifies post-employment benefit plans into the defined contribution plan and the
defined benefit plan.
(1) During the accounting period in which the employees provide services to the Company, the
amount to be contributed as calculated according to the defined contribution plan is recognized as a
liability and recorded in the profit or loss for the current period or the related asset costs.
(2) The accounting handling of the defined benefit plan usually includes the following steps:
are estimated by using unbiased and mutually compatible actuarial assumptions, the obligations under
Annual Report 2022
the defined benefit plan are measured, and the periods to which relevant obligations are attributed are
determined. Meanwhile, the Company will discount the obligations incurred from a defined benefit plan,
to determine present value of defined benefit plan and current service cost.
the fair value of assets of the defined benefit plans is recognized as one net liabilities or net profits of the
defined benefit plans. If the defined benefit plans have a surplus, the Company shall measure the net
profit of the defined benefit plans according to whichever is lower between the surplus and upper limit
on the assets of the defined benefit plans.
recognized as service cost, net interest arising from the net liabilities and net assets of the defined benefit
plan, and changes in the net liabilities or net assets of the remeasured defined benefit plan. Of which, the
net interest arising from the net liabilities or net assets of the defined benefit plan is recorded in profit
and loss of the current period or related asset cost, and changes in the net liabilities or net assets of the
remeasured defined benefit plan are recorded in other comprehensive income, and is not written-back to
profits and losses in subsequent accounting periods. But these amounts recognized in other
comprehensive income can be transferred within the scope of equity.
(3). Accounting treatment method for dismissal benefits
√ Applicable □ Not applicable
If the Company provides the employee with dismissal benefits, the Company shall recognize the
employee remuneration liabilities and record them in profit or loss for the current period on the
following dates (whichever is earlier): (1) the date when the Company may not unilaterally withdraw
dismissal benefits provided due to termination of labor relationship plans or layoff proposals; (2) the
date when the Company recognizes costs or expenses relating to the restructure of payments of dismissal
benefits.
(4). Accounting treatment method for other long-term employee benefits
√ Applicable □ Not applicable
If other long-term benefits provided by the Company to employees meet the conditions of the
defined contribution plan, accounting treatment shall be carried out according to the relevant provisions
of defined contribution plan. Except for that, the other long-term benefits shall be subject to the
accounting handling according to the defined benefit plan. To simplify the related accounting treatment,
employee compensation cost incurred in the defined benefit plan is recognized as service costs. Net
interests of net liabilities or net assets of other long-term employee benefits, as well as the total net
amount of changes caused by re-measurement of net liabilities or net assets of other long-term employee
benefits, will be recorded in profit and loss of the current period or the related asset costs.
Annual Report 2022
□ Applicable √ Not applicable
□ Applicable √ Not applicable
√ Applicable □ Not applicable
The Company's share-based payment includes equity-settled share-based payment and cash-settled
share-based payment.
share-based payment plans
(1) Equity-settled share-based payment
For an equity-settled share-based payment in return for services of employees, if the right can be
exercised immediately after the grant, the fair value of the equity instruments shall, on the grant date, be
recorded in the relevant costs or expenses and the capital reserve shall be adjusted accordingly. For an
equity-settled share-based payment in return for employee services, if the right cannot be exercised only
after completing the service during the vesting period or meeting the prescribed performance conditions,
then on each balance sheet date within the vesting period, the services acquired in the current period
shall, based on the best estimate of the number of vested equity instruments, be recorded in the relevant
costs or expenses at the fair value of the equities instruments on the grant date, and the capital reserve
shall be increased accordingly.
For an equity-settled share-based payment in return for the service of any other party, if the fair
value of the service of any other party can be reliably measured, it shall be measured at the fair value of
the service of any other party on the acquisition date; if the fair value of the service of any other party
can not be reliably measured, but the fair value of the equity instruments can be reliably measured, it
shall be measured at the fair value of the equity instruments on the acquisition date and recorded in the
relevant costs or expenses, and the owner's equity shall be increased correspondingly.
(2) Cash-settled share payment
For a cash-settled share-based payment in return for services of employees, if the right can be
exercised immediately after the grant, the fair value of liabilities assumed by the Company shall, on the
grant date, be recorded in the relevant costs or expenses and the liabilities shall be increased accordingly.
For a cash-settled share-based payment, if the right cannot be exercised only after completing the service
during the vesting period or meeting the prescribed performance conditions, on each balance sheet date
within the vesting period, the services acquired in the current period shall, based on the best estimate of
the information about the vesting right, be recorded in the relevant costs or expenses and the
corresponding liabilities at the fair value of the liabilities assumed by the Company.
Annual Report 2022
(3) Modification and termination of share-based payment plans
If the modification increases the fair value of the granted equity instruments, the Company shall
recognize the increase of the services acquired 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
shall recognize the increased fair value of equity instruments as the increase of the services acquired. If
the Company modifies the vesting conditions in a way that is favorable to employees, the Company shall
consider the modified vesting conditions when processing vesting conditions.
If the modification reduces the fair value of the granted equity instruments, the Company shall
continue to recognize the amount of the service acquired based on the fair value of the equity
instruments on the grant date, and shall not consider the decrease of the fair value of the equity
instruments. If the modification reduces the number of equity instruments, the Company shall process
equity instruments by reducing some of them as the cancellation of the granted equity instruments. If the
vesting conditions are modified in a way that is unfavorable to employees, the Company shall not
consider the modified vesting conditions when processing vesting conditions.
If the Company cancels the granted equity instruments or settles the granted equity instruments (not
including those canceled due to failure to meet vesting conditions) during the vesting period, the
cancellation or settlement shall be processed as the vested right and the amount to be recognized within
the remaining vesting period originally shall be recognized immediately.
□ Applicable √ Not applicable
(1). Accounting policy for recognition and measurement of revenue
√ Applicable □ Not applicable
On the commencement date of a contract, the Company shall assess the contract, identify each
single performance obligation in the contract, and determine that each single performance obligation is
satisfied whether within a certain period of time or at a certain point in time.
When one of the following conditions is met, it belongs to fulfilling the performance obligation
within a certain period of time, otherwise, it belongs to fulfilling the performance obligation at a certain
point in time: (1) The customer obtains and consumes the economic benefits brought by the Company's
performance while the Company performs the obligation; (2) The customer can control the goods under
construction during the performance of the Company; (3) The goods produced during the performance
of the Company have irreplaceable uses, and the Company has the right to collect amount for the
cumulative performance completed so far during the whole contract period.
For the performance obligations performed within a certain period of time, the Company recognizes
the revenue according to the performance progress within that period of time. When the performance
Annual Report 2022
progress cannot be reasonably determined, if the cost incurred is expected to be compensated, the
revenue shall be recognized according to the amount of the cost incurred until the performance progress
can be reasonably determined. For performance obligations performed at a certain point in time, revenue
is recognized at the time when the customer obtains control over related goods or services. To decide
whether the customer has obtained the control over goods, the Company takes into account the following
signs: (1) the enterprise has the present right to collection for the goods, meaning the customer bears the
present obligation to payment for the goods; (2) the enterprise has passed the legal title to the goods to
the customer, meaning the customer has had the legal title to the goods; (3) the enterprise has transferred
the physical possession of the goods to the customer, meaning the customer has had the physical
possession of the goods; (4) the enterprise has transferred the major risks and remunerations concerning
the title to the goods to the customer, meaning the customer has obtained the major risks and
remunerations concerning the title to the goods; (5) the customer has accepted the goods; (6) other signs
to show that the customer has obtained the control over the goods.
(1) The Company measures revenue on the basis of the transaction price allocated to each
performance obligation. Transaction price is the amount of consideration that the Company is expected
to be entitled to receive for transferring goods or services to customers, excluding the amount received
on behalf of third parties and the amount expected to be refunded to customers.
(2) If there is variable consideration in a contract, the Company shall determine the best estimate of
the variable consideration according to the expected value or the most likely amount, but the transaction
price including the variable consideration shall not exceed the amount that the cumulative recognized
income will most likely not be significantly written-back when the relevant uncertainty is eliminated.
(3) If there is a significant financing component in a contract, the Company shall determine the
transaction price according to the amount payable in cash when the customer assumes control of the
goods or services. The difference between the transaction price and the contract consideration shall be
amortized by the effective interest rate method during the contract period.
(4) If a contract contains two or more performance obligations, the Company shall allocate the
transaction price to each single performance obligation according to the relative proportion of the single
selling price of the goods promised by each single performance obligation on the commencement date of
the contract.
The Company mainly sells adaptors, wall switches and sockets, LED lighting and digital
accessories. In addition to meeting the general principles of revenue recognition, the sales of products
under different sales situations are generally recognized after meeting the following conditions.
(1) The specific time points for revenue recognition of various domestic sales methods of the
Company are as follows:
the distributor receives the goods.
Annual Report 2022
goods and publishes the information on the quantity and amount of goods received on its supplier
platform, the Company recognizes the revenue when it completes the reconciliation. For sales by
opening an online shop on the e-commerce platform, the Company recognizes the revenue when the
customer receives the goods and confirms such receipt on the e-commerce platform. For the sales by real
estate developers or decoration companies, the Company recognizes the revenue when the buyer has
received the goods and both parties complete the reconciliation. For offline direct sales such as Shanghai
area, the Company recognizes the revenue when the goods are delivered to the buyer.
list.
(2) The Company recognizes its revenue when it has completed the customs declaration formalities
and obtained the bill of lading.
(2). Different business models are adopted for different businesses, which may lead to the
differences in the accounting policy for recognition of revenue
□ Applicable √ Not applicable
√ Applicable □ Not applicable
Assets related to contract costs include costs of obtaining a contract and costs to fulfil a contract.
The Company recognizes as an asset the incremental costs of obtaining a contract if it expects to
recover those costs. The costs of obtaining a contract shall be included in profit or loss if the asset's
amortization period is one year or less.
If the costs incurred in fulfilling a contract are not within the scope of standards related to
inventories, fixed assets or intangible assets, etc., the Company shall recognize the costs to fulfil a
contract as an asset if all the following criteria are satisfied:
materials, manufacturing overhead cost (or a similar cost), costs that are explicitly chargeable to the
customer under the contract, and other costs that are only related to the contract.
obligations in the future.
An asset related to contract costs shall be amortized on a systematic basis that is consistent with
related goods or services and included in profit or loss.
The Company shall make provision for impairment and recognize it as impairment losses on assets
to the extent that the carrying amount of an asset related to the contract costs exceeds the remaining
amount of consideration that the Company expects to receive in exchange for the goods or services to
which the asset relates less the costs expected to be incurred. If the remaining amount of consideration
that the Company expects to receive in exchange for the goods or services to which the asset relates
Annual Report 2022
minus the costs expected to be incurred is higher than the carrying amount of the asset due to the
subsequent changes in the factors of impairment in previous periods, the asset impairment provisions set
aside should be reversed and included in profit and loss of the current period. However, the carrying
amount of the asset upon the reversal should not exceed the carrying amount of the asset on the reversal
date, supposing that impairment provisions are not set aside.
√ Applicable □ Not applicable
able to satisfy all the conditions attached to such government grant; (2) The Company is able to receive
the grants from the government. Government grants were measured at the amount received or receivable
if they were monetary assets. Non-monetary government grants were measured at fair value; if the fair
value could not be reliably obtained, they were measured at the nominal amount.
Government documents stipulate that government grants used to purchase, build or otherwise form
long-term assets are classified as government grants related to assets. If the government documents
concerning a government grant do not specify the target of the grant, it should be determined based on
the basic conditions that must be met in order to receive the grant, and government grants which are
conditional upon a long-term asset acquired, constructed or otherwise formed are classified as
asset-related government grants. Government grants related to assets are used to offset carrying value of
assets or are recognized as deferred income. If recognized as deferred income, government grants related
to assets shall be recorded in the profit and loss in stages in a reasonable and systematic manner within
the useful life of the relevant asset. Government grants measured at nominal amount were directly
recognized as profit or loss for the current period. If the underlying assets were sold, transferred,
scrapped, or damaged before the end of the useful life, the unallocated balance of the relevant deferred
income was transferred to the profit or loss for the period of assets disposal.
Government grants other than government grants related to assets were classified as government
grants related to income. For government grants, including both asset-related parts and income-related
parts that are difficult to be distinguished, overall government grants shall be classified as government
grants related to income. Government grants related to income shall be recognized as deferred income if
they are used to compensate related future expenses or losses and recorded in profit and loss of the
current period during the period when relevant expenses are recognized, or shall be recognized as
current profit and loss or offset the related costs if they are used to compensate related expenses or losses
incurred.
relevant costs according to the substance of business activities. Government grants that are not related to
daily activities are recognized as non-operating income and expenses.
Annual Report 2022
(1) If the fiscal system allocated the funds of interest subsidies to the lending bank, and the lending
bank provided loans to the Company at a policy prime interest rate, the actual loan amount received by
the Company was recognised as the carrying value of the loan, and the relevant borrowing costs were
calculated in accordance with the loan principal and the policy prime interest rate. /The fair value of the
loan was recognised as the carrying value and the borrowing costs were calculated according to the
effective interest method. The discrepancy between the actual loan amount received by the Company
and the fair value of the loan was recognised as deferred income. The deferred income was amortised by
the effective interest method during the outstanding maturities of the loan to offset relevant borrowing
costs.
(2) If the fiscal system allocated the funds of interest subsidies to the Company directly, the
Company reduced the corresponding interest subsidies against relevant borrowing costs.
√ Applicable □ Not applicable
(the difference between the tax base and the carrying value, where tax bases of items that are not
recognized as assets and liabilities can be determined according to the tax law), deferred income tax
assets or deferred income tax liabilities are recognized in accordance with the applicable tax rates during
the expected period in which such assets are to be recovered or such liabilities are to be settled.
that is likely to be obtained and deducted from deductible temporary difference. On the balance sheet
date, if there is conclusive evidence that it is probable that sufficient taxable income will be available to
offset the deductible temporary differences in the future, the deferred income tax assets that have not
been recognized in the previous accounting period shall be recognized.
determined that the Company is not Period likely to obtain adequate taxable income to offset benefits
from deferred tax assets, the carrying values of deferred tax assets are written down. Such write-downs
are reversed when it becomes probable that sufficient taxable income should be available.
loss of the current period as income tax expenses or incomes, excluding the income taxes incurred in the
following circumstances: (1) Business combination; (2) Transactions or events directly recognized in the
owner's equity.
(1). Accounting treatment method for operating lease
√ Applicable □ Not applicable
Annual Report 2022
On the beginning date of the lease term, the Company will recognize the lease with a lease term not
exceeding 12 months and excluding the purchase option as a short-term lease. Leases with lower value
when a single leased asset is a brand-new asset are identified as low-value asset leases. If the Company
sublets or expects to sublet the leased assets, the original lease shall not be deemed as a low-value asset
lease.
The Company records the payments of short-term and low-value asset leases incurred during each
period of the lease term in the relevant asset costs or the profit or loss for the current period by the
straight-line method.
The Company will recognize right-of-use assets and lease liabilities on the inception date of the
lease term, excluding the above short-term and low-value asset leases.
(1) Right-of-use assets
Right-of-use assets are initially measured at costs, including: 1) The initial measurement amount of
lease liabilities; 2) If there is a lease incentive for the lease payment paid on or before the start date of
the lease term, the relevant amount of the lease incentive already enjoyed shall be deducted; 3) Initial
direct expenses incurred by the lessee; 4) The expected cost to be borne by the lessee in order to
dismantle and remove the assets leased, restore original state of the place where the assets leased are in,
or restore the assets leased to the state stipulated in the lease terms.
The Company depreciates right-of-use assets on a straight-line basis. If it is reasonably certain that
ownership of the leased asset(s) will be obtained at the end of the lease term, the Company depreciates
the leased asset(s) over its/their remaining service life. If it is not reasonably certain that the ownership
of the leasehold property will be obtained at the end of the lease term, the Company will depreciate the
leased asset(s) over the lease term or the remaining service life, whichever is shorter.
(2) Lease liabilities
On the start date of the lease term, the Company recognizes the present value of the outstanding
lease payments as lease liabilities. The Company regards the interest rate implicit in lease as the rate of
discount when calculating the present value of the lease payment. The incremental lending rate of the
lessee will be deemed as the rate of discount, if the interest rate implicit in lease cannot be confirmed.
The difference between the lease payment and its present value is regarded as an unrecognized financing
expense. Interest expense is recognized at the discount rate of the present value of the recognized lease
payment during each period of the lease term and is recorded in the profits and losses of the current
period. Variable lease payments that are not recorded in the lease liabilities measurement are recorded in
profits and losses of the current period when they are actually incurred.
After the start of the lease term, in case of any changes in actual fixed payment amount, the
expected payable amount of the guarantee residual value, the index or ratio used to determine the lease
payment amount, and the evaluation result or actual exercise of the purchase option, renewal option or
termination option, the Company will re-calculate the lease obligation using the present value of the
changed lease payment, and adjusts the carrying value of right-of-use assets accordingly. If the carrying
value of right-of-use assets has been reduced to zero, while lease liabilities still needs to be further
Annual Report 2022
reduced, the remaining amount will be recorded in the profits and losses of the current period.
On the start date of the lease term, the Company divides the lease that substantially transfers almost
all risks and rewards related to the ownership of the leased assets into finance leases, except for
operating leases.
The Company recognizes the lease payments receivable as rental earnings in each period within the
lease term on a straight-line basis. The initial direct costs related to the operating lease are capitalized,
amortized within the lease term on the same basis as the recognition of rental earnings, and included in
the profit or loss for the current period. Variable lease payments obtained by the Company in relation to
operating leases that are not included in the lease receivable are included in the profit or loss for the
current period when they are actually incurred.
(2). Accounting treatment method for finance lease
□ Applicable √ Not applicable
(3). Definition method and accounting treatment method of lease under the new lease standards
□ Applicable √ Not applicable
□ Applicable √ Not applicable
(1). Changes in important accounting policy
√ Applicable □ Not applicable
Remarks (Name and
amount of items in
Approval
Contents of and reasons for the changes to accounting policies the statement
procedure
suffering significant
influence)
"accounting treatment for the sale of products or by-products
produced by an enterprise before the fixed assets reach their
intended useable state or during the research and development
No approval
process" stipulated in the Interpretation No. 15 of the No influence
required
Accounting Standards for Business Enterprises issued by the
Ministry of Finance since 1 January 2022. Changes in the
accounting policy had no influence on the Company's financial
statements.
"judgment on loss-making contracts" stipulated in the
Interpretation No. 15 of the Accounting Standards for Business No approval
No influence
Enterprises issued by the Ministry of Finance since 1 January required
Company's financial statements.
Annual Report 2022
"accounting treatment of the income tax effect of financial
instrument related dividend whose issuer is classified as equity
instrument" stipulated in the Interpretation No. 16 of the No approval
No influence
Accounting Standards for Business Enterprises issued by the required
Ministry of Finance since 30 November 2022. Changes in the
accounting policy had no influence on the Company's financial
statements.
"accounting treatment of share-based payment in cash
settlement modified into share-based payment in equity
settlement by the enterprise" stipulated in the Interpretation No. No approval
No influence
by the Ministry of Finance since 30 November 2022. Changes
in the accounting policy had no influence on the Company's
financial statements.
Other notes:
N/A
(2). Key changes in accounting estimates
□ Applicable √ Not applicable
(3). Adjustments to the financial statements at the beginning of the year of implementation of the
new accounting standards or interpretations of the standards for the first time since 2022
□ Applicable √ Not applicable
√ Applicable □ Not applicable
(1) Segment reporting
The Company identifies the operating segments based on the internal organisation structure,
management requirements and internal reporting system. An operating segment of the Company refers
to a component that meets the following conditions:
resource allocation and evaluate its performance;
information of the component through analysis.
(2) Hedge accounting
investment in foreign operations.
with it: (1) The hedging relationship is only composed of qualified hedging instruments and hedged
instruments; (2) At the beginning of hedging, the Company formally designated hedging instruments and
hedged items, and prepared written documents on hedging relationship and risk management strategies
and risk management objectives of the Company engaged in hedging; (3) The hedging relationship
meets the requirements of hedging effectiveness.
Annual Report 2022
When the hedging meets the following conditions at the same time, the Company determines that
the hedging relationship meets the requirements of hedging effectiveness: (1) There is an economic
relationship between the hedged item and the hedging instrument; (2) Credit risk does not play a
dominant role in the value changes caused by the economic relationship between hedged items and
hedging instruments; (3) The hedging ratio of the hedging relationship is equal to the ratio of the number
of hedged items actually hedged by the Company to the actual number of hedging instruments, but does
not reflect the imbalance of the relative weights of hedged items and hedging instruments.
The Company continuously evaluates whether the hedging relationship meets the hedging
effectiveness requirements on and after the hedging start date. If the hedging relationship no longer
meets the requirements of hedging effectiveness due to the hedging ratio, but the risk management
objectives of the designated hedging relationship have not changed, the Company shall rebalance the
hedging relationship.
(1) Fair value hedge
period. If the hedging instrument is used to hedge a non-trading equity instrument (or a component
thereof) that is chosen to be measured at fair value and whose changes are included in other
comprehensive income, the gains or losses arising from the hedging instrument are included in other
comprehensive income.
loss of the current period and meanwhile the carrying value of the hedged item not measured at fair
value shall be adjusted. If a hedged item is classified as financial assets (or a component thereof) that are
measured at fair value and whose changes are recorded in other comprehensive income according to
Article 18 of Accounting Standards for Business Enterprises No.22-Recognition and Measurement of
Financial Instruments, its gains or losses due to hedged risk exposure are recorded in profit and loss of
the current period, and its carrying value has been measured at fair value and will not be adjusted. If the
hedged item is a non-trading equity instrument investment (or a component thereof) that the Company
chooses to measure at fair value and its changes are recorded in other comprehensive income, the gains
or losses arising from the hedged risk exposure are recorded in other comprehensive income, and its
carrying value has been measured at fair value and will not be adjusted.
If a hedged item is an unrecognized firm commitment (or a component thereof), the cumulative
changes in the fair value arising from hedged risk after the designation of hedging relationship shall be
recognized as an asset or liability, and the related gain or loss shall be recorded in profit and loss of the
respective periods. In case of acquiring assets or bearing liabilities for performing a firm commitment,
the initially recognized amount of the assets or liabilities shall be adjusted to include the cumulative
changes in the fair value of the recognized hedged item.
If a hedged item is a financial instrument (or a component thereof) at measured amortized cost, the
adjustment to the carrying value of the hedged item shall be amortized based on the actual interest rate
recalculated on the commencement date of amortization and recorded in profit and loss of the current
period. If a hedged item is classified as financial assets (or a component thereof) that are measured at
fair value and whose changes are recorded in other comprehensive income according to Article 18 of
Accounting Standards for Business Enterprises No.22-Recognition and Measurement of Financial
Instruments, cumulative recognized hedging gains or losses are amortized in the same manner and
Annual Report 2022
recorded in profit and loss of the current period, but the carrying value of financial assets (or their
components) is not adjusted.
(2) Cash flow hedge
included in the other comprehensive income as a reserve for cash flow hedges, and the invalid part is
included in profit and loss of the current period. The amount of reserve for cash flow hedges is
recognized as the absolute amount of the lower of the following two items: A. The cumulative gains or
losses of hedging instruments since hedging; B. The cumulative change in the present value of the
estimated future cash flows of the hedged item since hedging.
subsequently recognize a non-financial asset or non-financial liability, or the forecast transaction of the
non-financial asset or non-financial liability forms a recognized commitment to which fair value hedge
accounting is applicable, the original amount of reserve for cash flow hedges recognized in other
comprehensive income shall be transferred out and recorded in the initially recognized amount of such
non-financial asset or non-financial liability.
other comprehensive income is transferred out during the same period when the hedged expected
transaction affects the profit and loss, and is recorded in the profit and loss of the current profit.
(3) Net investment hedge in a foreign operation
The part of the gains or losses formed by hedging instruments that belong to effective hedging is
recognized as other comprehensive income, and when disposing of foreign operations, it is transferred
out and recorded in the profit and loss of the current profit. The part of the gains or losses resulting from
hedging instruments that belong to invalid hedging shall be recorded in profit and loss of the current
period.
VI Taxation
Major types of taxes and tax rates
√ Applicable □ Not applicable
Tax Tax basis Tax rate
Revenue from commodity sales and taxable services
calculated according to the tax law are the basic
VAT calculation of output tax. After deducting the amount
of input tax which is allowed to be deducted in the
current period, the difference is the VAT payable.
Ad valorem tax: levied at 1.2% of the remaining value
after deducting 30% from the original value of the
Real estate tax 1.2%, 12%
housing property; Tax levied from rent: levied at 12%
of the rental income.
Urban
maintenance and Turnover tax paid 5%, 7% [Note 2]
construction tax
Educational fee Turnover tax paid 3%
Local educational
Turnover tax paid By 2%
fee
Enterprise
Amount of taxable income 25%, 20%, 15%, 8.25%
income tax
Annual Report 2022
[Note 1] The tax of the Company's main products is levied at the tax rate of 13%, and VAT of
interest income is levied at the tax rate of 6%; VAT of the real estate rental income of subsidiaries
Banmen Electric Appliance and Shanghai Gongniu is levied at a tax rate of 5% according to the simple
method; VAT of Lingbo Gongniu's real estate rental income is partly levied at a tax rate of 5% and
partly at 9% according to the simple method.
[Note 2] Electric Sales is levied at a tax rate of 7%, and other companies at a tax rate of 5%
Explanation of disclosure if different income tax rates apply to different corporate taxpayers
√ Applicable □ Not applicable
Name of taxpayer Income tax rate (%)
The Company 15%
Ningbo Gongniu 15%
Gongniu Photoelectric 15%
Gongniu Digital 15%
Domestic Electrical Appliance 15%
Bull HK 8.25%
Xingluo Trading 20%
Bull International Trading 20%
Hainan Dacheng 20%
Other taxpayers except the above 25%
√ Applicable □ Not applicable
Ningbo City's Accreditation Authority in 2022 issued by the Office of the National Leading Group for
the Identification and Management of High-tech Enterprises on 30 December 2022, the Company and
Domestic Electrical Appliance were identified as high-tech enterprises in Ningbo in 2022, with a valid
term of 3 years. Therefore, from 2022 to 2024, the Company and Domestic Electrical Appliance enjoy a
preferential corporate income tax rate of 15%.
(YGQRL [2020] No.1) issued by the Leading Group for the Identification and Management of
High-tech Enterprises of Ningbo on 15 January 2021, Gongniu Digital was recognized as a high-tech
enterprise in Ningbo in 2020, and its qualification is valid for 3 years. From 2020 to 2022, Gongniu
Digital enjoys a preferential corporate income tax rate of 15%.
issued by Beilun District Science and Technology Bureau of Ningbo on 19 January 2022, Ningbo
Gongniu and Gongniu Photoelectric were recognized as high-tech enterprises in Ningbo in 2020, and
their qualification is valid for 3 years. From 2021 to 2023, Ningbo Gongniu and Gongniu Photoelectric
enjoy a preferential corporate income tax rate of 15%.
and the Ministry of Science and Technology on Increasing Pre-tax Deductions in Support of Scientific
and Technological Innovation (Announcement No. 28 [2022] of the Ministry of Science and Technology)
issued on 22 September 2022, equipment and instruments purchased from 1 October 2022 to 31
Annual Report 2022
December 2022 were eligible for a full deduction in a lump sum for the year in the calculation of taxable
income and for a 100% pre-tax additional deduction. The Company, Ningbo Gongniu, Photoelectric
Technology, Digital Technology and Domestic Electrical Appliance satisfied the above requirements
and enjoyed relevant concessions.
Micro Enterprises (C.SH. [2019] No. 13) issued by the Ministry of Finance and the State Taxation
Administration and the Announcement on Issues Related to Implementing Inclusive Income Tax
Reduction and Exemption Policy for Small Low-profit Enterprises (State Administration of Taxation
Announcement No. 2 in 2019) issued by the State Administration of Taxation, from 1 January 2019 to
RMB1 million (including RMB1 million) shall be included in the taxable revenue at a reduced rate of
taxable revenue exceeds RMB1 million but not more than RMB3 million shall be included in the taxable
revenue at a reduced rate of 50%, and the corporate revenue tax shall be levied at the tax rate of 20%.
According to the Announcement on the Implementation of Preferential Income Tax Policies for Small-
and Micro-sized Enterprises and Individual Industrial and Commercial Entities (No. 12 of 2021) issued
by the Ministry of Finance and the State Taxation Administration, from 1 January 2021 to 31 December
RMB1 million, the corporate income tax will be levied by half on the basis of the preferential policies
stipulated in Article 2 of the Tax Credit Policies for Small and Micro Enterprises (C.SH. [2019] No. 13)
issued by the Ministry of Finance and the State Taxation Administration. Xingluo Trading, Bull
International Trading and Hainan Dacheng meet the recognition criteria of small low-profit enterprises,
and pay corporate income tax at the preferential tax rate of small low-profit enterprises.
□ Applicable √ Not applicable
VII. Notes to the Consolidated Financial Statements
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Cash on hand 34,167.84
Bank deposits 4,435,294,692.17 4,230,383,599.91
Other monetary assets 55,930,602.55 87,372,876.35
Interest receivable on
term deposits
Total 4,611,966,169.54 4,377,228,556.74
Of which: Total
amount deposited 174,605.10 217,966.13
overseas
Deposits placed with
finance companies
Annual Report 2022
Other notes
The limited funds in the closing balance of other monetary assets include a futures margin of
RMB13,774,515.95 and cash deposits for L/G of RMB7,141,771.63.
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Financial assets at fair value through
profit or loss
Of which:
Banking WM products 1,919,000,000.00 1,936,600,000.00
Trust product 1,260,000,000.00 1,120,000,000.00
Asset management plan 3,420,000,000.00 2,670,000,000.00
Securities return voucher 350,000,000.00 200,000,000.00
Total 6,949,000,000.00 5,926,600,000.00
Other notes:
√Applicable□Not applicable
(1) Description of held-for-trading financial assets with restrictions on the realisation
The closing balance of held-for-trading financial assets includes closed-end WM products worth
RMB6,853 million
(2) Details of banking WM products
Item Closing balance Opening balance Type
“Yangguang Tianli Zhenxiang” No.
Non-principal-guaranteed
C001 of Everbright Wealth 300,000,000.00
floating income
Management
Ningxin One-year Regular Open
Wealth Management Product No.
Non-principal-guaranteed
floating income
Wealth Management Co., Ltd.,
Bank of Ningbo
CMBC Fuzhu Bond, Automatically
Renewed Public Wealth Non-principal-guaranteed
Management Products, with a floating income
Holding Period of 182 Days
Ningxin One-year Regular Open
Wealth Management Product No.
Non-principal-guaranteed
floating income
Wealth Management Co., Ltd.,
Bank of Ningbo
BOC Wealth Management
“Wenxiang” Enhanced Fixed Non-principal-guaranteed
Income (Closed-end) Phase 202218 floating income
of Bank of China
BOC Wealth Management
“Wenxiang” Enhanced Fixed Non-principal-guaranteed
Income (Closed-end) Phase 202219 floating income
of Bank of China
Ningxin One-year Regular Open
Wealth Management Product No.
Non-principal-guaranteed
floating income
Wealth Management Co., Ltd.,
Bank of Ningbo
Annual Report 2022
Jingyao One-year Regular Open
Wealth Management Product No. 7
Non-principal-guaranteed
with Fixed Income of BNB Wealth 100,000,000.00
floating income
Management Co., Ltd., Bank of
Ningbo
Ningxin Closed-end Wealth
Management Product No. 254 with
Non-principal-guaranteed
Fixed Income of BNB Wealth 100,000,000.00
floating income
Management Co., Ltd., Bank of
Ningbo
Ningxin One-year Regular Open
Wealth Management Product No.
Non-principal-guaranteed
floating income
Wealth Management Co., Ltd.,
Bank of Ningbo
Non-principal-guaranteed
Placement Products of Bank of 50,000,000.00 50,000,000.00
floating income
Ningbo
Ningxin One-year Regular Open
Wealth Management Product No.
Non-principal-guaranteed
floating income
Wealth Management Co., Ltd.,
Bank of Ningbo
CMB Wealth Management
“Zhaorui Jinding” Fixed Income Non-principal-guaranteed
Program No. 4 with 14-month Fixed floating income
Opening Period
“ABC Pay at Any Time” Open
Non-principal-guaranteed
RMB Wealth Management Products 26,000,000.00 92,500,000.00
floating income
of ABC Wealth Management
Non-principal-guaranteed
CMBC Tiantian Zengli 372,000,000.00
floating income
Non-principal-guaranteed
Placement Products of Bank of 200,000,000.00
floating income
Ningbo
Ningxin Semi-annual Regular Open
Wealth Management Product No. 6
Non-principal-guaranteed
with Fixed Income of BNB Wealth 180,000,000.00
floating income
Management Co., Ltd., Bank of
Ningbo
CMBC Corporate Wealth Non-principal-guaranteed
Management Product Ririxin 80008 floating income
Ningxin Closed-end Wealth
Management Product No. 75 with
Non-principal-guaranteed
Fixed Income of BNB Wealth 120,000,000.00
floating income
Management Co., Ltd., Bank of
Ningbo
CMBC Extraordinary Asset
Management Daily
Non-principal-guaranteed
Profit-increasing Wealth 100,000,000.00
floating income
Management Products (Institutional
Funds)
Ningxin Closed-end Wealth
Management Product No. 183 with Non-principal-guaranteed
Fixed Income of BNB Wealth floating income
Management Co., Ltd., Bank of
Annual Report 2022
Ningbo
Everbright Cash A of Everbright Non-principal-guaranteed
Bank (EB4395) floating income
Ningxin Semi-annual Regular Open
Wealth Management Product No. 1
Non-principal-guaranteed
with Fixed Income of BNB Wealth 50,000,000.00
floating income
Management Co., Ltd., Bank of
Ningbo
ICBC “TLB” Net-value Wealth Non-principal-guaranteed
Management Products floating income
ABC “Golden Key, Anxin Profits
Non-principal-guaranteed
floating income
Management Products
Subtotal 1,919,000,000.00 1,936,600,000.00
(3) Details of trust products
Item Closing balance Opening balance Type
Financial City Hongyu No. 1
Non-principal-guaranteed
Collective Fund Trust Plan of 490,000,000.00 350,000,000.00
floating income
Lujiazui International Trust
Xicheng Profit Increase Single Fund Non-principal-guaranteed
Trust of Huaneng Guicheng Trust floating income
Zhaofubao No. 17 Collective Fund Non-principal-guaranteed
Trust Plan of SDIC Taikang Trust floating income
Wenying No. 2 Single Fund Trust Non-principal-guaranteed
of Lujiazui International Trust floating income
Wenying No. 1 Single Fund Trust Non-principal-guaranteed
of Lujiazui International Trust floating income
Yongxinbao D-type WM No. 2
Non-principal-guaranteed
Collective Fund Trust Plan of SDIC 50,000,000.00
floating income
Taikang Trust
Fengli Jijixin No. 8 Collective Fund Non-principal-guaranteed
Trust Plan of Cofco Trust floating income
Xinyue Fengli FL30 of Shanghai Non-principal-guaranteed
Trust floating income
Yongxinbao D-type WM No. 2
Non-principal-guaranteed
Collective Fund Trust Plan of SDIC 15,000,000.00
floating income
Taikang Trust
Xinyue Fengli Series Collective Non-principal-guaranteed
Fund Trust Plan of Shanghai Trust floating income
Shengyuan Profit-increasing Bond
Collective Fund Trust Plan of Non-principal-guaranteed
Everbright Securities and floating income
Everbright Trust
Xinxiang Bond Investment
Non-principal-guaranteed
Collective Fund Trust Plan of 30,000,000.00
floating income
CITIC Trust
Subtotal 1,260,000,000.00 1,120,000,000.00
(4) Asset management plan
Opening
Item Closing balance Type
balance
Yuxiang No. 1 Collective Asset Non-principal-guaranteed
Management Plan of Everbright floating income
Annual Report 2022
Securities Asset Management
Anxiang Bond No. 53 of Haitong Non-principal-guaranteed
Securities floating income
Financing Business, Debt Income
Non-principal-guaranteed
Right Transfer and Forward Transfer 300,000,000.00 100,000,000.00
fixed income
Contract of Founder Securities
Yuxiang No. 2 Collective Asset
Non-principal-guaranteed
Management Plan of Everbright 220,000,000.00 220,000,000.00
floating income
Securities Asset Management
Anzhi No. 2 Single Asset
Non-principal-guaranteed
Management Plan of Huafu 200,000,000.00
floating income
Securities
Yongxin No. 2 Single Asset
Non-principal-guaranteed
Management Plan of Yongzheng 200,000,000.00
floating income
Asset Management
Yuexiang No.1 Collective Asset
Non-principal-guaranteed
Management Plan of Everbright 800,000,000.00
floating income
Securities Asset Management
Niannianwang Collective Asset
Non-principal-guaranteed
Management Plan of Haitong 400,000,000.00
floating income
Securities Asset Management
Huatai Zijin Collective Asset
Non-principal-guaranteed
Management Plan of Huatai 400,000,000.00
floating income
Securities
Yongxin Single Asset Management
Non-principal-guaranteed
Plan of Yongxing Securities Asset 200,000,000.00
floating income
Management, Yongxing Securities
Niannianwang No.88 Collective
Non-principal-guaranteed
Asset Management Plan of Haitong 150,000,000.00
floating income
Securities Asset Management
Everbright Sunshine Big Dipper Star
Non-principal-guaranteed
No. 7 Collective Asset Management 90,000,000.00
floating income
Plan of Everbright Securities
Everbright Sunshine Big Dipper Star
Non-principal-guaranteed
No. 6 Collective Asset Management 60,000,000.00
floating income
Plan of Everbright Securities
Subtotal 3,420,000,000.00 2,670,000,000.00
(5) Securities return voucher
Opening
Item Closing balance Type
balance
Caiyingtong Series CSI 500 Single
Principal-guaranteed
Bullish Shark No. 28 Return Voucher of 50,000,000.00
floating income
Caitong Securities
Caiyingtong Series CSI 500 Single
Principal-guaranteed
Bullish Shark No. 25 Return Voucher of 50,000,000.00
floating income
Caitong Securities
Guangpu 360 Feicui No. 154 of Principal-guaranteed
Everbright Securities floating income
Guangpu 360 Feicui No. 95 of Principal-guaranteed
Everbright Securities floating income
Zhangdiebao Spread Series No. 135
Principal-guaranteed
Return Voucher (CSI 500 Long) of 50,000,000.00
floating income
Sinolink Securities
Annual Report 2022
Xingdong Series Single Bullish Shark
Floating Return Voucher No. 235 Principal-guaranteed
(Ningbo) of Industrial Securities (CSI floating income
Caiyingtong Series CSI 500 Double
Principal-guaranteed
Bullish Shark No. 20 Return Voucher of 30,000,000.00
floating income
Caitong Securities
Guangpu 360 Feicui No. 95 of Principal-guaranteed
Everbright Securities floating income
Return Voucher “JinTianli” No. D184 of Principal-guaranteed
Founder Securities floating income
Guangjing Series Return Voucher No. Principal-guaranteed
Xingdong Series
Automatically-redeemed Floating Principal-guaranteed
Return Voucher No. 65 of Industrial floating income
Securities (CSI 500 Long)
Xingzhi Series Single Shark Floating
Principal-guaranteed
Return Voucher No. 107of Industrial 50,000,000.00
floating income
Securities (Ningbo) (CSI 500 Long)
Subtotal 350,000,000.00 200,000,000.00
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Hedge instruments - commodity future
contract
Total 643,100.00 3,613,050.00
Other notes:
The Company hedged raw materials such as copper and plastic particles purchased, performed
accounting treatment as cash flow hedges, and recorded the profit on the book in the derivative financial
assets.
(1) Notes receivable listed by category
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Bank acceptance notes
Trade acceptance notes 750,723.35
Total 750,723.35
(2) Notes receivable pledged by the Company at the period-end
□Applicable√Not applicable
(3) Notes receivable which had been endorsed by the Company or had discounted and had not due
on the balance sheet date at the period-end
□Applicable√Not applicable
(4) Notes transferred to accounts receivable because the drawer of the notes failed to execute the
contract or agreement
□Applicable√Not applicable
(5) Breakdown by method of establishing allowance for doubtful account
√Applicable□Not applicable
Unit: RMB
Annual Report 2022
Closing balance Opening balance
Carrying balance Bad debt provision Carrying balance Bad debt provision
Type Carryin
Accrued g Accrued Carrying
Percentag Percentag
Amount Amount proportio amount Amount Amount proportio amount
e (%) e (%)
n (%) n (%)
Bad debt
provision
establishe 3,712,829.7 3,712,829.7 361,810.7
d on the 5 5 1
individual
basis
Of which:
Bank
acceptanc
e notes
Trade
acceptanc 100.00 100.00 361,810.71 31.41 100.00
e notes
Bad debt
provision
accrued 790,235.11 68.59 39,511.76 5.00
by
portfolio
Of which:
Bank
acceptanc
e notes
Trade
acceptanc 790,235.11 68.59 39,511.76 5.00
e notes
Total 100.00 100.00 100.00 34.84
Bad debt provision established on the individual basis:
√Applicable□Not applicable
Unit: RMB
Closing balance
Name Bad debt Accrued Reason for
Carrying balance
provision proportion (%) accruing
Significant
Sunac Real Estate
Group Co., Ltd.
expected
Total 3,712,829.75 3,712,829.75 100.00 /
Notes to bad debt provision accrued by item:
√Applicable□Not applicable
Note: The Company is related to and controlled by Sunac Real Estate Group which is the ultimate
voucher issuer.
Bad debt provision accrued by portfolio:
□Applicable√Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
□Applicable√Not applicable
(6) Bad debt provision
√Applicable□Not applicable
Unit: RMB
Annual Report 2022
Changes for the current period
Opening Closing
Type
balance balance
Reversed or
Established Charged-off/Written-off
transferred-back
Bad debt
provision
accrued by
item
Bad debt
provision
accrued by
portfolio
Total 401,322.47 3,311,507.28 3,712,829.75
Of which significant amount of recovered or transferred-back bad debt provision for the current period:
□Applicable√Not applicable
Other notes:
None.
(7) Notes receivable with actual written-off for the Reporting Period
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
(1) Breakdown by aging
√Applicable□Not applicable
Unit: RMB
Aging Closing carrying balance
Within 1 year
Of which: Sub-items within one year
Within 1 year 233,008,605.06
Subtotal within one year 233,008,605.06
Over 3 years 6,932,922.28
Total 246,477,011.69
(2) Breakdown by method of establishing allowance for doubtful account
√Applicable□Not applicable
Unit: RMB
Closing balance Opening balance
Carrying balance Bad debt provision Carrying balance Bad debt provision
Type Accrue Carrying Accrue Carrying
Percenta d amount Percenta d amount
Amount Amount Amount Amount
ge (%) proporti ge (%) proporti
on (%) on (%)
Bad
debt
provisio
n
establish
ed on
the
individu
al basis
Annual Report 2022
Bad
debt
provisio
n 100.00 7.98 100.00 5.08
accrued
by
portfolio
Total 100.00 7.98 100.00 5.08
Bad debt provision established on the individual basis:
□Applicable√Not applicable
Bad debt provision accrued by portfolio:
√Applicable□Not applicable
Unit: RMB
Closing balance
Name
Accounts receivable Bad debt provision Accrued proportion (%)
Within 1 year 233,008,605.06 11,650,430.23 5.00
Over 3 years 6,932,922.28 6,932,922.28 100.00
Total 246,477,011.69 19,668,312.50 7.98
Criteria and explanation of bad debt provision accrued by portfolio:
□Applicable√Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
□Applicable√Not applicable
(3) Bad debt provision
√Applicable□Not applicable
Unit: RMB
Changes for the current period
Opening Transferred Closing
Type Recovered Other
balance Established or balance
or reversed changes
written-off
Bad debt
provision
accrued by
portfolio
Total 11,735,996.31 324,932.55 817,175.84 615,760.06 7,405,967.86 19,668,312.50
[Note] Other changes represent the increase in the bad debt provision arising from the acquisition
of Dalitek.
Of which significant amount of recovered or transferred-back bad debt provision for the current period:
√Applicable□Not applicable
Unit: RMB
Entity Amount reversed or transferred-back Way of recovery
Shanghai Lotus
Supermarket Chain 707,267.51 Litigation
Store Co., Ltd.
Total 707,267.51 /
Other notes:
None.
Annual Report 2022
(4) Accounts receivable written-off in current period
√Applicable□Not applicable
Unit: RMB
Item Amount written-off
Accounts receivable written-off 615,760.06
Of which: The written-off of significant accounts receivable
□Applicable√Not applicable
Notes to written-off of accounts receivable:
□Applicable√Not applicable
(5) Top 5 of the closing balance of the accounts receivable collected according to arrears party
√Applicable □Not applicable
Unit: RMB
As % of the closing
Closing balance of bad
Entity Closing balance balance of total
debt provision
accounts receivable
Beijing Jingdong
Century Trading Co., 57,730,716.19 23.42 2,886,535.81
Ltd.
Ningbo Boya Metal
Material Co.,Ltd
Zhejiang TMALL
Technology Co., Ltd.
ALPHA.LTD 6,685,976.72 2.71 334,298.84
Kangcheng
Investment (China) 6,223,169.73 2.52 311,158.49
Co., Ltd.
Total 108,466,122.67 44.01 5,423,306.15
Other notes
None.
(6) Accounts receivable derecognised due to the transfer of financial assets
□Applicable √Not applicable
(7) Amount of assets and liabilities formed due to the transfer and the continued involvement of
accounts receivable
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Bank acceptance notes 1,036,801.70 927,023.00
Total 1,036,801.70 927,023.00
The changes of accounts receivable financing in the Current Period and the changes in fair value
□Applicable√Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
Annual Report 2022
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
(1) Breakdown of prepayments by aging
√Applicable □Not applicable
Unit: RMB
Closing balance Opening balance
Aging
Amount Percentage (%) Amount Percentage (%)
Within 1 year 48,536,368.53 97.79 28,765,116.10 98.71
Over 3 years 42,500.00 0.09 37,500.00 0.13
Total 49,635,694.61 100.00 29,140,223.00 100.00
Reason for outstanding prepayments that are over 1 year and of a substantial amount:
None.
(2).Status of the top five advance payments in the closing balances by prepaid subject
√Applicable □Not applicable
Percentage of total advances to
Entity Closing balance
suppliers (%)
Guangxi Jingdong Xinjie
E-commerce Co., Ltd.
Giugiaro Architecture S.r.l. 2,809,992.00 5.66
Tianjin Bohua Nangang
International Trade Co., Ltd.
Beijing Jiahe Jingshi Culture
Media Co., Ltd.
Jiangsu Pengbo Xingye
E-commerce Co., Ltd.
Total 14,311,516.82 28.83
Other notes
None.
Other notes
□Applicable √Not applicable
Breakdown
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Interests receivable
Dividends receivable
Other receivables 71,887,692.32 195,924,505.99
Total 71,887,692.32 195,924,505.99
Other notes:
□Applicable√Not applicable
Annual Report 2022
Interests receivable
(1) Category of interests receivable
□Applicable√Not applicable
(2) Significant overdue interest
□Applicable√Not applicable
(3) Bad debt provision
□Applicable√Not applicable
Other notes:
□Applicable √Not applicable
Dividends receivable
(4) Dividends receivable
□Applicable√Not applicable
(5) Significant dividends receivable aging over one Year
□Applicable√Not applicable
(6) Bad debt provision
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
Other receivables
(7) Breakdown by aging
√Applicable□Not applicable
Unit: RMB
Aging Closing carrying balance
Within 1 year
Of which: Sub-items within one year
Within 1 year 13,221,675.68
Subtotal within one year 13,221,675.68
Over 3 years 4,575,618.48
Total 134,200,767.72
(8) Breakdown by nature
√Applicable□Not applicable
Unit: RMB
Nature Closing carrying balance Opening carrying balance
Call money 110,000,000.00 111,000,000.00
Housing loan for employees 12,466,303.78 16,817,779.29
Guaranteed deposit 8,486,128.40 101,781,134.68
Others 3,248,335.54 670,191.81
Total 134,200,767.72 230,269,105.78
(9) Bad debt provision
√Applicable□Not applicable
Unit: RMB
Phase I Phase II Phase III
Bad debt 12-month Lifetime expected Lifetime expected
Total
provision expected credit credit loss (without credit loss (with
loss credit impairment) credit impairment)
Balance of 1
January 2022
Balance of 1
Annual Report 2022
January 2022 in
the Current Period
- Transferred to
-250,045.44 250,045.44
Stage 2
- Transferred to
-20,240,256.45 20,240,256.45
Stage 3
- Transferred back
to Stage 2
- Transferred back
to Stage 1
Amount accrued
for the current -4,045,817.46 -1,571,349.86 32,451,250.70 26,834,083.38
period
Amount
transferred-back
for the current
period
Amount
charged-off for the
current period
Amount
written-off for the 11,100.00 11,100.00
current period
Other changes 42,960.23 3,000.00 1,099,532.00 1,145,492.23
Balance as at 31
December 2022
Notes to significant changes in the carrying balance of other receivables for which changes in the loss
reserve for the current period occurred:
√Applicable□Not applicable
Note: Other changes represent the increase in the bad debt provision arising from the acquisition of
Dalitek.
The amount of bad debt provision for the current period and the basis for assessing whether the credit
risk of financial instruments has increased significantly:
□Applicable√Not applicable
(10) Bad debt provision
√Applicable□Not applicable
Unit: RMB
Changes for the current period
Opening Reversed or Closing
Type Charged-off/Written- Other
balance Established transferred-ba balance
off changes
ck
Bad
debt
provisio 22,000,000. 33,500,000. 55,500,000.
n 00 00 00
accrued
by item
Bad
debt
provisio 12,344,599. -6,665,916.6 1,145,492.2 6,813,075.4
n 79 2 3 0
accrued
by
Annual Report 2022
portfoli
o
Total 34,344,599. 26,834,083. 1,145,492.2 62,313,075.
Of which the bad debt provision recovered or transferred-back with significant amount during the
current period:
□Applicable√Not applicable
(11) Particulars of the actual written-off of other receivables during the current period
□Applicable√Not applicable
(12) Other receivables with the top five closing balances collected according to the arrears party
√Applicable□Not applicable
Unit: RMB
As a % of the
Nature of Bad debt
closing balance
Entity other Closing balance Aging provision
of total other
receivable Closing balance
receivables
Sunac Real
Estate Group 2 to 3
Call money 110,000,000.00 81.97 55,000,000.00
Co., Ltd. years
[note]
Changzhou
Pa’erlingke
Intelligent
Payment Over 3
Lifting 1,099,532.00 0.82 1,099,532.00
for goods years
Lighting
Equipment
Co., Ltd.
Advances Within 1
Xie Weiwei 708,080.00 0.53 35,404.00
Receivable year
Shanghai
Caohejing
Development
Zone Guaranteed Within 1
High-tech deposit year
Park
Development
Co., Ltd.
Beijing
Jingdong
Guaranteed Within 1
Century 650,000.00 0.48 32,500.00
deposit year
Trading Co.,
Ltd.
Total / 113,159,674.90 84.32 56,202,539.15
[Note] The loan was provided by the Company's subsidiary Electric Sales to Sunac Real Estate
Group Co., Ltd. Inclusive of seven of its subsidiaries in order to expand its sales to Sunac Group in the
principal amount of RMB110,000,000.00 for a period of two years, which was guaranteed by Sunac
Group.
(13) Accounts receivable involving government grants
□Applicable√Not applicable
(14) Other receivables derecognised due to the transfer of financial assets
□Applicable √Not applicable
Annual Report 2022
(15) Amount of assets and liabilities formed due to the transfer and the continued involvement of
other receivables
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
(1).Category of inventories
√Applicable□Not applicable
Unit: RMB
Closing balance Opening balance
Inventory Inventory
Item Carrying falling Carrying Carrying falling Carrying
balance price amount balance price amount
reserves reserves
Finished 673,207,187.7 14,761,249. 658,445,938.4 893,826,248.2 9,387,709. 884,438,539.2
goods 0 29 1 4 01 3
Goods in 293,819,050.6 293,819,050.6 130,428,496.7 130,428,496.7
transit 8 8 1 1
Raw materials 113,937,083.0 113,937,083.0 124,009,445.4 124,009,445.4
Work-in-progr 160,824,141.9 160,824,141.9 163,087,929.2 163,087,929.2
ess 2 2 7 7
Commissione
d products
Low-value
consumables
Packaging
material
Total 1,299,979,705 14,761,249. 1,285,218,456 1,386,374,831 9,387,709. 1,376,987,122
.38 29 .09 .61 01 .60
(2).Inventory falling price reserves and impairment allowances for contract performance costs
√Applicable□Not applicable
Unit: RMB
Increase in the current Decrease in the current
Opening period period Closing
Item
balance Reversed or balance
Established Others Others
charged-off
Finished goods 9,387,709.01 11,504,455.94 2,529,326.21 8,660,241.87 14,761,249.29
Total 9,387,709.01 11,504,455.94 2,529,326.21 8,660,241.87 14,761,249.29
Note: Other increased amounts represent the increase in the acquisition of Dalitek.
(3).Note on closing balance of inventory containing the capitalised amount of borrowing costs
□Applicable √Not applicable
(4).Notes of the amount of contract performance costs amortised for the current period
□Applicable√Not applicable
Other notes
√Applicable □Not applicable
The specific basis for determining the net realisable value, the reasons for the shrinkage reserves for
transferred-back or charged-off inventories for the current period
Annual Report 2022
Reasons for
The specific basis Reasons for charged-off
transferred-backing the
Item for determining the net the reserve for inventory
reserve for inventory
realisable value shrinkage
shrinkage
The net realisable value is
For the Current Period,
determined by estimated
Finished the inventories, which
selling price deducting the
goods accrued shrinkage
estimated selling expense
reserves, have been sold
and the relevant taxes
(1).Details of contract assets
□Applicable√Not applicable
(2).Significant changes in the amount of carrying value and the reason in the Reporting Period
□Applicable√Not applicable
(3).Impairment allowances for contract assets in the current period
□Applicable√Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
□Applicable√Not applicable
□Applicable√Not applicable
Significant investments in debt obligations and other investments in debt obligations at the
period-end:
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Contract acquisition costs
Refund costs receivable
Wealth management products 283,755,939.73 1,114,551,150.68
Input VAT to be credited 63,937,448.75 10,534,966.75
Advance payment of enterprise
income tax
Total 363,825,426.89 1,126,520,898.44
Other notes
Details of WM products
Item Closing balance Opening balance Type
Structural bank deposits of Structural bank
Ningbo Bank deposits
Return voucher of Founder
Securities
Structural bank deposits of China Structural bank
Merchants Bank deposits
Annual Report 2022
Yanguangbi Jigouying of
Everbright Bank
Structural bank deposits of
Structural bank
Industrial & Commercial Bank 500,000,000.00
deposits
of China
Structural bank deposits of Structural bank
Agricultural Bank of China deposits
Structural bank deposits of Bank Structural bank
of Communications deposits
Structural bank deposits of Bank Structural bank
of Communications deposits
Interest on structural bank
deposits
Total 283,755,939.73 1,114,551,150.68
(1).Debt investments
□Applicable√Not applicable
(2).Significant debt investments at the period-end
□Applicable√Not applicable
(3).Status of accrued depreciation reserves
□Applicable√Not applicable
The amount of the depreciation reserves for the current period and the basis for assessing whether the
credit risk for financial instruments has increased significantly
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
(1).Other debt investments
□Applicable√Not applicable
(2).Significant other debt investments at the period-end
□Applicable√Not applicable
(3).Status of accrued depreciation reserves
□Applicable√Not applicable
The amount of the depreciation reserves for the current period and the basis for assessing whether the
credit risk for financial instruments has increased significantly
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
(1).Details of long-term receivables
□Applicable√Not applicable
(2).Bad debt provision
□Applicable√Not applicable
The amount of the bad debt provision for the current period and the basis for assessing whether the
credit risk for financial instruments has increased significantly
□Applicable√Not applicable
Annual Report 2022
(3).Derecognition of long-term receivables due to the transfer of financial assets
□Applicable √Not applicable
(4).The amount of the assets and liabilities formed due to the transfer and the continued
involvement of long-term receivables
□Applicable √Not applicable
Other notes
□Applicable√Not applicable
□Applicable√Not applicable
(1).Investment in other equity instruments
□Applicable√Not applicable
(2).Status of an equity investment that is not held for trading
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
Investment property by measurement method
N/A
Breakdown
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Fixed assets 1,851,129,657.93 1,489,874,874.31
Fixed assets disposed of 3,364,852.64 3,858,246.51
Total 1,854,494,510.57 1,493,733,120.82
Other notes:
□Applicable√Not applicable
Annual Report 2022
Fixed assets
(1).List of fixed assets
√Applicable□Not applicable
Unit: RMB
Decoration of
Transportation Electronic and other
Item Buildings and constructions Machinery equipment the fixed Total
vehicle equipment
assets
I. Original Carrying Value:
balance
the current 428,700,972.22 125,281,944.29 3,459,432.68 28,830,928.84 6,156,530.82 592,429,808.85
period
(1)
Purchased
(2) Transfer
from
construction
in progress
(3) Increase
due to
business
combination
in the current 1,096,640.58 40,015,377.08 1,981,471.84 4,457,862.07 47,551,351.57
period
(1) Disposal
or retirement
balance
II. Accumulated Depreciation
balance
the current 59,642,335.61 129,819,079.79 5,694,034.54 19,473,402.27 9,226,461.39 223,855,313.60
period
(1)
Established
(2) Increase 770,692.80 663,942.79 1,434,635.59
Annual Report 2022
through
consolidation
in the current 1,087,607.83 29,238,818.56 1,918,590.01 4,457,862.07 36,702,878.47
period
(1) Disposal
or retirement
balance
III. Impairment Allowances
balance
the current
period
(1)
Established
in the current 3,528,761.47 3,528,761.47
period
(1) Disposal
or retirement
balance
IV. Carrying Amount
carrying 1,302,497,611.31 500,914,237.69 1,604,228.36 28,857,554.84 17,256,025.73 1,851,129,657.93
amount
carrying 933,448,007.45 512,699,170.24 3,901,712.05 19,500,028.27 20,325,956.30 1,489,874,874.31
amount
Annual Report 2022
(2).List of temporarily idle fixed assets
□Applicable√Not applicable
(3).Status of fixed assets obtained by finance lease
□Applicable√Not applicable
(4).Fixed assets leased out from operation lease
√Applicable□Not applicable
Unit: RMB
Item Ending carrying amount
Buildings and constructions 2,499,295.57
(5).Fixed assets with pending ownership certificate
√Applicable□Not applicable
Unit: RMB
Reason for not obtaining
Item Carrying amount
ownership certificate
A technology information
company in Room 301 and
Delivered and procedures are in
others, Building 7, Zone A, 240,154,680.74
process in the Current Period
Yinggang East Road, Zhao
Xiang Town
Information needs to be changed,
The 3# Factory in the Western
Base of the Company
to be replaced
The 2# Factory and auxiliary
Information needs to be changed,
engineering in Cidong Precision
Manufacturing Base of the
to be replaced
Company
The 1# Factory and auxiliary Information needs to be changed,
engineering in the Company’s 81,103,303.69 and ownership certificate needs
precision manufacturing base to be replaced
Information needs to be changed,
Auxiliary engineering of the 3#
Factory
to be replaced
Subtotal 592,966,597.60
Other notes:
□Applicable√Not applicable
Fixed assets disposed of
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Scrapped machinery equipment
yet to be completely disposed
Total 3,364,852.64 3,858,246.51
Other notes:
None.
Breakdown
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
Annual Report 2022
Construction in progress
(1).Details of construction in progress
√Applicable□Not applicable
Unit: RMB
Closing balance Opening balance
Item Carrying Impairment Carrying Carrying Impairment Carrying
balance allowances amount balance allowances amount
R&D centre
and
headquarters
base
construction
project
Base
construction
project for
annual
output of
sets of LED
lamps
Base
construction
project for
annual
output of 130,109,662.81 130,109,662.81 2,156,275.13 2,156,275.13
sets of wall
switches and
sockets
Construction
project for
automation
upgrading of
annual 20,761,287.51 20,761,287.51 14,280,038.14 14,280,038.14
output of
sets of
converters
Information
construction 2,814,215.88 2,814,215.88 3,539,851.67 3,539,851.67
project
Equipment
to be 22,521,969.18 22,521,969.18 28,504,645.70 28,504,645.70
installed
Other small
projects
Total 611,457,850.54 611,457,850.54 198,364,136.97 198,364,136.97
Annual Report 2022
(2).Changes in significant construction in progress during the current period
√Applicable□Not applicable
Unit: RMB
Of which:
Transferred Transferre Other Cumulativ Interest
Cumulativ Capitalise
Period-beginnin Increase in to fixed d in fixed decrease e project Project capitalisatio Fundin
Period-end e d interest
Project Budget g the current assets in the assets in s in the investment progress(% n rate for g
balance capitalised in the
balance period current the Current current as % of ) the current source
interest current
period Period period the budget period (%)
period
R&D centre
and
headquarter 144,438,563.2 212,491,009.5 Fund
s base 5 7 raising
constructio
n project
Base
constructio
n project
for annual 146,348,397.9 Fund
output of 4 raising
sets of LED
lamps
Base
constructio
n project
for annual
output of 1,204,528,600.00 2,156,275.13 4,665,509.12 32.76 40.00
sets of wall
switches
and sockets
Annual Report 2022
Constructio
n project
for
automation
upgrading Fund
of annual raising
output of
sets of
converters
Information
constructio 240,350,000.00 3,539,851.67 9,760,392.16 7,741,067.27 2,814,215.88 6.63 10.00
n project
Equipment
to be 28,504,645.70 80,312,526.06 85,068,408.83 22,521,969.18
installed
Other small 473,898,327.0 402,182,193.1 Equity
projects 6 8 fund
Total 198,364,136.97 / / / /
Annual Report 2022
(3).Impairment allowances for construction in progress for the current period
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
Engineering materials
(4) Status of engineering materials
□Applicable√Not applicable
(1).Productive living assets adopting cost measurement mode
□Applicable√Not applicable
(2).Productive living assets adopting fair value measurement mode
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Item Buildings and constructions Total
I. Original Carrying Value
(1) Rent 5,813,706.50 5,813,706.50
(2) Increase through 9,179,394.81 9,179,394.81
consolidation
(1) Disposed amount 8,500,077.77 8,500,077.77
II. Accumulated Depreciation
(1) Accrued amount 14,110,005.67 14,110,005.67
(2) Increase through 2,265,478.33 2,265,478.33
consolidation
(1) Disposal 4,385,368.32 4,385,368.32
III. Impairment Allowances
(1) Accrued amount
(1) Disposal
IV. Carrying Amount
Annual Report 2022
Other notes:
None.
(1).Details of intangible assets
√Applicable □Not applicable
Unit: RMB
Patent and
Item Land use rights Software Total
know-how
I. Original carrying value
balance
current period
(1) Purchased 44,980,100.00 450,443.00 45,430,543.00
(2) Increase
through business 1,247,208.20 1,247,208.20
combination
(3) Transfer
from construction in 4,629,002.57 4,629,002.57
progress
the current period
(1) Disposal 62,239.32 62,239.32
II. Accumulated depreciation
balance
current period
(1)
Established
(2) Increase
through consolidation
the current period
(1) Disposal 62,239.32 62,239.32
balance
IV. Carrying amount
carrying amount
carrying amount
The proportion of intangible assets formed from the internal R&D of the Company at the Period-end to
the ending balance of intangible assets is 0.
(2).Status of land use right without certificate of title
□Applicable√Not applicable
Annual Report 2022
Other notes:
□Applicable√Not applicable
□Applicable√Not applicable
(1).Original carrying value of goodwill
√Applicable□Not applicable
Unit: RMB
Increase in the current Decrease in the
Investee or
period current period
item Opening
Generated due to Closing balance
generating balance
business Disposal
goodwill
combination
Dalitek 45,133,442.04 45,133,442.04
Total 45,133,442.04 45,133,442.04
(2).Impairment allowances for goodwill
□Applicable√Not applicable
(3).Information on the asset group or combination of asset groups to which goodwill is
apportioned
√Applicable□Not applicable
Composition of the asset group or
Dalitek assets group
combination of asset groups
Carrying value of this assets group or
combination of assets groups
Carrying value of goodwill
apportioned to this asset group or 64,476,345.77 [Note]
combination of asset groups
Carrying value of this asset group or
combination of asset groups including 104,329,929.48
goodwill
Is this asset group or combination of
asset groups consistent with that at the
Yes
time it was purchased and that in the
prior year goodwill impairment tests?
(4).Describe the goodwill depreciation testing process, key parameters (e.g., expect growth rate
during the forecast period when the present value of future cash flows, growth rate during the
stabilisation period, profit margin, discount rate, forecast period, etc., if applicable) and the
method of recognizing impairment losses of goodwill
√Applicable□Not applicable
projected cash flow in the future, which is on the basis of the Company’s approved detailed cash flow
projections for the 5-year forecast period, with a discount rate of 11.76%. The Company expects its cash
flows to remain stable beyond the five-year period, with cash flows beyond the detailed projection
period remaining consistent with those of 2027.
According to the test, the recoverable amount of asset group containing goodwill is RMB108.8546
million, which is higher than the difference of the carrying value of the asset group or combination of
asset groups containing goodwill by RMB4.5247 million. Therefore, no impairment loss on goodwill
was recognised at the end of the period.
Other key data used in the impairment test include the expected selling price of the product, sales
volume, production costs and other related expenses. The company determines the above key data based
on historical experience and forecasts of market developments. The discount rate adopted by the
Annual Report 2022
Company is a pre-tax rate that reflects the current market time value of money and the risks specific to
the related asset group.
Due to the impact of the pandemic, the business development of Dalitek was restricted and its
operating revenue of RMB53.136 million in 2022 was lower than the committed amount of
RMB79.6752 million, and the performance commitment for the year was not fulfilled.
The current goodwill impairment is a projection based on the audited operating results of Dalitek in
the year 2022. Failure to meet the performance commitments for the year has no impact on the goodwill
impairment test.
(5).Impact of goodwill impairment tests
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Amortisation
Increase in Increase amount
Opening in the Other Closing
Item the current through
balance current decreases balance
period consolidation
period
Talent
Shareholding
Plan
Payment for
fixtures
Total 17,750,835.99 8,033,477.00 2,586,173.25 8,006,255.46 20,364,230.78
Other notes:
For details of the 2020 Special Talent Shareholding Plan, please refer to “5. Other information”
under “XIII Share-based Payments” of “Part X Financial Statements” herein.
(1).Deferred income tax assets before offsetting
√Applicable□Not applicable
Unit: RMB
Closing balance Opening balance
Item Deductible Deferred income Deductible Deferred income
temporary tax temporary tax
differences Assets differences Assets
Unrealised profit of
internal transactions
Discount on sale accrued
in advance
Restricted share Incentive
Plan
Deferred income 53,820,328.00 8,073,049.20
Bad debt provision of
accounts receivable
Shrinkage reserves for
inventories
Shareholding Plan
Annual Report 2022
Total 627,594,234.32 143,479,114.53 484,224,232.51 116,456,369.78
(2).Deferred income tax liabilities before offsetting
√Applicable□Not applicable
Unit: RMB
Closing balance Opening balance
Item Taxable Deferred income Taxable Deferred income
temporary tax temporary tax
differences Liabilities differences Liabilities
Depreciation policy on
fixed assets subject to tax 340,139,021.71 54,854,169.49 309,268,738.92 50,024,829.68
variances
Gain and loss of hedge
instrument included in
the other comprehensive
income
Total 345,956,783.94 56,308,610.05 310,289,897.39 50,280,119.30
(3).Deferred income tax assets or liabilities listed in net amount after offset
□Applicable√Not applicable
(4).Schedule of deferred income tax assets unrecognised
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Deductible temporary
differences
Deductible losses 37,516,651.15 46,483,443.12
Total 126,352,818.67 90,303,193.60
(5).Deductible losses on which deferred income tax assets were unrecognised will expire in the
following years
√Applicable□Not applicable
Unit: RMB
Year Closing balance Opening balance Remark
Total 37,516,651.15 46,483,443.12 /
Other notes:
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Closing balance Opening balance
Item Carrying Impairment Carrying Carrying Impairment Carrying
balance allowances amount balance allowances amount
Contract
acquisition
costs
Contract
performance
costs
Annual Report 2022
Refund costs
receivable
Contract
assets
Prepayment
for
equipment
acquisition
Talent
Shareholding
Plan
Prepayment
for 26,990,656.00 26,990,656.00
investment
Total 76,508,015.77 76,508,015.77 76,068,914.50 76,068,914.50
Other notes:
None.
(1).Category of short-term borrowings
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Borrowings secured by pledge
Borrowings secured by collateral
Borrowings secured by
guarantee
Credit loan 840,000,000.00 500,000,000.00
Interest payable on short-term
borrowings
Total 845,374,749.03 500,430,555.55
Notes of the category for short-term borrowings:
Note: Zhang Wenying, a minority shareholder of Dalitek, and her spouse, Zhou Yun, provided guarantee
for the loan to Dalitek.
(2).Short-term borrowings overdue but not returned
□Applicable√Not applicable
Of which: The status of significant overdue short-term borrowings that are not repaid is as follows:
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Opening Increase in the Decrease in the
Item Closing balance
balance current period current period
Held-for-trading financial
liabilities
Of which:
Investment payables 27,300,000.00 9,100,000.00 18,200,000.00
Financial liabilities measured
at fair value through profit and
Annual Report 2022
loss for the current period
Of which:
Total 27,300,000.00 9,100,000.00 18,200,000.00
Other notes:
√Applicable□Not applicable
For details of the investment payables, please refer to “1. Business combinations involving entities not
under the common control” under “VIII Changes to the Consolidation Scope” of “Part X Financial
Statements”.
□Applicable√Not applicable
(1).List of notes payable
√Applicable□Not applicable
Unit: RMB
Type Closing balance Opening balance
Trade acceptance notes
Bank acceptance notes 2,333,774.75
Total 2,333,774.75
Total amount of notes payable which became matured but unpaid at the end of the current period is
RMB0.00.
(1).Breakdown of accounts payable
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Payment for goods 1,506,053,347.86 1,580,297,065.42
Engineering equipment 87,123,159.57 69,316,617.33
Payment for expense 50,485,456.10 52,072,881.39
Total 1,643,661,963.53 1,701,686,564.14
(2).Substantial accounts payable that are over 1 year
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
(1). Breakdown of advances from customers
□Applicable√Not applicable
(2). Significant advances from customers aged over 1 year
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
(1).Details of contract liabilities
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Advance receipt of payment for
goods
Total 431,654,611.71 437,999,921.93
Annual Report 2022
(2).Significant changes in the amount of carrying value and the reason in the Reporting Period
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
(1).Breakdown of employee benefits payable
√Applicable□Not applicable
Unit: RMB
Increase
Opening Increase in the Decrease in the Closing
Item through
balance current period current period balance
consolidation
I. Short-term
Benefits
II. After-service
Benefits-defined
Contribution
Schemes
III. Severance
Benefits
IV. Other Benefits
that are due
within 1 year
Total 279,463,472.43 1,955,109,240.73 3,751,373.33 1,903,231,927.48 335,092,159.01
(2).Breakdown of short-term benefits
√Applicable□Not applicable
Unit: RMB
Increase
Opening Increase in the Decrease in the
Item through Closing balance
balance current period current period
consolidation
I. Salaries,
Bonuses,
Allowances and
Subsidies
II. Staff welfare 58,214,632.72 58,214,632.72
III. Social
Insurance 5,183,398.31 59,915,305.96 107,639.33 59,470,100.95 5,736,242.65
Premiums
Of which:
Medical
insurance
premiums
Work-rel
ated injury
insurance
premiums
Maternity
insurance
IV. Housing
Allowance
V. Labour Union
Expense and
Employee 21,342,600.74 11,666.80 21,354,267.54
Education
Budget
Annual Report 2022
VI. Short-term
Paid Absence
VII. Short-term
Profit Sharing
Plan
Total 271,307,479.92 1,835,393,373.35 3,588,183.40 1,783,678,472.30 326,610,564.37
(3).List of defined contribution plan
√Applicable□Not applicable
Unit: RMB
Increase
Opening Increase in the Decrease in the Closing
Item through
balance current period current period balance
consolidation
insurance
insurance premiums
pension payment
Total 8,155,992.51 112,420,655.50 163,189.93 112,325,743.30 8,414,094.64
Other notes:
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Enterprise income tax 203,734,037.13 305,914,943.40
VAT 58,417,765.49 195,348,236.75
Real estate tax 10,551,939.19 10,692,552.05
Stamp duty 8,636,239.12 877,508.40
Land use tax 4,827,210.48 4,695,105.35
Personal income tax 4,800,514.20 4,038,032.19
Urban construction and
maintenance tax
Disability allowance 3,103,966.10 1,695,195.50
Educational surcharges 1,838,024.51 2,387,890.63
Local educational fee 1,225,349.64 1,591,927.11
Total 300,308,365.64 533,077,969.51
Other notes:
None.
Breakdown
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Interest payable
Dividends payable
Other payables
Discount on sale accrued in advance 215,847,304.76 285,699,608.15
Obligations of restricted stock
repurchase within one year
Annual Report 2022
Guaranteed deposit 90,292,099.16 61,020,316.08
Accrued expenses 44,520,261.35 46,433,533.02
Temporary receipts and advances
payable
Total 446,413,870.85 430,813,760.10
Other notes:
□Applicable√Not applicable
Interest payable
(1).List by category
□Applicable√Not applicable
Dividends payable
(2) List by category
□Applicable√Not applicable
Other payables
(1). Other payables listed by nature of account
□Applicable√Not applicable
(2). Other significant payables aging over one year
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Current portion of long-term
borrowings
Current portion of long-term 686,888.90
borrowings - interest payable
Current portion of bonds
payable
Current portion of long-term
payables
Lease obligation matured
within 1 Year
Total 8,798,658.13 673,911,937.53
Other notes:
None.
Other current liabilities
√Applicable □Not applicable
Unit: RMB
Item Closing balance Opening balance
Short-term bond payable
Refunds payable
Output VAT to be charged off 56,140,971.75 56,939,989.86
Total 56,140,971.75 56,939,989.86
Annual Report 2022
Increase/decrease of the short-term bonds payable:
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
(1). Category of long-term borrowings
□Applicable√Not applicable
Other notes, including interest rate range:
□Applicable√Not applicable
(1).Bonds payable
□Applicable√Not applicable
(2).Changes of bonds payable: (excluding other financial instruments divided as financial
liabilities such as preferred shares and perpetual bonds)
□Applicable√Not applicable
(3).Notes of the conditions for the conversion of convertible corporation bonds and the time of
conversion
□Applicable √Not applicable
(4).Notes of other financial instruments classified as financial liabilities
Basic information about other outstanding financial instruments such as preferred shares and perpetual
bonds at the period-end
□Applicable√Not applicable
Changes of outstanding financial instruments such as preferred shares and perpetual bonds at the
period-end
□Applicable√Not applicable
Notes of basis for the classification of other financial instruments as financial liabilities:
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
The amount of the lease payment
that has not yet been made
Minus: Unrecognised financing
expenses
Total 4,544,619.22 5,089,837.39
Other notes:
None.
Breakdown
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
Annual Report 2022
Long-term payables
(1).Long-term payables listed by nature
□Applicable√Not applicable
Specific payables
(2) Special payables listed by nature of payments
□Applicable√Not applicable
□Applicable√Not applicable
□Applicable√Not applicable
Deferred income
√Applicable □Not applicable
Unit: RMB
Decrease in
Opening Increase in the Reason for
Item the current Closing balance
balance current period Formation
period
Government Related to
grants assets
Total 53,820,328.00 53,820,328.00 /
Item involving government grants:
√Applicable□Not applicable
Unit: RMB
Amount
Amount recorded
Amount of recorded into into
Related to
Opening newly subsidy non-operating other Other
Item Closing balance assets/related
balance for the current income in the income changes
income
period Current in the
Period Current
Period
Awards Related to
and assets
subsidies
for 53,820,328.00 53,820,328.00
Longshan
Leasing
Market
Other notes:
√Applicable□Not applicable
Note: For details of government grants, please refer to “84. Government grants” under “VII Notes to the
Consolidated Financial Statements” of “Part X Financial Statements” herein.
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Contract liabilities
Annual Report 2022
Obligations of restricted stock
repurchase for over one year
Total 34,814,148.70 46,125,187.50
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Increase/Decrease (+/-)
Opening Provident Closing
Issuance
balance Bonus fund balance
New Others Subtotal
shares Conversion
shares
of capital
Total
shares
Other notes:
Due to the departure of employees participating in the restricted share incentive plan in the current
period, the Company repurchased 102,930 shares of restricted shares, reducing share capital by
RMB102,930.00 and capital reserves (share premium) by RMB7,413,649.30.
(1).Basic information about other outstanding financial instruments such as preferred shares and
perpetual bonds at the period-end
□Applicable√Not applicable
(2).Changes of outstanding financial instruments such as preferred shares and perpetual bonds
at the period-end
□Applicable√Not applicable
Changes of other equity instruments in the Current Period, reasons thereof and basis of related
accounting treatment:
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Increase in the Decrease in the
Item Opening balance Closing balance
current period current period
Capital premium
(share premium)
Other capital
reserves
Total 3,914,068,288.56 77,469,476.84 127,989,881.86 3,863,547,883.54
Other notes, including a description of the increase or decrease for the current period and the reasons for
the change:
RMB120,576,232.56 borne by the Company due to the repurchase of shares under the 2022 Restricted
Share Incentive Plan was charged to the capital premium (share premium), as described in “XIII
Share-based Payments” in “Part X Financial Statements”; ② A decrease of RMB7,413,649.30 in the
current period was due to the departure of employees participating in the restricted share incentive plan.
Annual Report 2022
vesting period of the restricted shares, the Company recognised the share-based payment cost of
RMB77,469,476.84, which was recorded in capital reserves (other capital reserves).
√Applicable□Not applicable
Unit: RMB
Increase in the Decrease in the
Item Opening balance Closing balance
current period current period
Treasury stock 80,711,540.00 309,989,842.56 261,089,028.56 129,612,354.00
Total 80,711,540.00 309,989,842.56 261,089,028.56 129,612,354.00
Other notes, including a description of the increase or decrease for the current period and the reasons for
the change:
repurchased stock from the secondary market, increasing the treasury stock by RMB215,286,334.56,
granted restricted share incentives to awardees, reducing treasury stock by RMB215,279,740.56, and
recognized the repurchase obligation on the aforesaid restricted shares, increasing treasury stock by
RMB94,703,508.00. For further information, see “XIII Share-based Payments” under “Part X Financial
Statements” herein.
a decrease in treasury stock worth RMB7,516,579.30; the partially unlocked shares under the 2020 and
RMB33,467,436.70; and the dividend for the current period includes locked-up restricted share
incentives and the cash dividend is revocable, resulting in a decrease in treasury stock worth
RMB4,825,272.00.
Annual Report 2022
√Applicable□Not applicable
Unit: RMB
Less: recorded in Less: recorded in
other other
comprehensive comprehensive
Amount before Attributable
Period-beginning income in prior income in prior Attributable to the Period-end
Item deducting income Less: Income tax minority
balance period and period and Company as the balance
tax for the current expense shareholders
transferred in transferred in parent after tax
period after tax
profit or loss in retained earnings
the current in the current
period period
I. Other Comprehensive
Income that may not be
Reclassified to Profit or
Loss
Of which: The changes of
re-measurement of the
defined benefit pension
plan
Other comprehensive
income that will not be
reclassified to profit or
loss under the equity
method
Changes in the fair
value of other equity
investments
Changes in the fair
value arising from changes
in own credit risk
II. Other Comprehensive
Income that may
Subsequently be 7,537,390.37 -4,208,833.60 -1,060,970.18 -3,147,863.42 4,389,526.95
Reclassified to Profit or
Loss
Of which: Other
Annual Report 2022
comprehensive income
that will be reclassified to
profit or loss under the
equity method
Changes in the fair
value of other debt
investments
Other comprehensive
income arising from the
reclassification of
financial assets
Credit impairment
allowances for other debt
investments
Reserve for cash flow
hedges
Differences arising from
the translation of foreign
-8,841.84 35,047.12 35,047.12 26,205.28
currency-denominated
financial statements
Total of other
comprehensive income
Other notes, including the adjustment of the effective gain/loss on cash flow hedges to the initial recognised amount:
None.
Annual Report 2022
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Item Opening balance Increase in the Decrease in the Closing balance
current period current period
Statutory surplus
reserves
Discretional
surplus reserves
General reserves
Enterprise
expansion fund
Others
Total 302,797,998.73 302,797,998.73
Notes, including changes and reason of change:
None.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Beginning balance of retained profits
before adjustments
Adjust the total amount of
undistributed profits at the beginning
of the year (increase +, decrease -)
Beginning balance of retained profits
after adjustments
Add: Net profit attributable to owners
of the Company as the parent
Less: Withdrawal of statutory surplus
reserve
Withdrawal of discretional
surplus reserves
Appropriated to general reserve
Dividends of common shares
payable
Dividends on common stock
transferred to equity
Ending retained profits 7,756,665,030.53 6,010,878,918.97
List of adjustment of beginning retained profits:
the Accounting Standards for Business Enterprises and relevant new regulations.
control.
(1).Operating revenue and cost of sales
√Applicable□Not applicable
Annual Report 2022
Unit: RMB
Item
Income Cost Income Cost
Principal
business
Other
businesses
Total 14,081,373,030.94 8,730,082,585.08 12,384,916,337.51 7,808,540,666.84
Of which:
Revenue
generated by 14,080,683,516.01 8,729,867,530.13 12,383,778,964.63 7,808,260,223.58
contracts with
customers
(2).Status of contract revenue
□Applicable√Not applicable
Details of contract revenue:
□Applicable√Not applicable
(3).Details of obligation for contract performance
□Applicable√Not applicable
(4).Notes of the allocation to the remaining obligations for contract performance
□Applicable√Not applicable
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Urban maintenance and
construction tax
Educational surcharges 24,378,077.48 17,945,609.53
Local education surcharge 16,252,051.57 12,118,900.15
Real estate tax 10,331,309.05 10,754,950.02
Stamp duty 16,430,918.58 5,560,108.84
Land use tax 4,770,521.69 4,791,701.11
Vehicle and vessel usage tax 44,403.17 53,029.46
Environment protection tax 15,656.64 15,293.6
Total 115,758,059.90 82,785,296.48
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Employee remuneration 325,364,319.34 261,647,749.30
Marketing expense 299,723,604.19 217,339,450.58
Advertising expense 77,484,221.03 5,339,637.47
Annual Report 2022
Travel expense 43,297,989.40 34,695,865.40
Administrative expense 36,290,184.82 32,909,137.36
Lease rental 9,778,151.66 1,976,612.98
Others 8,449,188.97 6,278,549.71
Total 800,387,659.41 560,187,002.80
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Employee remuneration 256,350,627.82 214,964,233.06
Restricted share incentive 77,469,476.84 41,090,453.82
Depreciation and amortisation 52,172,006.88 43,934,085.95
Administrative expense 45,742,988.76 56,125,085.23
House and equipment maintenance expense 21,657,342.01 26,859,235.14
Consultant service expense 16,904,014.09 20,597,126.42
Lease rental 9,285,328.92 2,455,152.98
Entertainment expense 5,668,555.03 5,788,268.11
Expense on 2020 special talent plan 6,611,860.38 6,701,548.01
Tax 3,082,509.25 2,864,245.72
Others 5,651,663.90 6,236,122.53
Total 500,596,373.88 427,615,556.97
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
R&D of converters 249,597,370.31 204,811,830.81
R&D of wall switches and sockets 154,925,908.04 141,889,975.17
R&D of LED 67,196,736.33 53,911,159.57
R&D of digital accessories 51,413,278.02 41,413,616.82
R&D of household appliances 25,044,926.07 17,154,346.37
R&D of circuit breakers 15,897,548.30 11,834,088.08
R&D of smart door locks 12,858,419.10
R&D of smart lighting 11,361,893.94
Total 588,296,080.11 471,015,016.82
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Interest costs 35,925,352.09 39,763,491.76
Interest income -137,795,215.87 -128,887,165.64
Exchange profit and loss -6,216,803.18 1,365,206.44
Auxiliary expense 812,258.47 1,194,046.81
Cash discount -718,892.47 -1,277,860.69
Annual Report 2022
Total -107,993,300.96 -87,842,281.32
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Amount recorded in
non-recurring profit or
Item 2022 2021
loss in the Current
Period
Government grants
related to income 130,991,587.24 388,196,973.94 130,991,587.24
[Note]
Employment VAT
reduction or
exemption for 236,650.00 416,950.00
veterans and key
groups
Return of auxiliary
expense for individual 1,712,485.52 2,322,217.53 1,712,485.52
income tax withheld
Total 132,940,722.76 390,936,141.47 132,704,072.76
Other notes:
[Note] For details of government grants included in other income, please refer to “84. Government
grants” under “VII Notes to the Consolidated Financial Statements” of “Part X Financial Statements”
herein.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Long-term equity investment income
accounted by equity method
Investment income from disposal of
long-term equity investment
Investment income from holding of
held-for-trading financial asset
Dividend income of other equity
investments gained for the holding
period
Interest income earned on investment in
debt obligations during the holding
period
Interest income earned on other
investment in debt obligations during
the holding period
Investment income from disposal of
held-for-trading financial asset
Investment income from disposal of
other equity instruments
Investment income from disposal of
investment in debt obligations
Annual Report 2022
Investment income from disposal of
other investment in debt obligations
Earnings of debt restructuring
Investment income from bank wealth 279,374,491.92 171,623,256.63
management products
Investment income from disposal of -7,385,680.00 11,107,836.63
financial instruments
Of which: Investment in futures -7,385,680.00 11,107,836.63
Interest income from calling money 7,294,215.55
Total 271,988,811.92 190,025,308.81
Other notes:
None.
□Applicable√Not applicable
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Loss on bad debts of notes receivable
Bad debt loss of accounts receivable
Bad debt loss of other receivables
Impairment loss on investment in debt
obligations
Impairment loss on other investment in
debt obligations
Bad debt loss of long-term receivables
Contractual Asset Impairment Loss
Bad debt loss -30,470,523.21 -24,746,561.94
Total -30,470,523.21 -24,746,561.94
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
I. Bad Debt Loss
II. Inventory shrinkage loss and
impairment provision for contract -11,504,455.94 -7,512,895.82
performance costs
III. Impairment Loss on Long-term
Equity Investment
IV. Impairment Loss on Investment
Property
V. Impairment loss on fixed assets -8,744,227.44
VI. Depreciation Loss of Engineering
Materials
VII. Impairment Losses on
Construction in Progress
Annual Report 2022
VIII. Impairment Losses on
Productive Living Assets
IX. Impairment Losses of Oil & Gas
Assets
X. Impairment Losses on Intangible
Assets
XI. Impairment losses on Goodwill
XII. Miscellaneous
Total -11,504,455.94 -16,257,123.26
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Non-recurring amount
Item 2022 2021
in the Current Period
Gains on disposal of
-3,139,686.69 -11,308,464.89 -3,139,686.69
fixed assets
Total -3,139,686.69 -11,308,464.89 -3,139,686.69
Other notes:
None.
Non-operating Income
√Applicable □Not applicable
Unit: RMB
Amount recorded in the
Item 2022 2021 current non-recurring
profit or loss
Gains from disposal
of non-current assets
Of which: Gains from
fixed assets disposal
Gains from
disposal of intangible
assets
Gains on exchange of
non-monetary assets
Donation accepted
Government grants
Damages for
infringement and 2,952,203.08 2,254,500.38 2,952,203.08
contract breaching
Default revenue of
suppliers
Default revenue of
dealers
Payment not required
to be made
Others 303,573.54 103,363.88 303,573.54
Total 3,784,363.32 4,353,269.76 3,784,363.32
Government grants recorded in profit or loss for the current period
□Applicable√Not applicable
Annual Report 2022
Other notes:
□Applicable√Not applicable
√Applicable □Not applicable
Unit: RMB
Amount recorded in the
Item 2022 2021 current non-recurring
profit or loss
Gains from disposal
of non-current assets
Of which: Loss
caused by disposal of
fixed assets
Loss caused
by disposal of
intangible assets
Loss caused by
exchange of
non-monetary assets
Donation 62,500,296.94 32,185,534.91 62,500,296.94
Compensation 2,025,121.90
expense
Fines expenditure 294,810,000.00
Others 47,161.99 43,227.39 47,161.99
Total 63,388,662.51 330,657,723.91 63,388,681.62
Other notes:
Details of donations:
Amount of Current
Item Same period of last year
Period
Cixi General Institution of Charity 56,275,000.00 7,402,000.00
Red Cross Society of China Cixi Branch 4,688,737.42
Shanghai Charity Foundation 1,000,000.00 11,583,534.91
Peking University Education Foundation 10,000,000.00
Red Cross Society of China Ningbo Branch 2,000,000.00
Sichuan Province Leshan Normal University
Education Development Foundation
Other petty donations 536,559.52 200,000.00
Subtotal 62,500,296.94 32,185,534.91
(1).Income tax expense
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Current income tax expense 589,710,229.89 582,281,936.16
Deferred income tax expense -20,714,816.96 -37,682,743.86
Total 568,995,412.93 544,599,192.30
(2). Adjustment process of accounting profit and income tax expense
√Applicable□Not applicable
Unit: RMB
Item 2022
Total profit 3,754,456,143.17
Annual Report 2022
Income tax expense calculated at the parent
company’s applicable tax rate
Influence of applying different tax rates by
subsidiaries
Influence of income tax before adjustment 237,402.68
Influence of non-taxable income
Influence of non-deductible costs, expenses and
losses
The effect of using deductible losses of deferred
income tax assets that have not been recognised -10,088,778.03
in the previous period
Effect of deductible temporary differences or
deductible losses on deferred income tax assets 13,289,743.03
not recognised in the current period
Influence of R&D and deductions -77,819,239.95
Fourth quarter add-on deduction -8,530,236.85
Income tax expense 568,995,412.93
Other notes:
□Applicable√Not applicable
√Applicable□Not applicable
For details of other comprehensive income after tax, please refer to “57. Other comprehensive income”
under “VII Notes to the Consolidated Financial Statements” of “Part X Financial Statements” herein.
(1).Other cash received from business activities
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Income from government subsidy 184,811,915.24 390,519,191.47
Deposit received 94,815,279.98 46,881,551.84
Interest income 76,560,589.37 82,233,607.43
Return of housing loan for employees 8,172,679.13 2,447,354.41
Others 5,675,054.71 3,344,812.08
Total 370,035,518.43 525,426,517.23
Notes:
None.
(2).Cash payments related to other operating activities
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Out-of-pocket expense 982,834,528.81 705,132,660.86
Fine payment 294,810,000.00
Deposit payment 58,237,557.33 173,494,360.86
Donation expenditure 62,500,296.94 32,185,534.91
Housing loan for employees 3,821,203.62 4,840,000.00
Others 4,072,643.97 3,264,696.97
Total 1,111,466,230.67 1,213,727,253.60
Notes:
None.
Annual Report 2022
(3).Other cash received from investment activities
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Redemption of investments such as 11,033,100,000.00
bank wealth management
Return of futures margin 298,315,309.31 241,233,253.72
Received interest on call money 1,000,000.00 7,200,000.00
Total 9,613,715,309.31 11,281,533,253.72
Notes:
None.
(4).Other cash paid for investment activities
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Investment expenditure such as bank 12,413,600,000.00
wealth management
Payment for futures margin 293,700,000.00 180,500,000.00
Payment for equity transfer 26,990,656.00
Total 10,615,500,000.00 12,621,090,656.00
Notes:
None.
(5).Other cash received from funding activities
□Applicable√Not applicable
(6).Other cash paid for funding activities
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Repurchase of share incentive 222,802,913.86 7,808,216.40
Repayment of lease liabilities 13,844,786.80 12,579,833.83
Total 236,647,700.66 20,388,050.23
Notes:
None.
(1).Supplemental information for cash flow statement
√Applicable □Not applicable
Unit: RMB
Amount during the current
Supplemental information Previous period
period
Net profit 3,185,460,730.24 2,780,360,732.66
Add: Provision for impairment of
credit
Asset impairment loss 11,504,455.94 16,257,123.26
Depreciation of fixed assets, oil and
gas assets, and productive living 222,420,678.01 206,424,241.17
assets
Annual Report 2022
Amortisation of right-of-use assets 14,110,005.67 11,244,984.87
Amortisation of intangible assets 20,494,628.97 16,458,214.68
Amortisation of long-term prepaid
expenses
Losses from disposal of fixed assets,
intangible assets and other long-lived 3,139,686.69 11,308,464.89
assets (gains represented by “-”)
Losses from scrap of fixed assets
(gains represented by “-”)
Losses from changes in fair value
(gains represented by “-”)
Finance costs (gains represented by
-30,687,370.90 41,128,698.20
“-”)
Investment loss (gains represented by
-271,988,811.92 -190,025,308.81
“-”)
Decrease in deferred income tax assets
-27,022,744.75 -49,553,192.50
(gains represented by “-”)
Increase in deferred income tax
liabilities (decrease represented by 6,028,490.75 11,870,448.64
“-”)
Decrease in inventory (gains
represented by “-”)
Decrease in accounts receivable
generated from operating activities -72,562,204.17 -190,636,989.81
(gains represented by “-”)
Increase in accounts payable used in
operating activities (decrease -220,315,149.21 869,359,175.52
represented by “-”)
Others 77,469,476.84 43,348,156.82
Net cash generated from/used in
operating activities
Conversion of debt to capital
Convertible corporate bonds matured
within one year
Fixed asset under finance lease
Closing balance of cash 1,925,343,174.98 2,552,716,453.54
Less: Opening balance of cash 2,552,716,453.54 1,829,551,296.70
Add: Closing balance of cash
equivalents
Less: Opening balance of cash
equivalents
Net increase in cash and cash
-627,373,278.56 723,165,156.84
equivalents
(2).Net cash paid for the current period to acquire subsidiaries
□Applicable□Not applicable
Unit: RMB
Amount
Cash or cash equivalents paid in the current period for the business
combination occurring in the current period
Of which: Dalitek 45,809,344.00
Less: cash and cash equivalents held by subsidiaries on the
purchase date
Of which: Dalitek 26,701,851.91
Annual Report 2022
Add: Payments of cash and cash equivalents made in current period
due to business combinations incurred in previous periods
Net cash paid for acquisition of subsidiaries 19,107,492.09
Other notes:
None.
(3).Net cash received for the disposal of subsidiaries for the current period
□Applicable√Not applicable
(4).Composition of cash and cash equivalents
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
I. Cash 1,925,343,174.98 2,552,716,453.54
Of which: Cash on hand 34,167.84
Bank deposits on demand 1,890,294,692.17 2,500,383,599.91
Other monetary assets on
demand
Due from central banks that can
be used for payment
Due from banks and other
financial institutions
Interbank withdrawal
II. Cash Equivalents
Of which: Investment in bonds due
within three months
III. Ending balance of cash and cash
equivalents
Of which: Cash and cash equivalents
with restricted use by the Company
as the parent or subsidiaries within
the Group
Other notes:
√Applicable□Not applicable
Supplemental information for cash flow statement
As at 31 December 2022, the balance of monetary assets was RMB4,611,966,169.54, the balance of
cash and cash equivalents was RMB1,925,343,174.98, the difference was RMB2,686,622,994.56, which
was the futures margins of RMB13,774,515.95 not belonging to cash and cash equivalents, the cash
deposits for L/G was RMB7,141,771.63, and the fixed deposit of RMB2,545,000,000.00 and the interest
of RMB120,706,706.98 that cannot be withdrawn at any time.
As at 31 December 2021, the balance of monetary assets was RMB4,377,228,556.74, the balance of
cash and cash equivalents was RMB2,552,716,453.54, the difference was RMB1,824,512,103.20, which
was the futures margins of RMB25,988,465.80 not belonging to cash and cash equivalents, the cash
deposits for L/G was RMB6,654,782.17, and the bill deposits was RMB2,333,774.75. The third party
pays the platform deposit of RMB63,000.00, and the fixed deposit of RMB1,730,000,000 and the
interest of RMB59,472,080.48 that cannot be withdrawn at any time.
Notes to the name of “Other” of closing balance of the same period of last year adjusted and the amount
adjusted:
□Applicable√Not applicable
Annual Report 2022
√Applicable□Not applicable
Unit: RMB
Item Ending carrying amount Reason for Restriction
Monetary assets Deposits that cannot be
withdrawn at any time
Notes receivable
Inventories
Fixed assets
Intangible assets
Total 20,916,287.58 /
Other notes:
None.
(1).Foreign currency monetary items
√Applicable□Not applicable
Unit: RMB
Closing balance
Closing foreign
Item Exchange rate converted to RMB
currency balance
balance
Monetary assets - - 1,500,906.06
Of which: USD 205,639.39 6.9646 1,432,196.10
EUR 5,970.43 7.4229 44,317.90
CAD 4,212.75 5.1385 21,647.22
HKD 3,072.80 0.8933 2,744.84
Accounts receivable - - 33,989,427.41
Of which: USD 4,880,312.93 6.9646 33,989,427.41
EUR
HKD
Long-term borrowings - -
Of which: USD
EUR
HKD
Other notes:
None.
(2).Notes to overseas operating entities, including: For important overseas operating entities,
their main overseas business location, bookkeeping base currency and basis for selection
should be disclosed, and the reasons for changes in the bookkeeping base currency should
also be disclosed
√Applicable□Not applicable
As Bull HK was established and carries out its operating activities in Hong Kong, its bookkeeping base
currency is HKD.
√Applicable□Not applicable
The hedge items, related hedge instruments, and qualitative and quantitative information about hedged
risks are disclosed by hedging category:
The Company used commodity future contracts to hedge the Company’s exposure to raw material
price risks. The future contracts used by the Company are mainly the cathode copper future standard
contracts of the Shanghai Futures Exchange and the polypropylene standard contracts of the Dalian
Commodity Exchange.
Expected bulk-purchase of raw materials such as copper and plastic
Hedged items
particles
Annual Report 2022
Hedge instruments Commodity future contracts
Commodity future purchase contracts locked in changes of price in
Hedging method
expected raw materials bulk-purchase contract
The Company used commodity future contracts to hedge the expected bulk-purchase of raw
materials of copper and plastic particles to avoid the risk of fluctuations in the expected future cash
flows caused by the fluctuations in the market price of the above raw materials.
As at 31 December 2022, the pre-tax profit arising from the change in fair value of cash flow hedge
instruments that has been included in other comprehensive income was RMB5,817,762.23.
(1).Basic information on government subsidy
√Applicable □Not applicable
Unit: RMB
Amount
recorded in the
Type Amount Listed items
current profit or
loss
Financial aid in the first half of 2022 44,500,000.00 Other income 44,500,000.00
Financial aid from the Bureau of Finance of
Ningbo Meishan Bonded Port Area
Financial aid cleared in 2021 21,930,000.00 Other income 21,930,000.00
companies
Industrial incentive from administrative
committee of Zhejiang Cixi Binhai Economic 5,608,000.00 Other income 5,608,000.00
Development Zone
Refund of unemployment insurance premiums
from stabilizing job positions
project subsidy
Government support incentive from Qingpu
district finance Bureau, Shanghai
pilot application project subsidy
projects of high quality enterprises in Ningbo
Industrial Economy Awards 715,100.00 Other income 715,100.00
of information technology and manufacturing 576,800.00 Other income 576,800.00
industry
Support funds from Xinzhuang Industrial Zone 490,000.00 Other income 490,000.00
Award for integrated management system of
informatisation and industrialisation and 420,000.00 Other income 420,000.00
excellent industrial APPs in Cixi in 2021
Intellectual property strategy funding grant
project (appearance design excellence award)
Refund of unemployment insurance premiums
from stabilizing job positions
Rewards for enterprises that retained employees,
hired talents, steadily developed and enhanced 369,000.00 Other income 369,000.00
investment in the first quarter in 2022 in Ningbo
voucher use cashing-in grant
Annual Report 2022
project (enterprises)
Subsidy for export credit insurance provided by
Cixi Municipal Bureau of Commerce
Service industry contribution award 263,520.30 Other income 263,520.30
The second batch of project-based support in
Meilong Town in 2022
Postdoctoral subsidy funding 200,000.00 Other income 200,000.00
Items to be supported of advanced
manufacturing industry special project by 200,000.00 Other income 200,000.00
Minhang District (some categories)
VAT deduction of enterprises recruiting key
group personnel
One-time expansion grant 159,000.00 Other income 159,000.00
model incentive
Incentive for trade and circulation enterprises to
get bigger and stronger provided by Cixi 150,000.00 Other income 150,000.00
Municipal Bureau of Commerce
Refund of unemployment insurance premiums
from stabilizing job positions
industrial control safety diagnosis and excellent 118,800.00 Other income 118,800.00
protection products
Output value standard reward for manufacturing
enterprises above designated size in Ningbo in 100,000.00 Other income 100,000.00
the fourth quarter of 2021
Others 342,331.02 Other income 342,331.02
Subtotal 130,991,587.24 130,991,587.24
(2).Return of government subsidy
□Applicable√Not applicable
Other notes:
None.
□Applicable√Not applicable
VIII Changes in Consolidation Scope
√Applicable□Not applicable
(1).Business combination not under the same control during the current period
√Applicable□Not applicable
Unit: RMB
Time
Income of Net profits of
and Cost of Recognition
Name Proportion acquiree from acquiree from
place gaining Way to gain Purchase basis of
of of equity the purchase the purchase
of the equity date purchase
acquiree (%) date to date to
gaining equity date
period-end period-end
equity
Daliktek January 70.00 Outsourcing January Controlled 53,135,968.72 -10,978,504.44
million
Annual Report 2022
Other notes:
On 18 August 2021, the Company signed the Equity Transfer Agreement with Dalitek and its
shareholders Bridges Electronic Technology Co., Ltd., Shanghai Houqi Investment Centre (Limited
Partnership) and natural person shareholders Pan Xiaobin and Zhang Wenying, agreeing that 70% of the
equity interests of the Company held by the shareholders be transferred at the price of RMB91,000,000
(inclusive of contingent considerations). The agreement stipulates that the compound growth rate of the
audited main business revenue of Dalitek for 2021-2023 over 2020 shall not be less than 20%, i.e. the
committed revenue for 2021-2023 shall be RMB66.396 million, RMB79.6752 million and RMB95.6102
million respectively, and the main business revenue can be calculated cumulatively. If Dalitek reaches
the performance commitment requirement, the Company shall pay the original shareholders of Dalitek a
contingent consideration of RMB27.3 million, with a maximum of RMB9.1 million in 2022, a maximum
of RMB18.2 million in 2022 and 2023 combined, and a maximum of RMB27.3 million in 2022, 2023
and 2024 combined.
The Company has paid for the equity transfer in two installments, including RMB26.9907 million
in November 2021 and RMB36.7093 million in January 2022, which amounted to more than 50% of the
total consideration for the equity transfer. Therefore, Dalitek has been included in the consolidated
financial statements from 1 January 2022. RMB9.1 million of contingent consideration was paid in 2022
and the remaining consideration for the equity transfer (contingent consideration) of RMB18.2 million is
unpaid.
(2).Combination cost and goodwill
√Applicable□Not applicable
Unit: RMB
Combination cost Daliktek
-Cash 63,700,000.00
-Fair value of non-cash assets
-Fair value of debt issued or assumed
-Fair value of equity securities issued
-Fair value of contingent consideration 27,300,000.00
-Fair value of equity interests held before the
purchase date
--Other
Total combination costs 91,000,000.00
Less: share in the fair value of identifiable net
assets acquired
Goodwill 45,133,442.04
Note to determination method of the fair value of the combination cost, consideration and changes:
The Company uses the net assets of Dalitek on the acquisition date as the fair value.
The contingent consideration for the Company's acquisition of Dalitek was RMB27.3 million.
Dalitek has completed the performance commitment in 2021, and the Company paid RMB9,100,000 for
the performance commitment in 2021 on 2 September 2022. The audited revenue of Dalitek in 2022 was
RMB53.136 million, which did not reach the performance commitment in 2022. Therefore, the
Company does not need to pay the amount in relation to the performance commitment of Dalitek. If
Dalitek’s performance in 2023 can meet the cumulative target, the Company will pay the contingent
consideration.
The main formation reason for the large goodwill:
None.
Other notes:
None.
(3).The acquiree can identify the assets and liabilities on the date of purchase
√Applicable□Not applicable
Unit: RMB
Annual Report 2022
Dalitek
Fair value on purchase date Carrying value on purchase date
Assets: 97,523,456.12 97,523,456.12
Monetary assets 26,701,851.91 26,701,851.91
Accounts 22,606,150.89 22,606,150.89
receivable
Inventories 22,809,479.39 22,809,479.39
Fixed assets 885,848.31 885,848.31
Intangible 390,727.10 390,727.10
assets
Held-for-trading
financial assets
Receivables
financing
Prepayments 1,396,516.07 1,396,516.07
Other
receivables
Other current
assets
Right-of-use
assets
Long-term
prepaid expense
Deferred
income tax 1,478,587.98 1,478,587.98
assets
Other
non-current 21,848.00 21,848.00
assets
Liabilities: 31,999,801.89 31,999,801.89
Borrowings 9,010,201.37 9,010,201.37
Accounts 8,376,364.12 8,376,364.12
payable
Deferred
income tax
liabilities
Contract
liabilities
Employee
benefits payable
Taxes and
levies payable
Deferred
income tax
liabilities
Other payables 168,126.42 168,126.42
Current portion
of non-current 2,170,444.17 2,170,444.17
liabilities
Other current
liabilities
Lease liabilities 5,005,022.82 5,005,022.82
Net assets 65,523,654.23 65,523,654.23
Annual Report 2022
Less:
non-controlling
interests
Net assets
acquired
The determination method of the fair value of identifiable assets and liabilities:
The Company uses the audited net assets of Dalitek on the acquisition date as the fair value.
Contingent liability of acquiree undertaken in the business combination:
None.
Other notes:
None.
(4).Gains or losses resulting from the remeasurement of equity held prior to the date of purchase
at fair value
Whether there is a transaction that through multiple transaction step by step to realise business
combination and gaining the control during the Reporting Period
□Applicable√Not applicable
(5).Notes to reasonable consideration or fair value of identifiable assets and liabilities of the
Acquiree that cannot be determined on the date of purchase or at the end of the merger
□Applicable √Not applicable
(6).Other notes
□Applicable √Not applicable
□Applicable√Not applicable
□Applicable√Not applicable
Whether there was a single disposal of an investment in a subsidiary that resulted in a loss of control
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
Notes of other changes in the combination scope (e.g., new subsidiaries, liquidation of subsidiaries, etc.)
and relevant situations:
√Applicable□Not applicable
Increase in scope of combination
Time and place of Contribution
Company name Way to gain equity Paid-in capital
gaining equity proportion
Information
Set-up January 2022 RMB100 million 100.00%
technology
Gongniu Tools Set-up January 2022 62.00%
Gongniu New
Set-up April 2022 RMB600,000 100.00%
Energy
Shenzhen
Set-up July 2022 RMB1 million 100.00%
Intelligent
Muguang
Set-up July 2022 RMB1 million 100.00%
Technology
Annual Report 2022
Gongniu
Set-up November 2022 100.00%
Marketing
On 17 January 2022, Information Technology completed the business registration procedures, and
obtained a business licence with a unified social credit code of 91310118MA7F49691P, with a
registered capital of RMB100 million, and a shareholding ratio of 100% of the Company. As at 31
December 2022, the Company’s paid-up capital contribution was RMB100 million. Therefore, since the
date of its establishment, Information Technology has been included in the scope of the consolidated
financial statements.
On 27 January 2022, Gongniu Tools completed the business registration procedures, and obtained a
business licence with a unified social credit code of 91330206MA7GDPWU2Q, with a registered capital
of RMB48 million and a shareholding ratio of 62% of the Company. As at 31 December 2022, the
Company didn’t pay its capital contribution. Therefore, since the date of its establishment, Gongniu
Tools has been included in the scope of the consolidated financial statements.
On 12 April 2022, Gongniu New Energy completed the business registration procedures, and
obtained a business licence with a unified social credit code of 91330282MA7NGRDG5Q, with a
registered capital of RMB10 million and a shareholding ratio of 100% of the Company. As at 31
December 2022, the Company’s paid-up capital contribution was RMB600,000. Therefore, since the
date of its establishment, Gongniu New Energy has been included in the scope of the consolidated
financial statements.
On 25 July 2022, Shenzhen Intelligent completed the business registration procedures, and obtained
a business licence with a unified social credit code of 91440300MA5HEL5G8Y, with a registered
capital of RMB10 million and a shareholding ratio of 100% of the Company. As at 31 December 2022,
the Company’s paid-up capital contribution was RMB1 million. Therefore, since the date of its
establishment, Shenzhen Intelligent has been included in the scope of the consolidated financial
statements.
On 27 July 2021, Muguang Technology completed the business registration procedures, and
obtained a business licence with a unified social credit code of 91441303MABUTN451A, with a
registered capital of RMB10 million and a shareholding ratio of 100% of the Company. As at 31
December 2022, the Company’s paid-up capital contribution was RMB1 million. Therefore, since the
date of its establishment, Muguang Technology has been included in the scope of the consolidated
financial statements.
On 29 November 2022, Gongniu Marketing completed the business registration procedures, and
obtained a business licence with a unified social credit code of 91330282MAC3BUBJ9H, with a
registered capital of RMB10 million and a shareholding ratio of 100% of the Company. As at 31
December 2022, the Company didn’t pay its capital contribution. Therefore, since the date of its
establishment, Gongniu Marketing has been included in the scope of the consolidated financial
statements.
□Applicable √Not applicable
Annual Report 2022
IX Interests in Other Entities
(1).Subsidiaries
√Applicable□Not applicable
Main Shareholding Ratio (%)
Subsidiary Place of Business Acquisition
Operating
Name Registration Nature Directly Indirectly Method
Place
Merge under
Ningbo Ningbo, Ningbo, Manufacturing
Gongniu Zhejiang Zhejiang industry
control
Gongniu Ningbo, Ningbo, Manufacturing
Photoelectricity Zhejiang Zhejiang industry
Gongniu Ningbo, Ningbo, Manufacturing
Digital Zhejiang Zhejiang industry
Banmen
Ningbo, Ningbo, Manufacturing
Electrical 100.00 Set-up
Zhejiang Zhejiang industry
Appliances
Gongniu
Ningbo, Ningbo, Manufacturing
Precision 100.00 Set-up
Zhejiang Zhejiang industry
Manufacturing
Merge under
Ningbo, Ningbo,
Electric Sales Commercial 100.00 common
Zhejiang Zhejiang
control
Merge under
Ningbo, Ningbo,
Cixi Gongniu Commercial 100.00 common
Zhejiang Zhejiang
control
Merge under
Shanghai
Shanghai Shanghai Commercial 100.00 common
Gongniu
control
Gongniu Ningbo, Ningbo,
Commercial 100.00 Set-up
Management Zhejiang Zhejiang
Gongniu
Ningbo, Ningbo,
International Commercial 100.00 Set-up
Zhejiang Zhejiang
Trade
Merge under
Hong Kong Hong
Hong Kong Commercial 100.00 common
Gongniu Kong
control
Merge under
Xingluo Ningbo, Ningbo,
Commercial 100.00 common
Trading Zhejiang Zhejiang
control
Gongniu Low
Ningbo, Ningbo,
Voltage Commercial 100.00 Set-up
Zhejiang Zhejiang
Electrical
Household
Ningbo, Ningbo, Manufacturing
Electrical 100.00 Set-up
Zhejiang Zhejiang industry
Appliances
Hainan Sanya, Sanya, Commercial
Dacheng Hainan Hainan services
Intelligent Ningbo, Ningbo, Manufacturing
Technology Zhejiang Zhejiang industry
Business
combination
Dalitek Shanghai Shanghai Commercial 70.00 not under
common
control
Information Shanghai Shanghai Commercial 100.00 Set-up
Annual Report 2022
technology
Ningbo, Ningbo,
Gongniu Tools Commercial 62.00 Set-up
Zhejiang Zhejiang
Gongniu New Ningbo, Ningbo,
Commercial 100.00 Set-up
Energy Zhejiang Zhejiang
Murora Manufacturing
Guangdong Guangdong 100.00 Set-up
Intelligent industry
Shenzhen Manufacturing
Shenzhen Shenzhen 100.00 Set-up
Intelligent industry
Gongniu Ningbo, Ningbo,
Commercial 100.00 Set-up
Marketing Zhejiang Zhejiang
Notes of shareholding percentage in subsidiaries different from voting percentage:
None.
Basis of holding half or less voting rights but still controlling the investee and holding more than half of
the voting rights but not controlling the investee:
None.
Basis of controlling significant structural entities incorporated in the scope of combination:
None.
Basis of determining whether the Company is the agent or the mandator
None.
Other notes:
None.
(2).Significant non-wholly-owned subsidiary
√Applicable□Not applicable
Unit: RMB
The profit or loss Declaring dividends
Shareholding of Balance of
attributable to the distributed to
Name of minority non-controlling
non-controlling non-controlling
subsidiaries shareholder interests at the
interests for the interests for the
Percentage period-end
current period current period
Dalitek 30.00% -3,158,629.32 16,498,466.95
Gongniu Tools 38.00%
Holding proportion of non-controlling interests in subsidiary different from voting proportion:
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
Annual Report 2022
(3).The main financial information of significant not wholly-owned subsidiary
√Applicable□Not applicable
Unit: RMB
Closing balance Opening balance
Name of
Current Non-current Current Non-current Total Current Non-current Current Non-current Total
subsidiaries Total assets Total assets
assets assets liabilities liabilities liabilities assets assets liabilities liabilities liabilities
Dalitek 70,444,095.63 7,160,779.01 77,604,874.64 19,948,974.82 2,661,009.99 22,609,984.81 85,246,355.00 12,277,101.12 97,523,456.12 26,994,779.07 5,005,022.82 31,999,801.89
Name of Total Cash flows Total Cash flows
Operating Operating
subsidiaries Net profit comprehensive from operating Net profit comprehensive from operating
revenue revenue
income activities income activities
Dalitek 53,135,968.72 -10,528,764.40 -10,528,764.40 -4,681,119.04 73,742,183.32 2,578,060.73 2,578,060.73 4,144,776.69
Other notes:
None.
Annual Report 2022
(4).Significant restrictions on the use of assets and the settlement of debts of the Group
□Applicable√Not applicable
(5).Financial or other support to structured entities included in the scope of consolidated
financial statements
□Applicable √Not applicable
Other notes:
□Applicable√Not applicable
controls the subsidiary
□Applicable√Not applicable
□Applicable√Not applicable
□Applicable√Not applicable
statements
Notes to the structured entity excluded in the scope of consolidated financial statements:
□Applicable√Not applicable
□Applicable √Not applicable
Annual Report 2022
X Risks Related to Financial Instruments
√Applicable□Not applicable
The Company is engaged in risk management to achieve balance between risks and returns,
minimizing the negative effects of risks on its operation performance and maximizing the interests of its
shareholders and other equity investors. Based on that risk management goal, the fundamental strategy
of its risk management is to identify and analyse various risks facing the Company, establish an
appropriate risk bottom line, carry out risk management and monitor various risks in a timely and
reliable manner to control them within a restricted scope.
The Company faces various risks related to financial instruments in its routine activities, mainly
including credit risk, liquidity risk market risk. The management has reviewed and approved the policies
of managing those risks, which are summarised as follows.
(I) Credit risk
Credit risk means the risk of financial losses incurred to the other party when one party of a
financial instrument is unable to fulfil its obligations.
(1) Methods for evaluating credit risk
On each balance sheet date, the Company shall evaluate whether the credit risk of relevant financial
instruments has increased significantly since the initial recognition. After determining whether the credit
risk has increased significantly since the initial recognition, the Company shall consider obtaining
reasonable and reliable information without paying unnecessary extra costs or efforts, including
qualitative and quantitative analysis based on historical data, external credit risk rating and
forward-looking information. On the basis of the single financial instrument or combination of financial
instruments with similar credit risk characteristics, the Company compares the risk of default of
financial instruments on the balance sheet date with the risk of default on the initial recognition date to
determine the change of default risk of financial instruments during their expected duration.
When one or more of the following quantitative and qualitative criteria prevails, the Company shall
believe the credit risk of financial instruments has increased significantly:
balance sheet date increases by more than a certain percentage from the time of initial recognition;
status, changes in the existing or expected technical, market, economic or legal environment that will
have a material adverse impact on the debtor’s ability to repay the Company.
(2) Definition of default and asset with credit impairment
When a financial instrument meets one or more of the following conditions, the Company shall
define the financial asset as having defaulted, and its criteria are consistent with the definition of having
incurred credit impairment:
difficulties, gives concessions to the debtor which would not have been made in any other
circumstances.
The key parameters for measuring expected credit loss included default probability, loss given
default and exposure at default. The Company considered quantitative analysis and forward-looking
information of historical statistical data (such as counterparty rating, guarantee method, repayment
method, etc.) to establish a model of probability of default, default loss ratio and default risk exposure.
For details of the reconciliation statements of opening balance and closing balance of financial
instrument loss provision, please refer to “4. Notes receivable”, “5. Accounts receivable”, and “8. Other
receivables” under “VII Notes to the Consolidated Financial Statements” of “Part X Financial
Statements” herein.
The Company’s credit risk mainly comes from monetary assets and accounts receivable. To control
the aforementioned relevant risks, the Company has adopted the following measures.
(1) Monetary assets
Annual Report 2022
The Company places the bank deposit and its monetary assets with financial institutions of high
credit ratings. Thus, its credit risk is low.
(2) Accounts receivable
The Company continuously conducted credit assessments for customers who trade on credit lines.
Based on the credit assessment result, the Company chooses to trade with recognised customers with
good credit and monitor the balance of the accounts receivable from them to ensure that the Company
will not face any significant bad debt risk.
Due to the Company merely trades with the authorised third party with good credit, the guarantee is
not required. Credit risk concentration is managed in accordance with the customers. As at 31 December
receivable of the Company (70.04% on 31 December 2021) came from the top 5 customers by balance.
The Company hasn’t held any guarantee or other credit enhancement for balance of accounts receivable.
The maximum credit risk exposure the Company undertook shall be the carrying value of each
financial asset on balance sheet.
(II) Liquidity risk
Liquidity risk refers to the risk of fund shortage occurring when the Company fulfils the settlement
obligation in the mode of cash delivery or other financial assets. Liquidity risk may originate from the
failure to sell financial assets at fair value as soon as possible; or from the other party’s failure to pay off
its contractual debts; or from the earlier maturity of debts; or from the failure to generate the expected
cash flow.
To control the risk, the Company comprehensively used a variety of financing methods such as
bank clearing and bank borrowing, and adopted the appropriate combination of long-term and short-term
financing methods to optimise the financing structure and maintain a balance between financing
sustainability and flexibility. The Company has obtained the line of credit from a number of commercial
banks to satisfy its operation fund needs and capital expenditure.
Financial liabilities classified by remaining maturity
Closing balance
Item Undiscounted
Carrying amount Within 1 year 1-3 years Over 3 years
contract amount
Banking
borrowings
Held-for-tradin
g financial 18,200,000.00 18,200,000.00 18,200,000.00
liabilities
Notes payable
Accounts
payable
Other payables 446,413,870.85 446,413,870.85 446,413,870.85
Current portion
of non-current 8,798,658.13 9,116,363.36 9,116,363.36
liabilities
Lease
liabilities
Subtotal 2,966,993,860.76 2,979,124,686.86 2,974,455,742.95 4,668,943.91
(Continued)
Amount of the Previous Period
Item Undiscounted
Carrying amount Within 1 year 1-3 years Over 3 years
contract amount
Banking
borrowings
Held-for-tradin
g financial
liabilities
Annual Report 2022
Notes payable 2,333,774.75 2,333,774.75 2,333,774.75
Accounts
payable
Other payables 430,813,760.10 430,813,760.10 430,813,760.10
Current portion
of non-current 13,225,048.63 13,759,081.13 13,759,081.13
liabilities
Lease
liabilities
Subtotal 3,314,266,429.46 3,325,867,177.54 3,320,658,624.57 5,208,552.97
(III) Market risk
Market risk refers to the risk of fluctuations in the fair value or future cash flows of financial
instruments arising from changes in market prices. Market risk mainly includes interest rate risk and
foreign exchange risk.
Interest rate risk refers to the risk of fluctuations in the fair value or future cash flows of financial
instruments arising from changes in market interest rates. Interest-bearing financial instruments with
fixed interest rates may bring the fair value interest rate risk to the Company, while those with floating
interest rate may bring the cash flow interest rate risk to the Company. The Company will determine the
proportion between the financial instruments with fixed interest rate and those with floating interest rate
in combination with market environment, and maintain an appropriate portfolio of financial instruments
through regular review and monitoring. The interest rate risk of cash flows facing the Company is
mainly related to the bank loans calculated by floating interest rate of the Company.
As at 31 December 2022, the Company had borrowed RMB844 million (RMB1,160 million at 31
December 2021) from banks, and the interest rate change would not have a significant influence on the
Company’s gross profit and shareholders’ equity.
Foreign exchange risk refers to the risk that may lead to the changes of fair value of financial
instruments or future cash flows due to fluctuation in exchange rate. The Company operates in mainland
China, and the main activities are recorded by RMB. Thus, the foreign exchange market risk undertaken
is insignificant for the Company.
For details of the Company’s foreign currency monetary assets and liabilities at the end of the
Current Period, please refer to “82. Foreign currency monetary items” under “VII Notes to the
Consolidated Financial Statements” of “Part X Financial Statements” herein.
XI The Disclosure of Fair Value
√Applicable□Not applicable
Unit: RMB
Closing fair value
Fair value
Fair value Fair value
Item measurement
measurement measurement items Total
items at level
items at level 1 at level 3
I. Consistent Fair
Value Measurement
i. Held-for-trading
Financial Assets
measured at fair value
through profit or loss
for the current period
(1) Debt instrument
investments
Annual Report 2022
(2) Equity instruments
investments
(3) Derivative financial
assets
(4) Banking WM
products
(5) Receivables
financing
assigned to be
measured at fair value
through profit or loss
for the current period
(1) Debt instrument
investments
(2) Equity instruments
investments
(II) Other equity
investments
(III) Other equity
instrument investment
(IV) Investment
properties
rent
and to be transferred
after appreciation
(V) Biological assets
biological assets
assets
The total amount of
assets consistently 643,100.00 6,950,036,801.70 6,950,679,901.70
measured at fair value
vi. Trading financial
liabilities
measured at fair value
through profit or loss
for the current period
Of which: Issued
trading bonds
Derivative
financial liabilities
Investment
payables
financial liabilities
measured at fair value
through profit or loss
for the current period
Total amount of
liabilities at fair value
Annual Report 2022
II. Inconsistent Fair
Value Measurement
(I) Assets held for sale
Total assets of
inconsistent fair value
measurement
Total liabilities of
inconsistent fair value
measurement
items at Level 1
√Applicable □Not applicable
The Company’s first-level item measured at fair value is derivative financial assets (futures
contract), which determines the fair value based on the public quotation of the futures market.
parameters for consistent and inconsistent fair value measurement items at Level 2
√Applicable □Not applicable
□Applicable √Not applicable
parameters for consistent and inconsistent fair value measurement items at Level 3
□Applicable √Not applicable
of unobservable parameters of third-level items measured consistently at fair value
√Applicable □Not applicable
The Company’s third-level items measured at fair value are bank WM products and trust products,
etc., with a low expected yield rate and a small change in fair value, so the initial recognition cost is used
as its fair value.
where there is a conversion between the various levels for the current period in items consistently
measured at fair value
□Applicable √Not applicable
for the changes
□Applicable √Not applicable
□Applicable √Not applicable
□Applicable √Not applicable
XII Related Party and Related-party Transaction
√Applicable □Not applicable
Unit: RMB’0,000
Shareholding Proportion of
Name of the percentage held voting rights
Place of Business Registered
Company as by the Company owned by the
Registration Nature Capital
the parent as the parent to Company as the
the Company parent to the
Annual Report 2022
Company (%)
Liangji Ningbo, 50,000
Investment 53.90 53.90
Industrial Zhejiang
Notes: Information on the Company as the parent
Ruan Liping and Ruan Xueping are the joint actual controllers of the Company, and the two jointly
hold 100% of the equity of Liangji Industrial, 53.89% of the equity of the Company through Liangji
Industrial, and directly hold 32.22% of the equity of the Company through the Ningbo Ninghui
Investment Management Partnership (Limited Partnership), indirectly holds 0.68% of the voting rights
of the Company and indirectly holds 0.30% of the voting rights of the Company through the Ningbo
Suiyuan Investment Management Partnership (Limited Partnership).
The ultimate controllers of the Company are Ruan Liping and Ruan Xueping.
Details of the subsidiaries of the Company are in the notes
√Applicable □Not applicable
The Company’s subsidiaries are detailed in “IX. Interests in Other Entities” of “Section 10
Financial Report” of the Annual Report
Details of joint ventures and associated enterprises of the Company are in the notes
□Applicable√Not applicable
The following are the circumstances of other joint ventures or associated enterprises that have a balance
with the Company for the current period or that have formed balances from related-party transactions
with the Company for the previous period
□Applicable√Not applicable
Other notes
□Applicable√Not applicable
√Applicable□Not applicable
Name of other related party Relationship with the Company
Ruan Shuhong Daughter of the actual controller Ruan Liping
A company controlled by the actual controller, Ruan
Liangniu Hardware Liping’s wife’s brother Pan Minfeng and his wife Xu
Yirong
A company controlled by the actual controller, Ruan
Hangniu Hardware Liping’s wife’s brother Pan Minfeng and his wife Xu
Yirong
The actual controller Ruan Liping’s wife’s brother Pan
Minfeng and his wife Xu Yirong’s son Pan Qianliang
Feiniu Hardware
holds 55% of the shares, and Xu Yirong holds 45% of the
shares
A company controlled by Yu Shoufu, father of Director
Niuweiwang Trading
Cai Yingfeng’s daughter’s spouse
The main body controlled by Cai Libo, sister of Director
Cixi Libo
Cai Yingfeng
A company controlled by the Ying Jianguo,
Jianke Trading
brother-in-law of Director Cai Yingfeng
Zhang Meina, sister of Senior Executive Zhang Lina,
Yaoyang Trading
holds 100% of the shares
Zhang Meina, sister of Senior Executive Zhang Lina,
Huantian Technology indirectly holds 7.9%% of the shares, and Xu Yanhao,
son of Zhang Meina, holds 43.10% of the shares
Annual Report 2022
A company controlled by Xia Zhonggui, brother of
Chenhao Electronics
Supervisor Li Yu’s spouse, and his spouse Zeng Minhui
A company controlled by another company controlled by
Minshen Property
Ruan Liping and Ruan Xueping
Shenghui Electronics A company controlled by Liangji Industrial
A company controlled by the Ying Jianguo,
Guoxin Trading
brother-in-law of Director Cai Yingfeng
A company controlled by siblings of Senior Executive Li
Qiudi Trading
Guoqiang
(1).Related-party transactions of purchase and sale of goods, provision and acceptance of
services
Information on acquisition of goods and reception of labour service
□Applicable√Not applicable
Information of sales of goods and provision of labour service
√Applicable□Not applicable
Unit: RMB
Content of the Related-Party
Related Parties 2022 2021
Transaction
Adapters, wall switches,
Liangniu Hardware 13,079,962.46 19,286,108.43
LEDs, digital products
Adapters, wall switches,
Hangniu Hardware 36,858,578.23 35,795,907.44
LEDs, digital products
Feiniu Hardware Adapters, digital products 1,481,704.60 1,282,944.42
Subtotal of Hangniu
Hardware [note]
Adapters, LEDs, digital
Guoxin Trading 7,242,317.55
products
Adapters, LEDs, digital
Jianke Trading 3,625,007.82 10,814,536.24
products
Subtotal of Jianke
Trading [note 2]
Adapters, LEDs, digital
Huantian Technology 14,088,847.19 12,206,053.32
products
Niuweiwang Trading Adapters, LEDs 21,583,182.90 21,108,464.96
Adapters, LEDs, digital
Cixi Libo 12,230,224.20 11,075,424.86
products
Chenhao Electronics Digital products, Adapters 1,116,890.54 894,547.84
Adapters, wall switches,
Minshen Property 252,151.56
LEDs, digital products
Adapters, LEDs, digital
Qiudi Trading 5,179,424.46
products
Subtotal 116,733,608.32 112,463,987.51
[Note 1] includes Hangniu Hardware, Liangniu Hardware and Feiniu Hardware. Liangniu
Hardware and Hangniu Hardware are controlled by Pan Minfeng and his spouse Xu Yirong; Feiniu
Hardware is 55% owned by Pan Minfeng’s son Pan Qianliang and 45% owned by Xu Yirong.
[Note 2] Jianke Trading comprises Guoxin Trading and Jianke Trading, which are both under
control of Ying Jianguo.
Notes to acquisition of goods and reception of labour service
□Applicable√Not applicable
(2).Related entrusted management/contracting and entrusted management/outsourcing
Lists of trusteeship/contract of the Company:
Annual Report 2022
□Applicable√Not applicable
Notes:
□Applicable√Not applicable
Entrusted management/contracting of the Company
□Applicable√Not applicable
Notes:
□Applicable√Not applicable
(3).Information on related-party lease
The Company was lessor:
□Applicable√Not applicable
Annual Report 2022
The Company as the lessee:
√Applicable□Not applicable
Unit: RMB
Variable lease
Rental expense of
payments that are not
simplified short-term
covered in the Interest expense on Added right-of-use
Name of Category of leases and low-value Rent payable
measurement of the lease liabilities borne assets
lessor leased assets asset leases (if
lease liabilities (if
applicable)
applicable)
Ruan Buildings and
Shuhong contructions
Shenghui Buildings and
Electronics contructions
Notes:
□Applicable√Not applicable
Annual Report 2022
(4).Information on related-party guarantee
The Company was guarantor:
□Applicable√Not applicable
The Company was secured party
√Applicable□Not applicable
Unit: RMB’0,000
Amount of Execution
Guarantor Start date End date
guarantee accomplished or not
Liangji Industrial 16,000.00 28 December 2020 27 January 2022 Yes
Liangji Industrial 50,000.00 8 April 2021 7 May 2022 Yes
Notes:
□Applicable√Not applicable
(5).Borrowings of funds
□Applicable√Not applicable
(6).Information on assets transfer and debt restructuring by related party
□Applicable√Not applicable
(7).Remuneration for key management personnel
√Applicable□Not applicable
Unit: RMB’0,000
Item 2022 2021
Remuneration for key management
personnel
(8).Other related transaction
□Applicable √Not applicable
(1).Accounts receivable
□Applicable √Not applicable
(2).Accounts payable
√Applicable □Not applicable
Unit: RMB
Item name Related Parties Closing carrying Opening carrying balance
balance
Contract liabilities Hangniu Hardware 2,387,446.01 96,061.89
Contract liabilities Niuweiwang Trading 883,947.33 13,432.85
Contract liabilities Guoxin Trading 527,657.82
Contract liabilities Cixi Libo 437,257.56 157,748.83
Contract liabilities Huantian Technology 234,326.66 28,959.98
Contract liabilities Jianke Trading 194,410.70 322,837.70
Contract liabilities Liangniu Hardware 126,617.06 1,500,950.96
Contract liabilities Feiniu Hardware 90,790.88 11,914.81
Contract liabilities Qiudi Trading 3,955.24
Contract liabilities Yaoyang Trading 3,461.19 3,461.19
Contract liabilities Chenhao Electronics 245.67 2,727.19
Subtotal 4,890,116.12 2,138,095.40
Other payables Hangniu Hardware 2,387,446.01 96,061.89
Other payables Liangniu Hardware 70,000.00 70,000.00
Other payables Cixi Libo 70,000.00 70,000.00
Other payables Yaoyang Trading 30,000.00 30,000.00
Other payables Qiudi Trading 30,000.00 30,000.00
Other payables Niuweiwang Trading 23,000.00
Annual Report 2022
Other payables Feiniu Hardware 20,000.00 20,000.00
Other payables Huantian Technology 20,000.00 20,000.00
Other payables Chenhao Electronics 20,000.00 20,000.00
Other payables Guoxin Trading 20,000.00 10,000.00
Other payables Jianke Trading 20,000.00
Subtotal 20,000.00
□Applicable √Not applicable
□Applicable √Not applicable
XIII Share-based Payment
√Applicable□Not applicable
Unit: Share Currency: RMB
The total amount of equity instruments granted by
the Company for the current period
The total amount of the Company’s equity
instruments exercised for the current period
The total amount of equity instruments of the
Company losing efficacy for the current period
The range of exercise prices of stock options issued
and outstanding at the end of the period of the
Company and the remaining term of the contract
The exercise price of restricted shares in 2020
was: RMB76.13; the remaining contract term
The range of exercise prices of other equity was: 0.5 years; the exercise price of restricted
instruments issued at the end of the period of the shares in 2021 was: RMB88.15; the remaining
Company and the remaining term of the contract contract term was: 1.5 years; the exercise price of
restricted shares in 2022 was: RMB63.06; the
remaining contract term was: 2.5 years
Other notes
(1) Restricted share Incentive Plan in 2020
The Company held the 12th Meeting of the 1st Board of Directors of the Company and the 2019
Annual General Meeting, where the Proposal on the Company’s Restricted Share Incentive Plan in 2020
(Draft) and Its Summary, Proposal on Adjusting the List of Awardees, the Number of Grants and the
Grant Price of the Restricted Share Incentive Plan in 2020 and the Proposal on Granting Restrictive
Shares to Awardees were deliberated and adopted. The Company decided to grant 613,800 restricted
shares to 441 incentive subjects who met the conditions for the grant at a price of RMB76.13 per share,
with an equity grant date of 3 June 2020.
The main performance appraisal requirements for restricted shares: For the first release period, the
performance appraisal target was the operating revenue or net profit attributable to the shareholders of
the listed company in 2020 was not less than the average of the previous three fiscal years (i.e. 2017 -
profit attributable to the shareholders of the listed company in 2021 was not lower than the average of
the previous three fiscal years (i.e. 2018 - 2020); for the third release period, the performance appraisal
target was the operating revenue or net profit attributable to the shareholders of the listed company in
In 2021, the Company’s restricted share Incentive Plan in 2020 recognised equity incentive
expenses of RMB7,347,206.26.
(2) Restricted share Incentive Plan in 2021
The Company held the 5th Meeting of the 2nd Board of Directors of the Company and the 2020
Annual General Meeting, where the Proposal on the Company’s Restricted Share Incentive Plan in 2021
Annual Report 2022
(Draft) and Its Summary, Proposal on Adjusting the List of Awardees, the Number of Grants and the
Grant Price of the Restricted Share Incentive Plan in 2021 and the Proposal on Granting Restrictive
Shares to Awardees were deliberated and adopted. The Company decided to grant 668,400 restricted
shares to 523 incentive subjects who met the conditions for the grant at a price of RMB88.15 per share,
with an equity grant date of 4 June 2021.
The main performance appraisal requirements for restricted shares: For the first release period, the
performance appraisal target was the operating revenue or net profit attributable to the shareholders of
the listed company in 2021 was not less than 110% of the average of the previous three fiscal years (i.e.
or net profit attributable to the shareholders of the listed company in 2022 was not less than 110% of the
average of the previous three fiscal years (i.e. 2019 - 2021); for the third release period, the performance
appraisal target was the operating revenue or net profit attributable to the shareholders of the listed
company in 2023 was not less than 110% of the average of the previous three fiscal years (i.e. 2020 -
As at 22 June 2021, the Company has received a total of RMB58,919,460 in restricted share
subscription payments from 523 incentive subjects in monetary assets, of which RMB668,400 is
included in the paid-up share capital, and RMB58,251,060 in capital reserves (premium on stock). The
matter was examined by Pan-China Certified Public Accountants LLP, which issued the Capital
Verification Report (T.J.Y. [2021] No. 343).
In 2022, the Company’s restricted share Incentive Plan in 2020 recognised equity incentive
expenses of RMB27,625,677.80
(3) Restricted share Incentive Plan in 2022
The Company held the 10th and 12th Meeting of the 2nd Board of Directors of the Company and
the 2021 Annual General Meeting, where the Proposal on the Company’s Restricted Share Incentive
Plan in 2022 (Draft) and Its Summary, Proposal on Adjusting the List of Awardees, the Number of
Grants and the Grant Price of the Restricted Share Incentive Plan in 2022 and the Proposal on Granting
Restrictive Shares to Awardees were deliberated and adopted. The Company planned to implement the
restricted share Incentive Plan with shares of the Company’s common stock repurchased from the
secondary market.
The main performance appraisal requirements for restricted shares in 2022: For the first release
period, the performance appraisal target was the operating revenue or net profit attributable to the
shareholders of the listed company in 2022 was not less than 110% of the average of the previous three
fiscal years (i.e. 2019 - 2021); for the second release period, the performance appraisal target was the
operating revenue or net profit attributable to the shareholders of the listed company in 2023 was not
less than 110% of the average of the previous three fiscal years (i.e. 2020 - 2022); for the third release
period, the performance appraisal target was the operating revenue or net profit attributable to the
shareholders of the listed company in 2024 was not less than 110% of the average of the previous three
fiscal years (i.e. 2021 - 2023).
The Company determined to grant 1,501,800 restricted shares to 646 awardees who met the
conditions at a price of RMB63.06 per share on 20 May 2022. The Company repurchased shares from
the secondary market for RMB215,279,740.56, increasing treasury shares by RMB215,279,740.56;
received RMB94,703,508.00 in subscriptions for shares from the awardees, decreasing treasury shares
by RMB94,703,508.00; the difference between the cost of repurchase in the secondary market and the
subscriptions received was RMB120,576,232.56, deecreasing capital reserves (share premium) by the
corresponding amount. The Company had a repurchase obligation for restricted shares that had not been
unlocked at the end of the period, and the provision for the repurchase obligation increased treasury
shares by RMB94,703,508.00.
In 2022, the Company’s restricted share Incentive Plan in 2022 recognised equity incentive
expenses of RMB42,496,592.78.
√Applicable□Not applicable
Unit: RMB
Methods for determining the fair value of equity The fair value of the restricted shares is the
instruments on the grant date closing price on the grant date
Basis for determining the number of feasible right The number of people expected to exercise the
equity instruments rights is multiplied by the number granted per
Annual Report 2022
person
Reasons for the significant discrepancy between the
current period estimates and the previous estimates
Accumulated amount of equity-settled share-based
payment included in capital reserves
The total amount of the expense recognised for the
current period paid on equity-settled shares
Other notes
The Company accounts for the above share payments in line with the relevant provisions of
share-based payments in Accounting Standard for Business Enterprises as equity-settled share-based
payments, and on each balance sheet date of the waiting period, on the basis of the best estimate of the
number of viable equity instruments, the services received in the current period are included in the
administrative expense based on the fair value of the equity instruments granted on the grant date, and
the capital reserves (other capital reserves) of RMB77,469,476.84 are added.
□Applicable√Not applicable
□Applicable √Not applicable
√Applicable □Not applicable
On 23 April 2020, the Company held the 11th Meeting of the 1st Board of Directors, where the
Special Talent Shareholding Plan was deliberated and adopted, which granted shares of the Special
Talent Shareholding Plan to eligible employees of the Company. The number of people involved
included supervisors, specially introduced talents and talents with special contribution, and the number
of people did not exceed 23. The source of funds for the shareholding plan is the special fund of the
shareholding plan accrued by the Company, and the total amount of funds for the shareholding plan is
RMB50 million, RMB1 per share. The source of stock in the shareholding plan is the A-share common
stock of the Company acquired in the secondary market.
After the Company’s performance evaluation target under the current shareholding plan is
achieved, the corresponding interests of the underlying stock of the holders will be vested to the holders
in batches in line with the evaluation situation in the year of attribution. If there is any remaining
unallocated underlying stock and its corresponding dividends (if any), they will all belong to the
Company.
The duration of the shareholding plan is 60 months, counting from the date of completion of the
acquisition of the underlying stock announced by the Company. Before the expiration of the duration, it
may be extended after the shareholding plan management committee submits it to the Board of Directors
for deliberation and adoption.
The lock-up period for each batch of the subject shares under the shareholding plan is 12 months,
the Company’s disclosure of the completion of the stock acquisition in the secondary market, and no
transactions shall be carried out during the lock-up period.
After the expiration of the lock-up period, it is divided into four batches, and the specific attribution
arrangement of each batch is as follows: Attribution of the 1st batch: 12 months from the date of
completion of the Company’s announcement of the completion of the stock acquisition, the planned
attribution amount is 25% of the total number of stock subject to the shareholding plan. Attribution of
the 2nd batch: 24 months from the date of completion of the stock acquisition announced by the
Company, the planned attribution amount is 25% of the total number of stock subject to the shareholding
plan. Attribution of the 3rd batch: 36 months from the date of completion of the stock acquisition
announced by the Company, the planned attribution amount is 25% of the total number of stock subject
to the shareholding plan. Attribution of the 4th batch: 48 months from the date of completion of the
stock acquisition announced by the Company, the planned attribution amount is 25% of the total number
of stock subject to the shareholding plan.
Annual Report 2022
The evaluation target for the attribution of each batch under the shareholding plan is that the
operating revenue or net profit for the current year is not lower than the average of the previous three
fiscal years.
On 25 September 2020, Sinolink Securities Co., Ltd., the manager entrusted by the Company, has
completed the stock acquisition of the 2020 Special Talent Shareholding Plan through the 2020 Special
Talent Shareholding Single Asset Management Plan of Sinolink Securities and Gongniu Group, with a
total acquisition of 322,000 shares, a transaction amount of RMB50,002,409, and an average transaction
price of RMB155.29 per share.
The Company actually granted 3,600,000 shares of the 2020 employee shareholding plan and
resignation of employees. In 2022, the Company actually granted 8,033,477 shares the employee
shareholding plan. The Company presents the granted share of the plan as the long-term prepaid
expense, confirmed the amortisation of share payment by the evaluation period, and presents the portion
not granted as the other non-current assets. In 2021, the Company’s amortisation by service period was
included in the administrative expense of RMB6,6,611,860.38.
XIV Commitment and Contingency
√Applicable□Not applicable
The external significant commitments, nature and amounts that exist on the balance sheet date
As at 31 December 2022, the Company’s public offerings to raise funds for investment items are as
follows:
Fund raising Amount used
Item name Investment amount Raised fund
(RMB’0,000) (RMB0’000)
Base construction project for annual output of 410
million sets of wall switches and sockets
Construction project for automation upgrading of
annual output of 400 million sets of converters
Base, R&D centre and headquarters base construction
project for an annual output of 180 million sets of LED 115,203.61 65,849.35
lamps
Information construction project 16,035.00 10,459.19
Channel terminal construction and brand promotion
projects
Total 350,320.85 204,383.18
(1).Significant contingencies existing on the balance sheet date
√Applicable □Not applicable
On 31 March 2022, Guangdong Ebelong Intelligent Technology Co., Ltd. (hereafter referred as
Ebelong) filed a lawsuit with Hangzhou Intermediate People’s Court in Zhejiang Province against the
Company, Ningbo Gongniu, Cixi Gongniu, and Information Technology, as well as Zhejiang Tmall
Network Co., Ltd. (hereafter referred as Tmall), demanding the defendants to stop manufacturing,
selling and promising to sell the infringing products, destroy the infringing products in stock and the
corresponding moulds, and compensate for the infringing economic loss of RMB 3 million.
As of the date of approval of the Current Report, the Company expects that the probability of outflow of
economic benefits from the Company as a result of the present obligation of the Company arising from
the above-mentioned litigation is insignificant, thus no related estimated liability has been accrued.
(2).If the Company does not have significant contingencies to be disclosed, it should also be
stated:
□Applicable √Not applicable
□Applicable √Not applicable
Annual Report 2022
XV Subsequent Events after the Balance Sheet Date
□Applicable√Not applicable
√Applicable□Not applicable
Unit: RMB
Profit or dividend to be distributed 1,983,555,895.20
Profit or dividend announced to issue
after review and approval
□Applicable√Not applicable
√Applicable□Not applicable
(1) Profit distribution after the balance sheet date
On 27 April 2023, the 2022 final dividend and bonus issue plan was approved at the 17th Meeting
of the Second Board of Directors. Based on the total share capital (exclusive of the shares in the
Company’s repurchased share account) at the record date of the dividend payout, the Company intends
to pay a cash dividend of RMB33 (tax inclusive) per 10 shares to shareholders, with a bonus issue of 4.8
additional shares for every 10 shares held by shareholders from capital reserves.
(2) The 2023 Restricted Share Incentive Plan
According to the 2023 Restricted Share Incentive Plan approved at the 17th Meeting of the Second
Board of Directors on 27 April 2023, the Company intends to grant a total of 1,510,000 restricted shares
to 762 awardees at a certain price. The plan is subject to final approval by a general meeting of
shareholders.
The restricted shares granted under the incentive plan will be subject to performance appraisal in
three unlocking years/periods, with the achievement of the performance requirements as the condition
for the unlocking of the restricted shares for the awardees. For the first unlocking period, the operating
revenue or net profit in 2023 shall be no less than the average of the previous three fiscal years (i.e.
the second unlocking period, the operating revenue or net profit in 2024 shall be no less than the average
of the previous three fiscal years (i.e. 2021-2023) and no less than 110% of the average of the previous
two fiscal years (i.e. 2022-2023); for the third unlocking period, the operating revenue or net profit in
XVI Other Significant Events
(1).Retrospective restatement
□Applicable√Not applicable
(2).Prospective application
□Applicable√Not applicable
□Applicable√Not applicable
(1).Exchange of non-monetary assets
□Applicable √Not applicable
(2).Replacement of other assets
□Applicable √Not applicable
□Applicable√Not applicable
Annual Report 2022
□Applicable√Not applicable
(1).Basis for the determination of the reporting segment and accounting policies
√Applicable □Not applicable
The Company determines the reporting segment on the basis of the regional division, the income
from principal businesses and the cost of principal business are divided based on the final sales place,
and the assets and liabilities are divided based on the location of the operating entity.
(2).Financial information of reporting segment
√Applicable □Not applicable
Unit: RMB
Overseas
Offset
Overseas companies companies
Item Domestic among Total
in China outside
segment
China
Revenue from
principal 261,466,476.29 14,052,771,512.23
,035.94
business
Principal 8,486,294,
business cost 382.03
Total assets 177,349.94 16,650,497,198.32
,848.38
Total liabilities 4,235,133,055.62
(3).If the Company does not report the segment, or cannot disclose the total assets and liabilities
of each reporting segment, the reasons should be explained
□Applicable √Not applicable
(4).Other notes
□Applicable √Not applicable
□Applicable √Not applicable
□Applicable √Not applicable
XVII Notes of Main Items in the Financial Statements of the Company as the Parent
(1).Breakdown by aging
√Applicable□Not applicable
Unit: RMB
Aging Closing carrying balance
Within 1 year
Of which: Sub-items within one year
Within 1 year 359,382,480.21
Subtotal within 1 year 359,382,480.21
Over 3 years
Over 5 years
Annual Report 2022
Total 359,382,480.21
(2).Breakdown by method of establishing allowance for doubtful account
√Applicable□Not applicable
Unit: RMB
Closing balance Opening balance
Carrying Bad debt Carrying
Carrying balance Bad debt provision Carrying balance
amount provision amount
Type Accrue Accrue
Percent d Percent d
Amount Amount Amount Amount
age (%) proporti age (%) proporti
on (%) on (%)
Bad
debt
provisio
n
establis
hed on
the
individu
al basis
Bad
debt
provisio
n 359,382,48 17,969,12 341,413,35 3,982,866 199,143. 3,783,723
accrued 0.21 4.01 6.20 .46 32 .14
by
portfoli
o
Total / 5.00 / 5.00
Bad debt provision established on the individual basis:
□Applicable√Not applicable
Bad debt provision accrued by portfolio:
√Applicable□Not applicable
Unit: RMB
Closing balance
Name
Accounts receivable Bad debt provision Accrued proportion (%)
Within 1 year 359,382,480.21 17,969,124.01 5.00
Total 359,382,480.21 17,969,124.01 5.00
Criteria and explanation of bad debt provision accrued by portfolio:
□Applicable√Not applicable
To accrue bad debt provision under the expected general model of credit loss, please refer to the
disclosure of other receivables:
□Applicable√Not applicable
(3).Bad debt provision
√Applicable□Not applicable
Unit: RMB
Changes for the current period
Opening Reversed or Other Closing
Type Charged-off/Written-
balance Established transferred-ba change balance
off
ck s
Bad
debt 9,924.00
provisio
Annual Report 2022
n
accrued
by
portfoli
o
Total 9,924.00
Of which significant amount of recovered or transferred-back bad debt provision for the current period:
□Applicable√Not applicable
(4).Accounts receivable written-off in current period
√Applicable□Not applicable
Unit: RMB
Item Amount written-off
Accounts receivable written-off 9,924.00
Of which: The written-off of significant accounts receivable
□Applicable√Not applicable
(5).Top 5 of the closing balance of the accounts receivable collected according to arrears party
√Applicable □Not applicable
Unit: RMB
As % of the closing
Closing balance of
Entity Closing balance balance of total
bad debt provision
accounts receivable
Information technology 349,673,489.15 97.30 17,483,674.46
Gongniu International Trade 3,784,596.47 1.05 189,229.82
Murora Intelligent 2,730,979.62 0.76 136,548.98
Kehua Hengsheng
(Guangzhou) Co., Ltd.
Kehua Data Co., Ltd. 898,089.82 0.25 44,904.49
Total 358,482,453.06 99.75 17,924,122.65
(6).Accounts receivable derecognised due to the transfer of financial assets
□Applicable √Not applicable
(7).Amount of assets and liabilities formed due to the transfer and the continued involvement of
accounts receivable
□Applicable √Not applicable
Other notes:
□Applicable√Not applicable
Breakdown
√Applicable□Not applicable
Unit: RMB
Item Closing balance Opening balance
Interests receivable
Dividends receivable 1,700,000,000.00 2,000,000,000.00
Other receivables 1,056,026,303.85 1,038,980,082.79
Total 2,756,026,303.85 3,038,980,082.79
Other notes:
□Applicable√Not applicable
Annual Report 2022
Interests receivable
(1).Category of interests receivable
□Applicable√Not applicable
(2).Significant overdue interest
□Applicable√Not applicable
(3).Bad debt provision
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
(4).Dividends receivable
√Applicable□Not applicable
Unit: RMB
Project (or investee) Closing balance Opening balance
Ningbo Gongniu 1,200,000,000.00 1,000,000,000.00
Electric Sales 500,000,000.00 700,000,000.00
Gongniu Photoelectricity 300,000,000.00
Total 1,700,000,000.00 2,000,000,000.00
(5).Significant dividends receivable aging over one year
□Applicable√Not applicable
(6).Bad debt provision
□Applicable√Not applicable
Other notes:
□Applicable√Not applicable
Other receivables
(1). Breakdown by aging
√Applicable□Not applicable
Unit: RMB
Aging Closing carrying balance
Within 1 year
Of which: Sub-items within 1 year
Within 1 year 437,048,066.18
Subtotal within 1 year 437,048,066.18
Over 3 years 1,570,245.20
Total 1,151,003,913.44
(2). Breakdown by nature
√Applicable□Not applicable
Unit: RMB
Nature Closing carrying balance Opening carrying balance
Intercourse funds 1,143,058,695.61 1,000,999,087.76
Guaranteed deposit 1,858,945.12 88,048,852.00
Housing loan for employees 4,768,468.33 7,347,019.79
Others 1,317,804.38 474,737.12
Total 1,151,003,913.44 1,096,869,696.67
Annual Report 2022
(3). Bad debt provision
√Applicable□Not applicable
Unit: RMB
Phase I Phase II Phase III
Bad debt 12-month Lifetime expected Lifetime expected
Total
provision expected credit credit loss (without credit loss (with
loss credit impairment) credit impairment)
Balance of 1
January 2022
Balance of 1
January 2022 in
the Current Period
- Transferred to
-35,579,730.00 35,579,730.00
Stage 2
- Transferred to
-79,100.22 79,100.22
Stage 3
- Transferred back
to Stage 2
- Transferred back
to Stage 1
Amount accrued
for the current 2,866,384.71 35,497,720.22 -1,276,109.22 37,087,995.71
period
Amount
transferred-back
for the current
period
Amount
charged-off for the
current period
Amount
written-off for the
current period
Other changes
Balance as at 31
December 2022
Notes to significant changes in the carrying balance of other receivables for which changes in the loss
reserve for the current period occurred:
□Applicable√Not applicable
The amount of bad debt provision for the current period and the basis for assessing whether the credit
risk of financial instruments has increased significantly:
□Applicable√Not applicable
(4). Bad debt provision
□Applicable□Not applicable
Unit: RMB
Changes for the current period
Opening Reversed or Other Closing
Type Charged-off/Written
balance Established transferred-ba change balance
-off
ck s
Bad
debt
provisio
n
Annual Report 2022
accrued
by item
Bad
debt
provisio
n 57,889,613. 37,087,995. 94,977,609.
accrued 88 71 59
by
portfoli
o
Total 57,889,613. 37,087,995. 94,977,609.
Of which the bad debt provision recovered or transferred-back with significant amount during the
current period:
□Applicable√Not applicable
(5). Particulars of the actual written-off of other receivables during the current period
□Applicable√Not applicable
(6). Other receivables with the top five closing balances collected according to the arrears party
√Applicable□Not applicable
Unit: RMB
As a % of the
Nature of Closing
closing balance
Entity other Closing balance Aging balance of bad
of total other
receivable debt provision
receivables
Within 1
Ningbo Transaction 152,607,928.97 13.26 7,630,396.45
year
Gongniu amounts
Within 1
Transaction 116,000,000.00 10.08 5,800,000.00
Cixi Gongniu year
amounts
Within 1
Transaction 113,107,936.67 9.83 5,655,396.83
Electric Sales year
amounts
Gongniu Transaction Within 1
Photoelectricity amounts year
Gongniu Transaction Within 1
Digital amounts year
Total / 1,129,373,686.60 / 98.12 91,407,201.83
(7). Accounts receivable involving government grants
□Applicable √Not applicable
(8). Other receivables derecognised due to the transfer of financial assets
□Applicable √Not applicable
(9). Amount of assets and liabilities formed due to the transfer and the continued involvement of
other receivables
□Applicable √Not applicable
Other notes:
□Applicable √Not applicable
√Applicable□Not applicable
Annual Report 2022
Unit: RMB
Closing balance Opening balance
Item Carrying Impairment Carrying Carrying Impairment Carrying
balance allowances amount balance allowances amount
Investment
to 688,178,210.52 688,178,210.52 441,959,500.17 441,959,500.17
subsidiaries
Investment
to joint
ventures
and
associated
enterprises
Total 688,178,210.52 688,178,210.52 441,959,500.17 441,959,500.17
(1). Investment to subsidiaries
√Applicable□Not applicable
Unit: RMB
Depreciation
Decrease Closing
reserves
Opening Increase in the in the Closing balance of
Investee accrued for
balance current period current balance impairment
the current
period allowance
period
Ningbo
Gongniu
Gongniu
Photoelectricity
Gongniu
Digital
Banmen
Electrical 11,546,142.26 288,241.80 11,834,384.06
Appliances
Gongniu
Precision 102,141,438.83 2,589,365.47 104,730,804.30
Manufacturing
Cixi Gongniu 42,399,186.50 1,170,285.63 43,569,472.13
Shanghai
Gongniu
Gongniu
Management
Gongniu
International 3,110,000.00 221,613.44 3,331,613.44
Trade
Electric Sales 13,385,245.91 8,425,502.56 21,810,748.47
Xingluo
Trading
LV Electric 1,799,085.11 1,138,137.90 2,937,223.01
Household
Electrical 2,591,280.19 2,872,366.86 5,463,647.05
Appliances
Hainan
Dacheng
Intelligent
Technology
Dalitek 91,000,000.00 91,000,000.00
Information 104,999,859.03 104,999,859.03
Annual Report 2022
technology
Gongniu New
Energy
Shenzhen
Intelligent
Murora
Intelligent
Total 441,959,500.17 246,218,710.35 688,178,210.52
(2). Investment to joint ventures and associated enterprises
□Applicable√Not applicable
(1). Operating revenue and cost of sales
√Applicable □Not applicable
Unit: RMB
Item
Revenue Cost Revenue Cost
Principal
business
Other
businesses
Total 5,527,593,701.30 4,279,629,067.01 5,306,290,224.15 3,876,062,056.48
Of which:
Revenue
generated by 5,503,428,124.33 4,271,075,267.90 5,292,184,752.33 3,867,282,763.40
contracts with
customers
(2). Status of contract revenue
□Applicable√Not applicable
(3). Details of obligation for contract performance
□Applicable√Not applicable
(4). Notes of the allocation to the remaining obligations for contract performance
□Applicable√Not applicable
Other notes:
None.
√Applicable□Not applicable
Unit: RMB
Item 2022 2021
Long-term equity investment income
accounted by cost method
Long-term equity investment income
accounted by equity method
Investment income from disposal of
long-term equity investment
Investment income from holding of
held-for-trading financial asset
Dividend income of other equity
investments gained for the holding
period
Annual Report 2022
Interest income earned on investment in
debt obligations during the holding
period
Interest income earned on other
investment in debt obligations during
the holding period
Investment income from disposal of
held-for-trading financial asset
Investment income from disposal of
other equity instruments
Investment income from disposal of
investment in debt obligations
Investment income from disposal of
other investment in debt obligations
Earnings of debt restructuring
Investment income from bank wealth
management products
Total 1,811,912,481.21 2,079,124,417.58
Other notes:
None.
√Applicable □Not applicable
R&D expense
Item 2022 2021
Employee remuneration 155,896,137.96 119,019,111.86
Direct investment 52,557,844.59 44,047,037.17
Depreciation and amortisation 7,656,663.14 5,049,216.83
Others 27,046,508.58 22,328,622.99
Total 243,157,154.27 190,443,988.85
XVIII Supplemental Information
√Applicable □Not applicable
Unit: RMB
Item Amount Note
Gain or loss on disposal of non-current assets -3,980,890.27
Exceptional tax rebates, reductions and
exemptions given with ultra vires approval,
in lack of official approval documents or for
other reasons
Government grants through profit or loss
(exclusive of government grants consistently
given in the Company’s ordinary course of 130,991,587.24
business at fixed quotas or amounts as per
governmental policies or standards)
Capital occupation charges on non-financial
enterprises that are recognized in profit or 590,062.34
loss
Gain equal to the amount by which
Annual Report 2022
investment costs for the Company to obtain
subsidiaries, associates and joint ventures are
lower than the Company’s enjoyable fair
value of identifiable net assets of investees
when making investments
Gain or loss on non-monetary asset swaps
Gain or loss on assets entrusted to other
entities for investment or management
Allowance for asset impairments due to acts
of God such as natural disasters
Gain or loss on debt restructuring
Restructuring costs in staff arrangement,
integration, etc.
Gain or loss on the over-fair value amount as
a result of transactions with distinctly unfair
prices
Current profit or loss on subsidiaries
obtained in business combinations involving
entities under common control from the
period-begin to combination dates, net
Gain or loss on contingencies that do not
arise in the Company’s ordinary course of
business
Gain or loss on fair-value changes on
held-for-trading and derivative financial
assets and liabilities & income from disposal
of held-for-trading and derivative financial
-7,385,680.00
assets and liabilities and other debt
investments (exclusive of the effective
portion of hedges that arise in the Company’s
ordinary course of business)
Reversed portions of impairment allowances
for receivables and contract assets which are
tested individually for impairment
Gain or loss on loan entrustments
Gain or loss on fair-value changes in
investment property of which subsequent
measurement is carried out using the fair
value method
Effects of all adjustments required by
taxation, accounting and other applicable
laws and regulations on current profit or loss
Income from charges on entrusted
management
Non-operating income and expense other
-58,763,095.61
than the above
Other gains and losses that meet the
definition of exceptional gain/loss
Less: Income tax effects 57,894,123.94
Non-controlling interests effects (net of
tax)
Total 284,470,942.06
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item defined or listed
in the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their
Securities to the Public—Exceptional Gain/Loss Items:
Annual Report 2022
□Applicable √Not applicable
√Applicable □Not applicable
Weighted average EPS
Profit of the Reporting Period
ROE (%) Basic EPS Diluted EPS
Net profit attributable to
ordinary shareholders
Net profit attributable to
ordinary shareholders before 25.39 4.84 4.82
exceptional gains and losses
□Applicable √Not applicable
□Applicable √Not applicable
Chairman of the Board: Ruan Liping
Date when this Report was authorized for issue: 27 April 2023
Revised information:
□Applicable √Not applicable
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