Haier Smart Home Company

Interim Report • Aug 28, 2025

Company Code: 600690.SH, 690D.DE Short Name: Haier Smart Home

Haier Smart Home Co., Ltd. 2025 Interim Report

Important Notice

• I. The Board of Directors, directors and senior management of Haier Smart Home Co., Ltd. (the "Company") are individually and collectively responsible for the content set out therein and hereby assure that the content set out in the interim report is true, accurate and complete, and free from any false record, misleading representation or material omission.
• II. All directors attend the Board of Directors.
• III. The interim report is unaudited.
• IV. Li Huagang (legal representative of the Company), Sun Jiacheng (chief financial officer of the Company) and Ying Ke (the person in charge of accounting department) hereby certify that the financial report set out in the interim report is true, accurate and complete.

V. Proposal of profit distribution or proposal of converting capital reserves into share capital for this reporting period resolved and passed by the Board

Proposal of profit distribution for the reporting period are examined and reviewed by the Board: to declare a cash dividend of RMB2.69 per 10 shares (tax inclusive) to all shareholders based on the total number of shares held on record date and after deducting the repurchased shares from the repurchase account upon the execution of distribution proposal, with proposed distribution amounting to RMB2,506,684,210.62 (tax inclusive). The proportion of cash distribution is 20.83% of the net profit attributable to shareholder of parent company of the Company for the current half-year. If there is any change in the total share capital of the Company during the period from the date of this report to the record date of the equity distribution, the total distribution amount will be remained unchanged with corresponding adjustment to the proportion of distribution per share.

VI. Disclaimer in respect of forward-looking statements

√ Applicable □ Not Applicable

Forward-looking statements such as future plans, development strategies as set out in this report do not constitute our substantial commitment to investors. Investors are advised to pay attention to investment risks.

VII. Is there any fund occupation by controlling shareholders and other related parties for non-operational purposes

No

VIII. Is there any provision of external guarantee in violation of prescribed decision-making procedures

No

IX. Are there more than half of the Directors could not warrant the truthfulness, accuracy and completeness of the interim report disclosed by the Company

No

Important Notice

X. Important risk warnings

For the possible risks which the Company may encounter, please refer to the relevant information set out in the section of 'MANAGEMENT DISCUSSION AND ANALYSIS' in this report.

XI. Others

□ Applicable √ Not Applicable

Chairman of the Board: LI Huagang Haier Smart Home Co., Ltd 28 August 2025

Contents

SECTION I — DEFINITIONS	4
SECTION II — GENERAL INFORMATION OF THE COMPANY AND KEY FINANCIAL INDICATORS	6
SECTION III — MANAGEMENT DISCUSSION AND ANALYSIS	12
SECTION IV — CORPORATE GOVERNANCE, ENVIRONMENTAL AND SOCIAL	56
SECTION V — SIGNIFICANT ISSUES	62
SECTION VI — CHANGES IN SHARES AND INFORMATION ABOUT SHAREHOLDERS	74
SECTION VII — RELEVANT INFORMATION OF CORPORATE BONDS	81
SECTION VIII — FINANCIAL REPORT	84
SECTION IX — RESPONSIBILITY STATEMENT	261

Documents Available for Inspection	I.	2025 Interim Report of Haier Smart Home Co., Ltd. with signature of the legal representative.
	II.	Financial statements with signatures or seals of the person in charge of the entity, chief accountant and person in charge of accounting department.
	III.	All documents publicly disclosed in China Securities Journal, Shanghai Securities News, Securities Daily, Securities Times and on the website of the Shanghai Stock Exchange (www.sse.com.cn) during the reporting period.

Section I Definitions

Unless otherwise stated in context, the following terms should have the following meanings in this report:

DEFINITION OF FREQUENTLY USED TERMS

CSRC	China Securities Regulatory Commission
SSE	Shanghai Stock Exchange
The Company, Haier Smart Home	Haier Smart Home Co., Ltd, its original name is "Qingdao Haier Co., Ltd.", and the original short name is "Qingdao Haier"
Four Major Securities Newspapers	China Securities Journal, Shanghai Securities News, Securities Times, Securities Daily
Haier Electronics, 1169	Haier Electronics Group Co., Ltd. (a company originally listed in Hong Kong, stock code: 01169.HK), a subsidiary as accounted for in the consolidated statement of the Company. Haier Electronics has been privatized by way of H shares issuance on 23 December 2020 and became a wholly-owned subsidiary of the Company since then.
GE Appliances	Household appliances assets and business of General Electric Group, which are currently owned by the Company.
FPA	Fisher & Paykel Appliances Holdings Limited (Chinese Name: 斐雪派克) was established in 1934 and is known as the national appliance brand of New Zealand, the global top-level kitchen appliance brand and the famous luxury brand of the world. It has products including ventilator, gas stove, oven, dishwasher, microwave oven, built-in freezer, washing machine, clothes dryer and etc. Its business covers over 50 countries/regions across the world. FPA is wholly-owned subsidiary of the Company.
Candy	Candy Group (Candy S.p.A) is an international professional appliances manufacturer from Italy. Since its establishment in 1945, it has been committed to enabling the global users to enjoy a higher quality of life through innovative technologies and quality services. Candy Group has been prestigious in the global market with users all over the world via its various self-owned professional household appliance brands. In January 2019, Candy became a wholly-owned subsidiary of the Company.
Euromonitor	Euromonitor, established in 1972, is the leading strategic market information supplier and has over 40-years of experience in respect of publishing market report, commercial reference data and on-line database. They create data and analysis on thousands of products and services around the world.

GfK	GfK Group, the world's leading market research company. After a long period
	of development and accumulation, GfK Group's global market research
	business covers consumer durables research, consumer research, media
	research, healthcare market research and special studies.

• All View Cloud All View Cloud (AVC) is a big data integrated solution provider to the smart home field, providing enterprises with big data information services, regular data information services and special data services.
• IEC The International Electrotechnical Commission. Founded in 1906, it is the world's first organization for the preparation and publication of international electrotechnical standardization and is responsible for international standardization for electrical engineering and electronic engineering. The goals of the commission include: to effectively meet the needs of the global market; to ensure that the standards and conformity assessment programs are applied globally in a prioritized manner and to the greatest extent; to assess and improve the quality of products and services involved in its standards; to create conditions for the common use of complicated systems; to improve the effectiveness of the industrialization process; to improve human health and safety, and to protect the environment.
• IEEE The Institute of Electrical and Electronics Engineers, an international association of electronic technology and information science engineers, is currently the largest non-profit professional technology society in the world. It is committed to the development and research of electrical, electronic, computer engineering and science-related fields, and has now developed into an international academic organization with great influence in terms of the fields of space, computer, telecommunications, biomedicine, power and consumer electronics.
• Model of Rendanheyi (人單合一) The concept of "Achieving win-win via Rendanheyi (人單合一) "is the guarantee of Haier's sustainable operation and the driving force of the Company featuring a self-motivated and empowering corporate culture. "Ren" is an employee who has the spirit of entrepreneurship and innovation; "Dan" is to create value for users. The "Rendanheyi (人單合一) "management model encourages employees to create value for users with an entrepreneurial mindset, and to achieve self-value in line with the those of the Company and its shareholders.
• APF Annual Performance Factor: a core indicator of air conditioner energy efficiency as stipulated by national standards. It is calculated by simulating operating conditions across different seasons and temperature conditions throughout the year, calculating the ratio of total cooling/heating capacity to total power consumption. A higher APF value indicates that the air conditioner consumes less power for the same output, reflecting higher energy efficiency.

Section II General Information of the Company and Key Financial Indicators

I. INFORMATION OF THE COMPANY

Chinese name	海尔智家股份有限公司
Chinese short name	海爾智家
English name	Haier Smart Home Co., Ltd.
English short name	Haier Smart Home
Legal representative	Li Huagang

II. CONTACT PERSON AND CONTACT INFORMATION

	Secretary to the Board	Representative of securities affairs	Company Secretary (D/H shares)	Others
Name	Liu Xiaomei	Liu Tao	Ng Chi Yin, Trevor	Global Customer Service Hotline
Address	Department of Securities of Haier Smart Home Co., Ltd. Haier Science and Technology Innovation Ecological Park, No. 1 Haier Road, Qingdao City	Department of Securities of Haier Smart Home Co., Ltd. Haier Science and Technology Innovation Ecological Park, No. 1 Haier Road, Qingdao City	Room 1908, 19/F, Harbour Centre, 25 Harbour Road, Wan Chai, Hong Kong	/
Tel	0532-8893 1670	0532-8893 1670	+852 2169 0000	4006 999 999
Fax	0532-8893 1689	0532-8893 1689	+852 2169 0880	/
Email	finance@haier.com	finance@haier.com	ir@haier.hk	/

III. SUMMARY OF THE CHANGES IN GENERAL INFORMATION

Registered address	Haier Industrial Park, Laoshan District, Qingdao City (now known as Haier Science and Technology Innovation Ecological Park, Laoshan District, Qingdao City)
Historical change of the registered address	Prior to the Company's listing in 1993, the registered address of the Company was No.165 Xiaobaigan Road, Sifang District, Qingdao City, Shandong Province, and has changed to the current address since 1994, during which the address name was adjusted in line with the change of name of the industrial park but the actual site remains unchanged.
Business address	Haier Science and Technology Innovation Ecological Park, Laoshan District, Qingdao City
Postal code of the business address	266101
Website	https://smart-home.haier.com/cn/
Email	9999@haier.com
Query index for any changes during the reporting period	Not applicable

IV. MOVEMENT OF PLACE FOR INFORMATION DISCLOSURE AND DEPOSIT

Designated newspaper for	Shanghai Securities News, Securities Times, China Securities Journal,
information disclosure	Securities Daily
Website for publishing	www.sse.com.cn; https://smart-home.haier.com/cn/; www.xetra.com,
interim report	www.dgap.de; https://www.hkexnews.hk
Deposit place of interim	Department of Securities of Haier Smart Home Co., Ltd.
report	Haier Science and Technology Innovation Ecological Park,
	No. 1 Haier Road, Qingdao City
Query index for any	Not applicable
changes during the
reporting period

V. SUMMARIZED INFORMATION OF SHARES OF THE COMPANY

Type of Shares	Stock Exchange of Shares Listed	Stock Short Name	Stock Code	Stock Short Name Before Variation
A share	Shanghai Stock Exchange	Haier Smart Home	600690	Qingdao Haier
D share	Frankfurt Stock Exchange	Haier Smart Home	690D	Qingdao Haier
H Share	Hong Kong Stock Exchange	Haier Smart Home	6690	/

VI. OTHER RELATED INFORMATION

□ Applicable √ Not Applicable

VII. KEY ACCOUNTING DATA AND FINANCIAL INDICATORS OF THE COMPANY

(I) Key accounting data

	For the reporting period	The corresponding period of last year After		Increase/decrease for the reporting period compared with the corresponding period of last year
Key accounting data	(January-June)	adjustment	Before adjustment	(%)
Operating revenue	156,494,034,448.85	141,982,482,605.75	135,622,549,121.01	10.22
Total profit Net profit attributable to shareholders	14,997,056,148.11	12,980,773,371.76	12,739,064,636.61	15.53
of the listed Company	12,032,995,820.27	10,409,642,540.63	10,420,218,389.22	15.59
Net profit after deduction of non
recurring profit or loss attributable to shareholders of the listed
Company	11,702,408,556.70	10,160,504,902.38	10,160,504,902.38	15.18
Net cash flows from operating
activities	11,139,045,781.34	8,424,060,603.43	7,818,257,937.26	32.23

	As at the end of	As at the end of last year	Increase/ decrease as at the end of the reporting period compared with the end
	the reporting period	After adjustment	Before adjustment	of last year (%)
Net assets attributable to shareholders of the listed Company	114,894,291,018.55	111,778,874,767.22	111,366,118,999.17	2.79
Total assets	301,700,068,337.08	290,736,357,978.75	290,113,822,824.61

(II) Key financial indicators

	For the reporting		The corresponding period of last year
Key financial indicators	period (January-June)	After adjustment	Before adjustment	period of last year (%)
Basic earnings per share (RMB/share)	1.30	1.13	1.13	15.04
Diluted earnings per share (RMB/share) Basic earnings per share after deducting non-recurring profit or loss	1.29	1.12	1.12	15.18
(RMB/share)	1.27	1.10	1.10	15.45 Increased by 0.52
Weighted average return on net assets (%) Weighted average return on net assets after	10.34	9.82	9.67	percentage points Increased by 0.62
deducting non-recurring profit or loss (%)	10.05	9.43	9.43	percentage points

Explanation of the key accounting data and financial indicators of the Company

√ Applicable □ Not Applicable

In December 2024, the Company realised control over Youjin (Shanghai) Corporate Management Co., Ltd. by way of entrustment of voting rights. In March 2025, the Company completed the acquisition of equity interests in COSMOPlat Mould (Qingdao) Co., Ltd. The transaction was accounted for as a business combination under common control in accordance with relevant accounting standards and accordingly, the comparative figures for the corresponding period were restated.

VIII. DIFFERENCES IN ACCOUNTING DATA UNDER DOMESTIC AND OVERSEAS ACCOUNTING STANDARDS

√ Applicable □ Not Applicable

(I) Difference in net profit and net assets attributable to shareholders of the listed company in financial statements as disclosed in accordance with International Accounting Standards and Chinese Accounting Standards

□ Applicable √ Not Applicable

There is no difference between the net profit and net assets attributable to shareholders of the listed company presented in the consolidated financial statements as disclosed in accordance with International Accounting Standards and Chinese Accounting Standards by the Company.

(II) Difference in net profit and net assets attributable to shareholders of the listed company in financial statements as disclosed in accordance with overseas accounting standards and Chinese Accounting Standards

□ Applicable √ Not Applicable

Apart from the financial statements prepared in accordance with International Accounting Standards, the Company has not prepared financial statements in accordance with other overseas accounting standards.

(III) Explanation on difference in domestic and overseas accounting standards

□ Applicable √ Not Applicable

IX. NON-RECURRING PROFIT OR LOSS ITEMS AND AMOUNT

√ Applicable □ Not Applicable

Non-recurring profit and loss items	Amount
Profit or loss from disposal of non-current assets, including the write-off of provision for asset impairment	–25,721,740.02
Government subsidies included in current profit or loss, except for government subsidies that are closely related to the Company's normal business
operations, conformed to requirements of state policies and granted
according to specific criteria, and have a sustained impact on the Company's profit or loss	511,165,290.49
Profit or loss arising from changes in fair value of financial assets and financial liabilities held by non-financial entities, and profit or loss arising from disposal of financial assets and financial liabilities, except for effective hedging activities
related to the Company's normal business operations	57,589,058.88
Net profit or loss of subsidiaries arising from business combinations under common control of the current period from the beginning of the period to the
date of consolidation	3,593,306.97
Other non-operating income and expenses except the aforementioned items	–121,916,440.93
Less: Effect of income tax	–70,186,916.68
Effect of minority equity interest (After Tax)	–23,935,295.14
Total	330,587,263.57

Section II General Information of the Company and Key Financial Indicators

For the Company's recognition of items that are not listed in the "Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 — Non-recurring Profit or Loss" as non-recurring profit or loss items and the amount of which is significant, and for non-recurring profit or loss items as illustrated in the "Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 — Non-recurring Profit or Loss" designated as recurring profit or loss items, reasons shall be specified.

□ Applicable √ Not Applicable

X. COMPANIES WITH EQUITY INCENTIVES AND EMPLOYEE STOCK OWNERSHIP PLANS MAY CHOOSE TO DISCLOSE NET PROFITS AFTER DEDUCTION OF THE IMPACT OF SHARE-BASED PAYMENTS

√ Applicable □ Not Applicable

Unit and Currency: RMB

				Increase/
				decrease for
				the reporting
				period
				compared
	For the	The corresponding period	with the
	reporting	of last year	corresponding
	period	After	Before	period of last
Key accounting data	(January-June)	adjustment	adjustment	year (%)
Net profit after deduction of the

impact of share-based payment 12,264,041,860.05 10,572,191,979.56 10,405,917,567.19 16.00

XI. OTHERS

Section III Management Discussion and Analysis

I. INTRODUCTION OF THE INDUSTRY WHERE THE COMPANY OPERATES AND ITS MAJOR BUSINESS DURING THE REPORTING PERIOD

Industry Overview of the First Half of 2025

1. China Market

The nationwide rollout of the home appliance trade-in programs stimulated demand. According to AVC omni-channel data, China's home appliance market (excluding 3C products) recorded RMB453.7 billion in retail sales in H1 2025, up 9.2% year-on-year.

Air Conditioners

Market demand was boosted by hotter-than-usual summer temperatures and expanded household subsidies (from one unit in 2024 to three units in 2025). Retail sales volume rose 15.6% to 38.45 million units, with sales value up 12.4% to RMB126.3 billion (AVC). Upgrades were driven by health and comfort features such as multi-outlet airflow, fresh air, and sterilization, with fresh air penetration in offline channels nearing 10%. Specialized products such as "air-washing" ACs gained traction. High airflow and ultra-high APF efficiency became key selling points, with Level 1 energy-efficiency models accounting for 98% of online and 95% of offline sales.

Refrigerators

The trade-in program supported steady growth. In H1 2025, retail sales reached RMB67.28 billion, up 3.5%, with sales volume of 19.889 million units, up 2.7% (AVC). The product mix continued shifting toward French-door and cross-door models, which represented over 60% of online sales and nearly 80% of offline sales. Flush-mount refrigerators expanded rapidly, with the share rising to 52.1% in the first half.

Washing Machines

The segment grew steadily, supported by essential demand and rising adoption of dryers, mini washers, and garment care appliances. Zone-washing models and Leader's innovative triple-drum Lazy Wash (懶人洗) washing machines drove product mix upgrades and consumer demand. According to AVC, retail sales reached RMB47.6 billion, up 11.5%, with sales volume of 21.03 million units, up 10.1% year-on-year. Dryers recorded RMB7.6 billion in sales (+13.7%) on 1.39 million units (+16.3%).

Kitchen Appliances

Driven by continued subsidies, the segment maintained steady growth. According to AVC, retail sales of kitchen and bathroom products grew 3.9% and volumes rose 5.4% year-on-year. Lifestyle-driven categories such as dishwashers and built-in microwave-steam-oven combos performed well, with sales up 6.1% year-on-year, supported by policy expansion and product upgrades. In contrast, integrated stoves declined 27.6% due to weak demand and a sluggish property market.

Key trends included larger capacity (18-place dishwashers, 70L+ steam ovens), greater professional functionality (integration and specialization), higher efficiency in washing, cooking, disinfection, and ventilation, and more lifestyle-oriented designs.

Water Heater Industry

Both electric storage and gas water heaters remained under pressure. In H1 2025, electric storage heaters posted sales of RMB10.6 billion (–1.0%), with volume down 1.6% to 8.13 million units. Gas heaters reached RMB13.1 billion (+2.3%), with volume up 0.7% to 6.05 million units (AVC). Demand for Level 1 energy efficiency and health-focused models — such as innovative inner tank designs and mineral-enriched water heaters — continued to rise. Large-capacity and premium models also grew in importance. Innovation in superconductivity and energy storage spurred breakthroughs in electric heaters, while gas heaters gained recognition for improved design, faster heating, and enhanced comfort.

Industry Trends

The home appliance industry is growing steadily with ongoing product upgrades, while consumer demand is increasingly polarized between premium and value-for-money segments, putting the mid-range under pressure. Diversified sales channels such as Douyin and Xiaohongshu, together with more transparent information, are accelerating the shift from channel-driven (B2B) to direct-to-consumer (D2C) models. Rising health awareness is driving specialized demand and the emergence of niche categories such as beauty refrigerators, sideboard refrigerators, zone-washing machines, and kitchen air conditioners. Content-driven e-commerce and professional reviews are shaping consumer decisions, while price convergence is making low-price strategies less effective and increasing the pressure on retail capabilities. Short videos and live streaming have become key touchpoints, with content marketing, social sharing, and cross-brand collaborations emerging as new growth drivers. As the younger generation emerges as the core consumer segment, demand for emotional value is rising, prompting companies to strengthen brand building, expand new media engagement, and launch trend-setting products to improve conversion and sustain growth.

2. Overseas Markets

In the first half of 2025, global home appliance markets showed a clear divergence. Developed markets were weighed down by high interest rates and persistent inflation, keeping demand subdued with only modest signs of stabilization, while parts of the emerging world continued to grow. U.S. tariff hikes further reshaped global supply chains and accelerated the trend toward nearshoring, pushing companies to add capacity closer to end markets.

North America: The market remained under pressure from high interest rates, inflation, and a weak housing sector. In H1 2025, large home appliance shipments fell 0.8% year-on-year, while retail sales value inched up 0.5%.

Europe: The market showed signs of gradual recovery. According to GfK, in Italy, the UK, France, and Spain, the sales volume of major appliances reached 17.4 million units, up 2.0% year-on-year, while retail sales value rose 0.4% to EUR 7.7 billion. The average unit price was EUR 443, down EUR 7.1 year-on-year.

South Asia: India's market grew about 2.4% in retail sales value, though sales of air conditioners and refrigerators fell in April — May due to weather conditions. In Pakistan, sales volume rebounded strongly, rising 25% year-on-year, with high-efficiency products gaining significant traction—inverter refrigerators accounted for 75% of sales and inverter air conditioners for 94%.

Southeast Asia: Overall demand softened. In the Philippines, both sales volume and retail sales value posted slight growth, remaining stable. In contrast, Thailand, Indonesia, and Malaysia saw volume declines of 7.4%, 6.6%, and 6% respectively, while Vietnam's sales volume fell nearly 10%, pressured by weaker-than-expected summer temperatures and subdued consumer spending.

Middle East and Africa: Regional markets maintained growth. In Egypt, retail sales value reached USD 2.3 billion, up 3% year-on-year. In the Gulf states, value rose 9% to USD 1.8 billion. In Saudi Arabia, value stood at USD 3.0 billion, down 3% year-on-year due to demand volatility.

Australia and New Zealand:

• o Australia: Consumer spending remained cautious under high interest rates and rising inflation. Sales volume of major home appliances grew 0.8% year-on-year, while retail sales value fell 2.0%. Currency fluctuations and higher living costs led to price adjustments, with consumers increasingly focused on value for money.
• o New Zealand: The economy grew slowly and inflation stayed elevated, weighing on discretionary spending. While sales of high-efficiency products increased, overall demand was mixed. Traditional retailers remained stable, while new retail entrants intensified competition, creating a more diversified market landscape.

Japan: The refrigerator, freezer, and washer markets contracted slightly. Overall sales volume declined 1.4% year-on-year, while sales value dropped 1.3%. Refrigerator sales volume fell 2.5%, washer sales volume fell 0.9%, while freezer sales volume grew 2.6%. Structural shifts driven by an aging population are supporting demand for high-value, user-friendly products, but declining real wages and rising prices are constraining overall consumption.

Industry Outlook for the Second Half of 2025

1. China Market

Home appliances have become indispensable to modern living, covering food, clothing care, housing, and bathing. High-quality products enhance daily life, and as AI and smart-home integration advance, appliances are becoming more embedded in everyday routines.

China is already one of the world's largest consumer markets for home appliances, with a substantial installed base. According to AVC, total demand (excluding 3C) reached 647.2 million units in 2024, of which major appliances accounted for 279.82 million units. On average, households purchase about 0.6 large appliances annually, equivalent to RMB1,827 in spending. As categories expand and premiumization and smart features accelerate, per-household spending is expected to continue rising, supporting steady growth for the industry.

2. Overseas Markets

Developed markets are likely to recover only gradually under the weight of higher rates and inflation, but demand will continue to gravitate toward energy-efficient, smart, and premium products, with online channels gaining further share. Cost headwinds, including U.S. tariffs, will remain a challenge. Emerging markets should continue to benefit from urbanization, favorable demographics, and consumption upgrades, with penetration still rising and strong growth in demand for smart and green appliances.

Explanation of the company's new material non-core business during the reporting period

□ Applicable √ Not Applicable

II. DISCUSSION AND ANALYSIS ON OPERATIONS

Founded in 1984, the Company is committed to being an enterprise of its time. Through relentless innovation and iterations, we seize opportunities in the industry by continuously launching innovative products that steer market development. After more than 40 years, the Company has become a global leader in the major home appliance industry, as well as a pioneer in global smart home solutions.

Market Position

• Global leader of the major home appliance industry: According to data from Euromonitor an authoritative market researcher, the Company ranked first in terms of sales volume in global major appliance market for 16 consecutive years. The Company has a global portfolio of brands, including Haier, Casarte, Leader, GE Appliances, Candy, Fisher & Paykel and AQUA. From 2008 to 2024, Haier brand refrigerators and washing machines ranked first among global major home appliance brands in sales volume for 17 and 16 consecutive years respectively.
• Pioneer of global smart home solutions: Capitalizing on our full-range home appliances products, the Company is recognised by Euromonitor as one of the first in the industry to introduce smart home solutions. San Yi Niao remained committed to the mission of "providing smart home experience for a better home", by establishing the three core capabilities of innovations in smart home scenario solutions, experiential scenario stores, and breakthroughs in Smart Home's main platform, we have been dedicated to providing proactive, professional, in-depth, and customised smart home solutions for users.

Business Layout

Over the years, the Company has established a business layout that includes smart solutions for, amongst others, food storage and cooking, laundry, air and water, the Overseas Home Appliance and Smart Home Business, and Other Business.

• Household food storage and cooking solutions: Through selling products such as refrigerators, freezers, kitchen appliances in global market, as well as providing one-stop smart kitchen scenario solutions and ecosystem solutions including smart cooking and nutrition planning, the Company fully addresses users' need for convenient, healthy and tasteful gourmet experiences. For example,Casarte developed its proprietary AI Eye Refrigerator, which accurately recognises over 210 types of ingredients, enabling automatic management of inventory and shelf life. Its AI nitrogen-oxygen intelligent control and fast and deep-freezing technology ensure freshness is locked in for 7 days and tenderness preserved for 30 days. The flush-mounted design combined with customised multi-material finishes seamlessly integrates into the kitchen décor.

• Household laundry management solutions: Haier's washing machine focuses on applying original technologies to directly address users' pain points in home living scenarios and create new experiences and value for users. With a product lineup of washing machines, tumble dryers, allin-one laundry machines, garment care machines, and heated drying racks, the Company has evolved from selling individual products to providing scenario-based solutions and offering endto-end laundry care services. For example, the Casarte AI Eye Washing Machine accurately identifies fabric types using AI, automatically matching optimal washing and care programmes while providing early warnings of colour transfer risks. The synergy of AI direct algorithms and technology equips the washing machine with "Smart Home" features capable of instantly adjusting drum speed within 0.01 seconds and precisely performing rapid stops at specific levels, achieving gentler and scientifically optimised tumbling that prevents fibre damage caused by excessive agitation.
• Air solutions (Internet of air):

Home air-conditioners: Through the double drivers of "technology and scenarios", the Company sells our products (such as home air-conditioners and fresh air systems) to markets worldwide, and provides full-cycle air-conditioning solutions that include design, installation and services, with products featuring smart system based inter-connectivity, we have, for example, formulated all-spaces, all-scenarios intelligent air-conditioning solutions consist of multiple air-conditioner and purifier coordination, adaptive air flow, air quality monitoring and air disinfection, thereby delivering a healthy and comfortable experience at home and during commuting that caters to users' needs in terms of air temperature, humidity and quality. One notable example is Casarte's dynamic five-constant system, a high-end whole-house air solution designed for villas and large apartments. It limits temperature fluctuations across the entire space to ≤0.5ºC and maintains humidity levels between 40% and 60%. Employing multi-layer filtration alongside segregated clean and dirty zones, it provides forest-grade fresh air, operating at noise levels below 30 decibels.

Smart buildings: The Company is committed to becoming a leader in efficient, sustainable and smart building solutions based on China's "carbon peaking and carbon neutrality" strategy. Focusing on business segments such as smart control, environment, energy and system integration of buildings, the Company provides green and smart building solutions integrating "technology + experience + space" for government and public buildings, commercial uses, railways, schools, and hospitals. In areas such as magnetic levitation centrifugal chillers, IoTbased multi-split system, and air-to-water heat pump, not only have Haier occupied a pivotal market position in China, but also have achieved remarkable success globally.

• Household water solutions (Internet of water): Through providing worldwide users with electric water heaters, gas water heaters, solar water heaters, air energy heat pump water heaters, POE water purifiers, POU water purifiers, water softening equipment, Haier offers smart water solutions including interactions between water heaters and purifiers, and between heating appliances and water heaters, so as to comprehensively cater to users' needs for water purification, softening and heating. One example is the industry's pioneering AI dual-cycle constant temperature technology, which utilise "heat storage constant temperature chamber + secondary heat exchange internal circulation" to achieve zero temperature difference when turning the water off and on again, maintaining water temperature fluctuations within ≤0.1ºC. Equipped with stepless frequency conversion water servo technology, it dynamically balances water pressure fluctuations, ensuring stable water temperature even when multiple devices use water simultaneously. Additionally, the 56ºC high-temperature sterilisation mode, paired with bipolar ion sterilisation, effectively eliminates 99.9% of Escherichia coli and Staphylococcus aureus, making it the preferred choice for households with mothers and infants.

In 2024, the Company acquired Kwikot, an established water heater brand in South Africa. With its strong market reputation and well-established sales channels, the acquisition enables the Company to rapidly expand its water heater business in South Africa market, boosting brand awareness and market share. This acquisition has further strengthened Haier Smart Home's business presence in the overseas water heater segment.

Global Market Presence

The Company manufactures and sells a comprehensive portfolio of home appliance products and provides value-added services in more than 200 countries and regions, including North America, Europe, South Asia, Southeast Asia, Australia, New Zealand, Japan, Middle East and Africa.

To overseas markets, the Company has been manufacturing and selling proprietary appliance products catering for local users' demands for more than 20 years. During the time, a number of acquisitions contributed to our growth including acquisitions of Haier Group Corporation's overseas white goods business (which included Sanyo Electric Co., Ltd.'s white goods business in Japan and Southeast Asia) in 2015, home appliances of GE in the US in 2016, Fisher & Paykel in 2018, and Candy in 2019.

In 2024, Haier Smart Home added another two brands, namely CCR and Kwikot, under its belt through mergers and acquisitions. The CCR acquisition has enabled Haier Smart Home to push forward its comprehensive refrigeration chain strategy and broadened its business reach to the commercial refrigeration segment, providing strong support for the Company's development in the European market while further promoting the development of the commercial refrigeration sector in Asia-Pacific and other regions. The acquisition of Kwikot, a century-old water heater brand in South Africa, has strengthened Haier Smart Home's business presence in the water heater sector and further facilitated the rapid penetration of white goods business into the South African market.

At present, the overseas business of the Company has entered a stage of healthy growth, having achieved a multi-brand, cross-product and cross-regional presence on a global basis. According to Euromonitor, the Company's market shares (by retail volume) for major home appliances in key regions around the globe in 2024 were as follows: ranked 1st in Asia in terms of retail volume with a market share of 25.9%; ranked 1st in North America with a market share of 24.5%; ranked 1st in Australia and New Zealand with a market share of 15.9%; and ranked 3rd in Western Europe with a market share of 8%.

Other Businesses

Building on our established smart home businesses, the Company has also developed small home appliances, cleaning robots, RRS Logistics, channel distribution and other businesses. In particular, the small home appliance business primarily involves small home appliances designed by the Company, produced by outsourced third-party manufacturers and sold under the Company's brands. It serves to enrich our smart home solutions product mix. RRS Logistics primarily engaged in the provision of integrated supply chain management solutions for clients in the home appliance and home furnishing industries. The channel distribution business primarily offers distribution services for products such as televisions and consumer electronics for Haier Group or third-party brands, leveraging the Company's sales network.

Honours and Recognitions

During the period, Haier Smart Home once again secured a place on the Fortune Global 500 list, rising 17 positions compared to 2024 and marking its seventh consecutive year on the list, demonstrating robust global competitiveness. Additionally, the Company has been named one of Fortune magazine's "World's Most Admired Companies" for seven consecutive years, standing as the only company from the home appliance and home furnishing sector across Eurasia and outside the US to be included. Moreover, Haier Smart Home has ranked among BrandZ™ 2025's Top 100 Most Valuable Global Brands for seven consecutive years, solidifying its position as the world's only IoT ecosystem brand.

In terms of corporate social responsibility and sustainable development, Haier Smart Home has delivered outstanding performance. The Company has topped the Fortune China ESG Impact list in its industry for four consecutive years and has been successfully included in three Hang Seng ESG indices: the HSI ESG Enhanced Index, the HSI ESG Enhanced Select Index and the HSCEI ESG Enhanced Index. It has also received an AA rating from MSCI, placing it at the forefront of the domestic home appliance industry. Furthermore, the Company was listed on Forbes 2025 Global Best Employers and was honoured with the 2024–2025 Forbes China "Sustainable Development Industrial Enterprise" award, reflecting widespread recognition of its ESG efforts.

Discussion and Analysis on Overall Operations for the First Half of 2025

During the reporting period, amid increasing external volatilities, the Company strengthened business model, advanced organizational transformation while fully embracing digitalization and AI technologies. By applying AI tools across the entire value chain, we strengthened operational resilience and improved market responsiveness, user experience, operational efficiency, and cost competitiveness in order to enhance profitability.

In the first half of 2025, the Company achieved revenue of RMB156.494 billion, up 10.2% compared to the same period in 2024. The growth was driven by:

• (1) Domestic market. Domestic revenue grew 8.8% in the first half of the year. Despite intensifying market competition, we leveraged advantages in R&D, manufacturing, distribution, and services to create value for users. We launched industry leading products such as the Haier Mailang (麥浪) refrigerator and Leader triple-drum Lazy Wash (懶人洗) washing machine. We implemented initiatives including digital inventory and digital marketing to expand touchpoints, accelerate product turnover and improve user conversion. Leveraging multi-brand collaborations, Casarte revenue grew by over 20%, and Leader revenue grew by over 15%.
• (2) Overseas markets. Overseas revenue grew 11.7% in the first half of the year. During the reporting period, we advanced premium brand strategy to consolidate market leadership. Through enhanced collaboration between each product unit and marketing team, we accelerated product localization and improved retail capabilities. We strengthened marketing, logistics, service, and digital platforms to drive growth. In the first half of 2025, white goods and HVAC businesses continued to outperform the industry in the U.S. and Europe. Emerging markets grew rapidly with revenue up 33% in South Asia, 18% in Southeast Asia, and 65% in Middle East & Africa. The Company continued to implement the integration of CCR and Kwikot in product synergy, market expansion, and technology development, establishing a solid foundation for sustained future growth.

In the first half of 2025, net profit attributable to shareholders of the parent company reached RMB12.033 billion, representing a 15.6% increase compared to the same period in 2024. Net profit attributable to shareholders of the parent company after deducting non-recurring profit or loss reached RMB11.702 billion, up 15.2% year-on-year compared to 2024.

• (1) In the first half of 2025, the Company's gross profit margin reached 26.9%, up 0.1 percentage points compared to the same period in 2024. In the domestic market, we focused on implementing 'low cost, high efficiency' strategy to enhance end-to-end cost competitiveness while committing to premium brand strategy overseas to improve user experience, strengthening global supply chain coordination to optimize manufacturing cost, and establishing digital procurement platform as well as cross-border logistics platform.
• (2) In the first half of 2025, the Company's selling expense ratio was 10.1%, an optimization of 0.1 percentage points compared to the same period in 2024. The Company accelerated digitalization to improve marketing, logistics and warehouse management in domestic market while focusing on building retail capabilities and coordinating global resources to improve operational efficiency overseas.
• (3) In the first half of 2025, the Company's administrative expense ratio was 3.8%, flat as compared with the same period in 2024.
• (4) In the first half of 2024, the Company's financial expense ratio decreased by 0.2 percentage points to –0.2% ("+" as expenses, "—" as income), as a result of exchange gains caused by strong currencies including the Euro.

In the first half of 2025, the Company's net cash flow from operating activities amounted to RMB11.139 billion, an increase of RMB2.715 billion compared to the same period in 2024, attributable to increased operating profits and improved operational efficiency.

I. Household Food Storage and Cooking Solutions

(I) Refrigeration Business

The refrigeration segment reported global revenue of RMB42.853 billion in H1 2025, up 4.2% year-on-year. Overseas emerging markets remained strong, with revenues in Southeast Asia and South Asia up over 25% year-on-year. According to GfK, the Company's retail market share in China reached 46.4% offline, up 2.3 percentage points year-on-year, and 39.4% online, up 0.4 percentage points.

China Market

In China, the Company enhanced consumer experience in healthy food preservation, integrated flush-mount design, smart scenarios, and energy efficiency, with several products emerging as market bestsellers. In the premium segment, Casarte's ZhiJing series, equipped with proprietary flush-mount design, MSA nitrogen — oxygen preservation, and bottom-mounted air curtain cooling, achieved sales of 320,000 units, doubling year-on-year. This drove Casarte's offline market share in the RMB20,000+ segment to exceed 70%, while its online market share in the high-end segment expanded rapidly, rising by 1.7 percentage points. In the mid-to-high-end segment, Haier's Heyue and Mailang series featuring full-space preservation and ultra-thin zero-clearance design — delivered over 350,000 units in H1, tripling year-on-year, and cumulative sales of 1.5 million units. The Heyue 625 remained the industry's top-selling single model. In the entry segment, Leader gained share with large-capacity, energy-efficient, and low-noise products. Its Yueji series, with a unique corner design and 594mm zero-clearance installation, lifted its share in the RMB2,999–4,999 range by 3 percentage points.

Overseas Markets

The Company advanced localized product designs tailored to climate, power conditions, and space constraints. In South Asia, the T-door LUMIÈRE series met demand for large capacity and categorized storage, while improving cooling stability and efficiency under hot and humid conditions with unstable power. Regional retail volume share rose 0.9 percentage points, with revenue up 27% year-on-year. The Company remained No.1 in Pakistan and achieved double-digit growth in other major markets. In Southeast Asia, smart ice-making and SPACE FIT series refrigerators captured rising mid-to-high-end demand, taking the Company to No.1 in the region. Market share reached 17%, up 3 percentage points, with Vietnam and Thailand posting the fastest growth.

Technology and Innovation

The Company introduced the AI Vision food recognition system (trained on 5 million+ images, backed by 100+ patents, identifying 200+ ingredients with mobile tracking), premium flush-mount installation technology (custom panels, six-way adjustment, hydraulic levelling, 30-minute installation), and upgraded AI nitrogen — oxygen preservation. These technologies will be applied in new premium models to be launched in H2 and are expected to expand share in the RMB10,000+ segment while improving margins.

(II) Kitchen Appliance Business

In H1 2025, kitchen appliances delivered global revenue of RMB20.672 billion, up 2.0% year-on-year, with sales exceeding 8 million units. According to GfK, the Company's market share in China reached 9.2% offline (+1.8ppts) and 6.7% online (+0.5ppts).

China Market

Amid a weak housing market, the Company focused on trade-in demand and consumption upgrades, launching the constant-airflow silent hood (for low-noise open kitchens), adaptive cooktops (adjusting heat to cookware and cooking method), space-saving steam-oven combos, along with AI Vision recognition and smart lift hood functions. By partnering with leading renovation companies to bundle full-suite built-in kitchens into renovation packages and carrying out community renovation campaigns in key cities, the Company accelerated penetration in the stock housing market. Casarte kitchen appliances grew revenue over 40% year-on-year, retaining leadership in the RMB10,000+ segment.

Overseas Markets

The Company executed localized strategies adapted to space, cooking habits, and efficiency standards. In North America, despite slower housing starts and increased promotional activity, the Company leveraged local manufacturing to ensure a stable supply. The launch of the Profile built-in steam-oven combo and the AJEX freestanding induction range secured 4,000 prime displays in key retailers, including The Home Depot, boosting product visibility and consumer reach. In Southeast Asia, compact and efficient kitchen suites for small homes drove the Philippines into the top three market positions. In South Asia, sales in Pakistan rose 23% year-on-year, consolidating leadership in premium built-ins. In Middle East & Africa, sales of premium built-in suites nearly doubled as a share of the business.

II. Household Laundry Solutions

In the first half of 2025, the washing machine business achieved global revenue of RMB32.006 billion, up 7.6% year-on-year, by deepening three core strategies: technological innovation, omni-channel marketing, and comprehensive cost optimization. According to GfK, the Company continued to lead the domestic industry with an offline retail share of 46.4%, up 1.5 percentage points year-on-year, and an online retail share of 38.8%, up 0.9 percentage points year-on-year. Euromonitor ranked the Company number one in market shares in Australia, New Zealand, Italy, Spain, Pakistan, and Vietnam.

China Market

Washing machine business is committed to providing users with outstanding laundry experience and leading the industry upgrade by leveraging product innovation and technological advancement. In response to user demands for integrated washing and drying, efficient drying, and large capacity, the Company launched the Casarte Languang (攬光) Pro washer-dryer suite. This product features a variable frequency motor with full-time 1:1 forward and reverse rotation, preventing tangling and ensuring thorough drying. It includes gentle care functions for washing precious fabrics like wool. The wash-dry feature automatically starts preheating 15 minutes before the wash cycle ends, enhancing wash-dry efficiency. The 580mm ultra-thin design can be fitted seamlessly with cabinet. 12kg Casarte washing machines and washer-dryer combo contributed to over 30% revenue growth, driving market share in price segment above RMB15,000 to over 90%.

The Company launched the Casarte Zhongzi Ronglang (中子 • 融朗) wash-dry-care all-in-one machine equipped with AI Vision, which manages water levels and detergent ratios, enhancing washing effectiveness. The AI Smart Eye effectively prevents laundry from getting caught and small items from being missing, while detecting residual washing foam and automatically commanding second-round rinsing. This product helped achieve over 95% market share in the price segment above RMB20,000 only two months since its launch.

Addressing consumer demand for separate laundry, Leader brand launched the "Lazy Wash Washing Machine (懶人洗)" featuring triple-drum design with independent water circulation that enables simultaneous washing, while addressing vibration challenges and ensuring stability using an integrated steel frame and three coordinated direct-drive motors. This washing machine has become a phenomenal hit as it precisely meets young consumer needs.

As online shopping penetration continued to rise, our washing machine business increased investments in mainstream platforms to enhance page design and create immersive shopping experiences. To capture opportunities from the rise of social commerce, we established official accounts on Douyin, Kuaishou, and Xiaohongshu, creating engaging short videos showcasing product features to promote user interaction. In the first half of 2025, sales through e-commerce channels accounted for over 40% of total domestic laundry sales.

Overseas Markets

We increased market share through highly differentiated and competitive products with retail-oriented go-to market strategies. In Europe, we launched ultra-slim built-in front-load washing machines with 0.8-meter depth to fit premium kitchen designs. In emerging markets, we maintained our commitment to high-end brand development by transitioning product mix from twin-tub to front-load washing machines while pursuing growth opportunities through differentiated products like the X Series and L+ models. During the reporting period, revenue grew by over 40% in South Asian and the Middle East & African markets, while Southeast Asian revenue increased by more than 30%.

III. Air Solutions

During the reporting period, the Company's air solution business realized revenue of RMB32.978 billion, up 12.8% year-on-year.

(I) Home Air Conditioner Business

Driven by continuous improvement in product competitiveness, further expansion of POP channel touchpoints, and enhanced e-commerce platform capabilities in the domestic market, along with strengthened end-to-end competitiveness in overseas markets, the home air conditioner business achieved revenue growth of over 10% in the first half of 2025. Market share performance: (1) In the domestic market, according to GfK, our offline and online retail market share for air conditioners reached 19.7% and 11.3% in the first half of 2025, up 1.17 and 0.9 percentage points year-on-year, respectively. (2) In overseas markets, according to GfK data, the Company ranked first in both the ITS channel share in Italy and the retail market share in Spain; in Egypt, the Company broke into the top three; in Pakistan, the Company maintained its leading industry position with 45% market share.

We strengthened innovation leadership with a focus on leading industry trends for high energy efficiency, healthy, and comfort features. We leveraged in-house manufacturing of core components such as compressors and PCBs, along with supply chain efficiency improvements, to enhance cost competitiveness and strengthen retail competitive advantages. (1) Our newly launched Haier Energy-Saving series air conditioners feature an APF value of 6.12, utilizing AI smart energy-saving technology to reduce daily power consumption to just 2 kWh in cooling mode, and equipped with bipolar ion sterilization and self-cleansing technology to ensure clean airflow. Sales reached 1 million units in the first half of the year, ranking among the top 10 for sales volume on e-commerce platforms during the 618-shopping festival. (2) The Haier Smart-Wind series air conditioners feature innovative Reuleaux triangular wind deflection technology, using mechanical arms to precisely control deflector angles, completely solving the direct airflow pain point for users. Sales exceeded 410,000 units within six months of launch, driving year-on-year volume growth of over 140% in high-end air conditioner sales priced above RMB3,000 per unit.

China Market

The Company effectively enhanced our competitiveness in POP and e-commerce channels through digital inventory and marketing transformation, driving rapid business development. (1) POP channels: we helped distributors establish an asset-light operating model where inventory is shared across all channels and online bestsellers are also sold in physical stores, thereby accelerating touchpoint expansion and improving retail efficiency. In the first half of 2025, our POP channel retail sales grew by over 100% and distributor inventory turnover efficiency improved by more than 30%. (2) E-commerce channels: by establishing an end-to-end conversion system from "brand awareness to user traffic to product sales", and developing an industry-leading portfolio of energy efficiency products, we improved operational efficiency and achieved nearly 50% revenue growth among e-commerce channels during the first half of the year. Our share in emerging e-commerce channels such as Douyin and Kuaishou rose rapidly, with over 5-percentage-point year-on-year increases respectively.

Overseas Markets

The Company strengthened multi-brand synergies, expanded solution-based products, and further localized supply chain, achieving revenue growth of over 15% year-on-year.

In the European market, leveraging the "Haier+Candy+HEC" multi-brand portfolio strategy, we continuously improved channel penetration and user coverage. According to GfK data, Haier air conditioner sales volume share in Italy's ITS channel reached 20.8%, ranking first in the industry; retail channel share in Spain reached 8.7%, also ranking first. We accelerated solution-based product deployment, and launched Haier SENSE product series which have won the German Red Dot Design Award.

In emerging markets, we focused on building end-to-end capabilities for the Haier brand, creating optimal user experiences and building market reputation. ① In Egypt, we launched the industry's first R32 cooling-only inverter air conditioner to address local pain points of high temperatures and expensive electricity. By leveraging our local factory's agile supply advantage and strengthening brand store development, we increased our market share to 16%, breaking into the top three. ② In Pakistan, we launched solar-powered air conditioners that provide cooling in high-temperature conditions with zero grid power consumption, allowing users to recoup purchase costs within two years, helping us increase market share by 2 percentage points to reach 45%.

(II) Smart Building Business

In the first half of 2025, we deepened our core technology deployment in magnetic and air bearing, accelerated the implementation of innovative products and solutions in the domestic market, and continued to enhance our localized operations and professional capabilities in overseas markets, achieving sustained and healthy development. Our market share expanded both domestically and internationally: according to China IOL data, from January to June 2025, our domestic central air conditioning market share increased by 0.4 percentage points year-on-year to 10.5%, ranking among the top three in the industry; our export market share rose by 0.7 percentage points year-on-year to 16.2%, ranking second in the industry.

We continued to focus on core technology R&D in magnetic and air bearing, AI, and high-efficiency energy conservation, using breakthrough innovations to enhance product performance and user experience, establishing industry standards, and consolidating our market leadership position. (1) Building on our deep technical expertise accumulated over 20 years in magnetic and air bearing technologies, we led the development of China's first national standard for magnetic and air bearing central air conditioning — the "Oil-free Bearing Centrifugal Chiller (Heat Pump) Units" national standard. This filled a technical standards gap and promoted green transformation across the industry through high energy efficiency thresholds. (2) During the reporting period, our proprietary static pressure air bearing technology filled the gap in large-capacity magnetic and air bearing technology in the domestic market. Our 600RT air bearing centrifugal chiller equipped with this technology achieves oil-free operation and ultra-long service life design, with energy efficiency improved by 50%, providing green and efficient solutions for high-capacity, high-reliability scenario application such as data centers and large hospitals. We enhanced the innovative integration of AI technology with hardware, which enabled our multi-split systems to reach 192HP by combining single 48HP modules. This resulted in the industry's largest single-unit capacity, with 30% energy savings and 10% reduction in equipment usage, and this product won the "Innovation Product Award" at China Refrigeration Expo.

In the Yancheng Xifu River Green and Low-Carbon Science and Technology Innovation Park project, Haier Smart Building provided solutions for centralized management and smart operations of 12 buildings in the park through IoT multi-split systems and HCM03 local control systems, saving nearly 1 million kWh of electricity annually.

China Market

The Company strengthened our foundation for long-term development through deepening our networks, enhancing professional capabilities, and diversifying our brand portfolio. (1) Deepening local networks and improving response efficiency: We expanded operations in regional markets to precisely cover key touchpoints and strengthen localized service capabilities and market responsiveness. Our regional network coverage rate increased to 78%, and average service response time has been reduced to 24 hours. (2) Strengthening professional capabilities to ensure user experience: We focused on building professional capabilities of our frontline teams through systematic training and standardized processes, improving professional standards across sales consultation, installation, and after-sales services. In the first half of 2025, we offered specialized training to over 12,000 participants, only 0.97% of work orders remained unresolved over one day. (3) Introducing the PROFROID brand to target high-end market: During the reporting period, we strategically introduced PROFROID, a global leading brand in CO2 refrigerant applications and HVAC refrigeration from CCR, to the Chinese market. PROFROID will integrate CCR's leading patents and technology in CO2 application with Haier HVAC's core technological advantages. In alignment with China's "carbon peaking and carbon neutrality" strategic policies, we will progressively introduce low-GWP, highly efficient, reliable, and technologically advanced HVAC refrigeration solutions using R410a/R32/R290/R740 (CO2) refrigerants to turbocharge our development in the high-end market.

Overseas Markets

The Company focused on enhancing localized competitiveness in product solutions, professional channels, and supply chains to drive rapid business growth. (1) Building differentiated competitive product solutions: We deeply integrated domestic and international product platforms to systematically optimize cost structures. Through in-depth insights into local demands, we created comprehensive product solutions tailored for local markets that combine cost competitiveness with high compatibility. For example, in Middle East and Africa, our cabinet units dedicated to living rooms were integrated with our domestic platform, increasing parts commonality by over 15% and reducing overall costs by 6%. (2) Implementing in-depth country-specific development: We adopted a market segmentation strategy. In mature markets, we built on our professional expertise to solidify our leading market position. Our goal was to achieve number one in market share by making progress across dimensions of product lines, regions, and sales channels. In less penetrated markets, we accelerated channel coverage, achieving breakthrough improvements in both coverage rate and market share. During the reporting period, we expedited development in Europe by acquiring KLIMA KFT, Hungary's leading HVAC channel, which helped us establish a strong distribution network and professional solution capabilities that extend throughout Central and Eastern Europe.

IV. Household Water Solutions

During the reporting period, the water solution business achieved global revenue of RMB9.793 billion through product innovation, deepened market segmentation, and cost initiatives, up 20.8% year-on-year. In China market, according to GfK data, our market share continued to lead the industry, with offline and online retail share reaching 31.4% and 43.0% respectively, up 2.4 and 0.8 percentage points year-on-year. Overseas water heater doubled sales revenue, benefiting from differentiated product innovation and accelerated expansion of sales channels.

China Market

In response to users' upgraded demand for water quality, electric water heaters launched magnesium rod-free solutions to address water quality issues caused by magnesium rod heating. Gas water heaters introduced the new Casarte Boundless (無界) series to solve the challenge of condensed water drainage, utilizing aerospace-grade atomization technology to achieve 100% discharge. This product achieved sales of over 10,000 units within one month of launch. The water solution business also focused on upgrading its offerings from single products to comprehensive solutions, driving product mix enhancement. Specifically, Casarte water heaters and water purifiers both maintained revenue growth above 20%, while heating boiler revenue achieved year-on-year growth of 32%.

Overseas Markets

We strengthened regional product differentiation and innovation. In North America, we launched an industry-leading mixed-water valve heat pump product featuring 1234YF eco-friendly refrigerant with high energy efficiency, superior performance, low noise, and reduced carbon emissions, contributing to overall 40% water heater revenue growth. In Australia, we introduced 330L heat pump water heater with rapid heating, large capacity, energy efficiency, and low noise level, driving overall water heater business revenue growth of over 50%. To improve responsiveness in emerging regions, we established dedicated overseas teams in Southeast Asia, Middle East and Africa, resulting in water heater revenue growth of over 80% in Southeast Asian markets. Driven by the acquisition of South Africa's Kwikot water heater business and development in the UAE, our water heater business achieved breakthroughs in Middle East and African markets.

V. China Operation

During the reporting period, we deepened digital transformation in both inventory and marketing, while strengthening our multi-brand strategy. Through building a digital operating system across channels, we improved efficiency and enhanced customer and consumer experience.

Digital Inventory: Streamlined Operations and Faster Fulfillment

By introducing shared digital inventory in POP channels and a One-inventory TC model in franchised stores, the Company eased distributors' capital and warehousing pressure, enabling them to focus more on retail execution. In the first half of the year, the POP channel added over 100 new distributors, while the sales contribution of bestselling models increased by 6 percentage points. In franchised stores, the share of orders delivered directly through the One-inventory system rose from 29% to 55%, driving a 22% increase in retail sales for participating distributors.

Logistics and service capabilities were upgraded in parallel. Coverage for 24/48-hour delivery expanded to 298 additional counties, while 12-hour delivery was extended to 30 counties. Integrated delivery-and-installation services now reach 99.9% of the network. Meanwhile, by sharing inventory across online and offline channels and applying AI-based demand forecasting for warehouse allocation, product turnover improved significantly. In the air-conditioning category, for instance, inventory turnover days were reduced by 17%.

Digital Marketing: Enhancing User Reach and Conversion Efficiency, and Brand Presence

Leveraging our self-developed digital marketing model, the Company achieved more efficient user targeting, conversion, and retention. From January to June, we generated 526,400 leads, translating into RMB1.49 billion in retail sales. By building CTC (Content-to-Consumer), OTO (Online-to-Offline), and OMO (Online-Merge-Offline) capabilities, the Company strengthened traffic acquisition and conversion, creating an end-to-end monetization pipeline. On Douyin, high-engagement A3-tier users grew 52% year-on-year, while user-initiated searches on Xiaohongshu increased 26%, gradually establishing a competitive moat in brand influence.

At the same time, the Company developed a three-tier communication matrix of KOL — KOE — KOS, and introduced an AI-powered influencer selection tool on Xiaohongshu. These initiatives improved account operation efficiency by 15% and increased quality content exposure by 16% year-on-year.

Strengthening Multi-Brand Synergy to Broaden Consumer Reach and Consolidate High-End Leadership

Casarte focused on blockbuster products in core price bands and integrated suite solutions, while advancing new media operations and upgrading its digital store system. In the first half of 2025, revenue grew by more than 20% year-on-year, with market share reaching 12.3%, up 0.9 percentage points (GfK). By expanding new media presence and enhancing online offerings, the brand improved traffic acquisition and conversion efficiency, driving a higher share of online sales.

Haier, under the theme of AI for Home, accelerated its transformation toward youthfulness, globalization, and technology leadership. Retail sales rose 18% in the first half, with membership surpassing 130 million. For young consumers, the "Little Red Flower" suite exceeded 1.2 million units in retail sales, while the "Mailang" suite targeted middle-class households with AI-powered health-focused and smart home experiences. Meanwhile, 166 new experience centers and flagship stores were opened across tier-1 and tier-2 cities, enhancing product showcases and shopping experiences.

Leader continued to target young consumers with innovative offerings designed around personalization, aesthetics, and efficiency needs, such as the triple-tub washing machines, shaping a differentiated brand identity. Revenue grew more than 15% in the first half of 2025.

Fisher & Paykel, positioned as a super-premium brand under the theme Luxury Living, launched the new Series 11 lineup featuring top-tier aesthetics with 3mm seamless built-in and fully concealed designs, which were well received by consumers. Seventeen new experience centers were added, further reinforcing brand presence.

Sanyiniao focused on its smart-home strategy, introducing integrated solutions for HVAC, kitchen, and balcony spaces. HVAC leveraged an AI-driven air model for self-sensing, self-judgment, and self-adjustment, enhancing all-season smart operations. In partnership with Boloni, it rolled out suite-based kitchen solutions — including the Zhijing Max, Conductor PRO, and Connoisseur series — strengthening customization and bundled sales. On the AI front, the Company launched the "Xiaoyou" intelligent agent powered by the Uhome foundation model, enabling vertical AI applications such as AI freshness and AI air in refrigerators and air conditioners — making products more responsive to user needs. Monthly active users of the Smart Home App surpassed 11 million, up 35% year-on-year.

VI. Overseas Markets

In the first half of 2025, the Company delivered revenue of RMB79.079 billion, up 11.66% year-on-year. We strengthened our technology edge through global R&D collaboration, accelerating innovation and enhancing product competitiveness. We optimized our market presence by expanding into HVAC and small appliances, enriching the mid— to entry-level portfolio, and improving channel efficiency in both emerging and developed markets. We advanced our global footprint with deeper local engagement, faster organizational response, and supply chain expansion in Belt and Road countries, capturing new growth opportunities.

North America

During the reporting period, GE Appliances delivered positive year-over-year sales growth, while premium and mass premium brand sales achieved double-digit increases.

The company continued to expand its portfolio of industry-leading appliance solutions with innovations rooted in technology to help users streamline everyday tasks. CAFÉ Smart Counter-Depth 4-Door French-Door Refrigerator with Dual-Dispense AutoFill Pitcher combines a seamless built-in look that fits with cabinets and counters for a clean design offering unmatched style and functionality. GE Profile made its innovative induction cooking technology more accessible with the launch of an induction range model. This GE Profile™ ENERGY STAR® 30" Smart Slide-In Induction and Convection Range gives consumers access to the speed, precision, responsiveness, easy-to-clean surface and efficiency of induction at price points accessible to a broader range of households. The Company also expanded our portfolio of room air conditioners to include new, powerful solutions across its GE Profile™ and GE® brands just in time for summer months. Air and Water Solutions continued to revolutionize residential water heater solutions with the all-new GE Profile™ GEOSPRING™ Smart Hybrid Heat Pump Water Heater, which utilizes advanced heat pump technology to provide up to 4.7 times more energy efficiency than standard electric water heaters and is up to 20% more energy efficient compared to other heat pump water heaters, it is also selected by Green Builder Media as Sustainable Product of the Year.

Europe

In the first half of 2025, the Company recorded sales revenue of RMB17.995 billion, up 24.07% compared with the same period in 2024.

During the reporting period, Candy brand celebrated 80 years of history with a forward-looking spirit. The top innovations include a brand-new washing machine with a groundbreaking design, created to offer maximum flexibility in garment care and the Active Scent System of the Pro Dry 700 tumble dryer, which releases a delicate fragrance through tablets integrated in the filter. In the kitchen, the most innovative techs take centre stage. Candy ovens stand out for their No Preheat and FullMenu features. In the cooling segment, Panorama Light and Circle Fresh have been extended to the built-in range. Fresco fridges now come in modern colours. I-Master Series 7 Kettle, Toaster and Blender received iF Design Award. In May, the Candy Bake 800 oven and the Candy Fresco 500 refrigerator, to the Hoover HF2 vacuum cleaner, and the Haier I-Master Series 7 small kitchen appliances line received our prestigious Red Dot Awards. All of these award-winning products were created at Milan Experience Design Center, the creative hub opened in late 2020 to merge the concepts of design, connectivity, and user experience in the development of appliance solutions.

The deal between Haier, ATP Tour, and the French Tennis Federation (FFT), which began in 2023, includes some of the world's biggest tournaments such as the Roland Garros, Mutua Madrid Open, Hamburg Open, HSBC Championships, European Open Antwerp, Rolex Paris Masters. The Company received over 3 billion mentions during Roland Garros tournament this year.

During the reporting period, we actively advanced the post-acquisition integration of CCR and implemented headquarters synergy initiatives, while maintaining steady business growth. (1) Initial integration benefits emerged as our headquarters and CCR completed collaborative projects across R&D, technology, procurement, and brand expansion, such as the launch of our fourth-generation CDU in the second half of the year, while organizational optimization and integration of our micro-enterprise mechanisms further ignited team initiative. (2) Our core European business returned to growth. While we maintained stability with high-end core clients and expanded our customer base in food retail, we doubled down on regional customer development efforts. (3) Our Asia-Pacific business sustained rapid growth with further expansion into industrial applications, particularly in biopharmaceuticals, food processing, and specialized cold storage. (4) In North America, we focused on accelerating expansion into the industrial equipment market of leading local supermarket chains.

South Asia

During the period, revenue from South Asia grew 32.47% year-on-year to RMB8.666 billion.

India

During the period, the Indian market maintained strong growth, with revenue increasing by over 20% year-on-year. This performance was driven by deep consumer insights and enhanced product differentiation. In response to Indian households' growing focus on energy consumption and vegetarian food refrigeration needs, we launched variable-temperature side-by-side refrigerators with up to 83% of their capacity configurable as refrigeration space. The variable-temperature feature enables flexible food storage and more efficient space utilization. We also launched the Gravity series inverter ACs — India's first fabric-clad AI self-learning air conditioners. Available in seven premium colors such as Morning Mist, Moonstone Gray, and Midnight Dream, the series combines smart cooling technology with fabric aesthetics, enhancing both comfort and the premium look of modern homes. We also strengthened our retail network and improved store performance: while online channels maintained rapid growth, we expanded coverage in national retail chains and traditional offline channels, reaching 65% coverage.

Pakistan

In Pakistan, we drove growth through localized product innovation, upgraded touchpoints, and improved store efficiency. By accelerating in-house supply chain development to enhance cost competitiveness, we increased our high-end market share and price index, achieving over 40% revenue growth and further strengthening our market leadership.

Australia & New Zealand

During the reporting period, sales revenue grew 1.02% to RMB3.258 billion.

The growth was achieved leveraging upgrading product strategy and solution packages such as Haier W790 refrigerator featuring industry leading 5.5/5-star energy efficiency, 7:3 fridge freezer split with Humidity Zone™ drawer and separate storage bins for more fresh food flexibility; Haier H500-H600 oven with steam-assist function and AI assistant; X11 washer, the industry's first "breathable" product, with Air Cruise technology to address bacterial growth and X11 dryer with dual-engine heat pump technology and 3D perspective drying technology to prevent clothes from tangling. FPA upgraded built-in products including Columns series refrigerators and 90cm Oven while invested in design interactions and strengthened social media presence. The Company also completed 119 cost initiatives, enhanced the efficiency of freight transportation and warehouse operations, increased the prediction accuracy to 60%, and reduced the inventory turnover from 71 days to 63 days.

Southeast Asia

During the period, the Southeast Asian market generated revenue of RMB4.130 billion, representing a year-on-year increase of 18.29%. Market share expanded across the regions. In Thailand, our white goods retail volume share increased by 4.1 percentage points to 14.5%, securing the No.1 position. In Vietnam, volume share increased by 2.2 percentage points to 14.9%. In Malaysia, we entered the top three in the white goods market share.

In terms of products, each market drove growth through differentiated innovations. In Thailand, we launched our first smart voice-controlled air conditioner, enabling voice commands for power, temperature, and airflow adjustment; sales exceeded 1,000 units within three months. In Vietnam, Haier brand washing machines were officially launched, including three premium, highly differentiated products — the L+ high-efficiency heat pump washer-dryer, the Zhongzi (中子) all-in-one washer-dryer-care machine, and the X Series equipped with Air Cruise technology driving the washing machine share to 21%, up 1.7 percentage points year-on-year. In Indonesia, we launched large-capacity two-door refrigerators with dual independent variable-temperature compartments, dual storage boxes, and a built-in water dispenser, further strengthening our competitiveness.

In terms of the supply chain, we further developed our local capability to reinforce our market position. In Thailand, construction of a new air conditioner plant progressed, optimizing lead times and reducing costs. In Indonesia, we focused on boosting manufacturing efficiency and shortening production cycles. We also implemented direct-from-factory delivery, reducing logistics costs and improving distribution efficiency.

Middle East & Africa

During the reporting period, the Middle East and African market generated revenue of RMB2.439 billion, representing a year-on-year increase of 65.42%.

During the period, we further enhanced our localized manufacturing base layout and drove rapid business growth through key regional partnerships and channel system reforms. (1) Phase I of our Egypt eco-park has achieved localized manufacturing of air conditioners, washing machines, and televisions, while Phase II production lines for refrigerators and other categories are under construction. Our industry-leading localization rate ensured cost advantages in the Egyptian market, with plans to export to neighboring markets in the Middle East and North Africa. (2) Following our acquisition and integration of Electrolux's water heater business in the South African market, we leveraged our global network to enhance Kwikot water heater products across procurement, R&D, and manufacturing, while actively utilizing Kwikot's local channel advantages and logistics network to expand sales of Haier brand water purifiers, refrigerators, washing machines, and other white goods in South Africa and surrounding markets. (3) We further optimized channel incentive mechanisms in Saudi Arabia and the Gulf region while advancing digital transformation to stimulate sales team motivation and overall operation efficiency. (4) Additionally, we continued promoting brand and product mix upgrades in key regions, increasing the proportion of mid to high-end product sales to uplift our premium brand positioning and unify brand image.

Japan

During the reporting period, the Company recorded sales revenue of RMB1.958 billion, up 7.17% year-on-year, ranking 2nd with 14.8% volume market share in refrigerator, 1st in freezer with 40.4% and 2nd in washing machine with 18.0%.

The Company introduced a collection of innovative products including AQUA NewDelie and Freezia refrigerator series; new heat pump washing machine that ranked 1st in 10kg range and helped grow total market share by 1.2 percentage points, Haier MX high-end air conditioners with self-cleansing, WIFI control and AI energy saving functions. The Company continued to work with Yuzuru Hanyu as the brand Ambassador to launch several campaigns across multiple platforms to capture maximum attention.

VII. Digital Transformation

During the reporting period, the Company accelerated the deployment of AI across all processes and established a data-driven, intelligent decision-making, and closed-loop optimization system, strengthening its advantages in product innovation, cost efficiency, and operational excellence.

In product innovation, the Company introduced an AI-driven demand insight system and standardized data platform, enabling precise identification of user needs and faster discovery of new opportunities. Supported by intelligent decision-making models, product portfolio efficiency improved by 13% in the first half.

In cost management, the Company advanced full-chain digital restructuring. In R&D, the digital BOM system and intelligent costing models reduced design costs by 5.98% and streamlined material codes by 18%. In procurement, a transparent digital platform enhanced supplier onboarding efficiency by 28%, while new technology solutions unlocked potential savings exceeding RMB1 billion. In overseas operations, a pilot program in Thailand achieved end-to-end digital management of suppliers, materials, orders, and operations, driving a 20% improvement in efficiency and generating over USD 40 million in collaborative value.

In supply chain and logistics, the Company established an integrated digital system covering forecasting, production planning, inventory, and order management. Daily output at domestic manufacturing bases rose by 14%, planning accuracy improved by 9.7 percentage points, and production scheduling time was reduced from 2 hours to 0.5 hours. Order response cycles shortened to 8.9 days. In logistics, AI-enabled warehousing, intelligent dispatch, and upgraded service assistants reduced logistics costs by 0.5%, enhanced labor productivity by 11%, and improved raw material VMI unit cost by 14%, with retail logistics success rates up by 5.35%.

Development Plan for the Second Half of the Year

Looking ahead to the second half of 2025, faced with changing user demand and competitive landscape, we will drive steady growth through systematic innovation to accelerate market share expansion and consolidate global leadership.

In the domestic market, we will continue to deepen digital inventory and marketing transformation to stay ahead. We will strengthen multi-brand synergies, with Casarte brand focusing on innovation and experience to create value for users, so as to strengthen high-end market leadership.

In overseas markets, we will focus on strategic upgrade and efficiency improvement to drive breakthroughs. We will continue upgrading global brand portfolio while strengthening localization capabilities and refining operations across all business processes. We will prioritize retail transition to expand market capacity through optimizing distributor and user experiences. At the operational level, we will integrate global platforms in quality control, logistics, services and digitalization to optimize resource allocation, improve market responsiveness, reduce cost and enhance efficiency, thus driving steady growth.

Significant changes in the Company's operating conditions during the reporting period, and matters occurring during the reporting period that have and expected to have a significant impact on the Company's operating conditions

III. ANALYSIS ON CORE COMPETITIVENESS DURING THE REPORTING PERIOD

√ Applicable □ Not Applicable

The Company has established a solid strategic presence and competitive advantage in global market. In China's major home appliance market, the Company has long maintained a leading position across all product categories. According to GfK's report, the Company has established a continued leading market position in key major home appliance categories during the period. In overseas markets, the Company has adhered to its high-end brand creation strategy. Coupling with the two newly acquired brands, namely CCR and Kwikot, this has served us well in building capacity to create global sustainable growth and continuously gaining market share. Building on this foundation and by leveraging on the consolidation and synergy of our global unified platform, efficiency transformation driven by digitalisation, technological strength and innovative capabilities, the Company will further consolidate its leading position in the industry. As cornerstone for sustainable development, our "Rendanheyi" (人單合一) Model also provided management guidance to the Company and enabled us to replicate successful experiences. It is believed that the following advantages will help the Company to continue to strengthen its leading position:

(i) Building up excellent high-end brand operation capabilities and creating a well- recognised high-end brand through forward-looking layout and long-term investment in the global market to achieve a leading market position.

To better meet the need of consumers in pursuit of quality life, the Company has started to develop the high-end brand Casarte in the Chinese market more than 10 years ago. The creation of high-end brands requires not only focus, experience and patience, but also continuous innovation of technological standards and differentiated service capabilities to fulfil user demand for high-quality experiences. The Casarte brand combined the Company's global technological strengths, product development capabilities and manufacturing craftsmanship, as well as privilege marketing and differentiation services, which has won the trust of users in China's high-end market. According to data from GfK, the Casarte brand has assumed a definitive leading position in China's high-end major home appliance market during the period, ranking first in the retail sales of refrigerator, washing machine and air-conditioner categories in the high-end segment. In particular, market shares (in terms of offline retail sales) of the Casarte brand of refrigerators, airconditioners and washing machines reached 59.2%, 49.2% and 90.4% respectively in the market with product priced above RMB15,000 in China.

(ii) Providing users with specialised and customised smart household solutions through the San Yi Niao brand with cross-household design focusing on scenario-based experience to carry out the mission of "providing smart home experience for a better home".

As users continued to demand for higher living quality, coupled with the development of technologies such as Internet of Things and big data, the industry has shown a smart and highend development trend that prioritised product suites, based upon scenarios, and home appliances integrated with home furnishings. With leading user insights, extensive product coverage and technological accumulation from algorithms, big data models and IoT equipment technology, the Company established its three major capabilities in respect of innovations in smart home scenario solutions, experiential scenario stores, and breakthroughs in Smart Home's main platform to create a new home appliances sales method with cross-household design focusing on scenario-based experience, and develop high-end, package, and front-end sales capabilities.

(iii) Extensive and solid global presence with localised operational capability

In respect of overseas markets, the Company seeks overseas expansion of its own brands as well as synergies with acquired brands to develop overseas markets. Such business strategy has guided the Company to establish R&D, manufacturing and marketing three-in-one structure across multiple brands, products and regions, as well as the model of self-development, interconnection and synergised operation.

The Company's extensive global presence depends on its localised business teams as well as its flexible and autonomous management mechanisms established in various overseas markets, which have enabled the Company to gain rapid insights and respond swiftly to local user demands. The Company also proactively integrates into local markets and cultures and has established a corporate image that is recognised by local communities in the overseas regions where the Company operates.

In the first half of 2025, the Company established 10+N innovative ecosystems, 163 manufacturing centres, and 126 marketing centres around the world, and achieved a coverage of nearly 230,000 points of sales in global markets.

(iv) A comprehensive portfolio of proprietary brands recognised by users of all tiers

Through organic growth and acquisitions, the Company has formed seven brand clusters, including Haier, Casarte, Leader, GE Appliances, Candy, Fisher & Paykel and AQUA. To address the needs of users from different tiers in various markets around the world, the Company has adopted a differentiated multi-brand strategy in different regions that centred around users, to achieve an extensive and in-depth user coverage. For example, in the Chinese market: the three brands of Casarte, Haier and Leader achieved the coverage of high-end, mainstream and niche market groups respectively; in the U.S. market, the six major brands such as Monogram, Café, GE Profile, GE, Haier, Hotpoint comprehensively covered all segments of high-end, mid-range and low-end markets, thereby meeting the preferences and needs of different types of users.

(v) Cross-border acquisition and synergy realisation capabilities

The Company has an excellent track record of acquisition and integration. The Company has acquired Haier Group Corporation's overseas white goods business, including Sanyo Electric Co., Ltd.'s white goods businesses in Japan and Southeast Asia in 2015, the home appliance business of General Electric in the US in 2016, the New Zealand company Fisher & Paykel (which has been entrusted by the Haier Group since 2015) in 2018, and the Italian company Candy in 2019. In addition, the Company successfully acquired CCR, a commercial refrigeration brand, in 2024, which has expedited the Company's comprehensive refrigeration chain strategy and strengthened the development of its commercial refrigeration segment. The acquisition of Kwikot, a century-old water heater brand in South Africa, has expanded the Company's business footprint in the African market and strengthened its market competitiveness in the region. Capitalising on the local resources and technological strengths of CCR and Kwikot, Haier Smart Home has rapidly increased its brand awareness and market share in the region.

The Company's capability to perform acquisition and integration is reflected in the following: First of all, the Company implements the "Rendanheyi" (人單合一) Model in the acquired companies, which is a value-added sharing mechanism for the whole-process team under a common goal. Such model can motivate the acquired companies and their employees and enable them to generate more value. Secondly, the Company made use of its global platform to empower the acquired companies in terms of strategic planning, R&D and procurement in order to enhance their competitiveness. Thirdly, the Company's open and inclusive corporate culture can support the acquired companies in establishing a flexible and autonomous management mechanism, which can easily earn recognition from the acquired companies and is conducive to the promotion of integration.

(vi) Comprehensive and in-depth global collaborations and empowerment

The Company has made full use of its global collaborative platform, as well as its integrated functions of R&D, product development, procurement, supply chain, sales and brand marketing. It was able to share and expand development experience to various markets around the world. By strengthening the synergies among its global businesses, the Company has created a strong driving force for its future development.

• Global product collaboration: Focusing on the needs of overseas users and customers, we leverage global R&D resources to ensure close collaboration across all stages, including user demand analysis, product planning, technical solution design, development testing and trial production, and have launched top-selling products in various regions around the world. For example, the only caravan air-conditioner in North America with a heat pump that operates at temperatures as low as –5 degrees Celsius, the first-ever 8.0 Energy Star refrigerator in the Australian market (which is 40% more energy-efficient than its rivals), a brand-new washing machine platform that meets the needs of both the China-US and Europe-Australia markets, and the global micro-vaporisation and roasting platform that integrates the R&D capabilities of Haier from, among others, China, Italy, New Zealand, America, and Japan. Through global product collaboration, overseas brands such as Haier, Fisher & Paykel, Candy, and GE have significantly expanded their product portfolios.

• Global capability collaboration: Development of high-caliber young engineers is conducted in accordance with the unified training model at both the Qingdao headquarters and GE Appliances in the U.S., which has yielded further progress. In Qingdao, young engineers trained through the Global Engineer Development Programme (GEDP) are continuously joining industrial R&D teams and becoming key players in product development. Meanwhile, driven by digital transformation, various global regions are progressively adopting advanced development tools and design methodologies from the automotive industry, significantly enhancing development accuracy and product quality.
• Global design collaboration: An industrial design collaboration system for global top-selling products centred on user experience and branding has been established. Through collaboration with global designers, design quality has been greatly improved. For example, the headquarters design team collaborated with the CANDY design team to complete the creation of Haier's Titanium Series 2/4/6 ovens under the global platform oven, which have been successively launched in markets included Europe and Australia. Meanwhile, the headquarters design centre supported Candy's brand transformation and realised Candy's price index improvement.
• Global procurement collaboration: The Company has established a global procurement committee to coordinate procurement activities. The committee has built a digital sourcing platform that brought together partners across industries and regions to develop an autonomous and controlled global supply chain ecosystem. The committee also created a global database of preferred suppliers and materials to achieve cost reduction by aggregating resources at the Company level. By unifying procurement rules and processes, the Company established a standardised operating system with differentiated procurement strategies to enhance efficiency while lowering risks. We have also developed a Companylevel digital procurement platform to enhance shared capabilities through connecting "materials, businesses, people and mechanisms" to the platform, thereby improving the resilience of our global supply chain.
• Global supply chain collaboration: The Company has built an end-to-end digital management system for the global supply chain that spanned from marketing to suppliers to production and logistics. Using intelligent algorithms, the system enabled real-time flexible deployment of production capacity, and factories across the globe could share and develop smart manufacturing technologies to boost competitiveness.
• Global marketing and brand promotion collaboration: The Company operates a global, multi-tier brand portfolio and carries out coordinated brand promotion worldwide. It also promotes the sharing and replication of successful marketing strategies across regional markets. For example, in Thailand, the Company drew on the online — offline integration strategy used in the Chinese market, leveraging social media platforms to deliver targeted advertising for home appliance products tailored to local household scenarios, successfully capturing consumer attention.

(vii) Industry-leading R&D and technological capabilities

Haier Smart Home delves into technological innovation to expedite the development of innovation-driven productivity that aims for high-end, smart and green upgrade. Leveraging on our industry-leading and comprehensive R&D presence, we constantly provide global users with home appliances that meet their needs and customise their smart and convenient way of living, thus enriching users' life experience as well as cementing our leading position in high-end brands, scenario brands and ecosystem brands.

• Leadership in original technologies:

Haier Smart Home has launched a magnetically controlled full-space freshness refrigerator, addressing the challenge of frozen food preservation by keeping frozen fish fresh for 60 days and chilled meat red, tender, and fresh for 10 days, with nutrients retained as originally stored. The fully built-in range hood equipped with AI Eye enables intelligent interaction with the hob and introduces the industry's first anti-overflow technology, allowing real-time monitoring during cooking and intelligent flame adjustment to prevent spillover. Haier also launched the world's first integrated triple-drum "lazy" washing machine, meeting users' needs for zoned washing and care. It introduced the industry's first air conditioner capable of achieving 110% cooling capacity at 53ºC and stable operation at 70ºC. To address the issue of condensate in gas water heaters with top-rated energy efficiency, Haier uses aerospace-grade atomisation and centrifugal technology to achieve 100% external discharge of condensate water, rejecting its reuse after purification. It also launched the industry's first magnesium rod-free water heater with a metal inner tank, upgrading to an AI cleaning system that replaces the magnesium rod, truly achieving "no magnesium rod, no scale."

• Certification from authorities:

As of the end of June 2025, the Company received a total of 17 State Science and Technology Progress Award, more than any other company in the industry. The Company won the highest accolade of the Disruptive Technology Innovation Competition (Winner Award), and is the only company to have won the highest accolade in the industry for 3 times.

• Leadership in patent quality:

As of the end of June 2025, Haier Smart Home has accumulated more than 116,000 patents applications globally, including more than 75,000 invention patents. The Company also accumulated 12 state patent gold awards, ranking first in the domestic market. In the 'Global Smart Home Invention Patent Ranking' in the first half of 2025, Haier Smart Home once again topped the list with 2,208 published patent applications, ranking 1st in the world for 13 consecutive times.

• Leadership in international standards:

As of the end of June 2025, Haier Smart Home has cumulatively led and participated in the drafting of 116 international standards and 840 state/industrial standards. We are the only company in the industry to have participated in smart home standards from international organisations including the IEC, ISO, IEEE, OCF and Matter. We are also the only enterprise in the world to serve on both the IEC Board and the IEC Market Strategy Board, which have enabled the Company to stay actively involved in the formulation of international standards.

• Leadership in experience design:

Haier won over 600 accolades, including international design awards such as the German IF Design Award and the Red Dot Design Award. The Company won the most international design gold awards in the industry with six in total and won 3 China Excellent Industrial Design Gold Awards from the Ministry of Industry and Information Technology, which is the only enterprise in China that have earned three consecutive gold awards.

(viii) Leading logistics and delivery capabilities in the PRC

Haier RRS Logistics has demonstrated strong competitiveness, particularly in its supply chain management solutions, which cover the entire process and various scenarios, as well as a delivery-loading synchronised logistics service network. By leveraging its digital operation and management capabilities, Haier RRS Logistics has integrated resources such as warehouses, transportation, and service outlets. As a result, it has built a nationwide logistics network that extends to villages and households, offering services that cover the entire process from procurement and factory manufacturing to end consumers. Additionally, Haier RRS Logistics has acquired strong capability in provision of customized services, boasting its strength in customising supply chain solutions according to individual customer needs, catering to a diverse range of needs of various clients. The Company also excels in cross-border supply chain management, addressing client needs in cross-border logistics through air, marine, railway, and multi-modal transportation.

• (ix) Sustainability
  • ① Global ESG governance structure: To advance the implementation of ESG initiatives, Haier Smart Home has further strengthened its organisational structure framework, building on its 3-tier global ESG governance structure (the ESG Committee of the Board of Directors, the ESG Global Executive Office and the Global ESG Executive Working Group). At the executive level, the structure has been expanded to include sub-clusters in areas such as environmental management, sustainable risk management, corporate governance, and supply chain management, providing organisational support for the effective advancement of ESG management.

Section III Management Discussion and Analysis

• ② Green development and low-carbon operation: Haier Smart Home has formulated the "6 Green" strategy of green management throughout the entire life cycle, which includes "green design, green manufacturing, green marketing, green recycling, green disposal, and green procurement", and promotes green actions throughout the entire life cycle. Haier Smart Home has integrated low-carbon, recycling, energy saving and emission reduction into its daily operations to promote green upgrading of the industry.
• ③ Social responsibility and charity work: Haier Smart Home actively participates in public welfare projects such as the Hope Project, rural revitalisation, and emergency relief on a global scale, and continues to give back to society through donations and volunteer services.
• ④ Leading ESG rating: Haier Smart Home has the leading rating among its peers in China in respect of the ESG ratings issued by three major organisations, namely CSI, MSCI and Wind. Among which, its MSCI rating has been upgraded to an AA level. This demonstrates its excellent performance in environmental, social responsibility and corporate governance.
• (x) Staying committed to the principle of "value of people comes first"

"Value of people comes first" has always been a guiding principle for Haier's development. From the autonomous operation team at the start of the venture to the current "Rendanheyi" (人單合 一) model, Haier encourages every employee to maximise their own values while creating values for users. In Haier's "Rendanheyi" (人單合一) model, "Ren" refers to creators; "Dan" refers to user value; "Heyi" refers to the integration of values realised by employees and the values created for users. "Value of people comes first" is the highest purpose of the "Rendanheyi" (人單合一) model.

Haier Smart Home adheres to the values of recognising users' demand as priority and denying our own perceptions and is committed to the "two creative spirits" of entrepreneurship and innovation. We turned employees into creators, implementers into entrepreneurs, and transformed enterprises into open ecosystem platforms, which have supported the Company to become a global leader of smart home in the Internet of Things era.

IV. MAJOR OPERATIONS DURING THE REPORTING PERIOD

(I) Analysis of principal business

1. Table of movement analysis on the related items in financial statements

Unit and Currency: RMB

		Corresponding period of
Items	Current period	last year	Change (%)
Operating revenue	156,494,034,448.85	141,982,482,605.75	10.22
Operating cost	114,437,933,108.76	103,945,159,570.63	10.09
Selling expenses	15,816,814,510.07	14,517,816,334.58	8.95
Administrative expenses	5,891,046,898.48	5,382,166,653.05	9.45
Financial expenses	—350,857,561.47	53,045,789.57	–761.42
R&D expenses	5,790,436,804.10	5,182,598,681.20	11.73
Net cash flow generated from
operating activities	11,139,045,781.34	8,424,060,603.43	32.23
Net cash flow generated from
investing activities	—10,021,560,348.60	–9,191,602,063.95	–9.03
Net cash flow generated from
financing activities	—2,065,226,988.46	–502,661,934.85	–310.86
Other gains	775,214,508.42	585,424,373.34	32.42
Gain on changes in fair value	34,753,540.63	–29,565,597.82	217.55
Gain on disposal of assets	–7,368,037.54	–1,569,698.49	–369.39
Non-operating income	121,855,656.14	76,490,746.47	59.31
Non-operating expenses	257,738,776.06	96,898,224.12	165.99

Reasons for significant changes in certain indicators:

• (1). Reasons for the changes in financial expenses: the decrease of 761.42% over the corresponding period was mainly due to the increase in foreign exchange gains and losses resulting from the appreciation of foreign currencies during the current period.
• (2). Reasons for the changes in net cash flow from operating activities: the increase of 32.23% over the corresponding period was mainly due to improved profitability and operational efficiency.
• (3). Reasons for the changes in net cash flow from financing activities: the increase of 310.86% over the corresponding period was mainly due to the increase in cash outflows for the repurchase of minority interests.
• (4). Reasons for the changes in other gains: the increase of 32.42% over the corresponding period was mainly due to the increase in government subsidies over the corresponding period.
• (5). Reasons for the changes in the gains on changes in fair value: the increase of 217.55% over the corresponding period was mainly due to the increase in changes in fair value of equity investments over the corresponding period
• (6). Reasons for the changes in gain on disposal of assets: the decrease of 369.39% over the corresponding period was mainly due to the year-on-year increase in losses from the disposal of non-current assets during the current period.
• (7). Reasons for the changes in non-operating income: the increase of 59.31% over the corresponding period was mainly due to the year-on-year increase in incomes generated during the current period that were not directly related to the Company's ordinary operation.
• (8). Reasons for the changes in non-operating expenses: the increase of 165.99% over the corresponding period was mainly due to the year-on-year increase in expenses generated during the current period that were not directly related to the Company's ordinary operation.

2. Detailed explanation on significant changes in the operation types and the components of profit or sources of profit of the Company during the period

□ Applicable √ Not Applicable

(II) Explanations on the major changes in profits caused by non-principal businesses □ Applicable √ Not Applicable

(III) Analysis of assets and liabilities

√ Applicable □ Not Applicable

1. Assets and liabilities

Unit: RMB'0,000

Name of Item	Amount at the end of Current Period	Percentage of Amount at the End of Current Period to Total Assets (%)	Amount at the End of the Corresponding Period of Last Year	Percentage of Amount at the End of the Corresponding Period of Last Year to Total Assets (%)	Percentage of Change in Amount from the End of the Corresponding Period of Last Year to Current Period (%)
Monetary funds	5,535,710.25	18.35	5,559,755.46	19.12	–0.43
Account receivables	3,112,579.67	10.32	2,649,484.55	9.11	17.48
Inventories	4,351,727.27	14.42	4,318,985.57	14.86	0.76
Contract assets	149,615.94	0.50	99,796.37	0.34	49.92
Investment properties	66,537.74	0.22	24,616.13	0.08	170.30
Long-term equity investments	2,141,390.02	7.10	2,093,243.93	7.20	2.30
Fixed assets	3,873,335.15	12.84	3,761,321.58	12.94	2.98
Construction in progress	567,744.33	1.88	568,605.10	1.96	–0.15
Right-of-use assets	632,438.49	2.10	584,186.96	2.01	8.26
Short-term borrowings	1,612,761.46	5.35	1,378,436.74	4.74	17.00
Contract liabilities	571,060.37	1.89	1,086,533.78	3.74	–47.44
Long-term borrowings	1,059,561.66	3.51	966,507.43	3.32	9.63
Lease liabilities	491,625.26	1.63	448,089.60	1.54	9.72
Other Explanations
Financial assets held for trading	881,544.83	2.92	123,601.78	0.43	613.21
Derivative financial assets	7,936.51	0.03	14,270.97	0.05	–44.39
Bills receivable	690,761.19	2.29	1,217,985.69	4.19	–43.29
Financing receivables	124,819.74	0.41	41,292.26	0.14	202.28
Non-current assets due within one year	230,757.40	0.76	143,975.87	0.50	60.28
Long-term receivables	13,902.22	0.05	22,472.41	0.08	–38.14
Derivative financial liabilities	44,009.64	0.15	7,101.13	0.02	519.76
Other payables	3,024,054.74	10.02	2,174,613.58	7.48	39.06
Non-current liabilities due within one year	1,114,878.50	3.70	1,653,004.05	5.69	–32.55
Other comprehensive income	228,070.06	0.76	82,550.29	0.28	176.28

Reasons for significant changes in certain indicators

• (1). The increase in financial assets held for trading of 613.21% from the beginning of the period was mainly due to an increase in short-term wealth management products;
• (2). The decrease in derivative financial assets of 44.39% from the beginning of the period was mainly due to fluctuations in the fair value of forward foreign exchange contracts;
• (3). The decrease in bills receivable of 43.29% from the beginning of the period was mainly due to the discounting of bills;
• (4). The increase in financing receivables of 202.28% from the beginning of the period was mainly due to the increase in bills expected to be discounted and endorsed for transfer;
• (5). The increase in contract assets of 49.92% from the beginning of the period was mainly due to the increase in accounts receivable with performance obligations;
• (6). The increase in non-current assets due within one year of 60.28% was mainly due to the increase in time deposits due within one year;
• (7). The decrease in long-term receivables of 38.14% was mainly due to the recovery of previous payments;
• (8). The increase in investment properties of 170.30% was mainly due to the increase in leases during the current period;
• (9). The increase in derivative financial liabilities of 519.76% was mainly due to fluctuations in the fair value of forward foreign exchange contracts;
• (10). The decrease in contract liabilities of 47.44% from the beginning of the period was mainly due to the decrease in advance payment with performance obligations;
• (11). The increase in other payables of 39.06% was mainly due to the increase in dividend payable;
• (12). The decrease in non-current liabilities due within one year of 32.55% was mainly due to the decrease in long-term borrowings due within one year;
• (13). The increase in other comprehensive income of 176.28% was mainly due to changes in exchange differences on translation of financial statement.

2. Overseas Assets

√ Applicable □ Not Applicable

(1) Scope of assets

Among the assets, overseas assets amounted to 14,812,771 (unit and currency:RMB'0,000), representing 49.1% of the total assets.

(2) Explanation of high percentage of overseas assets

√ Applicable □ Not Applicable

Unit and Currency: RMB

Name of overseas asset	Reason for formation	Operating mode	Operating revenue during the reporting period	Net profit of the reporting period
Overseas Home Appliance and Smart Home Business	Overseas mergers & acquisitions and the Company's own development	Localized Operations with the integration of R&D, manufacturing and marketing	79,078,994,757	4,720,998,499

Note: Net profit stated in the above table represents operating profit.

3. Restrictions on major assets as of the end of reporting period

□ Applicable √ Not Applicable

4. Other Explanations

□ Applicable √ Not Applicable

(IV) Analysis of investment

1. Overall analysis on external equity investment

√ Applicable □ Not Applicable

(1). Significant equity investment

√ Applicable □ Not Applicable

Unit and Currency: RMB'00,000,000

Name of invested company	Main business	Whether the subject is principally engaged in the investment business	Investment method	Investment amount	Percentage of shareholding	Whether to consolidate	Statement account (if applicable)	Source of funds	Partner (if applicable)	Investment period (if any)	Progress as of the balance sheet date	Estimated revenue (if any)	Impact on profit and loss for the current period	Whether involved in litigation	Disclosure date (if any)	Disclosure index (if any)
Haier Group Finance Co., Ltd.	Enterprise group financial company services	No	Other	12.6	42%	No	/	Converting undistributed profits into registered capital		/	Incomplete	/	/	No	28 March 2025	Announcement on the Capital Increase in the Investee, Haier Group Finance Co., Ltd., by Converting Undistributed Profits into Registered Capital in Proportion, and the Related-Party Transaction of Haier Smart Home Co., Ltd. (Announcement no.: Lin 2025–008).
Total	/	/	/	12.6	/	/	/	/	/	/	/	/	/	/	/	/

(2). Significant non-equity investment

√ Applicable □ Not Applicable

During the reporting period, the 13th meeting of the 11th session of the Board of Directors of the Company considered and approved a new construction project of 3 million units of washing machines in the SCO Economic Demonstration Zone, Jiaozhou, Qingdao, with an estimated total investment of RMB1.784 billion. It also considered and approved the proposed purchase of real estate for Haier White Goods R&D Center for RMB267 million. For details, please refer to the Announcement on Investing in Construction of a New Washing Machine Production Plant with an Annual Capacity of 3 Million Units of Haier Smart Home Co., Ltd. (Announcement no.: Lin 2025–016) and the Announcement on the Acquisition of the Real Estate of Haier White Goods R&D Centre and the Related-party Transaction of Haier Smart Home Co., Ltd. (Announcement no.: Lin 2025–015) disclosed by the Company on 28 March 2025. For details of other non-equity investment, please refer to "Section VIII Financial Report" for relevant information of items such as construction in progress.

Asset Type	Opening Balance	Profits or Losses of Changes in Fair Value during the Period	Cumulative Changes in Fair Value Included in Equity	Provision for Impairment of during the Period	Purchases during the Period	Sold/Redeemed Amount during the Period		Other Changes Closing Balance
Wealth management products	746,436,121.40	12,840,207.01				22,851,173,000.00 15,292,938,000.00		8,317,511,328.41
Investment in other equity instruments	6,073,680,870.82	—	–374,242,839.46		49,238.16	87,115,207.36	37,784,189.09	5,650,156,251.25
Investment in trading equity instruments	195,177,368.77	18,929,447.58				31,001,704.19		183,105,112.16
Investment funds	294,404,349.36	25,935,689.85			8,196,533.65	12,404,953.39	–1,299,744.42	314,831,875.05
Financing receivables	412,922,615.25					17,123,799,299.24 16,288,524,466.15		1,248,197,448.34
Derivative financial instruments	71,698,406.90	–267,552,013.91	–149,398,586.76				–15,479,086.92	–360,731,280.69
Total	7,794,319,732.50	–209,846,669.47	–523,641,426.22			39,983,218,071.05 31,711,984,331.09		21,005,357.75 15,353,070,734.52

(3). Items measured at fair value

Note: As of 30 June 2025, the aggregate balance of the Company's foreign exchange derivative transaction amounted to approximately US\$2.634 billion.

Investment in securities

√ Applicable □ Not Applicable

Unit and Currency: RMB

Type of Securities Securities Code	Securities Abbreviation	Initial investment cost	Sources of funding	Carrying amount at the beginning of the Period	Profit and loss arising from changes in fair value during the Period	Accumulated fair value changes included in equity	Purchases during the Period	Disposals during the Period	Investment profit or loss during the period	Carrying amount at the end of the Period	Accounting items
Stock 601328 Stock 600827 Stock 300183 Stock 688455 Total /	Bank of Communications Bailian Group Neusoft Carrier KENGIC /	1,803,769.50 154,770.00 18,713,562.84 13,820,053.00 34,492,155.34	Self-funding Self-funding Self-funding Self-funding	10,584,698.04 430,510.84 15,125,624.10 86,936,035.20 / 113,076,868.18	–4,275,003.34 –4,275,003.34	117,494.12 — 117,494.12		29,611,302.75 29,611,302.75	23,204,450.92	10,702,192.16 430,510.84 15,125,624.10 76,254,180.03 23,204,450.92 102,512,507.13	Investments in other equity instruments Investments in other equity instruments Investments in other equity instruments Trading financial assets /

Explanation of investment in securities

□ Applicable √ Not Applicable

Private equity investment

√ Applicable □ Not Applicable

By the end of the reporting period, the Company has historically invested in private equity funds as follows: the Company invested 63.13% share in Qingdao Haier SAIF Smart Home Industry Investment Center (Limited Partnership) (青島海爾賽富智慧家庭 創業投資中心(有限合伙)); Qingdao RRS Huitong Investment Management Co., Ltd. (青島日日順匯通投資管理有限公司), a subsidiary of the Company, invested 49% share in Guangzhou Heying Investment Partnership (Limited Partnership) (廣州合贏投 資合夥企業(有限合伙)); Qingdao Haishang Chuangzhi Investment Co., Ltd. (青島海尚 創智投資有限公司), a subsidiary of the Company, invested 30% share in Huizhixiangshun Equity Investment Fund (Qingdao) Partnership (Limited Partnership) (匯智翔順股權投資基金(青島)合夥企業(有限合伙)), a private equity fund, and 50% equity of Qingdao Ririshun Huizhi Investment Co., Ltd. (青島日日順匯智投資有限責 任公司), a managing partner of the fund; Qingdao Haier Technology Investment Co., Ltd. (青島海爾科技投資有限公司), a subsidiary of the Company, invested in private equity funds: 1.265% share in Beijing-Tianjin-Hebei Industrial Coordinated Development Investment Fund (Limited Partnership) (京津冀產業協同發展投資基金 (有限合伙)), 14.85% share in Shenzhen TopoScend Capital Phase I Fund (Limited Partnership) (深圳市投控東海一期基金 (有限合伙)), 24% share in Qingdao Haimu Smart Home Investment Partnership (Limited Partnership) (青島海慕智家投資合夥企 業(有限合伙)), and invested in fund management companies: 5.01% equity of CMG-SDIC Capital Co., Ltd. (國投招商投資管理有限公司), 15% equity of Shenzhen TopoScend Capital Co., Ltd. (深圳市投控東海投資有限公司), 49% equity of Qingdao Haimu Investment Management Co., Ltd. (青島海慕投資管理有限公司).

Derivative investment

√ Applicable □ Not Applicable

• (1). Derivatives investments for hedging purposes during the reporting period
  • √ Applicable □ Not Applicable

Unit and Currency: RMB'0,000

Type of derivatives investment	Initial investment amount	Carrying amount at the beginning of the Period	Gains or losses on fair value changes for the current period	Accumulative changes in fair value included in equity	Amount purchased during the reporting period	Amount sold during the reporting period	Carrying amount at the end of the Period	Proportion of carrying amount to net assets of the Company at the end of the reporting period (%)
Forward foreign exchange contracts	1,014,344.00	1,014,344.00	–26,903.00	–14,940.00			1,885,518.00	16.41
Forward commodity contracts	4,213.00	4,213.00	147				3,816.00	0.03
Total	1,018,557.00	1,018,557.00	–26,756.00	–14,940.00			1,889,334.00	16.44

Accounting principles are based on the Accounting Standards for Business Enterprises. The Company carried out the accounting treatment for its business in accordance with the relevant regulations of "Accounting Standards for Business Enterprises No. 22 — Recognition and Measurement of Financial Instruments", "Accounting Standards for Business Enterprises No. 24 — Hedge Accounting", "Accounting Standards for Business Enterprises No. 37 — Presentation of Financial Instruments" and "Accounting Standards for Business Enterprises No. 39 — Fair Value Measurement" published by the Ministry of Finance and its guidance, to reflect the relevant items in the balance sheet and the statement of profit or loss, which are consistent with those of the previous reporting period.

The actual profit and loss for the reporting period amounted to RMB–95.3522 million.

Under the premise of ensuring normal production and operation, the Company carried out hedging business to reduce the impact of exchange rate fluctuations on the Company's production and operation and to realize the Company's long-term stable development.

Source of funds for derivative investments Risk analysis and explanations on

Explanation on the effect of

Explanation on actual profit or loss during the reporting period

Explanation on any significant changes in the accounting policies and specific accounting and auditing principles for the hedging business during the reporting period as compared to the last reporting

period

hedging

risk control measures for positions in derivatives during the reporting period (including but not limited to market risk, liquidity risk, credit risk, operational risk, legal risk, etc.)

I. Foreign exchange hedging business

1. Risk Analysis

Self-owned funds

The Company and its holding subsidiaries conduct foreign exchange derivatives business in accordance with the principle of stability, and do not conduct the foreign exchange transaction for speculative purposes. All foreign exchange funds businesses are based on normal production and operation and rely on specific business operations to avoid and prevent exchange rate risks. However, there are also certain risks in conducting foreign exchange funds business:

• (1) Market risk: Forward settlement of foreign exchange: the Company will determine whether to sign a forward contract based on the cost of the product (basically consisting of RMB) and market risk. Signing the contract equals to fixing the price of currency exchange. It is effective to resist market fluctuation risk and ensure a reasonable and stable profit level of the Company through forward settlement of foreign exchange. Forward purchase of foreign exchange: according to the import contract entered with the customer and exchange rate risk, the future currency exchange cost will be fixed through the unilateral forward purchase of foreign exchange. Although there is a certain risk of loss, the forward purchase of foreign exchange will effectively reduce the market fluctuation risk and fix procurement costs. Other NDF and options businesses are mainly carried out when failed to sign the ordinary forward settlement/purchase of foreign exchange or the costs are too high, only serving as the supplement of the above businesses. Exchange rate fluctuation risk in currency swap business is avoided by adjusting the currency of assets and liabilities in order to match the currency of the assets with the currency of liabilities. Interest rate fluctuation risk in interest rate swap business is avoided by transfer the floating-rate business to fix-rate business or transfer the fixed-rate business to floating-rate business when the rate is going downward to reduce the costs. All of the above businesses have a real business background and there is no speculation.
• (2) Exchange rate fluctuation risk: After the Company fixing the forward exchange rate according to the foreign exchange management strategy, if the actual trend of the foreign exchange rate deviates significantly from the direction of the Company's fixed exchange rate fluctuation, the cost of the Company after fixing the exchange rate expenditure may exceeds the cost of not fixing the exchange rate, thus forming a loss of the Company. When the foreign exchange rate changes greatly, if the fluctuating direction of the Company's fixed foreign exchange hedging contract is inconsistent with that of the foreign exchange rate, the foreign exchange loss will be formed; if the exchange rate does not fluctuate in the future, the vast deviation from the foreign exchange hedging contract will also form a foreign exchange loss.
• (3) Internal control risk: The foreign exchange derivatives business is highly specialized and complex so it may cause risks due to imperfect internal control systems.
• (4) Transaction default risk: In the event of a default in the counterparty of foreign exchange derivative transaction, the Company would not be able to obtain hedging profits as agreed to hedge the Company's actual exchange losses, resulting in a loss of the Company.
• (5) Customer default risk: The overdue of customer's accounts receivable and the customer's order adjustment will make the actual payment inconsistent with the expected payment, which may result in the actual cash flow could not match the carried out foreign exchange derivative business term or amount completely, leading to a loss of the Company.
• 1. Risk Control Measures Taken by the Company
• (1) The Company may not engage in any foreign exchange derivative transactions except those carried out for the purpose of avoiding exchange rate risks, and only for foreign exchange operations related to the Company's import and export business and overseas asset/liability management.
• (2) The Company implemented approval process in strict compliance with the Foreign Exchange Risk Management Policy and the Foreign Exchange Derivatives Transaction Management Rules. The general meeting of shareholders of the Company and the Board of Directors delegate the President/President Office to take responsibility for the operation and management of the foreign exchange derivatives business, the Treasury Department shall act as the handling department, and finance department shall act as the daily review department.
• (3) The Company conducts foreign exchange derivatives business with financial institutions such as large banks with legal qualifications. The financial department timely tracks the changes in the transaction and strictly controls the occurrence of closing default risk.
• (4) The Company conducts foreign exchange derivatives business must base on the Company's cautious forecast on the foreign currency receipts and payments and actual business exposure. The delivery date of the foreign exchange derivatives business must match with the Company's predicted receipt time, deposit time or payment time of the foreign currency, or match with the corresponding redemption term of the foreign currency bank borrowing.
• II. Bulk Hedging Business
• 1. Risk Analysis
• (1) Market risk: The futures and derivatives market itself has certain systematic risks, while hedging requires certain level of price trend prediction. If the price prediction is directionally incorrect, it may cause losses to the Company.
• (2) Policy risk: Significant changes in laws and regulations of the futures and derivatives markets may cause market fluctuations or make trading impossible, which may result in risks.
• (3) Funding risk: Due to the strict margin system and daily mark-to-market system in the futures market, there may be corresponding funding floating loss risks. The Company will reasonably allocate its own funds for hedging business, control the scale of funds, and conduct funding projections while formulating trading plans to ensure sufficient funds. In the process of business operations, the Company will plan and utilize margins reasonably, and adjust funds appropriately to avoid risks.
• (4) Operational risk: There may be cases in which suppliers violate their agreements and cancel or delay deliveries, resulting in a mismatch between the actual hedging quantity and period, causing losses to the Company.
• (5) Internal control risk: Futures and derivatives transactions are more specialized and complex, which may give rise to risks caused by inadequate internal control systems or human errors in operations. The Company has formulated the Management Measures for Hedging Business of Bulk Raw Materials, which contains clear provisions on the authorization scope, approval procedures, risk management and other aspects of hedging transactions. The Company shall strengthen internal control management and improve professionalism, implement risk prevention measures and improve the management standard of hedging business.
• 1. Risk control measures adopted by the Company
• (1) Matching hedging business with the Company's production and operation to maximize hedging against the risk of market fluctuations.
• (2) Strictly control the scale of hedging funds and reasonably plan and use margins. The Company will reasonably allocate its own funds for hedging business, and will not use raised funds directly or indirectly for hedging.
• (3) The Company has formulated the Management Measures for Hedging Business of Bulk Raw Materials, which contains clear provisions on the organizational structure and its responsibilities, business processes, risk management, file management, etc. The Company will strictly follow the provisions of the internal control system to control all aspects of the business, and will implement the Management Measures in accordance with the established regulations.
• (4) The Company will strengthen the training of relevant personnel to enhance their professionalism and overall quality; strengthen research on the futures and derivatives market to grasp market changes and design specific operational plans for trading business.
• (5) The internal audit department of the Company will conduct regular and irregular inspections of hedging trading business, supervise hedging trading business personnel in the implementation of the risk management system and risk management procedures, and prevent operational risks in the business in a timely manner.

In respect of changes in market prices or fair value of products, gains or losses actually realized from the invested derivatives amounted to RMB–95.3522 million during the reporting period. As for the specific methodology used and the related assumptions and parameter settings: Foreign exchange and interest rate swap forward quotations from financial institutions were used.

value of invested derivatives during the reporting period, where specific methodology used and the settings of relevant assumptions and parameters should be disclosed in the fair value analysis of derivatives Litigation case (if applicable) N/A Disclosure date of announcement in relation to the consideration and approval of derivatives investment by the Board (if any) Disclosure date of announcement in relation to the consideration and the approval of derivatives investment by shareholders' general meeting (if any)

28 March 2025

29 May 2025

Changes in market price or fair

(2). Derivatives investments for investment purposes during the reporting period

(V) Sale of material assets and equity

□ Applicable √ Not Applicable

(VI) Analysis on major subsidiaries and Investees

√ Applicable □ Not Applicable

Major subsidiaries and investees with an impact of more than 10% on the Company's net profit

□ Applicable √ Not Applicable

Acquisition and disposal of subsidiaries during the reporting period

□ Applicable √ Not Applicable

There were no acquisitions or disposals of subsidiaries that had a material impact during the reporting period. For details of other changes, please refer to the relevant contents of sections headed "CHANGES OF CONSOLIDATION SCOPE" in "Section VIII Financial Report" of this report.

Other explanations

□ Applicable √ Not Applicable

(VII) Structured entities controlled by the Company

□ Applicable √ Not Applicable

V. OTHER DISCLOSURES

(I) Potential risks

√ Applicable □ Not Applicable

1. Risk of decreasing market demand due to macroeconomic slowdown. Sales of white goods and home appliances exhibits inherent cyclicality tied to discretionary consumer spending patterns and their expectations of future disposable income growth. Economic slowdown will reduce consumer spending and cause headwinds to industry growth. In addition, the persistent sluggish property market will also indirectly affect market demand for home appliances in a negative way.

2. 1. Risk of price war caused by intensified industry competitions. As industry concentration level continues to increase in recent years, the white goods industry is highly competitive with persistent commoditization pressures across core product categories. However, the increase in inventory level in certain verticals due to demand-supply imbalance may lead to price wars. Furthermore, rapid technological development, scarcity of talents in the industry, shortened product life cycles and relative easiness of copycat increase the difficulty to maintain margin levels. Nevertheless, new products, services and technologies are often associated with higher selling prices. The Company will actively invest more in R&D to sustain the product roll-out, attract more users through continuous innovation, and maintain our brand awareness.
3. 1. Risk of fluctuations in raw material prices. The Company's products and core components use metals such as steel, aluminum, and copper, as well as commodities such as plastics and foams. If raw material prices continue to increase, it will put certain pressures on the production and operations. In addition, the Company relies on third party manufacturers and suppliers for selected raw materials, components, and manufacturing equipment. Any disruption in supply chain or significant price increases will have a negative impact on the Company's business. As a leader in the industry, the Company will take actions and have contingency plans including volume and price adjustment mechanism and hedging to reduce the volatility of raw material prices.
4. 1. Operational risks in overseas markets. As manifested by the increasing percentage of revenue from overseas markets, the Company has developed our global business to a certain extent and established production bases, R&D centers, and marketing centers in key regions of the world. Overseas markets are subject to political and economic events (including events such as military conflicts and wars), different legal systems and regulatory regimes of those countries and regions. Significant changes in these factors will pose certain risks to the Company's local operations. The Company has taken various measures to mitigate the relevant impacts, including collaborating with suppliers and distributors, improving production efficiency to offset the selling expenses, potentially expanding the Company's supply resources to other countries, and adopting safety measures to protect our employees and assets.
5. 1. Risk of tariff increases. Potential tariff policies implemented and/or to be introduced by the U.S. and other major economies could negatively impact the existing supply chains of the industry and the global home appliance players. Higher tariffs would incur extra costs for export and import, reduce profit margins, weaken the consumer sentiment and demand, and intensify market competition in target markets. The increasing uncertainties regarding tariff policies would force home appliance players to reevaluate their supply chain strategies and footprints, increase operational complexities and management costs. To cope with the potential tariff shocks, the Company will actively leverage our localized supply chain resources in respective markets, further optimize supply chain management, enhance production flexibilities, and strengthen regional manufacturing and collaboration capabilities.
6. 1. Risk of exchange rate fluctuations. In conjunction with the Company's ongoing expansion of global business operations, a material portion of its import/export transactions and cross-border settlements are denominated in foreign currencies including but not limited to the US Dollar (USD), Euro (EUR), and Japanese Yen (JPY). If the exchange rates of these currencies fluctuate to a certain extent, it will impact the Company's financial performance and potentially increase the financial costs. In addition, the Company's consolidated financial statements are denominated in Renminbi, while subsidiaries' financial statements are measured and reported in the local currencies where they operate. To mitigate these exposures, the Company maintains a structured currency risk management program utilizing authorized hedging instruments.
7. 1. Risk of relevant policy changes. The home appliance industry is closely related to the consumer market and property market. Changes in macroeconomic policies, consumption and investment policies, property policies and relevant laws and regulations will affect the product demands, and in turn the sales of the Company. The Company will closely monitor changes in the relevant policies, laws, and regulations, and make forecasts of market changes, in order to ensure further development of the Company.
8. 1. Credit risk. There are possibilities that either the Company may be unable to collect all trade receivables from its distributors, or the distributors are unable to settle the Company's all trade receivables in a timely manner. If that is the case, the Company's business, financial status, and operation performance may be affected negatively. To mitigate this risk, the Company will maintain flexibilities by offering credit period of 30 to 90 days to certain distributors based on their credit history and transaction amount.
9. 1. Inventory risk. Excess inventory might occur as the Company may not accurately predict trends and events at all times and maintain optimal inventory levels. Therefore, the Company may be forced to offer discounts or promotions to accelerate the slow-moving inventory in these extreme cases. On the other hand, inventory shortage may lead to loss of revenues. The Company will actively manage its inventory and adjust levels according to market demand movements, in addition to the regular impairment tests.
10. 1. Capital expenditure risk. In the current macroeconomic environment characterized by slowing global economy and declining consumer demand, the existing production capacities may overwhelm the market in extreme case. This could lead to low utilization rate across the industry, lower down profitability and ROEs. The Company will actively manage the changes in the macroeconomic environment by forecasting and recalibrating market demand trends, optimizing capacity footprint, and improving existing utilization rate, in order to minimize capital expenditure risks.

(II) Other disclosures

Section IV Corporate Governance, Environmental and Social

I. CHANGES IN DIRECTORS AND SENIOR MANAGEMENT OF THE COMPANY

Name	Position Held	Description of Change
Li Huagang	Chairman, Chief Executive Officer	Elected
Kevin Nolan	Director, vice president	Elected
Sun Danfeng	Director, vice president, Chief Digital Officer	Elected
Gong Wei	Vice Chairman	Elected
LI Shaohua	Director	Elected
Yu Hon To, David	Director	Elected
Chien Da-chun	Director	Elected
Wong Hak Kun	Independent director	Elected
Li Shipeng	Independent director	Elected
Wu Qi	Independent director	Elected
Wang Hua	Independent director	Elected
Shao Xinzhi	Vice Chairman	Resigned
Li Kam Fun	Director	Resigned
Liu Dalin	Chairman of the Board of Supervisors	Resigned
Yu Miao	Employee supervisor	Resigned
Liu Yongfei	Supervisor	Resigned
Xie Juzhi	Vice president	Resigned
Li Pan	Vice president	Appointed
Zhao Yanfeng	Vice president	Appointed
Li Yang	Vice president	Appointed
Song Yujun	Vice president	Appointed
Guan Jiangyong	Vice president	Appointed
Wu Yong	Vice president	Appointed
Fu Songhui	Vice president	Appointed
Huang Decheng	Vice president	Appointed
Sun Jiacheng	Vice president, Chief Financial Officer	Appointed
JAMES QUN LIU	Vice president, Chief Compliance Officer	Appointed
Huang Xiaoyu	Vice president, Chief Sustainable Development Officer	Appointed
Liu Xiaomei	Secretary to the Board of Directors	Appointed

Section IV Corporate Governance, Environmental and Social

Explanation of changes in Directors, Supervisors and senior management of the Company

√ Applicable □ Not Applicable

During the reporting period, due to the expiration of terms of office and re-election of the Company's Board of Directors and senior management, and the repeal of the Board of Supervisors in accordance with the regulations, there were changes in the Company's Directors, Supervisors and senior management.

II. PROPOSAL OF PROFIT DISTRIBUTION OR CAPITALIZATION OF CAPITAL RESERVE

Proposal for interim profit distribution and proposal for conversion of capital reserve into share capital

Whether distributed or converted Yes Number of bonus shares for every 10 shares (shares) 0 Dividend per every10 shares (RMB) (tax inclusive) 2.69 Number of shares converted for every 10 shares (shares) 0 Description of the proposal of profit distribution or capitalization of capital reserve

Proposal of profit distribution for the reporting period are examined and reviewed by the Board: to declare a cash dividend of RMB2.69 per 10 shares (tax inclusive) to all shareholders based on the total number of shares held on record date and after deducting the repurchased shares from the repurchase account upon the execution of distribution proposal, with proposed distribution amounting to RMB2,506,684,210.62 (tax inclusive). The proportion of cash distribution is 20.83% of the net profit attributable to shareholder of parent company of the Company for the half year. If there is any change in the total share capital of the Company during the period from the date of this report to the record date of the equity distribution, the total distribution amount will be remained unchanged with corresponding adjustment to the proportion of distribution per share.

III. EQUITY INCENTIVE PLAN, EMPLOYEE STOCK OWNERSHIP PLAN OR OTHER EMPLOYEE INCENTIVES AND EFFECTS THEREOF

(I) Relevant incentive events disclosed in temporary announcements and without any subsequent progress or change

√ Applicable □ Not Applicable

Summary of Matters	Query Index
Cancellation of certain 2021 and 2022 equity incentive options: In view of the fact that the fourth exercise period of the first/reserved grant portion of the 2021 A Share Option Incentive Scheme and the third exercise period of the 2022 A Share Option Incentive Scheme of the Company did not meet the exercise conditions, and due to the resignation or redesignation of some of the incentive recipients, the Company cancelled the corresponding 9,652,135 share options and 25,262,727 share options that had been granted but had not yet been exercised.	For details, please refer to the Announcement of Haier Smart Home Co., Ltd on the Cancellation of Certain Share Options in the 2021 A Share Option Incentive Scheme, the 2022 A Share Option Incentive Scheme disclosed by the Company on 30 April 2025, the Announcement of Haier Smart Home Co., Ltd on the Completion of Cancellation of Certain Share Options in the 2021 A Share Option Incentive Scheme, the 2022 A Share Option Incentive Scheme and relevant contents disclosed by the Company on 10 May 2025.
Introduction of New Phase of A Share and H Share Employee Stock Ownership Plan: In order to further improve the governance mechanism of the Company, create shareholder value and promote the comprehensive implementation of the Company's IoT smart home ecological brand strategy, the Company considered and introduced the 2025 H Share Core Employee Stock Ownership Plan of Haier Smart Home Co., Ltd (Draft) and the 2025 A Share Core Employee Stock Ownership Plan of Haier Smart Home Co., Ltd (Draft) at the 14th meeting of the 11th session of the Board of Directors held by the Company on 29 April 2025 and the 2024 Annual General Meeting held by the Company on 28 May 2025. During the reporting period, the establishment of positions for 2025 A Share Employee Stock Ownership Plan has been completed, while the establishment of positions for 2025 H Share	For details, please refer to the 2025 A Share Core Employee Stock Ownership Plan of Haier Smart Home Co., Ltd (Draft), the 2025 H Share Core Employee Stock Ownership Plan of Haier Smart Home Co., Ltd (Draft), the Announcement of Resolutions at the General Meeting disclosed on 29 May 2025, the Announcement of the Completion of the Establishment of Positions for A Share Employee Stock Ownership Plan disclosed on 21 June 2025 and relevant contents.

Employee Stock Ownership Plan is still in progress.

(II) Incentive events not disclosed in provisional announcements or with subsequent development

Equity incentive

□ Applicable √ Not Applicable

Other explanations

□ Applicable √ Not Applicable

Employee stock ownership plan

□ Applicable √ Not Applicable

Other Incentives

IV. ENVIRONMENTAL INFORMATION OF LISTED COMPANIES AND THEIR MAJOR SUBSIDIARIES INCLUDED IN THE LIST OF ENTERPRISES THAT DISCLOSE ENVIRONMENTAL INFORMATION IN ACCORDANCE WITH THE LAW

√ Applicable □ Not Applicable

Number of enterprises included in the list of enterprises that disclose environmental information in accordance
	with the law (unit)	6
		Query index for reports on legal disclosure of
No.	Name of enterprise	environmental information
1	Hefei Haier Refrigerator Co., Ltd.	https://39.145.37.16:8081/zhhb/yfplpub_html/#/home
2	Qingdao Haier Special Refrigerator Co., Ltd.	http://221.214.62.226:8090/EnvironmentDisclosure/
3	Qingdao Haier Washing Appliance Co., Ltd.	http://221.214.62.226:8090/EnvironmentDisclosure/
4	Qingdao Economic and Technological	http://221.214.62.226:8090/EnvironmentDisclosure/
	Development Zone Haier Water Heater
	Co., Ltd.
5	Qingdao Haier Smart ElectricsEquipment Co. Ltd.	http://221.214.62.226:8090/EnvironmentDisclosure/
6	Zhengzhou Haier Air-conditioning Co., Ltd.	http://222.143.24.250:8247/home/home

Other explanations

V. PARTICULARS ON THE EFFORTS TO CONSOLIDATE AND EXPAND ITS ACHIEVEMENTS IN POVERTY ALLEVIATION AND RURAL AREA INVIGORATION

√ Applicable □ Not Applicable

The Company attaches importance to the work of poverty alleviation and rural revitalization. In accordance with the series of national planning and filing requirements and within the scope of authorization of the general meeting on donations and other matters, the Company has provided targeted support to support technology development and rural revitalization. In the first half of 2025, the Company's capital expenditure on targeted poverty alleviation amounted to approximately RMB6,780,000, which was mainly used for supporting technology development, educational poverty alleviation, etc. The Company has actively responded to the call of the government to fulfill its social responsibilities.

During the reporting period, an earthquake struck Tingri, Shigatse, the Tibet Autonomous Region, leaving residents in urgent need of essential cold-weather supplies and food, sparking widespread concern. Haier immediately responded to develop relevant relief initiatives, partnering with the Tibet Kezong Technology* (西藏科棕科技) Haier store to provide assistance to the disaster area. We donated electric water heaters and daily necessities to the Shigatse Red Cross Society, working against time to provide assistance to the affected people and help residents of Tingri, Shigatse, quickly resume their lives and rebuild their homes.

I. FULFILLMENT STATUS OF UNDERTAKINGS

(I) The undertakings made by the ultimate controllers, shareholders, related parties, acquirer as well as the Company and other relevant parties during or up to the reporting period

Background of undertakings	Type of undertakings	Covenanter	Contents of undertakings	Date of undertakings	Any deadline for performance	Term of undertakings	Whether performed in a timely and strict way
Undertaking related to significant reorganization of assets	Eliminate the property right defects in land etc.	Haier Group Corporation	During the period from September 2006 to May 2007, the Company issued shares to Haier Group Corporation ("Haier Group") to purchase the controlling equity in its four subsidiaries, namely Qingdao Haier Air-Conditioner Electronics Co., Ltd. (青島海爾空調電子有限公司), Hefei Haier Air-conditioning Co., Limited (合肥海爾空調器有限公 司), Wuhan Haier Electronics Co., Ltd. (武漢海爾電器股份 有限公司), Guizhou Haier Electronics Co., Ltd. (貴州海爾電 器有限公司). With regard to the land and property required in the operation of Qingdao Haier Air-Conditioner Electronics Co., Ltd. (青島海爾空調電子有限公司), Hefei Haier Air-conditioning Co., Limited (合肥海爾空調器有限公司), Wuhan Haier Electronics Co., Ltd. (武漢海爾電器股份有限 公司) (the "Covenantees"), Haier Group made an undertaking (the "2006 Undertaking"). According to the content of 2006 Undertaking and then condition of each Covenantee, Haier Group will constantly assure that Covenantees will lease the land and property owned by Haier Group for free. Haier Group will make compensation in the event that the Covenantees suffer loss due to the unavailability of such land and property.	27 September 2006	Yes	Long-term	Yes
	Address peer competition	Haier Smart Home Co., Ltd.	Prior to the Transaction (hereinafter "the Transaction" refers to the transaction in relation to the privatisation of Haier Electronics by Haier Smart Home), Haier Electric was a controlling subsidiary of the Company and did not compete with the Company; after the completion of the Transaction, Haier Electric became a wholly-owned or controlling subsidiary of the Company and no new competition with the Company existed or will arise. There is no new peer competition or potential competition between the Company and other related parties controlled by the controlling shareholders or the de facto controllers of the Company.	31 July 2020	Yes	Long-term	Yes

Background of undertakings	Type of undertakings	Covenanter	Contents of undertakings	Date of undertakings	Any deadline for performance	Term of undertakings	Whether performed in a timely and strict way
	Address connected transactions	Haier Group Corporation	1. The Transaction constitutes a connected transaction and the connected transaction procedures performed under the Transaction are in compliance with the relevant regulations. The pricing of the connected transaction is fair and there are no circumstances under which the interests of the listed company and the non-connected shareholders are prejudiced. 2. Upon completion of the Transaction, the Company and its affiliates will take lawful and effective measures to minimize and regulate the connected transactions with the listed company, take the initiative to safeguard the interests of the listed company and all shareholders, and refrain from taking advantages of connected transactions for improper benefits. 3. Provided that there is no conflict with laws and regulations, if connected transactions between the Company and its affiliates and the listed company occur or exist which cannot be avoided or for which there are reasonable reasons, the Company and its affiliates will legally enter into a transaction agreement with the listed company to ensure strict compliance with the procedures of connected transactions required by the laws, regulations, regulatory documents and the articles of association of the Company, conduct transactions in accordance with the principles of marketability and fair prices to ensure the fairness and compliance of connected transactions, and refrain from taking advantages of such connected transactions to engage in any acts that are detrimental to the interests of the listed company or its minority shareholders, and at the same time, comply with the information disclosure obligations in accordance with relevant regulations.	29 July 2020	Yes	Long-term	Yes
	Address peer competition	Haier Group Corporation	1. The Company and its controlling subsidiary, Haier COSMO Co., Ltd., were principally engaged in investment business during the reporting period, and the Company and its controlling subsidiary, Haier COSMO Co., Ltd. (including its subsidiaries and entities with more than 30% shareholding), have no real or potential competition with Haier Smart Home; 2. the domestic and overseas white goods businesses and assets held by the Company (including the Company's subsidiaries and entities with more than 30% shareholding) have been injected into Haier Smart Home through asset consolidation and equity transfer in accordance with the commitments made by the Company in January 2011 and the requirements for adjusting such commitments as considered and approved by Haier Smart Home at its 2014 annual general meeting; 3, Since the acquisition of 100% of Haier New Zealand Investment Holding Company Limited (which holds 100% of the shares in Fisher & Paykel Appliances Holdings Limited) by Haier Smart Home's offshore subsidiary, Haier Singapore Investment Holding Co., Ltd., following the completion in July 2018, the Company (including the Company's subsidiaries and entities with more than 30% shareholding) and Haier Smart Home do not have any competing relationship in any business areas both within and outside the PRC. During the reporting period, the Company (including the Company's subsidiaries and entities with more than 30% shareholding) did not have any new peer competition with Haier Smart Home; 4. Upon completion of the Transaction, the Company (including the Company's subsidiaries and entities with more than 30% shareholding) and its affiliates do not have any new or potential peer competition with Haier Smart Home; 5. During the period when the Company is the controlling shareholder of Haier Smart Home and the shares of Haier Smart Home are listed on the Hong Kong Stock Exchange, the Company and its other subsidiaries and entities with more than 30% shareholding will not operate any business that competes with the business engaged by Haier Smart Home and will not engage in real or potential competition with Haier Smart Home.	29 July 2020	Yes	Long-term	Yes

Background of undertakings	Type of undertakings	Covenanter	Contents of undertakings	Date of undertakings	Any deadline for performance	Term of undertakings	Whether performed in a timely and strict way
	Others	Haier Group Corporation	Upon completion of the Transaction, the Company will strictly comply with the Company Law, the Securities Law, the relevant regulations of the China Securities Regulatory Commission, the Shanghai Stock Exchange and the articles of association of Haier Smart Home, etc., fairly exercise shareholders' rights and fulfill shareholders' obligations, refrain from taking advantage of its shareholding position for improper benefits, ensure the listed company will continue to be completely separate from the Company and other enterprises on which the Company exercises control and exerts significant influence in terms of management, personnel, assets, finance, organization and business operations, and maintain the continued independence of the listed company in terms of management, personnel, assets, finance, organization and business operations. Upon completion of the Transaction, the Company will comply with the provisions of the Notice on Several Issues concerning Regulating Fund Transactions between Listed Companies and Their Affiliates and the External Guarantee of Listed Companies and the Circular of China Securities Regulatory Commission and China Banking Regulatory Commission on Regulating the External Guaranties Provided by Listed Companies to regulate the external guarantees by listed companies and their subsidiaries, and will not misappropriate the funds of the listed company and their subsidiaries. The Company undertakes to strictly fulfill the above commitments. In the event that the interests of the listed company are damaged as a result of any breach of the above commitments by the Company and other enterprises on which the Company exercises control and exerts significant influence, the Company will legally bear the corresponding liability for damage.	29 July 2020	Yes	Long-term	Yes
	Address connected transactions	HCH (HK) INVESTMENT MANAGEMENT CO., LIMITED	1. The Transaction constitutes a connected transaction and the connected transaction procedures performed under the Transaction are in compliance with the relevant regulations. The pricing of the connected transaction is fair and there are no circumstances under which the interests of the listed company and the non-connected shareholders are prejudiced. 2. Upon completion of the Transaction, the Company and other enterprises on which the Company exercises control will take lawful and effective measures to minimize and regulate the connected transactions with the listed company, take the initiative to safeguard the interests of the listed company and all shareholders, and refrain from taking advantages of connected transactions for improper benefits. 3. Provided that there is no conflict with laws and regulations, if connected transactions between the Company and other enterprises on which the Company exercise control and the listed company occur or exist which cannot be avoided or for which there are reasonable reasons, the Company and other enterprises on which the Company exercises control will legally enter into a transaction agreement with the listed company to ensure strict compliance with the procedures of connected transactions required by the laws, regulations, regulatory documents and the articles of association of the Company, conduct transactions in accordance with the principles of marketability and fair prices, and refrain from taking advantages of such connected transactions to engage in any acts that are detrimental to the interests of the listed company or its minority shareholders, and at the same time, comply with the information disclosure obligations in accordance with relevant regulations. 4. Any covenants and arrangements between the Company and other enterprises on which the Company exercise control and the listed company in relation to connected transactions shall not prevent the other party from conducting business or dealing with any third party for its own benefit and on equal	29 July 2020	Yes	Long-term	Yes

Background of undertakings	Type of undertakings	Covenanter	Contents of undertakings	Date of undertakings	Any deadline for performance	Term of undertakings	Whether performed in a timely and strict way
Undertaking related to refinancing	Eliminate the property right defects in land etc.	Haier Group Corporation	Haier Group Corporation undertakes that it will assure Haier Smart Home and its subsidiaries of the constant, stable and unobstructed use of the leased property. In the event that Haier Smart Home or any of its subsidiaries suffers any economic loss due to the fact that leased property has no relevant ownership certificate, Haier Group Corporation will make compensation to impaired party in a timely and sufficient way and take all reasonable and practicable measures to support the impaired party to recover to normal operation before the occurrence of loss. Upon the expiration of relevant leasing period, Haier Group Corporation will grant or take practicable measures to assure Haier Smart Home and its subsidiaries of priority to continue to lease the property at a price not higher than the rent in comparable market at that time. Haier Group Corporation will assure Haier Smart Home and its subsidiaries of the constant, stable, free and unobstructed use of self-built property and land of the Group. In the event that Haier Smart Home or any of its subsidiaries fails to continue to use self-built property according to its own will or in original way due to the fact that self-built property has no relevant ownership certificate, Haier Group Corporation will take all reasonable and practicable measures to eliminate obstruction and impact, or will support Haier Smart Home or its affected subsidiary to obtain alternative property as soon as possible, if Haier Group Corporation anticipates it is unable to cope with or eliminate the external obstruction and impact with its reasonable effort. For details, please refer to the Announcement of Qingdao Haier Co., Ltd. on the Formation, Current Situation of the Defective Property, the Influence on Operation of Issuer Caused by Uncertainty of Ownership, Solution for the Defect and Guarantee Measures (L2014–005) published by the Company on the four major securities newspapers and the website of Shanghai Stock Exchange on 29 March 2014.	24 December 2013	Yes	Long-term	Yes
Undertakings related to equity incentive	Others	Haier Smart Home Co., Ltd	The Company will not provide loans or any other forms of financial assistance, including guaranteeing their loans, to any incentive recipient for acquiring relevant stock options under this incentive plan.	15 September 2021/28 June 2022	Yes	The completion of equity incentive implementation	Yes
Other undertakings	Asset injection	Haier Group Corporation	Inject the assets of Haier Photoelectric to the Company or dispose such assets through other ways according to the requirements of the domestic supervision before June 2030. For more details, please refer to the Announcement of Haier Smart Home Co., Ltd. on the Changes in Commitments of Certain Asset Injection (L2025–013) published by the Company on the four major securities newspapers and the website of Shanghai Stock Exchange on 28 March 2025, the Announcement of relevant general meeting resolutions disclosed on 29 May 2025.	December 2015/March 2025	Yes	30 June 2030	Yes

II. NON-OPERATING UTILIZATION OF FUNDS BY CONTROLLING SHAREHOLDERS AND OTHER RELATED PARTIES DURING THE REPORTING PERIOD.

□ Applicable √ Not Applicable

III. INFORMATION ON NON-COMPLIANCE GUARANTEES

□ Applicable √ Not Applicable

IV. INFORMATION ON INTERIM AUDIT

□ Applicable √ Not Applicable

V. CHANGES IN MATTERS COVERED BY THE NON-STANDARD AUDIT OPINION ON THE PREVIOUS YEAR'S ANNUAL REPORT AND ITS HANDLING

□ Applicable √ Not Applicable

VI. MATTERS RELATING TO BANKRUPTCY AND RESTRUCTURING

□ Applicable √ Not Applicable

VII. MATERIAL LITIGATION AND ARBITRATION MATTERS

□ Material litigation and arbitration matter during the reporting period

√ No material litigation and arbitration matters during the reporting period

VIII. PUNISHMENT AND CORRECTION ON THE LISTED COMPANY AND ITS DIRECTORS, SENIOR MANAGEMENT, CONTROLLING SHAREHOLDERS AND ULTIMATE CONTROLLERS DUE TO SUSPECT OF LAW VIOLATIONS AND THE ISSUE OF RECTIFICATION

□ Applicable √ Not Applicable

IX. EXPLANATION OF THE INTEGRITY STATUS OF THE COMPANY AND ITS CONTROLLING SHAREHOLDERS AND ULTIMATE CONTROLLER DURING THE REPORTING PERIOD

X. SIGNIFICANT RELATED-PARTY TRANSACTIONS

(I) Related-party transactions relating to daily operation

1. Matters that have been disclosed in temporary announcements and with no subsequent progress or change

√ Applicable □ Not Applicable

Summary of matters	Query index
Renewal of the Framework Agreement on	For details, please refer to the
Regular Related-Party Transaction and	Announcement on the Renewal of the
the Estimated Related-Party Transaction	Framework Agreement on Regular
Limit: During the reporting period, the	Related-Party Transaction and the
Company renewed its regular related	Estimated Related-Party Transaction Limit
party transaction with the related parties	of Haier Smart Home Co., Ltd. disclosed
for the procurement of products and	by the Company on 28 March 2025, and
materials for the period from 2026 to	other related announcements, as well as
2028, which was approved by the	the Announcement of Resolutions at the
shareholders' meeting.	Shareholders' Meeting disclosed on 29
	May 2025.

2. Matters that have been disclosed in temporary announcements and with subsequent progress or change

√ Applicable □ Not Applicable

Pursuant to, among others, the "Product and Materials Procurement Framework Agreement between Haier Smart Home Co., Ltd. and Haier Group Corporation" (《海爾智家股份有限 公司與海爾集團公司之產品及物料採購框架協議》) and the "Services Procurement Framework Agreement between Haier Smart Home Co., Ltd. and Haier Group Corporation" 《( 海爾智家股份有限公司與海爾集團公司之服務採購框架協議》) considered and approved at the 28th meeting of the 10th session of the Board of Directors and the 2021 Annual General Meeting, and the "Resolution of Haier Smart Home Co., Ltd. on Renewing the Framework Agreement on Financial Services with Haier Group Corporation and Haier Group Finance Co., Ltd. and Estimated Amount of Connected Transactions" (《海爾智家股份有限 公司關於與海爾集團公司、海爾集團財務有限責任公司續簽〈金融服務框架協議〉暨預計 關聯交易額度的議案》) considered and approved at the 4th meeting of the 11th session of the Board of Directors and the 2022 Annual General Meeting, the Company has made estimation on the connected transactions for the next three years, as detailed in the aforesaid announcements regarding the resolutions of the meetings.

For the actual performance of the Company's connected transactions during the half year of 2025, please refer to "Related parties and related-party transactions" under Section VIII. Financial Report set out in this regular report.

3. Matters not disclosed in temporary announcements

□ Applicable √ Not Applicable

(II) Related-party transactions regarding acquisition or disposal of assets/equity

1. Matters disclosed in temporary announcements and with no subsequent progress or change

√ Applicable □ Not Applicable

Summary of matters	Query index
Acquisition of the Real Estate of Haier	For details, please refer to the
White Goods R&D Centre and Related	Announcement on the Acquisition of the
party Transaction: Qingdao Haier Air	Real Estate of Haier White Goods R&D
Conditioner Gen Corp., Ltd., the	Centre and Related-party Transaction of
Company's wholly-owned subsidiary,	Haier Smart Home Co., Ltd. disclosed by
purchased the Real Estate of Haier	the Company on 28 March 2025.
White Goods R&D Centre from Haier
Group Corporation to meet its office
needs. The purchase price was
RMB267.24 million.

2. Matters that have been disclosed in temporary announcements and with subsequent progress or change

□ Applicable √ Not Applicable

3. Matters not disclosed in temporary announcements

□ Applicable √ Not Applicable

4. If performance agreement is involved, the performance achieved during the reporting period shall be disclosed

(III) Significant related-party transactions of joint external investment

1. Matters that have been disclosed in temporary announcements and with no subsequent progress or change

√ Applicable □ Not Applicable

Overview of the matter	Query index
Haier Group Finance Co., Ltd. (hereinafter, the "Finance Company") planned to increase its capital by converting undistributed profits into capital, with a total capital increase of RMB3 billion. Upon completion of the capital increase, Qingdao Haier Air-Conditioner Electronics Co., Ltd. and Qingdao Haier Air Conditioner Gen Corp., Ltd., the Company's subsidiaries, as well as Haier Group Corporation and Qingdao Haikeda Electronics Co., Ltd., the Company's related parties, will increase their capital contributions to the Finance Company in proportion to their existing shareholding, and the shareholding of each party in the Finance Company will remain unchanged.	For more details, please refer to the Announcement on the Proportional Capital Increase of the Joint-stock Company, Haier Group Finance Co., Ltd. by Converting Undistributed Profits into Capital and Related-Party Transaction of Haier Smart Home Co., Ltd.' (L2025– 008) disclosed by the Company on 28 March 2025.

2. Matters that have been disclosed in temporary announcements and with subsequent progress or change

□ Applicable √ Not Applicable

3. Matters not disclosed in temporary announcements

(IV) Amounts due to or from related parties

1. Matters that have been disclosed in temporary announcements and with no subsequent progress or change

□ Applicable √ Not Applicable

1. Matters that have been disclosed in temporary announcement and with subsequent progress or change

□ Applicable √ Not Applicable

1. Matters not disclosed in temporary announcements

□ Applicable √ Not Applicable

(V) Financial business between the Company and the finance company with which it has a related relationship, the company's controlling finance company and related parties

√ Applicable □ Not Applicable

1. Deposit business

√ Applicable □ Not Applicable

Related party	Relationship	Maximum daily deposit limit	Range of deposit interest	Balance as at the beginning of the period	Changes of the period Total amount Total amount deposited during withdrawn during the period the period		Balance as at the end of the period
Haier Group Finance Co., Ltd	Subsidiary of Haier Group	34 billion	0.00012%–4.1%	33,884,585,069.50	265,681,947,201.56	265,600,323,759.92	33,966,208,511.13
Total	/	/	/	33,884,585,069.50	265,681,947,201.56	265,600,323,759.92	33,966,208,511.13

2. Lending business

√ Applicable □ Not Applicable

Unit and Currency: RMB

Related party	Relationship	Loan limit	Range of loan interest	Balance as at the beginning of the period	Total amount deposited during the period	Changes of the period Total amount withdrawn during the period	Balance as at the end of the period
Haier Group Finance Co., Ltd	Subsidiary of Haier Group	10 billion	1.828%–4.9%	196,200,183.66	2,126,324,323.00	28,461,903.15	2,294,062,603.51
Total	/	/	/	196,200,183.66	2,126,324,323.00	28,461,903.15	2,294,062,603.51

3. Trustee business or other finance businesses

√ Applicable □ Not Applicable

Unit and Currency: RMB

Related party	Relationship	Type of business	Total amount	Actual number of occurrence
Haier Group Finance Co., Ltd	Subsidiary of Haier Group	Foreign exchange derivatives	5.5 billion	724,141,204.80
Haier Group Finance Co., Ltd	Subsidiary of Haier Group	products Service charge	80 million	4,336,109.25

4. Other explanations

□ Applicable √ Not Applicable

(VI) Other material related transactions

□ Applicable √ Not Applicable

(VII) Others

XI. SIGNIFICANT CONTRACTS AND THEIR EXECUTION

(I) Trusteeship, contracting and leasing

□ Applicable √ Not Applicable

During the reporting period, the Company had no material escrow matters. Up to now, the following entrusted assets that have been approved by the Company's shareholders' meeting are still in effect:

According to Haier Group's commitment on further supporting the development of Qingdao Haier and resolving peer competition to reduce connected transactions, based on the fact that Qingdao Haier Optoelectronics Co., Ltd. (青島海爾光電有限公司) and its subsidiaries, the main body of Haier Group engaging in the color television business, are still in a period of transformation and integration, and their financial performance has not yet met the Company's expectations, Haier Group is unable to complete the transfer before the aforesaid commitment period. Haier Group intends to entrust the Company with the operation and management of the escrow assets and pay the Company an annual escrow fee of RMB1 million during the escrow period.

(II) Significant guarantees performed and outstanding during the reporting period

√ Applicable □ Not Applicable

Unit and Currency: RMB'0,000

					External guarantees provided by the Company (excluding guarantees for subsidiaries)
Guarantor	Relationship between the guarantor and the listed company	Secured party	Amount of guarantee	Date of occurrence of the guarantee (date of agreement)	Commencement date of guarantee	Expiration date of guarantee	Type of guarantee	Main debt situation	Collateral (if any)	Whether the guarantee has been fulfilled	Whether the guarantee is overdue	Overdue amount of the guarantee	Whether there is a counter guarantee	Whether Related party guarantee or not	Relationship
	Total amount of guarantee occurred during the reporting period (excluding guarantees for subsidiaries) Total balance of guarantee at the end of the reporting period (A) (excluding guarantees for subsidiaries)
						Guarantees provided by the Company for subsidiaries
	Total amount of guarantees for subsidiaries occurred during the reporting period Total balance of guarantees for subsidiaries at the end of the reporting period (B)														1,939,517 1,160,607
	Total amount of guarantees provided by the Company (including guarantees for subsidiaries)
	Total amount of guarantee (A + B) Ratio of total amount of guarantees to net assets of the Company (%)								1,160,607 10.1
	Including: Amount of guarantees for shareholders, ultimate controllers and their related parties (C) 0 Amount of debt guarantees provided directly or indirectly for the secured party with asset-liability ratio exceeding 70% (D) 664,557 The amount of total amount of guarantee in excess of 50% of net assets (E) 0 Total amount of the above three guarantees (C + D + E) 664,557 Explanation of possibly bearing related discharge duty for premature guarantees No
	Explanation of guarantee status No

(III) Other major contracts

XII. EXPLANATION OF PROGRESS IN USE OF PROCEEDS

□ Applicable √ Not Applicable

XIII. STATEMENT ON OTHER SIGNIFICANT EVENTS

√ Applicable □ Not Applicable

Entrusted wealth management: By the end of the reporting period, the balance of the Company's entrusted wealth management amounted to RMB8.280 billion. Under the premise of ensuring sufficient capital required by the principal operating activities and daily operations, the Company and some of its subsidiaries purchased some low-risk wealth management products and structured deposits from major commercial banks to improve the yield of temporarily-idle funds and the return for shareholders within the authority of the president's office meeting and under the condition of ensuring fund safety.

Section VI Changes in Shares and Information About Shareholders

I. CHANGES IN SHARE CAPITAL

(I) Table of Changes in shares

1. Table of Changes in shares

During the reporting period, there was no change in the total number of shares and share capital structure of the Company.

2. Statement on the changes in shares

□ Applicable √ Not Applicable

1. Effect of changes in shares on the financial indicators such as earnings per share and net assets per share (if any) after the reporting period to the disclosure date of interim report

□ Applicable √ Not Applicable

1. Other disclosure deemed necessary by the Company or required by securities regulatory authorities

□ Applicable √ Not Applicable

(II) Changes in shares with selling restrictions

□ Applicable √ Not Applicable

II. INFORMATION ON SHAREHOLDERS

(I) Total number of shareholders:

Total number of ordinary shareholders by the end of the reporting period 207,505 Total numbers of preferential shareholders with restoration of voting rights by the end of the reporting period 0

Section VI Changes in Shares and Information About Shareholders

(II) Table of shareholdings of top ten shareholders, top ten shareholders of tradable shares (or shares without selling restrictions) by the end of the reporting period

Unit: share

Name of shareholder (full name)	Increase/ decrease during the shares held reporting at the end of period the period	Number of Percentage (%)	Number of shares held with selling restrictions	Status of shares pledged, marked or frozen Status	Number	Nature of shareholder
HKSCC NOMINEES LIMITED (note)	2,313,497,562	24.66		Unknown		Unknown
Haier COSMO Co., Ltd. (海爾卡 奧斯股份有限公司)	1,258,684,824	13.41		None		Domestic non-state owned legal entity
Haier Group Corporation	1,072,610,764	11.43		None		Domestic non-state owned legal entity
HCH (HK) INVESTMENT MANAGEMENT CO., LIMITED	538,560,000	5.74		None		Foreign legal entity
Hong Kong Securities Clearing Co., Ltd.	449,764,199	4.79		None		Unknown
China Securities Finance Corporation Limited	182,592,654	1.95		None		Unknown
Qingdao Haier Venture & Investment Information Co., Ltd. (青島海爾創業投資諮詢有 限公司)	172,252,560	1.84		None		Domestic non-state owned legal entity
Qingdao Haichuangzhi Management Consulting Enterprise (Limited Partnership) (青島海創智管理諮詢企業(有 限合夥))	133,791,058	1.43		None		Domestic non-state owned legal entity
Industrial and Commercial Bank of China-SSE 50 Exchange Traded Open-End Index Securities Investment Fund (中國工商銀行 — 上證50交易 型開放式指數證券投資基金)	73,636,698	0.78		None		Unknown
Industrial and Commercial Bank of China Limited — Huatai PineBridge CSI 300 Exchange Traded Open-End Index Securities Investment Fund (中國工商銀行股份有限公司 — 華泰柏瑞滬深300交易型開	66,918,128	0.71		None		Unknown

放式指數證券投資基金)

Shareholdings of top ten shareholders (excluding shares lent out under refinancing)

Shareholdings of top ten shareholders without selling restrictions (excluding shares lent out under refinancing and executive lock-up shares)

	Number of tradable shares held without selling
Name of shareholder	restrictions	Class and number of shares
		Class	Number
HKSCC NOMINEES LIMITED	2,313,497,562	Overseas listed foreign shares	2,313,497,562
Haier COSMO Co., Ltd. (海爾卡奧 斯股份有限公司)	1,258,684,824	RMB ordinary	1,258,684,824
Haier Group Corporation	1,072,610,764	RMB ordinary	1,072,610,764
HCH (HK) INVESTMENT MANAGEMENT CO., LIMITED	538,560,000	Overseas listed foreign shares	538,560,000
Hong Kong Securities Clearing Co., Ltd.	449,764,199	RMB ordinary	449,764,199
China Securities Finance Corporation Limited	182,592,654	RMB ordinary	182,592,654
Qingdao Haier Venture & Investment Information Co., Ltd. (青島海爾創業投資諮詢有限 公司)	172,252,560	RMB ordinary	172,252,560
Qingdao Haichuangzhi Management Consulting Enterprise (Limited Partnership) (青島海創智管理諮詢企業(有限 合夥))	133,791,058	RMB ordinary	133,791,058
Industrial and Commercial Bank of China -SSE 50 Exchange Traded Open-End Index Securities Investment Fund (中國工商銀行 — 上證50交易型開放式指數證 券投資基金)	73,636,698	RMB ordinary	73,636,698
Industrial and Commercial Bank of China Limited — Huatai-Pine Bridge CSI 300 Exchange Traded Open-End Index Securities Investment Fund (中國工商銀行 股份有限公司 — 華泰柏瑞滬深 300交易型開放式指數證券投資 基金)	66,918,128	RMB ordinary	66,918,128

Name of shareholder	Number of tradable shares held without selling restrictions	Class and number of shares Class Number
Explanation on repurchase account of top ten shareholders	shares.	As at the end of the reporting period, the repurchase accounts of the Company held a total of 60,269,270
Explanation on delegated voting rights, entrusted voting rights, abstained voting rights of the above shareholders	None
Related parties or parties acting in concert among the aforesaid shareholders		(1) Haier COSMO Co., Ltd. (海爾卡奧斯股份有限公司) is a subsidiary of Haier Group Corporation. Haier Group Corporation holds 51.20% of its equity. Qingdao Haier Venture & Investment Information Co., Ltd. (青島海爾創業投資諮詢有限公司), HCH (HK) INVESTMENT MANAGEMENT CO., LIMITED and Qingdao Haichuangzhi Management Consulting Enterprise (Limited Partnership) (青島海 創智管理諮詢企業(有限合伙)) are parties acting in concert with Haier Group Corporation; (2) The Company is not aware of the existence of any connections of other shareholders.
Explanation of preferential shareholders with restoration of voting rights and their shareholdings	N/A

Note: HKSCC NOMINEES LIMITED is the Banking Collection Account for the shareholders of the Company's H-shares, which is the original data provided by China Hong Kong securities registration agency to the Company after the merger according to local market practices and technical settings, not representing the ultimate shareholder.

Shareholders holding more than 5% of the shares, top ten shareholders and top ten holders of outstanding shares without selling restrictions participating in the lending of shares under the refinancing business

□ Applicable √ Not Applicable

Changes in top ten shareholders and top ten holders of outstanding shares without selling restrictions due to lending/returning under refinancing as compared to the previous period.

□ Applicable √ Not Applicable

Number of shares held by top ten shareholders with selling restrictions and the selling restrictions

□ Applicable √ Not Applicable

(III) Strategic investors or general legal persons who became the top ten shareholders due to placing of new shares

□ Applicable √ Not Applicable

III. DIRECTORS, SENIOR MANAGEMENT

(I) Changes of shareholding of current and retired directors and senior management during the reporting period

□ Applicable √ Not Applicable

Other explanations

(II) Incentive share option granted to directors and senior management during the reporting period

√ Applicable □ Not Applicable

Unit: '0,000 Shares

Name	Position	Number of options held at the beginning of the period	Number of newly granted options during the reporting period	Shares of exercisable rights during the reporting period	Shares subject to option exercise during the reporting period	Number of options held at the end of the period
Li Huagang	Director	36.56	0	0	–18.28	18.28
Gong Wei	Director	18.28	0	0	–9.14	9.14
Li Shaohua	Director	6.24	0	0	–3.12	3.12
Sun Danfeng	Director	3.75	0	0	–1.87	1.87
Li Pan	Senior management	18.28	0	0	–9.14	9.14
Zhao Yanfeng	Senior management	18.73	0	0	–9.36	9.36
Li Yang	Senior management	18.28	0	0	–9.14	9.14
Song Yujun	Senior management	12.49	0	0	–6.24	6.24
Guan Jiangyong	Senior management	9.14	0	0	–4.57	4.57
Wu Yong	Senior management	9.14	0	0	–4.57	4.57
Fu Songhui	Senior management	7.49	0	0	–3.75	3.75
Huang Decheng	Senior management	9.99	0	0	–4.99	4.99
Sun Jiacheng	Senior management	9.99	0	0	–4.99	4.99
JAMES QUN LIU	Senior management	10.24	0	0	–10.24	0
Huang Xiaowu	Senior management	18.28	0	0	–9.14	9.14
Liu Xiaomei	Senior management	5.82	0	0	–2.91	2.91
Total	/	212.70	0	0	–111.45	101.21

Note: The "shares subject to stock option exercised during the reporting period" in the table above refer to the changes resulting from the partial cancellation of share options by the Company during the reporting period (for details, please refer to the disclosure in "(I) Relevant incentive events disclosed in temporary announcements and without any subsequent progress or change" in SECTION IV — "III. EQUITY INCENTIVE PLAN, EMPLOYEE STOCK OWNERSHIP PLAN OR OTHER EMPLOYEE INCENTIVES AND EFFECTS THEREOF".

(III) Other explanations

IV. CHANGES IN CONTROLLING SHAREHOLDER AND THE ULTIMATE CONTROLLER

□ Applicable √ Not Applicable

V. RELEVANT INFORMATION OF PREFERRED SHARES

Section VII Relevant Information of Corporate Bonds

I. CORPORATE BOND (INCLUDING ENTERPRISE BOND) AND NON-FINANCIAL CORPORATE DEBT FINANCING INSTRUMENTS

√ Applicable □ Not Applicable

(I) Corporate bonds (including enterprise bonds)

□ Applicable √ Not Applicable

(II) Funds raised by corporate bonds

□ Corporate bonds involved the use or rectification of raised funds during the reporting period

• √ All corporate bonds of the Company did not involve the use or rectification of raised funds during the reporting period.
• (III) Other matters that should be disclosed for special purpose bonds □ Applicable √ Not Applicable

(IV) Important matters related to corporate bonds during the reporting period

□ Applicable √ Not Applicable

(V) Debt financing instruments of non-financial enterprises in the interbank bond market

√ Applicable □ Not Applicable

1. Basic information on debt financing instruments of non-financial enterprises

Unit and Currency: RMB'00,000,000

Bond name	Abbreviation	Code	Release date Interest date		Expiration date	Bond balance	Interest rate (%)	Principal and interest repayment method	Trading venues	Investor suitability arrangements (if any)	Trading mechanism	Whether there is a risk of termination of listing and trading
2025 First Tranche of Green two-New Medium-term Notes of Haier Smart	25 Haier Smart Home MTN001 (Green	102580830	25 February 2025	26 February 2025	26 February 2028	15	1.99	Annual interest		None	/	NO
Home Co., Ltd. 2025 Second Tranche of Green Two-new Science and Technology	Two-New) 25 Haier Smart Home MTN002 (Science and	102582498		17 June 2025 18 June 2025 18 June	2028	20	1.66	payment with the principal repayment at maturity.	Interbank bond market	None	/	NO
Innovation Bonds Haier Smart Home Co., Ltd.	Innovation Bond)

Section VII Relevant Information of Corporate Bonds

The Company's response to the risk of termination of listing and trading of bonds

□ Applicable √ Not Applicable

Overdue bonds

□ Applicable √ Not Applicable

Explanation of overdue debts

□ Applicable √ Not Applicable

1. Triggering and enforcement of company or investor option clauses and investor protection clauses

□ Applicable √ Not Applicable

1. Adjustment of credit rating results

□ Applicable √ Not Applicable

1. The implementation and changes of guarantees, debt repayment plans and other debt repayment safeguard measures during the reporting period and their impacts

□ Applicable √ Not Applicable

1. Explanation of other situations of debt financing instruments of non-financial enterprises

□ Applicable √ Not Applicable

(VI) The Company's consolidated losses during the reporting period exceeded 10% of its net assets at the end of the previous year

(VII) Key accounting data and financial indicators

√ Applicable □ Not Applicable

Unit and Currency: RMB

Main indicators	At the end of the reporting period	At the end of last year	Increase/decrease at the end of the reporting period compared with the end of last year (%)
Current ratio	1.06	1.02	4.56
Quick ratio	0.78	0.73	6.62
Gearing ratio (%)	59.37	59.14	0.39
	For the reporting period (January June)	The corresponding period of last year	Increase/decrease for the reporting period compared with the corresponding period of last year (%)
Net profit after deducting non recurring gains and losses	11,702,408,556.70	10,160,504,902.38	15.18
EBITDA to total debt ratio	24.58%	23.30%	5.51
Interest coverage ratio	11.37	11.36	0.03
Cash interest coverage ratio	7.70	6.73	14.49
EBITDA interest coverage ratio	14.26	14.54	–1.94

II. CONVERTIBLE CORPORATE BOND

I. AUDIT REPORT

□ Applicable √ Not Applicable

II. FINANCIAL STATEMENTS

Consolidated Balance Sheet

30 June 2025

Prepared by: Haier Smart Home Co., Ltd.

Items	Notes	30 June 2025	31 December 2024
Current assets:
Monetary funds	VII.1	55,357,102,536.82	55,597,554,622.83
Provision of settlement fund
Funds lent
Financial assets held for trading	VII.2	8,815,448,315.62	1,236,017,839.53
Derivative financial assets	VII.3	79,365,117.40	142,709,716.91
Bills receivable	VII.4	6,907,611,901.39	12,179,856,870.01
Accounts receivable	VII.5	31,125,796,665.70	26,494,845,510.56
Financing receivables	VII.6	1,248,197,448.34	412,922,615.25
Prepayments	VII.7	1,861,233,589.08	2,378,144,459.47
Premiums receivable
Reinsurance accounts receivable
Reinsurance contract reserves receivable
Other receivables	VII.8	4,228,793,070.44	3,601,357,495.02
Including: Interest receivables		904,741,268.55	771,591,076.67
Dividends receivables
Financial assets purchased under resale
agreements
Inventories	VII.9	43,517,272,732.84	43,189,855,697.96
Including: Data resources
Contract assets	VII.10	1,496,159,397.94	997,963,705.67
Assets held for sale
Non-current assets due within one year	VII.11	2,307,574,005.86	1,439,758,652.55
Other current assets	VII.12	4,330,601,827.06	4,443,274,038.03
Total current assets		161,275,156,608.49	152,114,261,223.79
Non-current assets:
Loans and advances granted
Debt investments	VII.13	14,590,918,331.42	15,474,759,856.99
Other debt investments
Long-term receivables		139,022,168.65	224,724,107.31
Long-term equity investments	VII.14	21,413,900,164.48	20,932,439,255.93
Investments in other equity instruments	VII.15	5,650,156,251.25	6,073,680,870.82

Items	Notes	30 June 2025	31 December 2024
Other non-current financial assets
Investment properties	VII.16	665,377,401.85	246,161,259.83
Fixed assets	VII.17	38,733,351,465.18	37,613,215,769.46
Construction in progress	VII.18	5,677,443,291.08	5,686,050,990.48
Biological assets for production
Oil and gas assets
Right-of-use assets	VII.19	6,324,384,910.10	5,841,869,564.36
Intangible assets	VII.20	14,455,019,794.04	14,042,940,068.17
Including: Data resources
Development cost	VIII.2	236,103,656.27	267,267,592.92
Including: Data resources
Goodwill	VII.21	27,834,626,137.04	27,384,007,599.06
Long-term prepaid expenses	VII.22	604,735,820.92	598,216,433.64
Deferred income tax assets	VII.23	2,441,521,911.44	2,477,206,492.36
Other non-current assets	VII.24	1,658,350,424.87	1,759,556,893.63
Total non-current assets		140,424,911,728.59	138,622,096,754.96
Total assets		301,700,068,337.08	290,736,357,978.75
Current liabilities:
Short-term borrowings	VII.25	16,127,614,637.24	13,784,367,443.93
Borrowings from central bank
Funds borrowed
Financial liabilities held for trading
Derivative financial liabilities	VII.26	440,096,398.09	71,011,310.01
Bills payable	VII.27	25,408,488,465.99	21,220,364,311.81
Accounts payables	VII.28	53,257,299,256.55	54,665,277,420.32
Receipts in advance
Contract liabilities	VII.29	5,710,603,667.36	10,865,337,767.67
Disposal of repurchased financial assets
Absorbing deposit and deposit in inter
bank market
Customer deposits for trading in securities
Amounts due to issuer for securities
underwriting
Payables for staff's remuneration	VII.30	4,438,435,647.30	5,057,260,277.99
Taxes payable	VII.31	3,608,609,516.38	3,915,219,916.17
Other payables	VII.32	30,240,547,430.91	21,746,135,764.08
Including: Interest payables
Dividends payables		8,995,192,390.93	14,082,609.41
Fees and commissions payable
Reinsurance Accounts payables
Liabilities held for sale
Non-current liabilities due within one year	VII.33	11,148,785,048.80	16,530,040,461.37
Other current liabilities	VII.34	1,468,735,367.99	1,899,945,460.39
Total current liabilities		151,849,215,436.61	149,754,960,133.74

Items	Notes	30 June 2025	31 December 2024
Non-current liabilities:
Deposits for insurance contracts
Long-term borrowings	VII.35	10,595,616,602.87	9,665,074,313.67
Bonds payable	VII.36	3,500,000,000.00
Including: Preference shares
Perpetual bonds
Lease liabilities	VII.37	4,916,252,581.97	4,480,895,997.36
Long-term payables	VII.38	138,177,568.54	188,220,056.59
Long-term payables for staff's
remuneration	VII.39	2,659,860,931.78	2,561,647,446.35
Estimated liabilities	VII.40	2,404,338,137.69	2,386,261,752.92
Deferred income	VII.41	1,311,378,644.13	1,252,216,590.03
Deferred income tax liabilities	VII.23	1,623,752,433.04	1,547,287,169.00
Other non-current liabilities		122,217,515.04	98,073,333.45
Total non-current liabilities		27,271,594,415.06	22,179,676,659.37
Total liabilities		179,120,809,851.67	171,934,636,793.11
Owners' equity (or shareholders'
equity):
Paid-in capital (or share capital)	VII.42	9,382,913,334.00	9,382,913,334.00
Other equity instruments
Including: Preference shares
Perpetual bonds
Capital reserve	VII.43	19,844,397,232.25	20,310,218,222.04
Less: treasury stock	VII.44	4,367,132,060.90	3,510,728,776.44
Other comprehensive income	VII.45	2,280,700,601.57	825,502,860.47
Special reserve
Surplus reserve	VII.46	5,296,602,892.45	5,296,602,892.45
General risk provisions
Undistributed profits	VII.47	82,456,809,019.18	79,474,366,234.70
Total equity attributable to owners (or
shareholders) of the Parent Company		114,894,291,018.55	111,778,874,767.22
Minority shareholders' interests		7,684,967,466.86	7,022,846,418.42
Total owners' equity (or shareholders'
equity)		122,579,258,485.41	118,801,721,185.64
Total liabilities and owners' equity (or
shareholders' equity)		301,700,068,337.08	290,736,357,978.75

Person in charge of the Company: Li Huagang Person in charge of accounting function: Sun Jiacheng Person in charge of accounting department: Ying Ke

Balance Sheet of the Parent Company

30 June 2025

Prepared by: Haier Smart Home Co., Ltd.

Items	Notes	30 June 2025	31 December 2024
Current Assets:
Monetary funds		10,337,792,458.42	8,721,089,765.37
Financial assets held for trading		6,094,300,111.12
Derivative financial assets
Bills receivable
Accounts receivable	XIX.1	2,547,209,298.18	2,089,263,590.36
Financing receivables
Prepayments		3,124,793.19	3,124,793.19
Other receivables	XIX.2	62,239,070,610.58	35,309,208,101.73
Including: Interest receivables		66,600,316.50	137,951,583.62
Dividends receivables		3,615,317,738.91	955,746,044.23
Inventories		58,324,395.52	9,092,410.78
Including: Data resources
Contract assets
Assets held for sale
Non-current assets due within one year		321,325,000.00	1,105,291,666.67
Other current assets		9,264,931.90	174,671,080.16
Total current assets		81,610,411,598.91	47,411,741,408.26
Non-current assets:
Debt investments		7,029,527,912.19	7,243,616,935.47
Other debt investments
Long-term receivables
Long-term equity investments	XIX.3	62,575,577,386.31	62,193,654,756.17
Investments in other equity instruments		1,602,852,951.00	1,602,852,951.00
Other non-current financial assets
Investment properties
Fixed assets		119,811,886.16	131,874,644.27
Construction in progress		3,620,405.74	490,452.83
Biological assets for production
Oil and gas assets
Right-of-use assets
Intangible assets		32,137,672.64	35,196,337.86
Including: Data resources
Development cost
Including: Data resources
Goodwill
Long-term prepaid expenses		2,652,341.22	3,502,636.81

Items	Notes	30 June 2025	31 December 2024
Deferred income tax assets
Other non-current assets		2,557,619,709.23	1,738,121,667.23
Total non-current assets		73,923,800,264.49	72,949,310,381.64
Total assets		155,534,211,863.40	120,361,051,789.90
Current liabilities:
Short-term borrowings		3,700,000,000.00	2,000,000,000.00
Financial liabilities held for trading
Derivative financial liabilities
Bills payable
Accounts payables		2,015,053,240.92	1,526,611,034.49
Receipts in advance
Contract liabilities		12,597,148.63	12,597,148.63
Payables for staff's remuneration		7,979,314.64	7,798,419.39
Taxes payable		565,822.40	884,572.31
Other payables		99,347,694,829.86	63,004,946,189.17
Including: Interest payable			1,234,444.45
Dividends payable		8,991,794,045.13
Liabilities held for sale
Non-current liabilities due within one year		1,716,211,250.00	1,495,350,000.00
Other current liabilities		11,440,662.32	18,881,166.43
Total current liabilities		106,811,542,268.77	68,067,068,530.42
Non-current liabilities:
Long-term borrowings		2,271,500,000.00	3,292,370,000.00
Bonds payable		3,500,000,000.00
Including: Preference shares
Perpetual bonds
Lease liabilities
Long-term payable
Long-term payables for staff's
remuneration
Estimated liabilities
Deferred income		16,814,070.50	14,265,249.50
Deferred income tax liabilities		394,292,088.98	394,292,088.98
Other non-current liabilities
Total non-current liabilities		6,182,606,159.48	3,700,927,338.48
Total liabilities		112,994,148,428.25	71,767,995,868.90
Owners' equity (or Shareholders'
equity):
Paid-in capital (or share capital)		9,382,913,334.00	9,382,913,334.00
Other equity instruments
Including: Preference shares
Perpetual bonds
Capital reserve		25,843,919,017.13	25,680,561,451.57
Less: treasury stock		1,505,380,117.76	1,467,523,464.56

Items	Notes	30 June 2025	31 December 2024
Other comprehensive income		675,788,147.41	618,368,749.67
Special reserve
Surplus reserve		4,691,456,667.00	4,691,456,667.00
Undistributed profits		3,451,366,387.37	9,687,279,183.32
Total owners' equity (or shareholders'
equity)		42,540,063,435.15	48,593,055,921.00
Total liabilities and owners' equity
(or shareholders' equity)		155,534,211,863.40	120,361,051,789.90
Person in charge of the Company: Li Huagang

Person in charge of accounting function: Sun Jiacheng Person in charge of accounting department: Ying Ke

Consolidated Profit Statement

January-June 2025

Items	Notes	2025 Interim	2024 Interim
I. Total operating revenue		156,494,034,448.85	141,982,482,605.75
Including: Operating revenue	VII.48	156,494,034,448.85	141,982,482,605.75
Interest income
Insurance premiums earned
Fee and commission income
II. Total cost of operations		142,264,928,563.02	129,691,089,346.09
Including: Operating cost	VII.48	114,437,933,108.76	103,945,159,570.63
Interest expenses
Fee and commission expenses
Insurance withdrawal payment
Net payment from indemnity
Net provisions withdrew for insurance
contract liability
Insurance policy dividend paid
Reinsurance cost
Taxes and surcharges	VII.49	679,554,803.08	610,302,317.06
Selling expenses	VII.50	15,816,814,510.07	14,517,816,334.58
Administrative expenses	VII.51	5,891,046,898.48	5,382,166,653.05
R&D expenses	VII.52	5,790,436,804.10	5,182,598,681.20
Financial expenses	VII.53	–350,857,561.47	53,045,789.57
Including: Interest expenses		1,446,615,689.51	1,252,571,601.13
Interest income		908,582,647.56	947,056,127.00
Add: Other income	VII.54	775,214,508.42	585,424,373.34
Investment income (losses are
represented by '-')	VII.55	917,258,503.36	931,730,990.63
Including: investment income of
associates and joint ventures		850,409,233.36	913,969,362.35
Income generated from the derecognition
of financial assets measured at
amortized cost (losses are represented
by '-')
Exchange gain (losses are represented by '-')
Gains on net exposure hedges (losses are
represented by '-') Income from change in fair value (losses
are represented by '-')	VII.56	34,753,540.63	–29,565,597.82
Loss on credit impairment (losses are
represented by '-')	VII.57	–71,912,087.85	–69,794,942.03

Items	Notes	2025 Interim	2024 Interim
Loss on assets impairment (losses are
represented by '-')	VII.58	–744,113,044.82	–706,437,535.88
Gain from disposal of assets (losses are
represented by '-')	VII.59	–7,368,037.54	–1,569,698.49
III. Operating profit (losses are represented
by '-')		15,132,939,268.03	13,001,180,849.41
Add: non-operating income	VII.60	121,855,656.14	76,490,746.47
Less: non-operating expenses	VII.61	257,738,776.06	96,898,224.12
IV. Total profit (total losses are represented
by '-')		14,997,056,148.11	12,980,773,371.76
Less: income tax expense	VII.62	2,511,940,348.67	2,207,175,817.26
V. Net profit (net losses are represented by
'-')		12,485,115,799.44	10,773,597,554.50
(1) Classification by continuous operation
1. Net profit from continuous operation
(net losses are represented by '-')		12,485,115,799.44	10,773,597,554.50
2. Net profit from discontinued
operation (net losses are
represented by '-')
(2) Classification by ownership of the
equity
1. Net profit attributable to shareholders
of the Parent Company (net losses
are represented by '-')		12,032,995,820.27	10,409,642,540.63
2. Profit or loss attributable to minority
shareholders (net losses are
represented by '-')		452,119,979.17	363,955,013.87
VI. Other comprehensive income, net of tax	VII.63	1,452,271,379.89	–334,806,467.13
(I) Other comprehensive income
attributable to owners of the Parent			–335,021,596.15
Company, net of tax 1. Other comprehensive income that		1,455,197,741.10
cannot be reclassified into the
profit or loss		–158,056,399.69	–128,316,608.25
(1) Changes arising from re
measurement of defined benefit
plans		135,857,881.73	–2,491,664.07
(2) Other comprehensive income
that cannot be transferred into
profit or loss under equity
method
(3) Changes in fair value of
investments in other equity
instruments		–293,914,281.42	–125,824,944.18

Items	Notes	2025 Interim	2024 Interim
(4) Changes in fair value of credit
risks of the enterprise
2. Other comprehensive income to be
reclassified into the profit or loss		1,613,254,140.79	–206,704,987.90
(1) Other comprehensive income
that can be transferred into
profit or loss under equity
method		28,468,182.86	23,160,537.38
(2) Changes in fair value of other
debt Investments
(3) Reclassified financial assets that
are credited to other
comprehensive income
(4) Credit impairment provision for
other debt investments
(5) Reserve for cash flow hedging		–130,457,670.38	–30,039,858.31
(6) Exchange differences on
translation of financial
statements denominated in
foreign currencies		1,715,243,628.31	–199,825,666.97
(7) Others
(II) Other comprehensive income
attributable to minority shareholders,
net of tax		–2,926,361.21	215,129.02
VII. Total comprehensive income		13,937,387,179.33	10,438,791,087.37
(I) Total comprehensive income
attributable to the owners of Parent
Company		13,488,193,561.37	10,074,620,944.48
(II) Total comprehensive income
attributable to the minority
shareholders		449,193,617.96	364,170,142.89
VIII. Earnings per share:
(I) Basic earnings per share (RMB/share)	XXI.1	1.30	1.13
(II) Diluted earnings per share
(RMB/share)	XXI.1	1.29	1.12

For business combination under common control occurring in the current period, the net profit of the acquiree before the combination was RMB3,593,306.97, and the net profit of the acquiree for the previous period was RMB-10,575,848.59.

Person in charge of the Company: Li Huagang Person in charge of accounting function: Sun Jiacheng Person in charge of accounting department: Ying Ke

Profit Statement of the Parent Company

January-June 2025

Items	Notes	2025 Interim	2024 Interim
I. Operating income		453,790,319.36	251,601,614.76
Less: operating cost	XIX.4	421,626,827.34	223,444,233.50
Taxes and surcharges		4,975,640.95	2,634,526.12
Selling expenses		6,114,834.66	21,861,602.21
Administration expenses		230,730,912.40	379,191,355.33
R&D expenses		3,468,437.28	7,802,548.59
Financial expenses		–82,235,139.76	–179,030,129.87
Including: interest expenses		94,567,133.67	52,482,308.39
Interest income		173,636,781.09	233,381,967.37
Add: other income		3,036,529.45	4,280,121.77
Investment income (losses are
represented by '-')	XIX.5	2,871,560,525.29	508,175,341.20
Including: investment income of
associates and joint ventures		182,219,429.45	180,476,867.12
Derecognition income on
financial assets
measured at amortized
cost (losses are
represented by '-')
Gains on net exposure hedges
(losses are represented by '-')
Income from change in fair value
(losses are represented by '-')		13,176,519.93
Loss on credit impairment (losses
are represented by '-')		–700,000.00
Loss on assets impairment (losses
are represented by '-')
Gain from disposal of assets (losses
are represented by '-')		–241,461.19
II. Operating profit (losses are represented by
'-')		2,755,940,919.97	308,152,941.85
Add: non-operating income		200.00
Less: non-operating expenses		59,870.79	134,512.56
III. Total profit (total losses are represented
by '-')		2,755,881,249.18	308,018,429.29
Less: income tax expenses
IV. Net profit (net losses are represented by
'-')		2,755,881,249.18	308,018,429.29

Items	Notes	2025 Interim	2024 Interim
(I) Net profit from continuous operations
(net losses are represented by '-')		2,755,881,249.18	308,018,429.29
(II) Net profit from discontinued operations
(net losses are represented by '-')
V. Other comprehensive income, net of tax		57,419,397.74	38,468,441.16
(I) Other comprehensive income that
cannot be reclassified into the profit or
loss
1. Changes arising from re
measurement of defined benefit
plans 2. Other comprehensive income that
cannot be transferred into profit or
loss under equity method
3. Changes in fair value of investments
in other equity instruments
4. Changes in fair value of credit risks
of the enterprise
(II) Other comprehensive income to be
reclassified into the profit or loss		57,419,397.74	38,468,441.16
1. Other comprehensive income that
can be transferred into profit or loss
under equity method		57,419,397.74	38,468,441.16
2. Changes in fair value of other debt
investments
3. Reclassified financial assets that are
credited to other comprehensive
income
4. Credit impairment provision for other
debt investments 5. Reserve for cash flow hedging
6. Exchange differences on translation
of financial statements denominated
in foreign currencies
7. Others
VI. Total comprehensive income		2,813,300,646.92	346,486,870.45
VII. Earnings per share:
(I) Basic earnings per share (RMB/share)
(II) Diluted earnings per share
(RMB/share)
Person in charge of the Company: Li Huagang

Person in charge of accounting function: Sun Jiacheng Person in charge of accounting department: Ying Ke

Consolidated Cash Flow Statement

January-June 2025

Items	Notes	2025 Interim	2024 Interim
I. Cash flow from operating activities:
Cash received from the sale of goods
and rendering services		166,973,160,557.73	144,804,449,491.40
Net increase in distributor and inter-bank
deposits
Net increase in borrowing from the
central bank
Net cash increase in borrowing from other financial institutes
Cash received from premiums under
original insurance contract
Net cash received from reinsurance
business
Net increase in deposits of policy holders and investment
Cash received from interest, fee and
commissions
Net increase in cash borrowed
Net increase in cash received from
repurchase operation
Net cash received from customer
deposits for trading in securities
Refunds of taxes		1,265,635,650.92	1,067,732,811.42
Cash received from other related
operating activities	VII.64	1,512,184,469.60	1,435,678,595.14
Sub-total of cash inflows from operating
activities		169,750,980,678.25	147,307,860,897.96
Cash paid on purchase of goods and
services		118,785,453,051.35	103,618,664,285.75
Net increase in loans and advances of distributors
Net increase in deposits in the PBOC and inter bank
Cash paid for compensation payments
under original insurance contact
Net increase in cash lent
Cash paid for interest, bank charges and commissions
Cash paid for insurance policy dividend

Items	Notes	2025 Interim	2024 Interim
Cash paid to and on behalf of
employees		18,846,597,606.70	16,435,257,033.85
Cash paid for all types of taxes		9,435,218,293.50	7,917,809,512.74
Cash paid to other operation related
activities	VII.64	11,544,665,945.36	10,912,069,462.19
Sub-total of cash outflows from operating
activities		158,611,934,896.91	138,883,800,294.53
Net cash flow from operating activities	VII.65	11,139,045,781.34	8,424,060,603.43
II. Cash flow from investing activities:
Cash received from recovery of
investments		20,072,795,541.03	9,707,697,079.51
Cash received from return on
investments		449,498,890.02	480,559,603.84
Net cash received from the disposal of
fixed assets, intangible assets and
other long-term assets		17,203,877.85	9,279,434.48
Net cash received from disposal of
subsidiaries and other operating
entities
Other cash received from investment
activities	VII.64	131,428,806.14
Sub-total of cash inflows from investing
activities		20,670,927,115.04	10,197,536,117.83
Cash paid on purchase of fixed assets,
intangible assets and other long-term
assets Cash paid for investments		3,764,462,806.18 26,928,024,657.46	4,204,198,714.75 15,184,939,467.03
Net increase in secured loans
Net cash paid on acquisition of
subsidiaries and other operating
entities
Other cash paid on investment activities
Sub-total of cash outflows from investing
activities		30,692,487,463.64	19,389,138,181.78
Net cash flow from investing activities		–10,021,560,348.60	–9,191,602,063.95
III. Cash flow from financing activities:
Cash received from capital contributions		47,830,000.00	268,875,731.22
Including: cash received from capital
contributions by minority shareholders
of subsidiaries
Cash received from borrowings		13,818,811,428.03	6,237,610,857.45
Cash received from issuance of bonds		3,500,000,000.00
Other cash received from financing
activities	VII.64	111,646,384.65	115,332,534.00

Items	Notes	2025 Interim	2024 Interim
Sub-total of cash inflows from financing
activities		17,478,287,812.68	6,621,819,122.67
Cash paid on repayment of loans		14,319,613,817.74	4,633,695,648.37
Cash paid on distribution of dividends,
profits or repayment of interest
expenses		1,318,338,742.42	1,191,435,719.30
Including: dividend and profit paid to
minority shareholders by subsidiaries
Other cash paid to financing activities	VII.64	3,905,562,240.98	1,299,349,689.85
Sub-total of cash outflows from
financing activities		19,543,514,801.14	7,124,481,057.52
Net cash flow from financing activities		–2,065,226,988.46	–502,661,934.85
IV. Effect of fluctuations in exchange
rates on cash and cash equivalents		467,537,948.61	–41,638,689.56
V. Net increase in cash and cash
equivalents		–480,203,607.11	–1,311,842,084.93
Add: balance of cash and cash
equivalents at the beginning of the
period	VII.65	54,994,595,280.18	56,715,672,668.25
VI. Balance of cash and cash equivalents
at the end of the period	VII.65	54,514,391,673.07	55,403,830,583.32

Person in charge of the Company: Li Huagang Person in charge of accounting function: Sun Jiacheng Person in charge of accounting department: Ying Ke

Cash Flow Statement of the Parent Company

January-June 2025

Items	Notes	2025 Interim	2024 Interim
I. Cash flow from operating activities:
Cash received from the sale of goods and
rendering of services		142,867,762.31	219,993,729.62
Refunds of taxes		3,291,819.49	38,214.96
Other cash received from operating
activities		136,466,207.24	164,614,625.43
Sub-total of cash inflows from operating
activities		282,625,789.04	384,646,570.01
Cash paid on purchase of goods and
services		133,785,234.50
Cash paid to and on behalf of employees		19,501,379.07	27,649,816.71
Cash paid for all types of taxes		12,863,251.19	11,299,372.62
Other cash paid to operation activities		124,465,778.03	104,532,697.84
Sub-total of cash outflows from
operating activities		290,615,642.79	143,481,887.17
Net cash flow from operating
activities		–7,989,853.75	241,164,682.84
II. Cash flow from investing activities:
Cash received from recovery of
investments		13,152,000,000.00	7,222,000,000.00
Cash received from return on
investments		80,944,929.78	88,433,946.88
Net cash received from the disposal of
fixed assets, intangible assets and
other long-term assets
Net cash received from disposal of
subsidiaries and other operating
entities
Other cash received from investment
activities		1,726,172,255.14	389,573,294.54
Sub-total of cash inflows from investing
activities		14,959,117,184.92	7,700,007,241.42
Cash paid on purchase of fixed assets,
intangible assets and other long-term
assets		4,390,059.31	2,692,652.09
Cash paid for investments		18,278,117,869.26	12,422,000,000.00
Net cash paid on acquisition of
subsidiaries and other operating
entities

Items	Notes	2025 Interim	2024 Interim
Other cash paid on investment activities		1,434,000,000.00
Sub-total of cash outflows from
investing activities		19,716,507,928.57	12,424,692,652.09
Net cash flow from investing
activities		–4,757,390,743.65	–4,724,685,410.67
III. Cash flow from financing activities:
Cash received from capital injections
Cash received from borrowings		2,515,000,000.00	940,000,000.00
Cash received from issuance of bonds		3,500,000,000.00
Other cash received from financing
activities		2,941,508,886.50	7,717,935,238.95
Sub-total of cash inflows from financing
activities		8,956,508,886.50	8,657,935,238.95
Cash paid on repayment of borrowings		1,626,480,000.00	14,000,000.00
Cash paid on distribution of dividends,
profits or repayment of interest
expenses		87,281,645.03	50,962,018.77
Other cash paid on financing activities		857,354,695.20	466,600,210.43
Sub-total of cash outflows from
financing activities		2,571,116,340.23	531,562,229.20
Net cash flow from financing
activities		6,385,392,546.27	8,126,373,009.75
IV. Effect of fluctuations in exchange
rates on cash and cash equivalents		–3,309,255.82	–120,980.13
V. Net increase in cash and cash
equivalents		1,616,702,693.05	3,642,731,301.79
Add: balance of cash and cash
equivalents at the beginning of the
period		8,721,089,765.37	7,579,640,524.79
VI. Balance of cash and cash equivalents
at the end of the period		10,337,792,458.42	11,222,371,826.58

Person in charge of the Company: Li Huagang Person in charge of accounting function: Sun Jiacheng Person in charge of accounting department: Ying Ke

Consolidated Statement of Changes in Owner's Equity

January-June 2025 Unit and Currency: RMB

							Equity attributable to owners of the Parent Company	2025 Interim
			Other equity instruments				Other							Minority
Items	Paid-in capital (or share capital)	Preference shares	Perpetual bonds	Others	Capital reserve	Less: treasury stock	comprehensive income	Special reserve	Surplus reserve	General risk provision	Undistributed profits	Others	Sub-total	shareholders' interests	Total owners' equity
I. Closing balance for the previous period Add: changes in accounting policies Error correction for prior period	9,382,913,334.00				20,115,358,921.93	3,510,728,776.44	793,828,357.47		5,296,602,892.45	—	79,288,144,269.76		111,366,118,999.17	7,022,846,418.42	118,388,965,417.59
Business combination under common control					194,859,300.11		31,674,503.00				186,221,964.94		412,755,768.05		412,755,768.05
II. Opening balance for the current year Others	9,382,913,334.00				20,310,218,222.04	3,510,728,776.44	825,502,860.47		5,296,602,892.45		79,474,366,234.70		111,778,874,767.22	7,022,846,418.42	118,801,721,185.64
III. Increase/decrease for the current period (decrease is represented by '-') (I) Total comprehensive income					–465,820,989.79	856,403,284.46	1,455,197,741.10 1,455,197,741.10				2,982,442,784.48 12,032,995,820.27		3,115,416,251.33 13,488,193,561.37	662,121,048.44 449,193,617.96	3,777,537,299.77 13,937,387,179.33
1. Ordinary shares invested by owners 2. Capital contribution by holders of (II) Capital injection and reduction by owners					–465,820,989.79	856,403,284.46							–1,322,224,274.25	220,334,331.09 220,334,331.09	–1,101,889,943.16 220,334,331.09
3. Share-based payment included in other equity instruments
owners' equity (III) Profit distribution 4. Others					221,073,939.39 –686,894,929.18	856,403,284.46					–8,991,794,045.13		221,073,939.39 –1,543,298,213.64 –8,991,794,045.13	–7,406,900.61	221,073,939.39 –1,543,298,213.64 –8,999,200,945.74
2. Withdrawal of general risk provision 1. Withdrawal of surplus reserves
3. Distribution to owners (or shareholders)											–8,991,794,045.13		–8,991,794,045.13	–7,406,900.61	–8,999,200,945.74
(IV) Internal transfer of owner's equity 4. Others
2. Transfer of surplus reserves into 1. Transfer of capital reserves into capital (or share capital)
4. Changes in defined benefit plans 3. Surplus reserves used for capital (or share capital) remedying loss									—
5. Other comprehensive income carried forward to retained earnings
carried forward to retained earnings 6. Others
1. Withdrawal for the period 2. Utilization for the period (V) Special reserve (VI) Others											–58,758,990.66		–58,758,990.66		–58,758,990.66
IV. Closing balance for the period	9,382,913,334.00				19,844,397,232.25	4,367,132,060.90	2,280,700,601.57		5,296,602,892.45		82,456,809,019.18		114,894,291,018.55	7,684,967,466.86	122,579,258,485.41

Minority shareholders' interests 6,264,355,202.17 6,264,355,202.17 364,170,142.89 –13,819,692.29 –13,819,692.29 500,251,942.91 149,901,492.31 149,901,492.31 101,265,984,771.17 101,782,996,604.88 Sub-total 2,099,570,967.75 10,074,620,944.48 –321,162,787.46 201,405,574.94 –522,568,362.40 –7,513,967,094.69 –7,513,967,094.69 –139,920,094.58 517,011,833.71 Others Undistributed profits 68,535,686,494.60 306,295,814.70 68,841,982,309.30 2,755,755,351.36 10,409,642,540.63 –7,513,967,094.69 –7,513,967,094.69 –139,920,094.58 General risk provision — Surplus reserve 4,842,338,543.80 4,842,338,543.80 Special reserve Other comprehensive income 1,969,365,062.65 15,856,718.90 1,985,221,781.55 –334,178,995.99 –335,021,596.15 842,600.16 Less: treasury stock 5,034,065,107.42 5,034,065,107.42 466,600,210.43 466,600,210.43 466,600,210.43 Capital reserve 21,514,544,884.54 21,709,404,184.65 145,437,422.97 201,405,574.94 –55,968,151.97 –842,600.16 194,859,300.11 144,594,822.81 Others Other equity instruments Perpetual bonds Preference shares Paid-in capital (or share capital) 9,438,114,893.00 9,438,114,893.00 III. Increase/decrease for the current period 1. Ordinary shares invested by owners 3. Share-based payment included in 4. Changes in defined benefit plans 2. Capital contribution by holders of 2. Transfer of surplus reserves into I. Closing balance for the previous period 1. Transfer of capital reserves into Business combination under common (II) Capital injection and reduction by (IV) Internal transfer of owner's equity II. Opening balance for the current year 1. Withdrawal of surplus reserves 5. Other comprehensive income Add: changes in accounting policies carried forward to retained carried forward to retained 2. Withdrawal of general risk 3. Surplus reserves used for 3. Distribution to owners (or (decrease is represented by '-') (I) Total comprehensive income 1. Withdrawal for the period Error correction for prior period capital (or share capital) 2. Utilization for the period other equity instruments capital (or share capital) remedying loss owners' equity (III) Profit distribution shareholders) (V) Special reserve provision earnings earnings 4. Others 6. Others 4. Others (VI) Others owners control Others Items						Equity attributable to owners of the Parent Company	2024 Interim
												Total owners' equity
												107,530,339,973.34
												517,011,833.71
												108,047,351,807.05
												2,599,822,910.66 10,438,791,087.37
												–171,261,295.15 149,901,492.31
												201,405,574.94
												–522,568,362.40 –7,527,786,786.98
												–7,527,786,786.98
												–139,920,094.58
	IV. Closing balance for the period	9,438,114,893.00		21,853,999,007.46	5,500,665,317.85	1,651,042,785.56		4,842,338,543.80	71,597,737,660.66	103,882,567,572.63	6,764,607,145.08	110,647,174,717.71
	Legal representative of the Company: Li Huagang

Person in charge of accounting function: Sun Jiacheng

Person in charge of accounting department: Ying Ke

Statement of Changes in Owners' Equity of the Parent Company

January-June 2025

			Other equity instruments			2025 Interim
							Other
Items	Paid-in capital (or share capital)	Preference shares	Perpetual bonds	Others	Capital reserve	Less: treasury stock	comprehensive income	Special reserve	Surplus reserve	Undistributed profits	Total owners' equity
I. Closing balance for the previous period Add: changes in accounting policies Error correction for prior period Others	9,382,913,334.00				25,680,561,451.57	1,467,523,464.56	618,368,749.67		4,691,456,667.00	9,687,279,183.32	48,593,055,921.00
II. Opening balance for the current year	9,382,913,334.00				25,680,561,451.57	1,467,523,464.56	618,368,749.67		4,691,456,667.00	9,687,279,183.32	48,593,055,921.00
III. Increase/decrease for the current period (decrease is (I) Total comprehensive income represented by '-')					163,357,565.56	37,856,653.20	57,419,397.74 57,419,397.74		—	–6,235,912,795.95 2,755,881,249.18	–6,052,992,485.85 2,813,300,646.92
2. Capital contribution by holders of other equity (II) Capital injection and reduction by owners 1. Ordinary shares invested by owners					163,357,565.56	37,856,653.20					125,500,912.36
instruments
3. Share-based payment included in owners' equity (III) Profit distribution 4. Others					–24,425,340.75 187,782,906.31	37,856,653.20				–8,991,794,045.13	–62,281,993.95 –8,991,794,045.13 187,782,906.31
2. Distribution to owners (or shareholders) 1. Withdrawal of surplus reserves 3. Others										–8,991,794,045.13	–8,991,794,045.13
1. Transfer of capital reserves into capital (or share (IV) Internal transfer of owner's equity
capital)
2. Transfer of surplus reserves into capital (or share capital)
4. Changes in defined benefit plans carried forward 3. Surplus reserves used for remedying loss
to retained earnings
5. Other comprehensive income carried forward to
retained earnings 6. Others
(V) Special reserve
1. Withdrawal for the period 2. Utilization for the period
(VI) Others
IV. Closing balance for the period	9,382,913,334.00				25,843,919,017.13	1,505,380,117.76	675,788,147.41	—	4,691,456,667.00	3,451,366,387.37	42,540,063,435.15

						2024 Interim
			Other equity instruments				Other
Items	Paid-in capital (or share capital)	Preference shares	Perpetual bonds	Others	Capital reserve	Less: treasury stock	comprehensive income	Special reserve	Surplus reserve	Undistributed profits	Total owners' equity
I. Closing balance for the previous period	9,438,114,893.00				27,263,651,777.44	3,175,293,942.36	630,674,691.95	—	4,237,192,318.35	7,484,026,291.62	45,878,366,030.00
Add: changes in accounting policies Error correction for prior period Others
III. Increase/decrease for the current period (decrease is II. Opening balance for the current year	9,438,114,893.00				27,263,651,777.44	3,175,293,942.36	630,674,691.95		4,237,192,318.35	7,484,026,291.62	45,878,366,030.00
represented by '-')					182,744,999.21	466,600,210.43	38,468,441.16			-7,205,948,665.40	-7,451,335,435.46
(II) Capital injection and reduction by owners (I) Total comprehensive income					182,744,999.21	466,600,210.43	38,468,441.16			308,018,429.29	346,486,870.45 -283,855,211.22
2. Capital contribution by holders of other equity 1. Ordinary shares invested by owners
3. Share-based payment included in owners' equity instruments					182,744,999.21						182,744,999.21
4. Others						466,600,210.43					-466,600,210.43
1. Withdrawal of surplus reserves (III) Profit distribution										-7,513,967,094.69	-7,513,967,094.69
2. Distribution to owners (or shareholders)										-7,513,967,094.69	-7,513,967,094.69
3. Others
1. Transfer of capital reserves into capital (or share (IV) Internal transfer of owner's equity
capital)
2. Transfer of surplus reserves into capital (or share
capital)
3. Surplus reserves used for remedying loss
4. Changes in defined benefit plans carried forward to retained earnings
5. Other comprehensive income carried forward to
retained earnings
6. Others
(V) Special reserve
1. Withdrawal for the period 2. Utilization for the period
(VI) Others
IV. Closing balance for the period	9,438,114,893.00	—	—	—	27,446,396,776.65	3,641,894,152.79	669,143,133.11	—	4,237,192,318.35	278,077,626.22	38,427,030,594.54
Legal representative of the Company: Li Huagang
Person in charge of accounting function: Sun Jiacheng

Person in charge of accounting department: Ying Ke

III. GENERAL INFORMATION OF THE COMPANY

1. Overview of the Company

√ Applicable □Not Applicable

The predecessor of Haier Smart Home Co., Ltd (hereinafter referred to as the Company) was Qingdao Refrigerator Factory, which was established in 1984. As permitted to offering by People's Bank of China, Qingdao Branch on 16 December 1989, with the document of Qing Ti Gai [1989] No. 3 issued on 24 March 1989, based on the reconstruction of the original Qingdao Refrigerator Factory, a limited company was set up by directional fund raising of RMB150 million. In March and September 1993, as approved by the document of Qing Gu Ling Zi [1993] No. 2 and No. 9 issued by the pilot leading team of Qingdao joint stock company, the Company was converted from a directional offering company to a public subscription company and issued additional 50 million shares to the public and listed with trading on Shanghai Stock Exchange in November 1993. In October 2018, D-shares in issue of the Company were listed on the China Europe International Exchange AG. In December 2020, H-shares in issue of the Company were listed on the Stock Exchange of Hong Kong Limited by way of introduction.

The Company's registered office is located at the Haier Science and Technology Innovation Ecological Park of Laoshan District, Qingdao, Shandong Province, and the headquarters is located at the Haier Science and Technology Innovation Ecological Park of Laoshan District, Qingdao, Shandong Province.

The Company is mainly engaged in research and development, manufacturing and sales of home appliances including refrigerators/freezers, kitchen appliances, air-conditioners, laundry appliances and water appliances, and other smart home business, as well as providing smart home packaged solutions.

The ultimate controlling parent company of the Company is Haier Group Corporation.

These financial statements have been approved for publication by the Board of the Company on 28 August 2025.

2. Scope of consolidated statements

For details of changes in the scope of consolidated financial statements for the current period, please refer to "IX. Changes in Consolidation Scope" and "X. Interest in Other Entities" of this note.

IV. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS

1. Basis of preparation

The financial statements of the Company were prepared on the going concern basis according to the transactions and matters actually occurred, in accordance with the Accounting Standards for Enterprises — Basic Standards published by the Ministry of Finance, specific accounting standards, and guidance on application of accounting standards for enterprises, interpretations to accounting standards for enterprises and other relevant requirements (hereinafter collectively referred to as the "Accounting Standards for Enterprises") which issued subsequently, and in combination with the disclosure provisions of the Rules for the Information Disclosure and Compilation of Companies Publicly Issuing Securities No. 15: General Provisions for Financial Report (Revised in 2023) of CSRC as well as the following significant accounting policies and accounting estimation.

2. Going Concern

√ Applicable □Not Applicable

The Company has ability to continue its operation for at least 12 months since the end of the reporting period and there are no significant events affecting its ability to continue as a going concern.

V. SIGNIFICANT ACCOUNTING POLICIES AND ACCOUNTING ESTIMATES

√ Applicable □Not Applicable

According to the characteristics of its production and operation, the Company formulated a series of specific accounting policies and accounting estimates, including the provisions for impairment for accounts receivable (Note V.11); the measurement of inventories (Note V.12); the depreciation and amortization of the investment properties (Note V.15); the depreciation of fixed assets (Note V.16), the amortization of intangible assets (Note V.19), the criterion for determining of long-term assets impairment (Note V.20); and the date of revenue recognition (Note V.26), etc.

1. Statement of compliance with Accounting Standards for Enterprises

The financial statements prepared by the Company meet the requirements of the Accounting Standards for Enterprises, which accurately and completely reflected information relating to the financial position, results of operations, changes in shareholders' equity and cash flows of the Company.

2. Accounting period

The accounting year of the Company is from 1 January each year to 31 December of the same year in solar calendar.

3. Operating period

The Company takes the period from the acquisition of assets for processing to the ultimate realization of cash or cash equivalents as a normal operating cycle. The Company takes 12 months as an operating period, which is also the classification basis for the liquidity of its assets and liabilities.

4. Recording currency

Renminbi is the recording currency of the Company

5. Materiality criteria determination method and selection basis

Case	Materiality criteria
Material receivables for which bad debt provision is individually assessed Material receivables and bad debt provisions which are recovered or	The amount of provision on an individual basis accounts for more than 10% of the total bad debt provisions for various types of receivables and is greater than RMB100 million The amount of recovery or reversal on an individual basis accounts for more than 10% of the total amount of various types of receivables and is greater than RMB100 million
reversed
Actual write-off of material accounts receivable	The amount of write-off on an individual basis accounts for more than 10% of the total bad debt provisions of various types of receivables and is greater than RMB100 million
Material prepayments aged more than one year	Prepayment aged more than 1 year on an individual basis accounts for more than 10% of the total prepayments and is greater than RMB100 million
Material projects under construction	The ending balance of a project on an individual basis is greater than RMB100 million
Material capitalized R&D projects	The ending balance of a project on an individual basis accounts for more than 10% of the ending balance of development expenditure and is greater than RMB100 million
Material accounts payable and other payables aged more than one year	Accounts payable/other payables with aged more than 1 year on an individual basis account for more than 10% of the total accounts payable/other payables and are greater than RMB100 million
Material contract liabilities aged more than one year	Contract liabilities aged more than 1 year on an individual basis account for more than 10% of the total contract liabilities and are greater than RMB100 million
Material non-wholly owned subsidiaries	The net assets of the subsidiaries account for more than 5% of the Company's net assets or the net profits and losses of the subsidiaries account for more than 10% of the Company's consolidated net profit.
Material joint ventures or associates	The book value of long-term equity investment in an individual invested unit accounts for more than 5% of the Company's net assets or the investment profits and losses under the long-term equity investment equity method account for more than 10% of the Company's consolidated net profit.

6. Accounting methods of business combinations under common control and not under common control

√ Applicable □Not Applicable

A business combination is a transaction or event that brings together two or more separate entities into one reporting entity. Business combinations are classified into business combinations under common control and business combinations not under common control.

(1) Business combinations under common control

A business combination under common control is a business combination in which all of the combining entities are ultimately controlled by the same party or parties both before and after the combination, and that control is not transitory. For business combination under common control, the party that obtains the control over the other parties on the combination date is the acquirer, and other parties involving in the business combination are the transferors. The combination date is the date on which the acquiring party effectively obtains the control over the party being acquired.

For business combination under common control, the transferor's assets and liabilities obtained by the Company (as the acquirer) in a business combination are accounted for at the carrying amount of the transferor in the ultimate controller's consolidated financial statements as at the date of combination, except for adjustments due to differences in accounting policies. The difference between the carrying amount of the combination consideration paid by the Company (or the aggregate nominal value of shares issued) and the carrying amount of net assets obtained in a business combination shall be adjusted to capital reserve, in case the capital reserve is insufficient for the elimination, the retained earnings shall be adjusted.

Intermediary fees (such as audit, legal services and valuation consultancy) and other relevant management fees incurred in the business combination by the Company (as the acquirer) are credited in profit or loss in the period when they occurred. Trading expenses in direct relation to the issuance of equity instrument as the consideration for the combination is written down to the capital reserve (share premium), where the capital reserve (share premium) is insufficient, and to surplus reserves and undistributed profits in order. Trading expenses in direct relation to the issuance of debt instrument as the consideration for the combination is included in the initial recognition amount of the debt instrument.

(2) Business combinations involving entities not under common control

A business combination not under common control is a business combination in which all of the combining entities are not ultimately controlled by the same party or parties both before and after the combination. For business combination not under common control, the party that obtains the control of the other parties at the combination date is the acquirer; other parties involving in the business combination are the transferors. The combination date is the date on which the acquirer effectively obtains control of the transferors.

In business combination involving entities not under common control, the cost of combination of the Company (as the acquirer) shall be the sum of the assets paid, obligations incurred or assumed and the fair value of the equity securities issued by the Company for obtaining control of the transferor at the date of acquisition. Intermediary fees (such as audit, legal services and valuation consultancy) and other relevant management fees incurred by the Company for the purpose of business combination are credited in profit or loss in the period when they occurred. Transaction fees for the equity instruments or debt instruments issued by the Company as combination consideration is included in the initial recognition amount of such equity instruments or debt instruments. Contingent consideration involved shall be recorded as the combination cost based on its fair value on the acquisition date. Should any new or further evidence arise within 12 months after the acquisition date and makes it necessary to adjust the contingent consideration on the acquisition date, the goodwill arising from the business combination shall be amended accordingly.

The cost of combination and identifiable net assets obtained by the Company (as the acquirer) in a business combination involving entities not under common control are measured at fair value on the acquisition date. Where the cost of the combination exceeds the acquirer's interest in the fair value of the transferor's identifiable net assets, the difference is recognized as goodwill; where the cost of combination is lower than the acquirer's interest in the fair value of the transferor's identifiable net assets, the difference is initially recognized in profit or loss for the current year after the Company conducted a review of computation for the identifiable assets, liabilities or fair value of contingent liabilities and combination cost, and where the combination cost is still lower than the fair value of the identifiable net assets of the transferor obtained during the course of combination, then the difference is recorded in the profit and loss.

7. Judgement Criteria for Control and Preparation of Consolidated Financial Statements

√ Applicable □Not Applicable

Judgement Criteria for Control:

The scope of consolidation of consolidated financial statements is on the basis of control. Control means that the Company has the power over the investee, enjoys variable returns by participating in relevant activities of the investee, and has the ability to use its power over the investee to influence the amount of its return. Control refers to the Company's right over the investee to enjoy variable returns through involvement in the investee and have the ability to exert the right to affect those returns The Company will reassess when changes in relevant facts and circumstances result in changes in the relevant elements involved in the definition of control.

Preparation method of consolidated statements:

(1) Scope of consolidated financial statements

The Company incorporated all subsidiaries under its control (including the separate entities controlled by the Company) into the scope of consolidation financial statements, including the enterprises under the Company's control, divisible part in the investees and structured entities. Control refers to the Company having power over the investee and is entitled to variable returns from its involvement with the investee and has the ability to use its power over the investee to affect the amount of those return.

(2) To unify the accounting policies, balance sheets date and accounting periods of the Company and subsidiaries

When preparing consolidated financial statements, adjustments are made if subsidiaries' accounting policies or accounting periods are different from that of the Company, in accordance with the Company's accounting policies and accounting periods.

(3) Offset matters in the consolidated financial statements

The consolidated financial statements shall be prepared by the Company on the basis of the financial statements of the Company and subsidiaries and based on other relevant information. In preparing the consolidated financial statements, all significant balances, transactions and unrealized profits between the Company and subsidiaries and among subsidiaries are eliminated. In preparing the consolidated financial statements, the Company treats the entire enterprise group as one accounting entity and reflects the overall financial position, operating results and cash flows of the Group in accordance with the requirements for recognition, measurement and presentation of relevant accounting standards for enterprises and consistent accounting policies. The owner's equity of the subsidiaries not attributable to the Company shall be presented separately as "minority equity" under the owner's equity item in the consolidated balance sheet. The minority equity attributable to net profit or loss of subsidiaries in the current period shall be presented as "minority interest" under the "net profit" item in the consolidated profit statement. Where the amount of loss of a subsidiary attributable to the minority shareholders exceeds their share of the opening balance of owner's equity of the subsidiary, the excess shall be allocated against minority equity. The long-term equity investment of the Company held by the subsidiaries, deemed as treasury stock of the corporate group as well as the reduction of owners' equity, shall be presented as "Less: Treasury stock" under the owner's equity item in the consolidated balance sheet.

(4) Accounting treatment of subsidiaries acquired from combination

For subsidiaries acquired from business combination under common control of the Company, the opening amount of the consolidated balance sheet is adjusted, as if the business combination has taken place since the ultimate controller began its control. The income, expenses and profits of subsidiaries or business combinations from the beginning of the current period to the end of the reporting period are included in the consolidated profit statement. The cash flows from the beginning of the current period to the end of the reporting period of a subsidiary or business combination are included in the consolidated cash flow statement, and the related items in the comparative statements are adjusted Where control can be exercised over the investee under the same control due to additional investment and other reasons, the Company shall deem the parties participating in the business combination to have made adjustments in their current status when the ultimate controller began its control. Equity investments held by the Company before control of the transferor are recognised for profit or loss, other comprehensive income and other changes in net assets between the later of the date on which the original equity interest is acquired and the date on which the Company and the transferor are under the same control and the date of combination, which are offset against the opening retained earnings or current profit or loss, respectively, in the period of the comparative statements.

For subsidiaries acquired from business combination under non-common control, the opening amount of the consolidated balance sheet is not adjusted. The income, expenses and profits of the subsidiary or business from the date of purchase to the end of the reporting period are included in the consolidated profit statement. The cash flows of the subsidiary or business from the date of purchase to the end of the reporting period are included in the consolidated statement of cash flows. Where control can be exercised over an investee that is not under the same control due to additional investment or other reasons, the Company remeasures the equity interest of the investee held before the purchase date based on the fair value of the equity interest at the purchase date, and the difference between the fair value and its carrying amount is included in the current investment income. Where the equity interest in the transferor held before the purchase date relates to other comprehensive income under the equity method and other changes in owner's equity other than net profit or loss, other comprehensive income and profit distribution, other comprehensive income and other changes in owner's equity relating thereto are transferred to investment income of the current period as at the purchase date, except for other comprehensive income arising from the remeasurement of net liabilities or changes in net assets of defined benefit plans by the investee.

(5) Dispose of equity interests in subsidiaries achieved in stages until losing control

① General treatment

During the reporting period, when the Company disposes of a subsidiary or business, the income, expenses and profits of that subsidiary or business from the beginning of the period to the date of disposal are included in the consolidated income statement of the Company; The cash flows from the beginning of the period to the disposal date of the subsidiary or operation are included in the consolidated statement of cash flows of the Company.

When control over the investee is lost due to the disposal of part of the equity investment or other reasons, the Company remeasures the remaining equity investment after disposal at its fair value at the date when control is lost. The difference between the sum of the consideration obtained on disposal of the equity interest and the fair value of the remaining equity interest, less the sum of the share of the net assets of the original subsidiary calculated by the Company based on the original shareholding ratio and goodwill calculated on a continuing basis from the date of purchase or consolidation, is included in investment income in the period in which control is lost and goodwill is written off. The Company converts other comprehensive income relating to the equity investment in the original subsidiary, etc. to investment income in the current period when control is lost.

② Disposal of subsidiaries step by step

Where the Company disposed of equity investment in a subsidiary step by step through multiple transactions until control is lost, for example, the terms, conditions and economic impact of each transaction that disposes of the equity investment in a subsidiary meet one or more of the following conditions, the Company accounts for multiple transactions as a single transaction:

• i. The transactions were entered into simultaneously or with mutual influence in mind;
• ii. The transactions as a whole are capable of achieving a complete commercial outcome;
• iii. The occurrence of one transaction depends on the occurrence of at least one other transaction;
• iv. The transaction is uneconomical by itself but economic when considered in conjunction with other transactions.

Where each transaction that disposes of an equity investment in a subsidiary until control is lost is a blanket transaction, the Company accounts for each transaction as a transaction that disposes of the subsidiary and loses control; However, the Company recognises the difference between each disposal price before the loss of control and the share of net assets of the subsidiary corresponding to the disposal of the investment as other comprehensive income in the consolidated financial statements and is transferred to profit or loss in the period in which control is lost when control is lost.

Where each transaction that disposes of an equity investment in a subsidiary until the loss of control is not a blanket transaction, the relevant policy for partial disposal of an equity investment in a subsidiary without loss of control is accounted for before the loss of control by the Company; When control is lost, accounting is performed in the same manner as would be done for a disposal subsidiary.

(6) Purchase of minority interests in subsidiaries

The difference between the Company's costs of newly acquired long-term equity investment resulting from the purchase of minority interests and the share of net assets attributable to the subsidiary calculated on an ongoing basis from the date of purchase (or the date of combination) based on the newly increased shareholding ratio, the equity premium in the capital reserve in the consolidated balance sheet is adjusted, and if the equity premium in the capital reserve is insufficient to offset, the retained earnings is adjusted.

(7) Partial disposal of equity investments in subsidiaries without loss of control

The Company adjusts the equity premium in the capital reserve in the consolidated balance sheet for the difference between the disposal price obtained from the partial disposal of the long-term equity investment in the subsidiary without loss of control and the share of the net assets of the subsidiary that would continue to be calculated from the purchase date or the combination date corresponding to the disposal of the long-term equity investment, or adjust the retained earnings if the equity premium in the capital reserve is insufficient to offset.

8. Classification of joint arrangement and accounting methods of joint operations

√ Applicable □Not Applicable

A joint arrangement refers to an arrangement jointly controlled by two or more parties. In accordance with the Company's rights and obligations under a joint arrangement, the Company classifies joint arrangements into joint operations and joint ventures.

(1) Joint operations

Joint operations refer to a joint arrangement in which the Company is a party and is entitled to relevant assets and obligations of this arrangement.

The Company recognizes the following items in relation to its interest in a joint operation, and accounts the same in accordance with relevant accounting standards for business enterprises: ① recognize the assets held solely by the Company, and recognize assets held jointly by the Company in appropriation to the share of the Company; ② recognize the obligations assumed solely by the Company, and recognize obligations assumed jointly by the Company in appropriation to the share of the Company; ③ recognize revenue from disposal of joint operations in appropriation to the share of the Company; ④ recognize revenue from disposal of joint operations in appropriation to the share of the Company; ⑤ recognize fees solely occurred by the Company and recognize fees from joint operations in appropriation to the share of the Company.

When the Company, as a joint venture, invests or sells assets to or purchase assets (the assets do not constitute a business, the same below) from joint operations, the Company shall only recognize the part of profit or lost from this transaction attributable to other parties of joint operations before these assets are sold to a third party. In case of an impairment loss incurred on these assets which meets the requirements as set out in Accounting Standards for Business Enterprises No. 8 — Asset Impairment, the Company shall full recognize the amount of this loss in relation to its investment in or sale of assets to joint operations or recognize the loss according to the Company's share of commitment in relation to the its purchase of assets from joint operations.

(2) Joint ventures

Joint ventures refer to a joint arrangement during which the Company only is entitled to net assets of this arrangement. Investment in joint venture is accounted for using the equity method according to the accounting policies referred to under "14. Long-term equity investment" of Note V.

9. Recognition standard for cash and cash equivalents

Cash recognized in the cash flow statements represents the cash on hand and deposits available for payment of the Company at any time.

Cash equivalents recognized in the cash flow statements refer to short-term, highly liquid investments held by the Company that are readily convertible to known amounts of cash and which are subject to an insignificant risk on change in value.

10. Foreign currency businesses and translation of foreign currency statements

√ Applicable □Not Applicable

(1) Foreign currency transactions

If foreign currency transactions occur, they are translated into the amount of functional currency by applying the exchange rate at the transaction date.

Monetary items denominated in foreign currencies are translated by the Company into functional currencies at the rates of exchange ruling at the balance sheet date. All foreign exchange difference are credited in the profit or loss of the current period, except those arising from the funds denominated in foreign currency specially borrowed for the establishment of the qualifying assets are treated based on the principal of capitalization of borrowing costs.

Non-monetary items in foreign currency measured at historical cost are translated by the Company using the spot exchange rate prevailing on the date when transaction occurred and its functional currency shall remain unchanged. Non-monetary items denominated in foreign currencies that are measured at fair value are translated using the foreign exchange rate at the date the fair value is determined; the exchange differences between the translated and original amounts of functional currencies are recognized in the statement of profit or loss or other comprehensive income as changes in fair value (including changes in exchange rate).

(2) Translation of foreign currency financial statements

If the functional currencies used as the bookkeeping base currency by the subsidiaries, joint ventures and associates under the control of the Company are different from that of the Company, their financial statements denominated in foreign currencies shall be translated to perform accounting and prepare the consolidated financial statements.

The assets and liabilities of the foreign currency balance sheet of the Company are translated using the spot exchange rate at the balance sheet date; all items except for "undistributed profits" of the owner's equity are translated at the spot exchange rate on the transaction date. The revenue and expenses in the foreign currency income statement of the Company are translated using the approximate rate of the spot exchange rate on the transaction date. Exchange differences on translation of financial statements denominated in foreign currencies are presented as the "other comprehensive income" in the owner's equity of the balance sheet.

Foreign currency cash flow and cash flows of a foreign subsidiary of the Company is translated using the approximate rate of the spot exchange rate on the date of the cash flows. The impact of exchange rate changes on cash amount is regarded as a reconciliation item and reflected separately in the cash flow.

When disposing overseas operations, the translation difference in the foreign currency financial statements as shown in the owner's equity of the balance sheet and related to the overseas operation shall be transferred from owner's equity to profit or loss in the current period of disposal. If part of the overseas operations is disposed of, the translation difference in the foreign currency financial statements of the disposal part shall be calculated based on the proportion of the disposal and transferred to profit or loss in the current period of disposal.

11. Financial instruments

√ Applicable □Not Applicable

A financial instrument refers to any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. A financial asset or financial liability and equity instrument is recognized when the Company becomes a party to the contract of a financial instrument.

(1) Classification, recognition and measurement of financial assets

On initial recognition of a financial asset, according to the business model for managing financial assets and the contractual cash flow characteristics of financial assets, the Company classifies financial assets into: Financial assets measured at amortized cost; financial assets measured at fair value through other comprehensive income; financial assets measured at fair value through profit or loss of the current period.

Financial assets are measured at fair value upon initial recognition. For financial assets measured at fair value through profit and loss of the current period, related transaction costs are directly included in profit and loss of the current period; for other types of financial assets, related transaction costs are included in their initial recognized amounts. For the accounts receivable or bills receivable arising from the sale of products or the provision of labor services that do not contain or consider the significant financing components, etc., the Company shall take the consideration amount entitled to be received as the initial recognized amount.

1) The debt instruments held by the Company:

① Financial assets measured at amortized cost

The Company's business model for managing such financial assets is: With the aim of obtaining contractual cash flow, the contractual cash flow characteristics of such financial assets shall be consistent with the basic lending arrangements, that is, the cash flow generated on a specific date is only the payment for the principal and the interest based on the outstanding principal amount. For such financial assets, the Company recognizes the interest income in accordance with the effective interest method. Such financial assets are subsequently measured at amortised cost. The gains or losses arising from amortisation or impairment are recognised in profit or loss of the current period. Such financial assets of the Company mainly include cash and cash equivalents, bills receivable, accounts receivable, other receivables, creditor's right investment and long-term receivables. The Company lists the creditor's rights investments and long-term receivables matured within one year (inclusive) from the balance sheet date as non-current assets matured within one year; the creditor's rights investments matured within one year (inclusive) when being obtained are listed as other current assets.

• ② Financial assets measured at fair value through other comprehensive income The Company's business mode for managing such financial assets is: With the aim of obtaining contractual cash flow and selling the financial assets, the contractual cash flow characteristics of such financial assets shall be consistent with the basic lending arrangements. Such financial assets are measured at fair value through other comprehensive income, but impairment gains and losses, exchange gains and losses, and interest income calculated by the effective interest method are included in profit and loss of the current period. Such financial assets of the Company mainly include financing receivables and other creditor's rights investments. The Company lists other creditor's rights investments matured within one year (inclusive) from the balance sheet date as non-current assets matured within one year; other creditor's rights investments matured within one year (inclusive) when being obtained are listed as other current assets.
• ③ Financial assets measured at fair value through profit or loss of the current period The Company classifies financial assets other than those above measured at amortized cost and those measured at fair value through other comprehensive income as financial assets measured at fair value through profit or loss of the current period. In addition, at the time of initial recognition, in order to eliminate or significantly reduce accounting mismatch, the Company designated some financial assets as financial assets measured at fair value through profit or loss of the current period. Such financial assets are subsequently measured at fair value and changes in fair value are included in profit or loss of the current period. Such financial assets that are matured more than one year and are expected to be held for more than one year from the balance sheet date are listed as other non-current financial assets.

2) Equity instrument investments of the Company:

The Company classifies equity instrument investments that have no control, joint control and significant influence on itself as financial assets measured at fair value through profit or loss of the current period; investments that are expected to be held for more than one year from the balance sheet date are listed as other non-current financial assets.

In addition, the Company designated some non-trading equity instrument investments as financial assets measured at fair value through other comprehensive income, which are listed as other equity instrument investments. Such designation cannot be revoked once made. The Company includes the relevant dividends and interest income of such financial assets in profit and loss of the current period, and changes in fair value are included in other comprehensive income. When the financial asset is derecognised, the Company transfers the cumulative gain or loss previously included in other comprehensive income directly to retained earnings and is not included in profit or loss of the current period.

(2) Classification, recognition and measurement of financial liabilities

On initial recognition, financial instruments or their components issued by the Company are classified into financial liabilities or equity instruments based on the contractual terms of the financial instruments and the economic nature, rather than solely on its legal form, together with the definition of financial liability and equity instruments.

The Company classifies financial liabilities as financial liabilities at fair value through profit and loss of the current period and other financial liabilities at initial recognition.

Financial liabilities at fair value through profit and loss of the current period are subsequently measured at fair value. Any gains or losses arising from changes in the fair value and any interest expenses related to the financial liabilities are recognized in profit or loss of the current period. The financial liabilities at fair value through profit and loss of the current period of the Company mainly consist of financial liabilities held for trading.

Other financial liabilities are subsequently measured at amortized costs using effective interest method. Other financial liabilities of the Company are financial liabilities measured at amortized cost, including bills payable, accounts payable, other payables, borrowings, bonds payable, etc. Such financial liabilities are recognized initially at fair value less transaction costs and subsequently measured using the effective interest method. Financial liabilities with a maturity of less than one year (inclusive) are listed as current liabilities: those with maturity of more than one year but are mature within one year from the balance sheet date (inclusive) are listed as non-current liabilities due within one year; the rest are presented as non-current liabilities.

(3) Classification and treatment of financial liabilities and equity instruments

The Company classifies financial liabilities and equity instruments on the following principles: (1) Where the Company is unable to unconditionally avoid delivering cash or another financial asset to fulfil a contractual obligation, the contractual obligation meets the definition of a financial liability. Although some financial instruments do not explicitly include the terms and conditions imposing the contractual obligation to deliver cash or another financial asset, they may indirectly give rise to the contractual obligation through other terms and conditions. (2) Where a financial instrument shall or may be settled in the Company's own equity instrument, consideration shall be given to whether the Company's own equity instrument as used to settle the instrument is a substitute of cash or another financial asset or the residual interest in the assets of the Company after deducting all of its liabilities. In the former case, the instrument shall be the Company's financial liability; in the latter case, the instrument shall be the equity instrument of the Company. Under certain circumstances whereby a financial instrument contract stipulates that the Company shall or may use its own equity instrument to settle the financial instrument, and the amount of the contractual right or obligation equal to the number of its own equity instruments to be received or delivered multiplied by their fair value at the time of settlement, the contract shall be classified as a financial liability, regardless of whether the amount of the contractual right or obligation is fixed, or fluctuates in full or in partly in response to changes in a variable other than the market price of the Company's own equity instruments (for example an interest rate, a commodity price or a financial instrument price).

When classifying a financial instrument (or a component thereof) in consolidated financial statements, the Company shall consider all terms and conditions agreed between members of the Group and the holders of the financial instrument. If the Group as a whole has an obligation in respect of the instrument to settle it by delivering cash or another financial asset or in such a way that it would be a financial liability, such instrument shall be classified as a financial liability.

If the financial instrument or its component is attributable to the financial liability, the relevant interests, dividends, gains or losses, and gains or losses arising from redemption or refinancing, shall be recorded in the profit or loss of the current period.

If the financial instrument or its component is attributable to equity instrument, the Company treats it as change in equity when it is issued (including refinanced), repurchased, sold or cancelled. Changes in fair value of equity instrument is not recognized by the Company. Transaction costs related to equity transactions are deducted from equity. The Company recognizes the distribution to holders of the equity instruments as distribution of profits, and dividends paid do not affect total amount of shareholders' equity.

(4) Recognition and measurement on transfer of financial assets

A financial asset shall be de-recognized when one of the following conditions is met: ① the contractual right for receiving cash flows from the financial asset is terminated; ②the financial asset is transferred, and the risk and rewards of ownership of the financial asset have been substantially transferred to the transferee; and ③ the financial asset is transferred; the Company neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset, but ceases the control over the financial asset. If the Company neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset, and the control over the financial asset is not ceased, the financial asset and the related financial liabilities should be recognized based on the degree of continuing involvement. The degree of continuing involvement means the level of risks borne by the Company resulting from the change in value of the financial asset.

On de-recognition of other equity instruments investment, the difference between the carrying amount and the sum of the consideration received and the cumulative changes in fair value that had been recognized directly in other comprehensive income is recognized in the retained earnings. On de-recognition of other financial assets, the difference between the carrying amount and the sum of the consideration received and the cumulative changes in fair value that had been recognized directly in other comprehensive income is recognized in current profit or loss.

For financial assets that are sold with recourse or endorsement, the Company needs to determine whether the risk and rewards of ownership of the financial asset have been substantially transferred. If the risk and rewards of ownership of the financial asset have been substantially transferred, the financial asset shall be derecognized. If the risk and rewards of ownership of the financial asset have been substantially retained, the financial asset shall not be de-recognized. If the Company neither transfers nor retains substantially all the risks and rewards of ownership of the financial asset, the Company shall assess whether the control over the financial asset is retained, and the financial assets shall be accounted for according to the above paragraphs.

(5) Derecognition of financial liabilities

If the current obligation of a financial liability (or part of it) has been discharged, the Company derecognizes the financial liability (or part of the financial liability). The Company (borrower) enters into an agreement with the lender to replace the original financial liability in the form of a new financial liability, and if the new financial liability is substantially different from the original financial liability, the original financial liability is derecognized and the new financial liability is recognized. If the Company makes substantial changes to the contractual terms of the original financial liability (or a part thereof), the original financial liability is derecognized and the new financial liability is recognized in accordance with the revised terms.

If the financial liability (or a part thereof) is derecognized, the difference between the carrying amount and the consideration paid (including the transferred non-cash assets or liabilities assumed) is recognized in current profit or loss.

(6) Offsetting financial assets and financial liabilities

When the Company has the legal right to offset recognized financial assets and financial liabilities, and the legal right can be executed at present, and the Company has a plan to settle the financial assets and financial liabilities at the same time or at net amount, the financial assets and financial liabilities can be presented in the balance sheet at net amount after offsetting. Except for the above circumstances, financial assets and financial liabilities cannot be offset and shall be presented separately in the balance sheet.

(7) Determination of fair value of financial assets and financial liabilities

Fair value is the amount at which an asset could be sold or a liability could be transferred between willing parties in an orderly transaction on a measurement date. The fair value of a financial instrument that is traded in an active market is determined at the quoted price in the active market. Quoted price in the active market represents quoted price which can be easily obtained periodically from exchange market, brokers, industry associations or pricing services agency, etc., which is the transactions amount in arm's length transactions. The fair value of a financial instrument that is not traded in an active market is determined by using a valuation technique. Valuation techniques include using prices of recent market transactions between knowledgeable and willing parties, reference to the current fair value of another financial asset that is substantially the same with this instrument, discounted cash flow analysis and option pricing models, etc. During the valuation, the Company adopts an applicable valuation technique under current conditions and there are enough available data and other information to support. Those inputs should be consistent with the inputs a market participant would use when pricing the asset or liability, and the Company should maximize the use of relevant observable inputs. When related observable inputs can't be acquired or are not feasible to be acquired, then use unobservable inputs.

In summary, the Company categorizes inputs for fair value measurement into three levels and uses the inputs by the order of Level 1, Level 2 and Level 3. Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities at the measurement date. Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3: unobservable inputs for the asset or liability.

(8) Impairment of financial assets

For financial assets measured at amortized cost and debt instrument investments measured at fair value through other comprehensive income, contract assets and financial guarantee contracts, the Company recognizes the loss provision based on the expected credit losses.

The Company considers reasonable and reliable information about past events, current conditions and forecasts of future economic conditions, and takes the risk of default as a weight, and calculates the probability-weighted amount of the present value of the difference between the cash flow receivable and the cash flow expected to be received of the contract to confirm the expected credit losses.

On each balance sheet date, the Company measures the expected credit losses of financial instruments in different phases. If the credit risk has not increased significantly since the initial recognition, the financial instruments are in the first phase. The Company measures the loss provision according to the expected credit losses in the next 12 months; if credit risk has increased significantly but credit impairment has not yet occurred since the initial recognition, the financial instruments are in the second phase. The Company measures the loss provision according to the expected credit losses of the instruments during the entire duration; if credit impairment has occurred since the initial recognition, the financial instruments are in the third phase. The Company measures the loss provision according to the expected credit losses of the instruments during the entire duration.

For financial instruments with lower credit risk on the balance sheet date, the Company measures the loss provision according to the expected credit losses in the next 12 months, assuming that its credit risk has not increased significantly since the initial recognition.

For financial instruments in the first phase and second phase and financial instruments with relatively lower credit risk, the Company calculates interest income based on their book balance before the deduction of provisions and effective interest rate. For financial instruments in the third phase, the Company calculates interest income based on their amortized cost after the impairment provision has been deducted from the book balance and effective interest rate.

For bills receivable, accounts receivable and contract assets, whether there exist significant financing components, the Company measures loss provision based on expected credit loss over the entire duration.

The Company classifies accounts receivable into groups on the basis of shared credit risk characteristics, and calculates the expected credit losses on groups, the bases of group determination are as follows:

For each group of bills receivable, the Company applies exposure at default and expected credit losses rate over the entire duration to calculate the expected credit losses by taking into account the historical credit losses experience, the existing conditions and forecast of future economic conditions.

For each group of accounts receivable, the Company makes the comparison of expected credit losses rates of accounts receivable in overdue days and over the entire duration to calculate the expected credit losses by taking into account the historical credit losses experience, the existing conditions and forecast of future economic conditions.

For each group of other accounts receivable, the Company applies exposure at default and expected credit losses rate within the next 12 months or over the entire duration to calculate the expected credit losses by taking into account the historical credit losses experience, the existing conditions and forecast of future economic conditions.

The Company recognizes the loss impairment provision or reversed in profit or loss of the current period. For held debt instruments at fair value through other comprehensive income, the Company recognizes loss/gain on impairment in profit or loss of the current period, and adjusts other comprehensive income at the same time.

12. Inventory

√ Applicable □Not Applicable

(1) Classification of inventory

Inventory refers to finished products and commodities held by the Company in daily activities for sale, products in progress, materials and supplies consumed in the process of production or provision of labour services, including mainly raw materials, turnover materials, materials for commissioned processing work, packaging materials, products in progress, semi-finished products through in-house manufacturing, finished products (products in stock) and project construction, among others.

(2) Pricing of dispatch of inventory

The actual cost of inventories upon delivery is calculated using the weighted average method.

(3) Impairment provision for inventory

At the balance sheet date, inventory is measured at the lower of cost and net realisable value.

The net realisable value of inventories that can be directly put to sale, including finished products, commodities and materials for sale is determined as the estimated selling price of such inventory less estimated selling expenses and related tax expenses; the net realisable value of or inventories held for production, is determined as the estimated selling price of finished products manufactured less estimated cost incurred upon completion, estimated selling expenses and related tax expenses; the net realisable value of inventory held for the execution of sales contract or labour contract is computed on the basis of the contract price. If the quantity of inventories held by the Company is more than the quantity ordered under a sales contract, the net realisable value of the inventories in excess is computed on the basis of the general selling price.

Inventory impairment provision is made on the basis of individual inventory items, provided that if certain inventories are related to a series of products manufactured and sold in the same region with identical or similar end uses or purposes and are difficult to measure separately with other items, their cost and net realisable value may be measured on an aggregate basis. Inventories The cost and net realizable value of inventories in large quantity with low unit prices are measured according to inventory types.

At the balance sheet date, if the cost of inventory of the Company is higher than its net realisable value, impairment provision is made and charged to current profit or loss. If the factor causing the write-down of inventory value has been removed, the amount of write-down should be reversed and transferred out of the previous inventory impairment provision amount. The reversed amount is included in current profit or loss.

(4) Inventory system

The Company adopts the perpetual inventory system as its inventory system.

(5) Amortisation of low-value consumables and packaging materials

The Company adopts one-off amortisation of its low-value consumables and packaging materials.

13. Contract assets

√ Applicable □Not Applicable

The Company presents the right of the Company to charge consideration from the customer unconditionally (i.e. only depends on the passage of time) as a receivable, while the consideration that the Company has the right (and this right depends on factors other than passage of time) to receive for goods transferred to customers is presented as a contract assets. If the Company sells two clearly distinguishable goods to the customer, and it has the right to receive payment because one of the goods has been delivered, but the receipt of such payment is conditioned on the delivery of another goods, the Company shall recognise such right to receive payment as contract asset.

For the determination and accounting treatment methods of the expected credit loss of contract assets, please see note V.11 "Impairment of financial assets".

14. Long-term equity investments

√ Applicable □Not Applicable

Long-term equity investments hereunder refer long-term equity investments in which the Company exercises control, joint control or significant influence over the investee.

(1) Determination of initial investment cost

• ① The initial cost of long-term equity investments acquired through business combination involving parties under common control should be recognised as the share of the carrying value of the owner's equity of the acquired party; the initial cost of long-term equity investments acquired through business combination involving parties not under common control should be recognised as the combination costs determined at the date of acquisition;
• ② The Company invested in other equity investment other than long-term equity investments acquired through combination, the initial investment cost of long-term equity investments acquired with cash payment is the acquisition price actually paid; the initial investment cost of long-term equity investments acquired with the issuance of equity- based securities is represented by the fair value of equity-based securities; the initial investment cost of long-term equity investments acquired through debt restructuring is determined in accordance with relevant provisions under Accounting Standards for Business Enterprises No.12 — Debt Restructuring; the initial investment cost acquired in exchange for non-monetary assets shall be determined in accordance with relevant provisions of the standard.

(2) Subsequent measurement and recognition of profit or loss

① Cost method

Long-term equity investments in which the Company is able to exercise control over the investee is accounted for using the cost method. Under the cost method, the carrying value of long-term equity investments, other than additional investment or recouped investment, shall remain constant. The Company declared the distribution of profit or cash dividend to the investee and calculated the portion of entitlement, which is recognised as investment income.

② Equity method

The equity method is used by the Company to account for long-term equity investments in associates and joint ventures. Under the equity method, the initial investment cost is not adjusted for any excess of the initial investment cost over the share of the net fair value of the investee's identifiable assets. When the initial investment cost is less than the share of the fair value of the investment's identifiable net assets, the difference is recognised in current profit or loss and the cost of long-term equity investment is adjusted accordingly.

Under the equity method, share of net profit or losses and other comprehensive income of the investee are recognised by the Company as investment income and other comprehensive income, respectively, and the carrying amount of the long-term equity investment is adjusted accordingly. Share of profit or cash dividend declared by the investee is charged against the carrying value of the long-term equity investment; changes in owners' equity of the investee other than net profit or loss, other comprehensive income and profit distribution are adjusted against the carrying value of long-term equity investment and included in capital reserve. Share of net profit or loss of the investee is recognised by the Company on the basis of the fair value of the identifiable assets of the investee when the investment is acquired and adjusted against the net profit of the investee. If the accounting policy and accounting period of the investee are inconsistent with those of the Company, the financial statements of the investee is adjusted to align with the accounting policy and accounting period of the Company, and investment income and other comprehensive income is recognised accordingly.

Net losses of the investee is recognised by the Company by deducting the carrying value of the long-term equity investment together with long-term equity that in substance forms part of the net investment in the investee until it reaches zero. Moreover, if the Company has incurred obligations to assume additional losses of the investee, estimated liabilities are recognised according to the obligation expected to be assumed and charged to current investment loss. If the investee records net profit in future periods, the Company shall recognise its share of gains after applying such share of gains to make up for the unrecognised share of loss.

(3) Change of accounting method for long-term equity investment

• ① Change from fair value measurement to the equity method: If an equity investment in the investee not previously affording control, joint control or significant influence and accounted for in accordance with the standard for recognition and measurement of financial instruments becomes capable of affording joint control or significant influence over the investee as a result of increased shareholding following additional investment, the accounting method should be changed to the equity method, and the fair value of the original equity investment determined according to the standard for recognition and measurement of financial instruments plus the fair value of consideration paid for the acquisition of the new investment shall be changed the initial investment cost under the equity method.
• ② Change from fair value measurement or equity method to cost method: if an equity investment previously held in the investee not previously affording control, joint control or significant influence and accounted for in accordance with the standard for recognition and measurement of financial instruments, or a long- term equity investment previously held in associates or joint ventures becomes capable of affording control over the investee, it is accounted for long-term equity investment formed through business combination.
• ③ Change from equity method to fair value measurement: if a long-term equity investment previously held in the investee affording joint control or significant influence ceases to afford joint control or significant influence as a result of decrease in shareholding percentage following partial disposal, the remaining equity investment is recognised in accordance with the standard for recognition and measurement of financial instruments, and the difference between the fair value at the date of loss of joint control or significant influence and the carrying value is included in current profit or loss.
• ④ Change from cost method to equity method or fair value measurement: when preparing separate financial statements, if the Company losses control over an investee due to disposal of some equity-based investment and other reasons, the Company accounts for the remaining equity affording joint control or significant influence over an investee as a result of disposal based on the equity method, and the remaining equity will be adjusted as if it is accounted for using the equity method from the date of acquisition; for the remaining equity not affording joint control or significant influence over an investee as a result of disposal, it is accounted for in accordance with relevant requirements of Accounting Standards for Business Enterprises No. 22— Recognition and measurement of financial assets, and the differences between the fair value and book value on the date when control is lost are included in profit or loss. When preparing consolidated financial statements, it shall be accounted for in accordance with relevant requirements of Accounting Standards for Business Enterprises No.33— Consolidated financial statements.

(4) Bases for determining joint control or significant influence over an investee

Joint control is the contractually agreed sharing of control over an arrangement, which relevant activities of such arrangement must be decided by unanimously agreement from parties who share control. If all the parties or a group of parties must act in concert to decide on the relevant activities of certain arrangement, it can be considered that all parties or a group of parties have collective control over the arrangement. When determining if there is any joint control, it should first be determined if the arrangement is controlled collectively by all parties or a combination of parties, and then determined whether decisions about activities related to the arrangement must be made by the unanimous agreement of those parties who have collective control over the arrangement. If there are two or more party groups that can collectively control certain arrangement, it does not constitute joint control. When determining if there is any joint control, the relevant protection rights will not be taken into account.

Significant influence is the power of the investor to participate in the decision-making of an investee's financial and operational policies, but neither control nor jointly control the formulation of such policies with other parties. When determining if there is any significant influence on the investee, the influence of the voting shares of the investee held directly or indirectly and the potential voting rights held by the Company and other parties which are exercisable in the current period and converted to the equity of the investee, including the warrants, stock options and convertible bonds that are issued by the investee and can be converted in the current period, shall be taken into account by the Company.

When the Company holds directly or indirectly through the subsidiary 20% (inclusive) to 50% of the voting shares of the investee, it is generally considered to have significant influence on the investee, unless there is concrete evidence to prove that it cannot participate in the production and operational decisions of the investee and cannot pose significant influence in this situation.

The Company usually determines whether there is significant influence on the investee through the following one or several circumstances:

• ① Representation at the board or similar authority of the investee.
• ② Participation in the decision-making process of the investee's financial and operational policies.
• ③ Having important transactions with the investee.
• ④ Posting of management personnel at the investee.
• ⑤ Providing key technical data to the investee.

Having one or several of the above circumstances does not mean that the Company must have significant influence on the investee. The Company needs to comprehensively consider all the facts and circumstances to make an appropriate judgment.

(5) Methods for impairment test and impairment provision

At the balance sheet date, the Company inspects whether there are indications of possible impairment of a long-term equity investment. If there are indications of impairment, an impairment test should be performed to ascertain its recoverable amount, and an impairment provision equivalent to the margin by which the recoverable amount is lower than the carrying value should be made. Once recognised, impairment loss will not be reversed in subsequent accounting periods. The recoverable amount is determined as the higher of net fair value of the long-term equity investment on disposal and present value of estimated future cash flow.

(6) Disposal of long-term equity investments

Upon the Company's disposal of long-term equity investments, the difference between the carrying value and consideration actually acquired is included in current profit or loss. Upon disposal of long-term equity investment, the portion previously included in other comprehensive income is accounted for according to the relevant percentage on the same basis adopted in the direct disposal of the relevant assets or liabilities by the investee.

15. Investment properties

(1) Types and measurement models of investment properties

The Company's investment properties include the following types: leased land-use rights and leased buildings.

The Company's investment properties is initially measured at cost and subsequently on a cost basis.

(2) Adoption of cost model as accounting policy

Among the Company's investment properties, leased buildings are subject to depreciation on a straight-line basis in accordance with accounting policies identical with accounting policies for fixed assets. Leased land-use rights and land-use rights held for disposal after appreciation land- use rights in investment properties are amortised using the straight-line method in accordance with accounting policies identical with fixed asset accounting policies for intangible assets.

At the balance sheet date, the Company inspects whether there are indications of possible impairment of an investment property. If there are indications of impairment, an impairment test should be performed to ascertain its recoverable amount, and an impairment provision equivalent to the margin by which the recoverable amount is lower than the carrying value should be made. Once recognised, impairment loss will not be reversed in subsequent accounting periods.

Where the investment properties are sold, transferred, retired or damaged, the differences from disposal after deducting the carrying amount and related taxes are recognised in profit or loss for the current period by the Company. When the Company has evidence indicating the self-occupied houses and buildings are converted to leasing or leasing out its properties held for sale under operating leases, the carrying amount of such fixed assets, intangible assets or inventories before the conversion are transferred to investment properties. When the Company has evidence indicating the property held to earn rentals or for capital appreciation are converted to self-occupation or the property intended for operating lease purpose are open for sale, the carrying amount of such properties before the conversion are transferred to fixed assets, intangible asset or inventories.

16. Fixed assets

(1) Recognition criteria

√ Applicable □Not Applicable

Fixed assets of the Company refer to tangible assets held for the production of commodities, provision of labour services, lease or operational management with a useful life of more than one accounting year. Fixed assets are recognised if all of the following conditions are met:

• ① Economic benefits relating to such fixed assets are likely to flow into the Company;
• ② The cost of the fixed assets can be reliably measured.

Subsequent expenditure incurred for a fixed asset that meets the recognition criteria shall be included in the cost of the fixed asset, and the carrying amount of the component of the fixed asset that is replaced shall be derecognised. Otherwise, such expenditure shall be recognised in profit or loss for the period in which it is incurred.

Fixed assets of the Company are initially measured at cost. The purchase cost of a fixed asset comprises its purchase price, related taxes and any directly attributable expenditure for bringing the asset to its working condition for its intended use, such as transportation costs and installation expenses. If the payment for a purchased fixed asset is deferred beyond the normal credit terms, the cost of the fixed asset shall be determined based on the present value of the instalment payments. The difference between the actual payment and the present value of the purchase price is recognised in profit or loss over the credit period, except for such difference that is capitalised according to Accounting Standard for Business Enterprises No. 17 — Borrowing Costs.

(2) Classification and depreciation of fixed assets

The Company's fixed assets are mainly classified into: buildings, machinery equipment, transportation equipment and office and other equipment; depreciation is conducted on a straight-line basis. The useful life and estimated net residual value of fixed assets are determined based on the nature and use of the fixed assets. At the end of the year, the useful life and estimated residual value of and depreciation method for fixed assets are reviewed, and adjustment is made for any difference with the original estimated amount. Other than fully depreciated fixed assets which remain in use and the land which is separately priced and recorded, the Company measures depreciation for all fixed assets.

The type, depreciation method, estimated useful lives, estimated residual values and yearly depreciation of the Company's fixed assets are as follows:

Type of assets	Depreciation method	Estimated useful lives (years)	Estimated residual values, net
Buildings	Life average method	8–40	0–5%
Machinery equipment	Life average method	4–20	0–5%
Transportation equipment	Life average method	5–10	0–5%
Office and other equipment	Life average method	3–10	0–5%

(3) Methods for impairment test and impairment provision for fixed assets

At the balance sheet date, the Company inspects whether there are indications of possible impairment of fixed assets. If there are indications of impairment, an impairment test should be performed to ascertain its recoverable amount, and an impairment provision equivalent to the margin by which the recoverable amount is lower than the carrying value should be made. Once recognised, impairment loss will not be reversed in subsequent accounting periods.

(4) Disposal of fixed assets

Fixed assets are derecognised upon disposal, or when no economic benefits are expected from use or disposal. The difference between gains on disposal, transfer, retirement or damage of fixed assets, net of their book value and related taxes, are included in profit and loss.

17. Construction in progress

√ Applicable □Not Applicable

(1) Measurement of construction in progress

The cost of the Company's construction in progress is recognised at actual construction expenses, including all necessary construction expenses incurred during the construction, and borrowing costs capitalized before the work reaches the expected conditions for use and other related costs.

• (2) Criteria for and timing of the transfer of construction in progress to fixed assets The Company's construction in progress is transferred to fixed assets when the work is completed and reaches the expected conditions for use. The criteria for judgement of expected conditions for use should meet one of the following:
  • ① The physical construction (including installation) of fixed assets has been completed in full or substantially completed in full;
  • ② Trial production or operation has commenced and the result indicates that the asset can operate normally or can manufacture compliant products in a consistent manner, or the trial operation indicates that it can operate or conduct business normally;
  • ③ The amount of fixed asset expenditure of the construction is minimal or almost certain not be further incurred;
  • ④ Fixed assets acquired have reached design or contractual requirements, or are essentially consistent with design and contractual requirements.
• (3) Methods for impairment test and impairment provision for construction in progress At the balance sheet date, the Company inspects whether there are indications of possible impairment of construction in progress. If there are indications of impairment, an impairment test should be performed to ascertain its recoverable amount, and an impairment provision equivalent to the margin by which the recoverable amount is lower than the carrying value should be made. Once recognised, impairment loss will not be reversed in subsequent accounting periods.

The recoverable amount is determined as the higher of net fair value of the asset less disposal cost and the present value of estimated future cash flow.

18. Borrowing costs

√ Applicable □Not Applicable

(1) Principle for recognition of capitalisation of borrowing cost

Borrowing costs incurred by the Company that can be directly attributed to the acquisition or production of assets qualified for capitalisation are capitalised and included in relevant asset costs; other borrowing costs are recognised as cost at the amount incurred at the time of incurrence and charged to current profit or loss. Assets qualified for capitalisation refer to fixed assets, investment properties and inventory that require a considerably long period of acquisition or production activities to reach the expected conditions for use or sale.

(2) Computation of capitalised amounts

Capitalisation period: from the point of time at which the capitalisation of borrowing costs begins to the point of time at which capitalisation ceases. The period of suspension of capitalisation of borrowing costs is not included.

Period of suspension of capitalisation: In case of abnormal disruption during the acquisition or production process for a consecutive period of more than 3 months, the capitalisation period for borrowing costs should be suspended.

Computation of capitalised amount: ① For specific borrowings, the amount is determined as interest expense incurred for the period in respect of the specific borrowing less interest income received through the deposit of unutilised borrowed funds or investment gains received through provisional investments; ② For general borrowings utilised, the amount is determined as the weighted average amount of the portion of cumulative asset expenses in excess of the asset expense of specific borrowings multiplied by the capitalisation rate for the general borrowings utilised, where the capitalisation rate is the weighted average interest rate of general borrowings; ③ where there is a discount or premium in the borrowings, the amortisation of such discount or premium for each accounting period is determined according to the effective interest rate and the interest amount for each period is adjusted accordingly.

19. Intangible assets

Intangible assets are the identifiable non-monetary assets which have no physical form and are possessed or controlled by the Company, and are recognized when the following conditions are met:

• ① it is probable that economic benefits attributable to the intangible assets will flow into the Company;
• ② the costs of the intangible assets can be measured reliably.

(1) Measurement of intangible assets

Intangible assets of the Company are initially recognized at costs. The actual costs of purchased intangible assets include the consideration and relevant expenses actually paid. For intangible assets contributed by investors, relevant actual costs are determined based on the value agreed in the investment contract or agreement. But if the value agreed in the investment contract or agreement is not a fair value, the actual costs should be determined based on the fair value. The cost of a self-developed intangible asset is the total expenditure incurred in bringing the asset to its intended use. Intangible assets acquired in a business combination not under common control that are owned by the acquiree but not recognised in its financial statements are recognised as intangible assets at fair value on initial recognition of the acquiree's assets.

Subsequent measurement of intangible assets of the Company: ①Intangible assets with finite useful lives are amortized on a straight-line basis; their useful lives and amortization methods are reviewed at the end of each year, and adjusted accordingly if there is any variance with the previous estimates; ②Intangible assets with indefinite useful lives are not amortized and their useful lives are reviewed at the end of each year. If there is an objective evidence that the useful life of an intangible asset is finite, an estimation should be made on the useful life and the intangible asset should be amortized using the straightline method.

(2) Criterion of determining indefinite useful life

The useful life of an intangible asset is indefinite if the period in which the asset brings economic benefits for the Company is unforeseeable, or the useful life could not be ascertained.

Criterion of determining indefinite useful lives: ① the period is derived from contractual rights or other legal rights and there are no explicit years of use stipulated in the contract or laws and regulations; ② the period in which the intangible assets generate benefits for the Company still could not be estimated after considering the industrial practice or relevant expert opinions.

At the end of each year, the Company reviews the useful lives of the intangible assets with indefinite useful lives. The assessment is primarily reviewed by relevant departments that use the intangible assets, using the down-to-top approach, to determine if there are changes to the determination basis of indefinite useful lives.

(3) Methods of test and provision for impairment of intangible assets

At the balance sheet date, the Company reviews intangible assets to check whether there is any sign of impairment. If yes, the recoverable amount is recognized through an impairment test and provision for impairment is made based on the difference between the carrying value and the recoverable amount.

Impairment loss will not be reversed in subsequent accounting periods once provision is made for it. The recoverable amount of intangible assets should be based on the higher of the net fair value of the assets less the disposal expense and the present value of estimated future cash flow of the assets.

(4) Basis for research and development phases for internal research and development project and basis for capitalization of expenditure incurred in development stage As for an internal research and development project, expenditure incurred in the research stage is recognized in the profit or loss as incurred. Expenses incurred in the development stage are capitalized only if all of the following conditions are met: ①the technical feasibility of completing the intangible assets so that they will be available for use or for sale; ②the intention to complete the intangible assets for use or for sale; ③ how the intangible assets will generate economic benefits, including there is evidence that the products produced by the intangible assets has a market or the intangible assets themselves have a market; if the intangible assets are for internal use, there is evidence that there exists usage for the intangible assets; ④ the availability of adequate technical, financial and other resources to complete the development and gain the ability to use or sell the intangible assets; ⑤ the capability to reliably measure the expenditures attributable to the development stage of the intangible assets.

Specific standards for distinguishing research stage and development stage of an internal research and development project: the Company refers to the research stage as the stage of planned investigation and search for obtaining new technology and knowledge, which features planning and exploration; before commercial production or other uses, the Company regards the stage of applying the research achievements and other knowledge in a plan or design to produce new or substantially improved materials, equipment and products as development stage, which features pertinence and is very likely to form results.

All the expenditures incurred on research and development which cannot be distinguished between research stage and development stage are recognized in the profit or loss.

20. Impairment of long-term assets

√ Applicable □Not Applicable

Long-term equity investment, investment properties measured based on cost model, fixed assets, construction in progress, intangible assets and other long-term assets are tested for impairment if there is any sign of impairment at the balance sheet date. If the result of the impairment test indicates that the recoverable amount of the assets is less than the carrying amount, a provision for impairment will be made based on the difference and will be recorded in impairment loss. The recoverable amount is the higher of the net fair value of the assets less the disposal expense and the present value of estimated future cash flow of the assets. Provision for asset impairment is calculated and recognized on the individual asset basis. If it is not possible to estimate the recoverable amount of an individual asset, the recoverable amount of the asset group to which the asset belongs is determined. An asset group is the smallest asset portfolio that can generate cash inflows independently.

Goodwill arising from a business combination and an intangible asset with an indefinite useful life is tested for impairment at least at each year end, irrespective of whether there is any indication that the asset may be impaired. Intangible assets that have not been ready for intended use are tested for impairment each year.

When the Company carries out impairment test of the goodwill, the carrying amount of the goodwill, arising from business combination, shall be allocated to the related asset groups on reasonable basis since the acquisition date, or to the related asset group portfolios if it is difficult to be allocated to the related asset groups. When the carrying amount of the goodwill is allocated to the related asset groups or asset group portfolios, it shall be allocated in the proportion of the fair value of each asset group or asset group portfolio against the total fair value of related asset groups or asset group portfolios. If it is difficult to measure the fair value reliably, it shall be allocated in the proportion of the carrying amount of each asset group or asset group portfolio against the total carrying amount of related asset groups or asset group portfolios.

When impairment test is made by the Company to the related asset groups or asset group portfolios including goodwill, if there is a sign that the related asset groups or asset group portfolios are prone to impair, the Company shall first conduct impairment test on the asset groups or asset group portfolios excluding goodwill, calculate the recoverable amount and recognize the corresponding impairment loss by comparing with its carrying amount. The Company shall then conduct impairment test on the asset groups or asset group portfolios including goodwill and compare the carrying amount (including the carrying amount of allocated goodwill) of related asset groups or asset group portfolios with the recoverable amount thereof. Impairment loss shall be recognized in accordance with the differences when the recoverable amount of the related asset groups or asset group portfolios is lower than the carrying amount thereof. The amount of the impairment loss is first reduced by the carrying amount of the goodwill allocated to the asset group or set of asset groups, and then the carrying amount of other assets (other than the goodwill) within the asset group or set of asset groups, pro rata based on the carrying amount of each asset.

Once the above impairment loss on assets is recognized, it shall not be reversed by the Company in any subsequent accounting period.

21. Long-term prepaid expense

√ Applicable □Not Applicable

Long-term prepaid expenses of the Company are expenditures which have incurred but the benefit period of which is more than one year (exclusive). They are amortized by installments over the benefit period based on each item under the expenses. If items under the long-term pre-paid expenses are no longer beneficial to the subsequent accounting periods, the amortized value of such unamortized items is then fully transferred to the profit or loss.

22. Contract liabilities

√ Applicable □Not Applicable

A contract liability represents the Company's obligation to transfer goods to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. If the customer has already paid the contract consideration before the Company transfers goods to the customer or the Company has obtained the unconditional collection right, the Company will recognise such amount received or receivable as contract liabilities at earlier of the actual payment by the customer or the amount payable becoming due. Contract assets and contract liabilities under the same contract are presented on a net basis, and contract assets and contract liabilities under different contracts are not offset.

23. Staff's remuneration

Staff's remunerations are all forms of compensation and other relevant expenditure given by the Company in exchange for services rendered by employees, including short-term remunerations, post-employment benefits, termination benefits and other long-term benefits.

(1) Accounting treatment of short-term remunerations

√ Applicable □Not Applicable

Short-term remunerations provided by the Company include short-term salaries, bonus, allowance, subsidies, employee welfare, housing provident fund, labor union fee and education fee, medical insurance premiums, work-related injury insurance premiums, maternity insurance premiums, short-term compensated leave, short-term profit-sharing plans, etc. During the accounting period when employees render services, the Company shall recognize short-term remunerations that actually incurred as liabilities and credited into the current profit or loss or the cost of relevant assets on an accrual basis by the benefit objects.

(2) Accounting treatment of post-employment benefits

√ Applicable □Not Applicable

Post-employment benefits mainly include the basic pension insurance, enterprise annuity, etc., In accordance with the risks and obligations undertaken by the Company, the post-employment benefits are classified as defined contribution plans and defined benefit plans.

Defined contribution plans: the Company shall recognize the sinking funds paid on the balance sheet date to individual entities in exchange for services from employees in the accounting period as liabilities, and shall credit such funds into the profit or loss or the cost of relevant assets in accordance with the benefit objects.

Defined benefit plans: the Company determines the cost for providing benefits using the expected cumulative welfare unit method, with actuarial valuations being carried out by independent actuary at the interim and annual balance sheet date. The costs for staff's remunerations incurred by the defined benefit plans of the Group are categorized as follows: (1) service cost, including current period service cost, past service cost and settlement profit or loss. Specifically, current period service cost means the increase of the present value of defined benefit obligations resulted from the current period services offered by employees. Past service cost means the increase or decrease of the present value of defined benefit obligations resulted from the revision of the defined benefit plans related to the prior period services offered by employees; (2) interest expenses of defined benefit plans; (3) changes caused by the remeasurement of liabilities for defined benefit plans. Unless other accounting standards require or permit the credit of the costs for employee welfare into the cost of assets, the Company will credit (1) and (2) above into the profit or loss; and recognize (3) above as other comprehensive income and will not transfer it back to the profit or loss in subsequent accounting periods.

(3) Accounting treatment of termination benefits

√ Applicable □Not Applicable

Termination benefits are the indemnity proposal provided by the Company for employees for the purpose of terminating labor relations with employees before expiry of the labor contracts or encouraging employees to accept downsizing voluntarily. When the Company could not unilaterally withdraw the termination benefits provided as a result of plan for termination of labor relations or the redundancy offer, or upon recognition of costs or expenses related to a restructuring involving the payment of termination benefits, whichever is earlier, the staff's remuneration liabilities arising from such termination benefits are recognized and included in current profit or loss.

24. Estimated liability

√ Applicable □Not Applicable

(1) Criterion for determining of estimated liability

If an obligation in relation to contingencies such as external guarantees, discounting of commercial acceptance bills, pending litigation or arbitration and product quality assurance is the present obligation of the Company and the performance of such obligation is likely to lead to an outflow of economic interests and its amount can be reliably measured, such obligation shall be recognized as an estimated liability.

(2) Measurement of estimated liability

The estimated liability shall be initially measured according to the best estimate of the necessary expenses for the performance of the present obligation. If there is a continuous range for the necessary expenses and if all the outcomes within this range are equally likely to occur, the best estimate shall be determined according to the middle estimate within the range; if there are two or more items involved, the best estimate should be determined according to all possible outcomes and relevant probabilities.

At the balance sheet date, the carrying value of estimated liabilities should be reviewed. If there is objective evidence that the carrying value could not reflect in the current best estimate, the carrying value shall be adjusted to reflect the current best estimate.

If all or part of the expense necessary for settling the provisions is expected to be compensated by the third party, the amount of compensation is separately recognized as an asset when it is basically determined to be recoverable, and the recognized amount of the compensation shall not exceed the carrying amount of the provisions.

25. Share-based payments

√ Applicable □Not Applicable

Share-based payments of the Company are transactions in which equity instruments are granted to employees in exchange for services rendered by employees or for the assumption of liabilities based on equity instruments. Share-based payments of the Company are equity-settled share-based payments and cash-settled share-based payments.

For equity-settled share-based payment transaction in return for services from employees, it shall be measured at the fair value of equity instruments granted to the employees at the date of grant by the Company. On each balance sheet date within the vesting period, the Company makes the best estimation of the number of vested equity instruments based on subsequent information such as the updated changes in the number of employees who are granted to vest and the achievement of specified performance conditions. Based on the above results, the services received in the current period are included in the relevant cost or expenses based on the fair value on the date of grant, with the increase in the capital reserve accordingly. The recognized relevant cost or expenses and the total amount of owners' interest shall no longer be adjusted after the vesting date. However, equity instruments vested immediately after the date of grant shall be included in the relevant cost or expenses based on its fair value on the date of grant, with the increase in the capital reserve accordingly.

The cash-settled share-based payment shall be measured at the fair value of liability assumed by the Company, which is determined based on the shares or other equity instruments. For the cash-settled share-based payment that may be exercised immediately after the grant, the fair value of the liability assumed by the Company shall, on the date of the grant, be recognized in relevant costs or expenses and the liabilities shall be increased accordingly. For cash-settled share-based payment that may be exercised if services are fulfilled during the vesting period or the specified performance condition is achieved, on each balance sheet date within the vesting period, the services acquired in the current period shall, based on the best estimate of exercise, be recognized in relevant costs or expenses at the fair value of the liability assumed by the Company, and the liabilities shall be adjusted correspondingly. At each balanced sheet date and the settlement date prior to the settlement of liabilities, the fair value of the liability is re-measured with its change consolidated in profit/loss.

When there is changes to the Company's share-based payment plans, if the modification increases the fair value of the equity instruments granted, corresponding recognition of service increase in accordance with the increase in the fair value of the equity instruments; if the modification increases the number of equity instruments granted, the increase in fair value of the equity instruments is recognized as a corresponding increase in service achieved. Increase in the fair value of equity instruments refer to the difference between the fair values of the equity instrument on the modified date before or after the modification. If the Company modifies the vesting conditions in such manner conductive to the employees, including the shortening of the vesting period, change or cancellation of the performance conditions (rather than market conditions), the modified vesting conditions are considered upon the disposal of vesting conditions. If the modification reduces the total fair value of shares paid or the Company uses other methods not conductive to employees to modify the terms and conditions of share-based payment plans, the Company will continue to be accounted for the services obtained in the accounting treatment, as if the change had not occurred, unless the Company cancelled some or all of the equity instruments granted.

During the vesting period, if the Company cancel equity instruments granted which will be treated as accelerating the exercise of rights and any amount to be charged over the remaining vesting period should be recognized immediately in the profit or loss, while at the same time recognize the capital reserve. Employees or other parties can choose to meet non-vesting conditions, but for those that are not met in the vesting period, the Company will treat it as cancellation of equity instruments granted.

26. Revenue

Revenue is the total inflow of economic benefits formed by the Company and its subsidiaries during day-to-day operations which might lead to increase of shareholders' equity and be irrelevant to capital invested by shareholders.

The Company and its subsidiaries performed performance obligations stated in the contract, i.e., recognized revenue when the client obtains the control right of relevant goods or services.

Where the contract includes two or more performance obligations, during the starting date of the contract, the Company and its subsidiaries allocate transaction price to various single performance obligation in accordance with the relevant proportion of separate selling price of goods or services promised by various single performance obligation, and measure revenue in accordance with transaction price allocated to various single performance obligation.

Transaction price is the amount of consideration that the Company and its subsidiaries are expected to be entitled to collect due to transfer of goods and services transferred to the client, excluding the amount collected for any third party. The transaction price recognized by the Company and its subsidiaries does not exceed the amount of recognized revenue when relevant uncertainties are eliminated and might not incur material carrying back. The amount that is expected to be returned to the client is taken as liability of returned goods and is not recorded in transaction price.

When one of the following conditions is met, the Company and its subsidiaries perform performance obligations during a certain time horizon, otherwise, it belongs to fulfilling performance obligations at a certain time point:

• ① The client simultaneously obtains and consumes economic benefits as the Company and its subsidiaries perform the contract;
• ② The client is able to control goods under construction during the process of performance of the Company and its subsidiaries;
• ③ Goods produced by the Company and its subsidiaries during the process of performance have no alternative use, and the Company and its subsidiaries are entitled to collect the amount for the cumulative completed and performed portion to date during the entire contractual period.

For the performance obligations performed during a certain time horizon, the Company and its subsidiaries recognize revenue in accordance with the schedule of performance during such time horizon. When the schedule of performance can't be reasonably recognized, where the costs that have been incurred by the Company and its subsidiaries are estimated to be compensated, revenue shall be recognized in accordance with the amount of costs that has been incurred until the schedule of performance can be reasonably confirmed.

For performance obligations performed at a certain time point, the Company and its subsidiaries recognize revenue at the time point when the client obtains the control right of relevant goods or services. When judging whether the client has obtained control right over goods or services, the Company and its subsidiaries will consider the following signs:

• ① The Company and its subsidiaries enjoy the right of instant collection over such goods and services;
• ② The Company and its subsidiaries have transferred the material objects of such goods to the client;
• ③ The Company and its subsidiaries have transferred statutory ownership right of the goods or major risks and rewards of the ownership to the client;
• ④ The client has accepted such goods or service.

The right that the Company and its subsidiaries are entitled to collect the consideration for having transferred goods or services to the client (and such right depends on other factors other than time lapse) is presented as contract asset, and contract asset is provisioned impairment on the basis of expected credit losses. The right owned by and unconditionally collected from the client by the Company and its subsidiaries (only depend on time lapse) shall be presented as accounts receivable. Obligations that the Company and its subsidiaries have collected or shall collect consideration from the client and shall transfer goods or services to the client are presented as contractual obligations.

Specific accounting policies relating to major activities that the Company and its subsidiaries obtain revenue are described as follows:

(1) Sale of goods

Generally, contracts for sale of goods between the Company and its clients only include performance obligation of transferring the whole machine of home appliance. Generally, on the basis of taking into account the following factors comprehensively, the Company recognizes the revenue at the time point of transfer of control right of goods: the right of instant collection for obtaining goods, transfer of major risks and rewards on ownership of goods, transfer of statutory ownership of goods, transfer of assets of material objects of goods, the client's acceptance of such goods.

(2) Construction contract income

Construction contract between the Company and the client generally includes performance obligations of construction and installation of commercial air-conditioner and smart home, because the client is able to control goods under construction during the Company's performance process, the Company takes them as performance obligations performed during a certain time horizon, and recognizes revenue in accordance with the schedule of performance, and it is an exemption when the schedule of performance can't be reasonably confirmed. The Company confirms the schedule of performance of services provided in accordance with the input method. When the schedule of performance can't be reasonably confirmed, where the costs that have been incurred by the Company are estimated to be compensated, the revenue will be recognized in accordance with the amount of costs that has been incurred until the schedule of performance can be reasonably confirmed.

(3) Warranty obligations

According to contractual agreement and regulations of laws, the Company provides quality assurance for goods sold and project constructed. For guarantee-type quality assurance in order to ensure the client that goods sold comply with existing standards, the Company conducts accounting treatment in accordance with estimated liabilities. For service-type quality assurance in order to ensure the client that we also provide a separate service other than that the goods sold comply with existing standards, the Company takes it as a separate performance obligation, and allocates partial transaction price to service-type quality assurance in accordance with the relevant proportion of separate selling price of goods and service-type quality assurance, and recognizes revenue when the client obtains control right over services. When assessing whether quality assurance provides a separate service other than ensuring the client that the goods sold comply with existing standards, the Company shall consider factors such as whether such quality assurance is under statutory requirements or industrial practices, the term of quality assurance and the nature of the Company's commitment to perform the tasks.

27. Government grants

√ Applicable □Not Applicable

(1) Types of government grants

Government grants refer to the gratuitous monetary assets or non-monetary assets obtained by the Company from the government, excluding the capital invested by the government as an owner. The government grants are mainly divided into asset-related government grants and revenue-related government grants.

(2) Accounting treatment of government grants

Asset-related government grants shall be recognized as deferred income in current profit or loss on an even basis over the useful life of relevant assets; government grants measured at nominal amount shall be recognized directly in current profit or loss. Revenue-related government grants shall be treated as follows: ①those used to compensate relevant expenses or losses to be incurred by the enterprise in subsequent periods are recognized as deferred income and recorded in current profit or loss when such expenses are recognized; ②those used to compensate relevant expenses or losses that have been incurred by the enterprise are recorded directly in current profit or loss.

(3) Basis for determination of asset-related government grant and revenue-related government grant

If the government grant received by the Company is used for purchase, construction or other project that forms a long-term asset, it is recognized as asset-related government grant.

If the government grant received by the Company is not asset-related, it is recognized as revenue-related government grant.

Government grant received without clear objective shall be classified as asset-related government grant or revenue-related government grant by:

• ① Government grant subject to a certain project shall be separated according to the proportion of expenditure budget and capitalization budget, and the proportion shall be reviewed and modified if necessary on each balance sheet date;
• ② Government grant shall be categorized as revenue-related if its usage is described in general statement and no specific project is specified in the relevant government document.

(4) Amortization method and determination of amortization period of deferred revenue related to government grants

Asset-related government grant received by the Company is recognized as deferred revenue and is evenly amortized to the profit or loss in the current period over the estimated useful life of the relevant asset starting from the date when the asset is available for use.

(5) Recognition of government grants

Government grant measured at the amounts receivable is recognized at the end of the period when there is clear evidence that the relevant conditions set out in the financial subsidy policies and regulations are fulfilled and the receipt of such financial subsidy is assured.

Other government grants other than those measured at the account receivable is recognized upon actual receipt of such subsidies.

28. Deferred tax assets/deferred tax liabilities

√ Applicable □Not Applicable

Deferred income tax assets and deferred income tax liabilities of the Company are calculated and recognized based on the differences between the tax bases and the carrying amounts of assets and liabilities (temporary differences).

• (1) Deferred income tax assets are recognized by the Company to the extent that it is probable that future taxable profits will be available against which the deductible temporary differences can be utilized. For deductible losses and tax credits that can be carried forward to future years, deferred income tax assets shall be recognized to the extent that it is probable that taxable profit will be available in the future to offset the deductible losses and tax credits. Save as the exceptions, deferred income tax liabilities shall be recognized for the taxable temporary differences.
• (2) Deferred income tax asset of the Company is recognized to the extent that there is enough taxable income for the deduction of the deductible temporary difference. At the balance sheet date, if there is sufficient evidence that there will be enough taxable income in the future for the deduction of the deductible temporary difference, the deferred income tax asset not recognized in previous accounting period is recognized. If there is no sufficient evidence that there will be enough taxable income in the future for the deduction of the deferred income tax asset, the carrying value of the deferred income tax asset is reduced.
• (3) The Company recognizes deferred income tax liability for taxable temporary difference arising from investments in subsidiaries and associated companies, unless the Company could control the time of reversal of the temporary differences and the temporary differences would not be probably reversed in the foreseeable future. The Company recognizes deferred income tax asset for deductible temporary differences arising from investments in subsidiaries and associated companies, if the temporary difference will be very probably reversed in the foreseeable future and it is highly probable that taxable income will be available in the future to deduct the deductible temporary difference.
• (4) The Company does not recognize deferred income tax liability for a temporary difference arising from the initial recognition of goodwill. No deferred income tax asset or deferred income tax liability is recognized for the temporary differences resulting from the initial recognition of assets or liabilities due to a transaction other than a business combination, which affects neither accounting profit nor taxable income (or deductible loss). At the balance sheet date, deferred income tax assets and deferred income tax liabilities of the Company are measured at the tax rates that apply to the period when the asset is expected to be recovered or the liability is expected to be settled.
• (5) Deferred income tax assets and deferred income tax liabilities are offset when:
  • 1) deferred tax assets and deferred tax liabilities relate to income taxes levied by the same taxation authority on the same taxable entity within the Company;
  • 2) such taxable entity within the Company has a legally enforceable right to settle current income tax assets and current income tax liabilities on a net basis.

29. Leases

√ Applicable □Not Applicable

Lease is a contract in which the Company transfers or obtains the right of use of an identified asset or several identified assets under control for the exchange or payment of consideration within a certain period of time. At inception of a contract, the Company assesses whether a contract is, or contains, a lease.

(1) The Company as the lessee

1) Initial measurement

On the commencement date of the lease term, the Company recognizes its right to use leased assets over the lease term as right-of-use assets and recognizes the present value of the lease payments that have not been paid as lease liabilities, except for short-term leases and low-value leases. The lease payments are discounted using the implicit interest rate in the lease when calculating the present value of the lease payments. If that rate cannot be readily determined, the Company uses its incremental borrowing rate as the discount rate.

Right-of-use assets shall be initially measured at costs. The costs include:

• a. initial measurement amount of the lease liabilities;
• b. a lease payment paid on or before the date of commencement of the lease term, where there were lease incentives, such incentives received shall be deducted;
• c. initial direct costs incurred by the lessee;
• d. costs expected to be incurred by the Company for demolition and removal of leased assets, restoration of the premises where the leased assets are located, or restoration of the leased assets to the conditions of the lease terms.

2) Subsequent measurement

If the Company accrues depreciation for right-of-use assets by reference to the depreciation policy for fixed assets (see this Note V.16 "Fixed assets" for details), and can reasonably determine that the ownership of the leased asset can be acquired at the expiration of the lease term, the Company shall depreciate the leased asset within its remaining useful life. If the Company cannot reasonably determine that the ownership of the leased asset can be acquired at the expiration of the lease term, the Company shall depreciate the leased asset within the lease term or its remaining useful life, whichever is shorter. For lease liabilities, the Company shall calculate the interest expenses for each period over the lease term at the fixed periodic interest rate, and recognize it in current profit or loss or the cost of relevant assets. Variable lease payments that are not included in the measurement of lease liabilities are recognized in current profit or loss or the cost of relevant assets when they are actually incurred. After the commencement date of the lease term, in the event that there is a change in the substantive fixed payments, a change in expected payment under a guaranteed residual value, a change in an index or rate used in determining the lease payments, or a change in the evaluation result or actual exercise of purchase option, extension option or termination option, the Company remeasures the lease liabilities based on the present value of the lease payments after the change and adjusts the carrying value of the right-of-use asset accordingly. If the carrying amount of the right-of-use asset has been reduced to zero, but a further reduction in the measurement of the lease liabilities is still warranted, the Company recognizes the remaining amount of the remeasurement in current profit or loss.

3) Short-term leases and leases of low-value assets

For short-term leases (leases with a term of less than 12 months as of the lease commencement date) and leases of low-value assets, the Company adopts a simplified approach by not recognizing the right-of-use assets and lease liabilities, and instead recognizes the cost of relevant assets or current profit or loss on a straight-line basis for each period over the lease term.

(2) The Company as the lessor

The Company classifies leases into finance leases and operating leases based on the substance of the transaction at the inception date of the lease. A finance lease is a lease that transfers substantially all the risks and rewards incidental to ownership of the leased asset. An operating lease is a lease other than a finance lease.

1) Operating leases

The Company uses the straight-line method to recognize lease receipts under operating leases as rental income for each period during the lease term. Variable lease payments relating to operating leases that are not recognized as lease receipts are recognized in current profit or loss when they are actually incurred.

2) Finance leases

On the commencement date of the lease term, the Company recognizes finance lease receivables and derecognizes finance lease assets. Finance lease receivables are initially measured at the net investment in the lease (the sum of the unguaranteed residual value and the present value of the lease receipts not yet received on the commencement date of the lease term discounted at the interest rate embedded in the lease), and interest income is recognized over the lease term calculated at a fixed periodic interest rate. Variable lease payments acquired by the Company that are not included in the measurement of the net investment in the lease are recognized in current profit or loss when they are actually incurred.

30. Other significant accounting policies and accounting estimates

√ Applicable □Not Applicable

(1) Asset securitisation

The Company has securitised certain receivables to entrust the assets to specific-purpose entities which would issue such securities to investors. As asset service provider, the Company is responsible for the provision of maintenance and daily management of the assets, formulation of annual asset disposal plans, formulation and implementation of asset disposal plan, signing of relevant asset disposal agreements and preparation asset service reports on a regular basis.

In applying the accounting policy for the securitisation of financial assets, the Company has considered the extent to which the risk and reward of the assets have been transferred to other entities, and the extent to which the Company exercises control over the entity:

• ① When the Company has transferred substantially all risk and reward relating to the ownership of a financial asset, such financial asset is derecognised;
• ② When the Company retains substantially all risk and reward relating to the ownership of a financial asset, the Company continues to recognise such financial asset;
• ③ If the Company neither transfers nor retains substantially all risk and reward relating to the ownership of a financial asset, the Company considers whether it has control over the financial asset. If the Company does not retain control, the financial asset is derecognised, and the rights and obligations arising from or retained the transfer are recognised as assets and liabilities, respectively. If the Company retains control, the financial asset is recognised according to the extent of continued involvement in the financial assets.

(2) Hedge accounting

Hedge refers, in respect of the risk exposure arising from the company's management of specific risks such as foreign exchange risks, interest rate risks, price risks and credit risks, to risk management activity of designating financial instruments as hedging instruments such that the change in the fair value or cash flow of the hedging instruments can be expected to set off the change in the fair value or cash flow of the hedged item.

The hedged item refers to an item designated for hedge against the risk of change in fair value or cash flow that can be reliably measured.

Hedging instruments are financial instruments designated for hedge, the change in fair value or cash flow of which is expected to set off the change in the fair value or cash flow of the hedged item.

The Company assesses whether the hedge relationship fulfills the requirement for hedge effectiveness at the inception date of the hedge and continuously in subsequent periods. The effectiveness of hedge refers to the extent to which the change in the fair value or cash flow of the hedging instruments can offset the change in the fair value or cash flow of the hedged item caused by the risk against which the hedge is made. The change in the fair value or cash flow of a hedging instrument in excess or shortfall of the change in the fair value or cash flow of the hedging instruments can offset the change in the fair value or cash flow of the hedged item represents the ineffective portion of the hedge.

(3) Significant accounting estimates

In the course of applying accounting policies, the Company is required to make judgements, estimations and assumptions on the carrying values of statement items that cannot be accurately measured owing to uncertainties to which operating activities are subject. Such judgements, estimations and assumptions are made based on the past experience of the management and taking into consideration of other relevant factors. Such judgements, estimations and assumptions affect the reported amounts of income, expenses, assets and liabilities and the disclosure of contingent liabilities as at the balance sheet date. However, the actual outcome resulting from the uncertainty of such estimates could be different from the current estimates of the management, thereby resulting in significant adjustments to the carrying value of the future assets or liabilities affected. The Company regularly reviews such judgements, estimations and assumptions on a going concern basis. If the change in accounting estimates affects only the current period in which the change occurs, the affected amount is recognized for the period in which the change occurs; if both the current period and future periods are affected, the affected amount is recognised for the current period and the future periods.

At the balance sheet date, important aspects in which the Company is required to make judgements, estimations and assumptions on the amount of items on the financial statements are as follows:

① Estimated liabilities

The Company estimates and makes provision for product warranty and estimated contract loss according to contract terms, existing knowledge and historical experience. When such contingencies have given rise to a present obligation, and the performance of such present obligation is likely to result in the outflow of economic benefit from the Company, the Company recognises estimated liabilities for the contingencies based on the best estimates of expenses required for the performance of relevant present obligations. The recognition and measurement of estimated liabilities is dependent to a large extent on management judgement. In the course of judgement, the Company is required to assess factors such as risks, uncertainties and the time value of currency relating to such contingencies. In particular, the Company recognises estimated liabilities in respect of after-sales undertaking to customers for return and replacement, maintenance and installation of goods sold. The recognition of estimated liabilities has taken into account the maintenance experience and data of the Company for recent years, although past experience in maintenance may not reflect maintenance in the future. Any increase or decrease in this provision might affect the profit or loss of future years.

② Provision for ECL

The Company measures ECL through default risk exposure and the ECL rate, which is determined based on the default probability rate and default loss rate. In determining the ECL rate, the Company uses data such as internal historic credit loss experience and adjusts the historic data taking into consideration current conditions and prospective information. When considering prospective information, indicators adopted by the Company include the risk of economic downside, expected growth in unemployment rate, and changes in external market conditions, technical conditions and customer conditions. The Company monitors and reviews the assumptions relating to ECL computation on a regular basis. There was no significant change to aforesaid estimation technique and key assumptions during the year.

③ Impairment provisions for inventory

The Company makes impairment provisions for inventory of which cost is higher than net realisable value and obsolete and slow-moving inventory based on the lower of cost and net realisable value according to its inventory accounting policy. The impairment of inventory to its net realisable value is based on assessment of the sellability of inventory and its net realisable value. The authentication of inventory impairment requires the management to obtain conclusive evidence and make judgment and estimates taking into consideration factors such as the purpose of inventory and post-balance sheet date events. Any difference between the actual outcome and the previous estimate will affect the carrying value of inventory and the charge or reversal of impairment provisions for inventory during the period in which the estimates are modified.

④ Fair value of financial instruments

For financial instruments without an active trading market, the Company determines its fair value using valuation techniques. Such valuation techniques include discounted cash flow model analysis and others. During the assessment, the Company is required to make estimates on future cashflow, credit risk, market volatility rate and relevance and select an appropriate discount rate. Such relevant assumptions are subject to uncertainty, and any change will affect the fair value of financial instruments.

⑤ Impairment of other equity instrument investments

The Company's determination of impairment for other equity instrument investments is largely dependent on the management's judgment and assumptions to determine whether impairment should be recognised. In the course of making judgments and assumptions, the Company is required to assess the extent and duration of the fair value of the investment being lower than cost, as well as the financial conditions and short-term business prospects of the investee, including industry conditions, technological revolution, credit rating, default rate and counterparty risks.

⑥ Impairment provision for long-term assets

At the balance sheet date, the Company assesses whether there are indications of possible impairment of non-current assets other than financial assets. In addition to the annual impairment test, intangible assets with indefinite useful life are also tested for impairment when there are indications of the same. Impairment tests on noncurrent assets other than financial assets are conducted when there are indications that its carrying value may not be recoverable. An impairment has occurred when the carrying value of an asset or asset group is higher than the recoverable amount (the higher of net fair value less disposal cost and the present value of estimated future cash flow). The net fair value less disposal cost is determined with reference to the agreed selling price of similar assets in a fair transaction or observable market prices less incremental costs attributable directly to the disposal of such asset. In estimating the present value of future cashflow, significant judgement is required to be made in respect of the production volume and selling price of the asset or (asset group), relevant operating cost and discount rate for the computation of present value. The Company takes into consideration all available relevant information when making estimates on the recoverable amount, including forecasts on production volume, selling price and relevant operating costs based on reasonable and justifiable assumptions. The Company conducts goodwill impairment tests at least annually. This requires estimates on the present value of future cashflow of asset group or portfolio of asset groups to which goodwill has been allocated. When making estimates on the present value of future cashflow, the Company is required to make estimates on cashflow generated from future asset group or portfolio of asset groups, and at the same time select an appropriate discount rate to determine the present value of future cashflow.

⑦ Depreciation and amortisation

Depreciation and amortisation of investment properties, fixed assets and intangible assets is charged on a straight-line basis over their useful life after taking their residual values into account. The Company reviews the useful life on a regular basis to determine the amount of depreciation and amortisation charge to be allocated to each reporting period. The useful life is determined based on past experience relating to similar assets taking into consideration expected technological upgrades. If there are significant changes in previous estimates, the depreciation and amortisation charge for future periods will be adjusted.

⑧ Deferred income tax assets

The Company recognises deferred income tax assets in respect of all unutilised tax losses, to the extent that it is probable that sufficient taxable profit will be available to offset the loss. This requires the exercise of significant judgement by the Company's management to estimate the timing and amount of future taxable profit, taking into account its tax planning strategy, to determine the amount of deferred income tax assets to be recognised.

⑨ Income tax

In the Company's usual operating activities, the final tax treatment and computation of certain transactions are subject to uncertainty. Whether certain items can be presented on a pretax basis is subject to approval of the competent taxation authority. If the final confirmed outcome of such taxation matters is different from the amount of the initial estimates, such difference will affect the current income tax and deferred income tax for the period of final confirmation.

⑩ Provision for sales rebate

The Company and its subsidiaries adopt a sales rebate policy for sales agent customers. Based on relevant provisions of the sales agreements, vetting of specific transactions, market conditions, channel inventory level and past experience with reference to the status of completion of agreed appraisal indicators by sales agent customers, the Company and its subsidiaries makes estimates on and provision for sales rebate on a regular basis. The provision of sales rebate involves judgment and estimation by the management. In the event of any material change in previous estimates, the aforesaid difference will affect the sales rebate for the period for which the estimates are changed.

31. Changes in significant accounting policies and accounting estimation

√ Applicable □Not Applicable

In accordance with the Interpretation No. 18 of Accounting Standards for Business Enterprises issued by the Ministry of Finance, provision for the guarantee-type quality assurance expenses of the Company are included in "Operating cost" instead of "Selling expenses".

The Company adopted the retrospective approach to adjust the data of financial statements for comparable periods accordingly, and the effects of the above changes in accounting policies on the consolidated income statement for the same period are as follows:

Statement Item	Adjustment
Operating cost	4,218,830,574.18
Selling expenses	–4,218,830,574.18

VI. TAXATION

1. Main tax categories and rates

Main tax categories and rates

√ Applicable □Not Applicable

Tax types	Basis of taxation	Tax rate
Value-added tax	Taxable revenue from sales of goods and rendering services	6%, 9%, 13%
(Local) education surcharge	Circulation tax payable	1%, 2%, 3%
City maintenance and construction tax	Circulation tax payable	7%
EIT	Taxable income	Statutory tax rate or preferential rates as follows

2. Preferential tax

√ Applicable □Not Applicable

Companies subjected to preferential tax and preferential tax rate:

Company	Tax rate	Preferential tax
Qingdao Haier Refrigerator Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier Special Refrigerator Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier Dishwasher Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier Special Freezer Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier Intelligent Home Appliance	15.00%	entitled to the preferential taxation
Technology Co., Ltd.		policies as a hi-tech enterprise
Wuhan Haier Electronics Holding Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise

Company	Tax rate	Preferential tax
Wuhan Haier Freezer Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Hefei Haier Refrigerator Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier Air Conditioner Gen Corp., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Hefei Haier Air-conditioning Co., Limited	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Zhengzhou Haier Air-conditioning Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Shenyang Haier Refrigerator Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier Air-Conditioner Electronics Co.,	15.00%	entitled to the preferential taxation
Ltd.		policies as a hi-tech enterprise
Qingdao Meier Plastic Powder Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Hai Gao Design and Manufacture Co.,	15.00%	entitled to the preferential taxation
Ltd.		policies as a hi-tech enterprise
Qingdao Hairi High Technology Co., Ltd	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier (Jiaozhou) Air-conditioning Co.,	15.00%	entitled to the preferential taxation
Limited		policies as a hi-tech enterprise
Qingdao Haier Intelligent Technology	15.00%	entitled to the preferential taxation
Development Co., Ltd.		policies as a hi-tech enterprise
Foshan Haier Freezer Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier Central Air Conditioning Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Haier U+smart Intelligent Technology (Beijing)	15.00%	entitled to the preferential taxation
Co., Ltd.		policies as a hi-tech enterprise
Qingdao Haier Electronic Plastic Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Wei Xi Intelligent Technology Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Qingdao Haier Special Refrigerating Appliance	15.00%	entitled to the preferential taxation
Co., Ltd.		policies as a hi-tech enterprise
Qingdao Haier Smart Kitchen Appliance Co., Ltd. 15.00%		entitled to the preferential taxation
		policies as a hi-tech enterprise
Hefei Haier Air Conditioning Electronics Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Shanghai Haier Medical Technology Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise
Shanghai Haier Smart Technology Co., Ltd.	15.00%	entitled to the preferential taxation
		policies as a hi-tech enterprise

Qingdao Yunshang Yuyi IOT Technology Co., 15.00% entitled to the preferential taxation Ltd. policies as a hi-tech enterprise Haier (Shanghai) Home Appliance Research and 15.00% entitled to the preferential taxation Development Center Co., Ltd. policies as a hi-tech enterprise Haier (Shenzhen) R&D Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Laiyang Haier Smart Kitchen Appliance Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Guangdong Haier Intelligent Technology Co. Ltd 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Dalian Haier Refrigerator Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Qingdao Jijia Cloud Intelligent Technology Co., 15.00% entitled to the preferential taxation Ltd. policies as a hi-tech enterprise Hefei Haier Washing Machine Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Qingdao Haier Washing Machine Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Qingdao Haier Laundry Appliances Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Foshan Shunde Haier Electric Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Tianjin Haier Cleaning Electrical Appliances Co., 15.00% entitled to the preferential taxation Ltd. (天津海尔洗涤电器有限公司) policies as a hi-tech enterprise Qingdao Economic and Technological 15.00% entitled to the preferential taxation Development Zone Haier Water Heater Co., policies as a hi-tech enterprise Ltd. Wuhan Haier Water Heater Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Foshan Haier Drum Washing Machine Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Qingdao Haier Strauss Technology Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Qingdao Haier New Energy Electric Appliance 15.00% entitled to the preferential taxation Co., Ltd. policies as a hi-tech enterprise Qingdao Haier Washing Appliance Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Qingdao Haier Lexin Cloud Technology Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Hefei Haier Drum Washing Machine Co., Ltd. 15.00% entitled to the preferential taxation policies as a hi-tech enterprise Qingdao Haier Smart Electrics Equipment Co. 15.00% entitled to the preferential taxation	Company	Tax rate	Preferential tax
	Ltd.		policies as a hi-tech enterprise

Company	Tax rate	Preferential tax
Qingdao Haier Smart Living Appliance Co. Ltd.	15.00%	entitled to the preferential taxation policies as a hi-tech enterprise
Qingdao RRS Lejia IoT Technology Co., Ltd.	15.00%	entitled to the preferential taxation policies as a hi-tech enterprise
Tonghai Energy Technology Development Co., Ltd. (同海能源科技發展有限公司)	15.00%	entitled to the preferential taxation policies as a hi-tech enterprise
Jiangxi Haier Medical Technology Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Haier Electrical Appliance Sales Co., Ltd. and some Western companies	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Haier Air-conditioning Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Haier Refrigeration Appliance Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Haier Washing Machine Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Guizhou Haier Electronics Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Hairishun Home Appliance Sales Co., Ltd. and some Western companies	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Haier Washing Machine Co., Ltd	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Haier Water Heater Co., Ltd	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Haier Drum Washing Machine Co., Ltd	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Guizhou Peiji Logistics Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Central Asia Baofeng International Logistics Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC

Company	Tax rate	Preferential tax
Central Asia Baofeng International Logistics Co., Ltd. Xi'an Branch	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Shenzhen Furunde Supply Chain Management Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Gooday Supply Chain Technologies Co., Ltd.	15.00%	entitled to the preferential taxation policies as a hi-tech enterprise
Haier Robotics Technology (Qingdao) Co., Ltd.	15.00%	entitled to the preferential taxation policies as a hi-tech enterprise
Guiyang Ririshun Logistics Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Xi'an Gooday Smart Supply Chain Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Chongqing Gooday Supply Chain Management Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Qusong Tonghai Energy Technology Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Linzhou Tonghai Energy Technology Co., Ltd.	15.00%	entitled to the preferential taxation policies under the Western Development initiative of the PRC
Qingdao Haier Technology Co., Ltd.	10.00%	entitled to the preferential taxation policies as a key software enterprise

VII. EXPLANATORY NOTES FOR ITEMS IN CONSOLIDATED FINANCIAL STATEMENTS

Unless otherwise specified, the following closing balances represent the amount as at 30 June 2025 and opening balances represent the amount as at 31 December 2024; amount for the period represents the amount from 1 January to 30 June 2025 and amount for the previous period represents the amount from 1 January to 30 June 2024.

1. Monetary funds

Items	Closing balance	Opening balance
Cash on hand	1,685,740.35	560,953.91
Cash in bank	53,646,652,252.87	54,256,005,280.85
Other cash balances	1,708,764,543.60	1,340,988,388.07
Total	55,357,102,536.82	55,597,554,622.83
Include: total amount of overseas deposits	20,946,662,922.06	21,113,746,333.40
Deposit in Finance Company	20,194,208,511.13	20,565,469,130.81

Other monetary funds mainly included investment fund, deposit on third party payment platforms, guarantees and other restricted fund, etc.

2. Financial assets held for trading

Items	Closing balance	Opening balance
Short-term wealth management products	8,317,511,328.41	746,436,121.40
Investments in equity instruments	183,105,112.16	195,177,368.77
Investment funds	314,831,875.05	294,404,349.36
Total	8,815,448,315.62	1,236,017,839.53

3. Derivative financial assets

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Forward foreign exchange contracts	77,736,648.25	138,404,575.66
Cross-currency interest rate swaps		4,254,681.44
Forward commodity contracts	1,628,469.15	50,459.81
Total	79,365,117.40	142,709,716.91

4. Bills receivable

(1) Details of bills receivable

Items	Closing balance	Opening balance
Bank acceptance notes	4,970,941,573.88	10,382,273,687.38
Commercial acceptance notes	1,937,657,931.73	1,798,754,865.96
Balance of bills receivable	6,908,599,505.61	12,181,028,553.34
Allowance for bad debts	987,604.22	1,171,683.33
Bills receivable, net	6,907,611,901.39	12,179,856,870.01

(2) Changes in allowance for bad debts of bills receivable in the current period

Items	Opening balance	Increase for the current period Provision for		Decrease for the current period		Closing balance
		the current	Other		Write-off/other
		period	movement	Reversal	movement
Allowance for bad debts	1,171,683.33			184,079.11		987,604.22
Total	1,171,683.33			184,079.11		987,604.22

The Company's bills receivables were mainly generated from daily operation activities such as sales of commodity, provision of labor, etc., and the allowance for bad debts was measured based on expected credit loss over the entire duration whether there exist significant financing components.

The bills receivable pledged by the Company at the end of the period was RMB2,411,049,768.49 (amount at the beginning of the period: RMB5,115,222,700.13).

5. Accounts receivable

(1) Accounts receivable are disclosed by aging as follows:

Aging	Closing balance	Opening balance
Within 1 year	30,916,671,290.48	26,234,170,508.25
1–2 years	657,666,795.64	689,351,514.18
2–3 years	359,369,408.62	388,342,245.65
Over 3 years	309,571,739.21	252,055,595.77
Balance of accounts receivable	32,243,279,233.95	27,563,919,863.85
Allowance for bad debts	1,117,482,568.25	1,069,074,353.29
Accounts receivable, net	31,125,796,665.70	26,494,845,510.56

(2) By method of provision of allowance for bad debts

√ Applicable □ Not Applicable

Categories		Book balance	Closing balance Allowance for bad debts	Carrying value
			Percentage of
	Amount	Percentage (%)	Amount	provision (%)
Account receivables subject to
provision for bad debts on
a separate basis	350,826,367.32	1.09	340,572,030.01	97.08	10,254,337.31
Account receivables subject to
provision for bad debts on
a collective basis	31,892,452,866.63	98.91	776,910,538.24	2.44	31,115,542,328.39
Total	32,243,279,233.95	100.00	1,117,482,568.25	3.47	31,125,796,665.70

(continued)

Categories	Book balance		Opening balance Allowance for bad debts Percentage of		Carrying value
	Amount	Percentage (%)	Amount	provision (%)
Account receivables subject to provision for bad debts on a separate basis Account receivables subject to provision for bad debts on	401,873,990.95	1.46	384,907,108.05	95.78	16,966,882.90
a collective basis	27,162,045,872.90	98.54	684,167,245.24	2.52	26,477,878,627.66
Total	27,563,919,863.85	100.00	1,069,074,353.29	3.88	26,494,845,510.56

(3) Account receivables subject to provision for bad debts on a separate basis at the end of the period

√ Applicable □ Not Applicable

Unit and Currency: RMB

Name	Book balance	Closing balance Allowance for bad debts	Percentage of provision (%)	Reason for provision
44 customers in total	350,826,367.32	340,572,030.01	97.08	The obligors were in significant financial difficulty
Total	350,826,367.32	340,572,030.01	97.08	/

Explanation of provision for bad debts on a separate basis:

√ Applicable □ Not Applicable

The account receivables of significant individual amount and subject to provision for bad debts on a separate basis at the end of the period was RMB195,473,905.66 (amount at the beginning of the period: RMB195,473,905.66).

(4) Account receivables subject to provision for bad debts on a collective basis

Aging	Closing balance Allowance for Book balance bad debts		Percentage of provision (%)
Within 1 year	30,834,777,556.79	439,252,101.78	1.42
1–2 years	631,096,459.95	127,175,019.89	20.15
2–3 years	241,746,317.55	82,424,055.54	34.10
Over 3 years	184,832,532.34	128,059,361.03	69.28
Total	31,892,452,866.63	776,910,538.24	2.44

(continued)

Aging	Book balance	Opening balance Allowance for bad debts	Percentage of provision (%)
Within 1 year	26,106,894,301.60	389,323,682.89	1.49
1–2 years	659,738,683.37	100,738,283.50	15.27
2–3 years	181,282,912.23	60,958,005.85	33.63
Over 3 years	214,129,975.70	133,147,273.00	62.18
Total	27,162,045,872.90	684,167,245.24	2.52

(5) Changes in allowance for bad debts of accounts receivable in the current period:

Items	Opening balance	Increase for the current period		Decrease for the current period		Closing balance
		Provision for the current period	Other movement	Reversal	Write-off/other movement
Allowance for bad debts	1,069,074,353.29	108,717,671.67		53,424,844.11	6,884,612.60	1,117,482,568.25

• (6) The aggregate amount of the top 5 account receivables and contract assets as at the end of the period was RMB6,232,723,478.43 (amount at the beginning of the period: RMB6,775,144,962.81), accounting for 18.42% (at the beginning of the period: 23.65%) of the book balance of account receivables and contract assets, and the amount of provision for bad debts was RMB45,450,462.85 (amount at the beginning of the period: RMB18,226,518.24).
• (7) Actual write-off of accounts receivable in the current period

The amount of accounts receivable actually written off in the current period was RMB56,324,142.82 (amount for the corresponding period: RMB708,946,193.17) and the amount of significant bad debt write-off of accounts receivable was RMB0.00.

(8) The Company's accounts receivable that were terminated due to the transfer of financial assets in the current period

The amount of accounts receivable that the company terminated at the end of the period due to the transfer of financial assets was RMB7,092,705,208.95 (amount at the beginning of the period: RMB6,095,179,589.77) and the transfer method was outright sale factoring.

(9) Restricted accounts receivable in the current period

The amount of accounts receivable restricted at the end of the period is RMB0.00 (amount at the beginning of the period: RMB0.00).

6. Financing receivables

(1) Presentation by category

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Bills receivable	1,115,591,707.01	235,730,229.72
Accounts receivable	132,605,741.33	177,192,385.53
Total	1,248,197,448.34	412,922,615.25

• (2) The amount of the Company's pledged financing receivables at the end of the period is RMB129,036,825.42 (amount at the beginning of the period: RMB0.00).
• (3) Financing receivables at the end of the period that had been endorsed or discounted by the Company and were not yet due at the balance sheet date

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amounts derecognized at the end of the period	Amounts not derecognized at the end of the period
Bills receivable Total	10,658,378,486.25 10,658,378,486.25

(4) No provision for bad debts has been made for financing receivables during the period.

(5) There were no financing receivables written off during the period.

7. Prepayments

(1) Prepayments are presented by aging:

Aging	Closing balance		Opening balance
	Amount	Percentage	Amount	Percentage
Within 1 year	1,766,042,471.00	94.44%	2,319,075,168.29	97.16%
1–2 years	62,002,314.43	3.32%	43,056,825.13	1.80%
2–3 years	17,620,244.77	0.94%	8,098,753.24	0.34%
Over 3 years	24,323,435.95	1.30%	16,669,039.88	0.70%
Balance of prepayments	1,869,988,466.15	100.00%	2,386,899,786.54	100.00%
Provision for impairment of
prepayments	8,754,877.07		8,755,327.07
Net prepayments	1,861,233,589.08		2,378,144,459.47

(2) Provision for impairment

Items	Opening balance	Increase for the current period Provision for		Decrease for the current period		Closing balance
		the current period	Other movement	Reversal	Write-off/other movement
Provision for impairment Total	8,755,327.07 8,755,327.07				450.00 450.00	8,754,877.07 8,754,877.07

• (3) The total amount of the top 5 in the prepayments at the end of the period was RMB383,730,344.99, accounting for 20.52% of the book balance of prepayment (amount at the beginning of the period: RMB974,866,936.72, accounting for 40.84%).
• (4) There was no significant prepayment aged over 1 year at the end of the period.

8. Other receivables

√ Applicable □ Not Applicable

Items	Closing balance	Opening balance
Interest receivable	904,741,268.55	771,591,076.67
Other receivables	3,324,051,801.89	2,829,766,418.35
Total	4,228,793,070.44	3,601,357,495.02

Interest receivable

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance
Within 1 year	379,874,423.51	374,172,658.71
1–2 years	339,218,399.38	316,667,022.35
2–3 years	184,276,615.52	80,000,932.60
Over 3 years	1,371,830.14	750,463.01
Total	904,741,268.55	771,591,076.67

Other receivables

① Other receivables are disclosed by aging as follows:

Aging	Closing balance	Opening balance
Within 1 year	2,635,235,474.03	2,251,224,809.42
1–2 years	194,411,405.63	161,728,827.38
2–3 years	121,693,437.81	73,549,505.88
Over 3 years	435,978,580.19	392,681,572.53
Balance of other receivables	3,387,318,897.66	2,879,184,715.21
Allowance for bad debts	63,267,095.77	49,418,296.86
Other receivables, net	3,324,051,801.89	2,829,766,418.35

② Provision of allowance for bad debts based on the general model of expected credit losses

Allowance for bad debts	Stage 1 Expected credit losses for the coming 12 months	Stage 2 Lifetime expected credit losses (not credit-impaired)	Stage 3 Lifetime expected credit losses (credit-impaired)	Total
Opening balance	39,245,962.81		10,172,334.05	49,418,296.86
Provision for the current period	14,477,006.96		7,576,676.61	22,053,683.57
Reversal for the current period	5,250,344.17			5,250,344.17
Write-off and others for the current
period	2,954,540.49			2,954,540.49
Closing balance	45,518,085.11		17,749,010.66	63,267,095.77

Items Opening balance Increase for the current period Decrease for the current period Closing balance Provision for the current period Other movement Reversal Write-off/ other movement

Allowance for bad debts 49,418,296.86 22,053,683.57 5,250,344.17 2,954,540.49 63,267,095.77

③ Changes in allowance for bad debt provision of other receivables in the current period

• ④ The total amount of the top 5 other receivables at the end of the period was RMB855,104,972.12 (amount at the beginning of the period: RMB1,038,763,021.83), accounting for 25.24% of the book balance of other receivables (at the beginning of the period: 36.08%), and the amount of provision for bad debts was RMB0.00 (amount at the beginning of the period: RMB0.00).
• ⑤ Other receivables written off during the period

The amount of other receivables actually written off in the current period was RMB4,122,692.97 (amount for the corresponding period: RMB8,107,151.46) and no significant other receivables were written off for bad debts.

⑥ Other receivables mainly included deposits, quality guarantees, employee loans, tax refunds, and advance payments, etc.

9. Inventories

(1) Details of inventories

Items	Closing Balance Impairment provision of Book balance inventories		Carrying value
Raw materials Work in progress Finished goods	6,699,772,457.36 428,109,423.20 38,209,369,513.57	255,379,870.71 1,564,598,790.58	6,444,392,586.65 428,109,423.20 36,644,770,722.99
Total	45,337,251,394.13	1,819,978,661.29	43,517,272,732.84

(Continue)

Items	Book balance	Carrying value
Raw materials Work in progress	6,899,891,071.77 388,624,719.50	229,902,166.82	6,669,988,904.95 388,624,719.50
Finished goods	37,599,053,611.30	1,467,811,537.79	36,131,242,073.51
Total	44,887,569,402.57	1,697,713,704.61	43,189,855,697.96

(2) Impairment provision of inventories

Items	Opening balance	Increase for the current period Provision for		Decrease for the current period		Closing balance
		the current	Other		Write-off/other
		period	movement	Reversal	movement
Raw materials	229,902,166.82	31,908,473.98			6,430,770.09	255,379,870.71
Work in progress
Finished goods	1,467,811,537.79	433,086,565.54			336,299,312.75	1,564,598,790.58
Total	1,697,713,704.61	464,995,039.52			342,730,082.84	1,819,978,661.29

(3) Details of impairment provision of inventories are as follows

Items	Specific basis for determining net realizable value	Reason for reversing or writing off the impairment provision of inventories
Raw materials	Measurement at the lower of cost and net realizable value	Production, use or sales
Finished goods	Measurement at the lower of cost and net realizable value	sales

10. Contract assets

(1) Details

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Book balance	Closing Balance Allowance for bad debts	Carrying value	Book balance	Opening Balance Allowance for bad debts	Carrying value
Relating to construction service contract Total	1,587,563,750.08 1,587,563,750.08	91,404,352.14 91,404,352.14	1,496,159,397.94 1,089,472,041.72 1,496,159,397.94 1,089,472,041.72		91,508,336.05 91,508,336.05	997,963,705.67 997,963,705.67

(2) Classification by method of provision for bad debts

Categories	Book balance		Closing balance Allowance for bad debts	Carrying value
	Amount	Percentage (%)	Amount	Percentage of provision (%)
Contract assets subject to provision for bad debts on a separate basis Contract assets subject to provision for bad debts on	56,845,712.92	3.58	55,755,776.06	98.08	1,089,936.86
a collective basis	1,530,718,037.16	96.42	35,648,576.08	2.33	1,495,069,461.08
Total	1,587,563,750.08	100.00	91,404,352.14	5.76	1,496,159,397.94

(Continue)

Categories	Book balance		Opening balance Allowance for bad debts		Carrying value
	Amount	Percentage (%)	Amount	Percentage of provision (%)
Contract assets subject to provision for bad debts on a separate basis Contract assets subject to provision for bad debts on	55,755,776.06	5.12	55,755,776.06	100.00
a collective basis	1,033,716,265.66	94.88	35,752,559.99	3.46	997,963,705.67
Total	1,089,472,041.72	100.00	91,508,336.05	8.40	997,963,705.67

(3) Contract assets subject to provision for bad debts on a separate basis at the end of the period

√ Applicable □ Not Applicable

Unit and Currency: RMB

Name	Book balance	Closing balance Allowance for bad debts	Percentage of provision (%)	Reason for provision
7 customers in total	56,845,712.92	55,755,776.06	98.08	The obligors were in significant financial
Total	56,845,712.92	55,755,776.06	98.08	difficulty /

(4) Contract assets subject to provision for bad debts on a collective basis at the end of the period

√ Applicable □ Not Applicable

Unit and Currency: RMB

Name	Book balance	Closing balance Allowance for bad debts	Percentage of provision (%)
Relating to construction service contract	1,530,718,037.16	35,648,576.08	2.33
Total	1,530,718,037.16	35,648,576.08	2.33

(5) Provision for bad debts on contract assets during the current period

Items	Opening balance	Increase for the current period Provision for		Decrease for the current period		Closing balance
		the current period	Other movement	Reversal	Write-off/other movement
Relating to construction
service contract	91,508,336.05			103,983.91		91,404,352.14
Total	91,508,336.05			103,983.91		91,404,352.14

11. Non-current assets due within one year

Items	Closing balance	Opening balance
Debt investments due within one year	2,307,574,005.86	1,439,758,652.55
Total	2,307,574,005.86	1,439,758,652.55
Including: time deposit in finance company	1,695,536,677.09	334,466,985.88

12. Other current assets

(1) Details

Items	Closing Balance			Opening Balance
	Impairment			Impairment
	Book balance	provision	Book balance	provision
Deductible taxes products	3,353,363,884.61		3,618,407,941.29
Short-term deposits	115,221,674.82		491,724,709.59
Returns cost receivables	590,584,931.58	279,221,989.21	566,481,435.22	281,079,517.50
Entrusted loans	496,677,379.89
Others	53,975,945.37		47,739,469.43
Total	4,609,823,816.27	279,221,989.21	4,724,353,555.53	281,079,517.50

(2) Impairment provision

Items	Opening balance	Increase for the current period Provision for		Decrease for the current period		Closing balance
		the current period	Other movement	Reversal	Write-off/other movement
Returns cost receivables Total	281,079,517.50 281,079,517.50	279,221,989.21 279,221,989.21			281,079,517.50 281,079,517.50	279,221,989.21 279,221,989.21

(3) Time deposit in Finance Company was RMB115,221,674.82 at the end of the period.

13. Debt investments

Items	Closing balance		Opening balance
	Principal	Interest Principal		Interest
Time deposit -long term	16,142,500,000.00	755,992,337.28	16,292,500,000.00	622,018,509.54
Less: Debt investments due within
one year	2,187,500,000.00	120,074,005.86	1,327,500,000.00	112,258,652.55
Total	13,955,000,000.00	635,918,331.42	14,965,000,000.00	509,759,856.99
Include: time deposit in
Finance Company	12,065,000,000.00	583,553,482.11	12,605,000,000.00	448,060,172.04

14. Long-term equity investments

√ Applicable □ Not Applicable

Investees			Increase/decrease for the current period	Adjustment in
	Opening balance	Investment increase	Investment income recognized under equity method	other comprehensive income	Other changes in equity	Declaration of cash dividends or profits
Associate:
Haier Group Finance Co., Ltd.	8,219,298,837.87		377,480,635.87	–691.01		–235,200,000.00
Bank of Qingdao Co., Ltd.	3,473,162,128.86		222,430,213.11	144,943,528.84	—	–76,288,906.40
Wolong Electric (Jinan) Motor Co., Ltd.	198,467,631.66		14,338,896.00			–15,000,000.00
Qingdao Hegang New Material
Technology Co., Ltd.	342,315,345.52		6,843,983.51		—	–4,186,865.40
Qingdao Haier SAIF Smart Home
Industry Investment Center (Limited
Partnership)	191,276,594.86		—			—
Mitsubishi Heavy Industries Haier
(Qingdao) Air-conditioners Co., Ltd.	698,845,993.61		71,576,418.84			—
Qingdao Haier Multimedia Co., Ltd.	88,300,000.00
Baoshihua Energy Technology Co., Ltd.
(宝石花能源科技有限公司)	31,132,443.76					–1,409,295.17
Zhengzhou Highly Electric Appliance
Co., Ltd. (鄭州海立电器有限公司)	98,560,581.01
Zhejiang Futeng Fluid Technology
Co., Ltd. Hongtong Environmental Technology	73,460,549.11
(Guangzhou) Co., Ltd. (宏通環境
技術(廣州)有限公司)	6,464,386.26
Qingdao Haimu Investment
Management Co., Ltd.	2,692,755.00
Qingdao Haimu Smart Home
Investment Partnership (Limited
Partnership)	56,749,040.79
Qingdao Guochuang Intelligent Home
Appliance Research Institute Co.,
Ltd.	40,920,413.54		2,015,812.22
Guangzhou Heying Investment Partnership (Limited Partnership)	132,620,094.53
Qingdao Home Wow Cloud Network
Technology Co., Ltd.	1,083,682.47		–1,108,867.33
Bingji (Shanghai) Corporate
Management Co., Ltd.	1,095,450,007.15		27,395,141.18
Shangang Luhai International Logistics
(Jinan) Co., Ltd. (山港陆海国际物流
(济南)有限公司)	58,941,327.06		1,047,222.88
Haier Best Water Technology Co., Ltd.	148,369,638.40		2,124,281.52
Huizhixiangshun Equity Investment Fund
(Qingdao) Partnership (Limited
Partnership)	188,907,510.60
Qingdao Ririshun Huizhi Investment
Co., Ltd. Qingdao Xiaoshuai Intelligent	4,083,482.78
Technology Co., Ltd	9,578,046.65		2,125,935.87
Qingdao Xinshenghui Technology Co.,

Ltd. 11,365,227.21 599,131.76

Investees	Increase/decrease for the current period
	Opening balance	Investment increase	Investment income recognized under equity method	Adjustment in other comprehensive income	Other changes in equity	Declaration of cash dividends or profits
Ningbo Beilian Intelligent Technology Co., Ltd. (宁波贝立安智能科技有限 公司) Qingdao Oriental Haisheng Technology Co., Ltd. (青岛東方海盛科技有限 公司)	3,724,499.78	9,980,000.00	–236,575.45
Konan Electronic Co., Ltd.	59,415,065.89		–2,439,536.52	4,305,373.50		–218,290.50
HNR (Private) Company Limited	140,530,747.42		34,169,113.58	–5,099,023.40
HPZ LIMITED	11,203,257.77		—	—
Controladora Mabe, S.A. de C.V. Middle East Air conditioning Company, Limited	5,638,478,867.77 7,389,990.91		126,143,371.74 –2,260,730.88	–112,929,878.77 –458,145.29	–8,251,636.94	–80,024,194.29
Total	21,032,788,148.24	9,980,000.00	882,244,447.90	30,761,163.87	–8,251,636.94	–412,327,551.76

(Continued)

Investees	Increase/decrease for the current period		Closing balance	Closing balance of impairment provision
		The disposal of
	Other movement	the investment
Associate:
Haier Group Finance Co., Ltd.			8,361,578,782.73
Bank of Qingdao Co., Ltd.			3,764,246,964.41
Wolong Electric (Jinan) Motor Co., Ltd.			197,806,527.66
Qingdao Hegang New Material
Technology Co., Ltd.			344,972,463.63
Qingdao Haier SAIF Smart Home
Industry Investment Center (Limited
Partnership)			191,276,594.86
Mitsubishi Heavy Industries Haier
(Qingdao) Air-conditioners Co., Ltd.			770,422,412.45
Qingdao Haier Multimedia Co., Ltd.			88,300,000.00	–88,300,000.00
Baoshihua Energy Technology Co., Ltd.
(宝石花能源科技有限公司)			29,723,148.59
Zhengzhou Highly Electric Appliance
Co., Ltd. (鄭州海立电器有限公司)			98,560,581.01
Zhejiang Futeng Fluid Technology
Co., Ltd.			73,460,549.11
Hongtong Environmental Technology
(Guangzhou) Co., Ltd. (宏通環境
技術(廣州)有限公司)			6,464,386.26
Qingdao Haimu Investment
Management Co., Ltd.			2,692,755.00
Qingdao Haimu Smart Home Investment
Partnership (Limited Partnership)			56,749,040.79

				Closing balance of
Investees	Increase/decrease for the current period		Closing balance	impairment provision
	Other movement	The disposal of the investment
Qingdao Guochuang Intelligent Home
Appliance Research Institute Co.,
Ltd.			42,936,225.76
Guangzhou Heying Investment
Partnership (Limited Partnership)			132,620,094.53
Qingdao Home Wow Cloud Network
Technology Co., Ltd.			–25,184.86
Bingji (Shanghai) Corporate
Management Co., Ltd.			1,122,845,148.33
Shangang Luhai International Logistics
(Jinan) Co., Ltd. (山港陆海国际物流
(济南)有限公司)		–108,598.97	59,879,950.97
Haier Best Water Technology Co., Ltd.			150,493,919.92
Huizhixiangshun Equity Investment Fund
(Qingdao) Partnership (Limited
Partnership)		–17,011,435.35	171,896,075.25
Qingdao Ririshun Huizhi Investment Co.,
Ltd.			4,083,482.78
Qingdao Xiaoshuai Intelligent
Technology Co., Ltd			11,703,982.52
Qingdao Xinshenghui Technology Co.,
Ltd.			11,964,358.97
Ningbo Beilian Intelligent Technology
Co., Ltd. (宁波贝立安智能科技有限
公司)			3,487,924.33
Qingdao Oriental Haisheng Technology
Co., Ltd. (青岛東方海盛科技有限
公司)			9,980,000.00
Konan Electronic Co., Ltd.			61,062,612.37
HNR (Private) Company Limited			169,600,837.60
HPZ LIMITED			11,203,257.77	–11,203,257.77
Controladora Mabe, S.A. de C.V. Middle East Airconditioning Company,			5,563,416,529.51
Limited		–4,671,114.74
Total		–21,791,149.06	21,513,403,422.25	–99,503,257.77

15. Investments in other equity instruments

(1) Details of investments in other equity instruments at the end of the period:

Items	Closing balance	Opening balance
SINOPEC Fuel Oil Sales Corporation Limited Haier COSMO IOT Ecosystem Technology	1,328,800,000.00	1,674,427,670.51
Co., Ltd.	2,795,887,119.07	2,786,307,000.00
Others	1,525,469,132.18	1,612,946,200.31
Total	5,650,156,251.25	6,073,680,870.82

(2) Dividends from investment in other equity instruments during the current period:

Items	Amount for the current period
Others	3,225,726.29
Total	3,225,726.29

16. Investment properties

(1) The changes in investment properties measured at cost this year are as follows:

	Houses and
Items	buildings	Land use rights	Total
I. Original book value
1. Opening balance	162,700,718.91	108,900,075.76	271,600,794.67
2. Increase for the current period
(1) External acquisition	214,599,883.20		214,599,883.20
(2) Intangible asset/fixed assets/
construction in progress
transferred in	191,660,227.89		191,660,227.89
(3) Increase from business
combinations
3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
(3) Other transferring out
4. Change in foreign exchange rate
and others	17,269,237.18		17,269,237.18
5. Closing balance	586,230,067.18	108,900,075.76	695,130,142.94

	Houses and
Items	buildings	Land use rights	Total
II. Accumulated depreciation and
accumulated amortization
1. Opening balance	19,258,789.34	6,180,745.50	25,439,534.84
2. Increase for the current period
(1) Provision or amortization	3,238,920.77	292,591.07	3,531,511.84
(2) Intangible asset/fixed assets/
construction in progress
transferred in	574,600.56		574,600.56
3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
(3) Other transferring out
4. Change in foreign exchange rate
and others	207,093.85		207,093.85
5. Closing balance	23,279,404.52	6,473,336.57	29,752,741.09
III. Provision for impairment
1. Opening balance
2. Increase for the current period
(1) Provision 3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
(3) Other transferring out
4. Change in foreign exchange rate
and others
5. Closing balance
IV. Book value
1. Closing book value	562,950,662.66	102,426,739.19	665,377,401.85
2. Opening book value	143,441,929.57	102,719,330.26	246,161,259.83

(2) The depreciation and amortization amount charge for the period is RMB3,531,511.84 (amount for the corresponding period: RMB2,084,840.88).

(3) The recoverable amount of the investment real estate of the Company at the end of the period is not less than its book value, so no provision for impairment is made.

17. Fixed assets

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Fixed assets	38,733,351,465.18	37,613,215,769.46
Total	38,733,351,465.18	37,613,215,769.46

(1) Fixed assets:

Items	Houses and buildings	Production equipment	Transportation equipment
I. Original book value:
1. Opening balance	23,587,425,943.99	39,983,465,124.95	282,740,896.81
2. Increase for the current period
(1) Acquisition	19,579,747.22	363,026,991.03	3,553,499.21
(2) Construction in progress
transferred in	1,311,473,701.82	1,212,516,592.93	15,834,494.14
(3) Increase in business
combinations
(4) Investment properties
transferred in
3. Decrease for the current period (1) Disposal or write-off	187,771,425.53	456,000,308.57	14,132,509.90
(2) Disposal of subsidiaries
(3) Transfer to investment
properties	191,660,227.89
4. Change in foreign exchange rate
and others	576,231,484.63	519,106,432.99	15,281,247.26
5. Closing balance	25,115,279,224.24	41,622,114,833.33	303,277,627.52
II. Accumulated depreciation
1. Opening balance	7,079,072,646.10	21,078,671,488.71	161,340,026.39
2. Increase for the current period
(1) Provision	544,248,174.34	1,670,014,498.41	21,976,770.00
(2) Investment properties
transferred in
3. Decrease for the current period
(1) Disposal or write-off	76,124,981.15	354,877,165.74	6,928,570.79
(2) Disposal of subsidiaries
(3) Transfer to investment
properties	574,600.56
4. Change in foreign exchange rate
and others	102,890,975.29	199,092,965.34	6,037,374.50
5. Closing balance	7,649,512,214.02	22,592,901,786.72	182,425,600.10

Items	Houses and buildings	Production equipment	Transportation equipment
III. Provision for impairment 1. Opening balance 2. Increase for the current period (1) Provision	42,187,643.34	17,624,919.83	105,101.78
(2) Investment properties transferred in 3. Decrease for the current period (1) Disposal or write-off (2) Disposal of subsidiaries (3) Transfer to investment properties 4. Change in foreign exchange rate	15,847,683.49	1,708,197.46	78,319.36
and others	1,664,391.35	334,943.59	1,982.35
5. Closing balance IV. Book value	28,004,351.20	16,251,665.96	28,764.77
1. Closing book value	17,437,762,659.02	19,012,961,380.65	120,823,262.65
2. Opening book value	16,466,165,654.55	18,887,168,716.41	121,295,768.64

(Continue)

Items	Office furniture	Others	Total
I. Original book value:
1. Opening balance	1,866,237,560.00	3,564,759,601.87	69,284,629,127.62
2. Increase for the current period
(1) Acquisition	20,546,040.73	450,588.77	407,156,866.96
(2) Construction in progress
transferred in	88,896,896.04	120,084,199.19	2,748,805,884.12
(3) Increase in business
combinations
(4) Investment properties
transferred in
3. Decrease for the current period
(1) Disposal or write-off	72,935,367.28	155,134,680.58	885,974,291.86
(2) Disposal of subsidiaries
(3) Transfer to investment
properties			191,660,227.89
4. Change in foreign exchange rate
and others	145,846,374.30	163,116,974.53	1,419,582,513.71
5. Closing balance	2,048,591,503.79	3,693,276,683.78	72,782,539,872.66

Items	Office furniture	Others	Total
II. Accumulated depreciation
1. Opening Balance	1,091,419,033.13	2,198,543,345.96	31,609,046,540.29
2. Increase for the current period
(1) Provision	120,671,021.82	159,543,528.56	2,516,453,993.13
(2) Investment properties
transferred in
3. Decrease for the current period
(1) Disposal or write-off	64,369,294.86	108,606,377.69	610,906,390.23
(2) Disposal of subsidiaries
(3) Transfer to investment
properties			574,600.56
4. Change in foreign exchange rate
and others	66,440,830.74	113,796,374.71	488,258,520.58
5. Closing Balance	1,214,161,590.83	2,363,276,871.54	34,002,278,063.21
III. Provision for impairment
1. Opening balance	209,527.14	2,239,625.78	62,366,817.87
2. Increase for the current period (1) Provision (2) Investment properties transferred in 3. Decrease for the current period (1) Disposal or write-off (2) Disposal of subsidiaries (3) Transfer to investment properties 4. Change in foreign exchange rate and others 5. Closing balance IV. Book value 1. Closing book value 2. Opening book value	5,323.23 14,684.17 218,888.08 834,211,024.88 774,608,999.73	14,269.95 181,318.43 2,406,674.26 1,327,593,137.98 1,363,976,630.13	17,653,793.49 2,197,319.89 46,910,344.27 38,733,351,465.18 37,613,215,769.46

• (2) In the current period, the balance of the construction in progress transferred to the original value of the fixed assets in a total of RMB2,748,805,884.12 (amount for the corresponding period: RMB2,107,328,131.20).
• (3) As at 30 June 2025, the net book value of the buildings for which the Company has not yet obtained certificates of title was RMB71 million (amount at the beginning of the period RMB396 million), and the relevant certificates of title were being processed. The Company can legally and effectively occupy and operate the above-mentioned buildings for which no certificates of title have been obtained.
• (4) The amount of mortgage secured by the fixed assets mortgage at the end of the period was RMB31,825,255.89, and there was no mortgage secured by the fixed assets mortgage at the beginning of the period.

18. Construction in progress

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing Balance	Opening Balance
Construction in progress	5,677,443,291.08	5,686,050,990.48
Total	5,677,443,291.08	5,686,050,990.48

(1) Balance of construction in progress

√ Applicable □ Not Applicable

Projects		Closing Balance			Opening Balance
	Book balance	Impairment Provision	Book Value	Book balance	Impairment provision	Book Value
Qingdao Water Ecology
Technology Project	1,107,019,900.03			1,107,019,900.03 1,066,513,889.60		1,066,513,889.60
New Zealand FPA Project	774,202,009.02		774,202,009.02	404,446,522.30		404,446,522.30
Qingdao Refrigeration
Appliance Project	604,379,654.55		604,379,654.55	598,424,118.21		598,424,118.21
Qingdao HV Equipment
Project	332,086,933.65		332,086,933.65	760,657,151.21		760,657,151.21
Haier Thailand Project	316,627,436.01		316,627,436.01	94,645,094.35		94,645,094.35
America GE Appliances
Project	165,078,821.53	24,711,494.86	140,367,326.67	255,332,644.93	24,814,364.49	230,518,280.44
Europe Candy Project	130,621,013.23		130,621,013.23	195,308,817.72		195,308,817.72
Qingdao Haishi IoT
Technology Project	117,647,025.54		117,647,025.54	74,638,984.28		74,638,984.28
Haier India Project	103,944,468.67		103,944,468.67	29,688,644.93		29,688,644.93
Eastern European Project	103,746,218.69	2,611,599.07	101,134,619.62	134,970,342.86	1,890,763.38	133,079,579.48
Others	1,950,250,639.94	837,735.85		1,949,412,904.09 2,098,967,643.81	837,735.85	2,098,129,907.96
Total	5,705,604,120.86	28,160,829.78		5,677,443,291.08 5,713,593,854.20	27,542,863.72	5,686,050,990.48

Project name	Opening balance	Increase for the current period	Transfer to fixed assets	Transfer to investment properties	Change in foreign exchange rate and others	Closing balance	Source of fund
Qingdao Water Ecology Technology Project	1,066,513,889.60	73,840,906.03	33,334,895.60			1,107,019,900.03	Self-funding
New Zealand FPA Project	404,446,522.30	403,328,632.37	71,591,550.85		38,018,405.20	774,202,009.02	Self-funding
Qingdao Refrigeration Appliance Project	598,424,118.21	231,071,301.37	225,115,765.03			604,379,654.55	Self-funding
Qingdao HV Equipment Project	760,657,151.21	110,792,017.76	539,362,235.32			332,086,933.65	Self-funding
Haier Thailand Project	94,645,094.35	218,630,522.36			3,351,819.30	316,627,436.01	Self-funding
America GE Appliances Project	255,332,644.93	130,126,099.16	219,594,881.75		–785,040.81	165,078,821.53	Self-funding
Europe Candy Project	195,308,817.72	50,773,226.31	130,994,895.37		15,533,864.57	130,621,013.23	Self-funding
Qingdao Haishi IoT Technology Project	74,638,984.28	43,008,041.26				117,647,025.54	Self-funding
Haier India Project	29,688,644.93	131,357,635.68	56,980,042.05		–121,769.89	103,944,468.67	Self-funding
Eastern European Project	134,970,342.86	66,921,762.68	103,625,833.16		5,479,946.31	103,746,218.69	Self-funding
Others	2,098,967,643.81	1,201,876,571.09	1,368,205,784.99		17,612,210.03	1,950,250,639.94	Self-funding
Total	5,713,593,854.20	2,661,726,716.07	2,748,805,884.12		79,089,434.71	5,705,604,120.86

(2) Details of changes of significant construction in progress for the current period

(3) Impairment provision of construction in progress

Project name	Opening balance	Increase for the current period	Transfer to fixed assets	Other decrease	Change in foreign exchange rate and others	Closing balance
America GE Appliances Project	24,814,364.49				–102,869.63	24,711,494.86
Eastern European Project	1,890,763.38				720,835.69	2,611,599.07
Lejia IOT Project	837,735.85					837,735.85
Total	27,542,863.72				617,966.06	28,160,829.78

19. Right-of-use assets

Items	Houses and buildings	Production equipment	Transportation equipment
I. Original book value:
1. Opening balance	7,414,325,184.86	424,335,480.27	287,794,375.66
2. Increase for the current period
(1) Acquisition	839,125,111.44	69,060,505.50	66,554,028.46
(2) Increase from business
combinations
3. Decrease for the current period
(1) Disposal	442,834,662.97	4,906,292.42	21,136,622.99
(2) Disposal of subsidiaries
4. Change in foreign exchange rate and
others	380,810,924.40	9,998,146.43	7,050,297.26
5. Closing balance	8,191,426,557.73	498,487,839.78	340,262,078.39
II. Accumulated depreciation
1. Opening balance	2,728,106,200.79	72,300,559.30	141,273,353.79
2. Increase for the current period
(1) Provision	623,087,733.49	32,380,649.79	47,860,539.92
3. Decrease for the current period
(1) Disposal	404,315,509.20	136,499.46	23,315,553.70
(2) Disposal of subsidiaries
4. Change in foreign exchange rate and
others	194,441,487.85	–829,925.81	1,983,091.56
5. Closing balance	3,141,319,912.93	103,714,783.82	167,801,431.57
III. Impairment provision
1. Opening balance
2. Increase for the current period
(1) Provision
3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
4. Change in foreign exchange rate and
others
5. Closing balance IV. Book Value
1. Closing book balance	5,050,106,644.80	394,773,055.96	172,460,646.82
2. Opening book balance	4,686,218,984.07	352,034,920.97	146,521,021.87

(continued)

Items	Office furniture	Other	Total
I. Original book value:
1. Opening balance	407,420,134.04	624,841,431.90	9,158,716,606.73
2. Increase for the current period
(1) Acquisition	748,444.05	86,884,036.47	1,062,372,125.92
(2) Increase from business
combinations
3. Decrease for the current period
(1) Disposal	4,371,913.63	22,099,005.23	495,348,497.24
(2) Disposal of subsidiaries
4. Change in foreign exchange rate and
others	34,204,873.15	–2,768,491.58	429,295,749.66
5. Closing balance	438,001,537.61	686,857,971.56	10,155,035,985.07
II. Accumulated depreciation
1. Opening balance	65,901,643.86	309,265,284.63	3,316,847,042.37
2. Increase for the current period
(1) Provision	22,726,847.88	45,259,244.86	771,315,015.94
3. Decrease for the current period
(1) Disposal	4,371,913.63	17,842,283.50	449,981,759.49
(2) Disposal of subsidiaries
4. Change in foreign exchange rate and
others	–1,776,008.63	–1,347,868.82	192,470,776.15
5. Closing balance	82,480,569.48	335,334,377.17	3,830,651,074.97
III. Impairment provision
1. Opening balance
2. Increase for the current period
(1) Provision
3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
4. Change in foreign exchange rate and
others
5. Closing balance
IV. Book Value
1. Closing book balance	355,520,968.13	351,523,594.39	6,324,384,910.10
2. Opening book balance	341,518,490.18	315,576,147.27	5,841,869,564.36

20. Intangible assets

(1) Intangible assets

√ Applicable □ Not Applicable

Items	Proprietary technology	Licenses and franchises	Land use rights
I. Original book value
1. Opening balance	2,233,838,691.22	5,045,290,131.23	3,896,750,377.76
2. Increase for the current period
(1) Acquisition		15,352.56	76,419,471.62
(2) Internal research and development	69,980,046.81
(3) Increase from business combinations
3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
(3) Transfer to investment properties
4. Change in foreign exchange rate and
others	77,544,677.40	61,765,460.62	13,484,758.08
5. Closing balance	2,381,363,415.43	5,107,070,944.41	3,986,654,607.46
II. Accumulated amortization
1. Opening balance	1,544,511,772.33	1,379,799,620.89	611,504,507.21
2. Increase for the current period
(1) Provision	99,291,747.05	97,138,585.99	43,433,194.20
(2) Increase from business combinations
3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
(3) Transfer to investment properties
4. Change in foreign exchange rate and
others	43,977,809.69	41,997,286.23	–294,664.59
5. Closing balance	1,687,781,329.07	1,518,935,493.11	654,643,036.82
III. Impairment provision
1. Opening balance		67,588,227.33
2. Increase for the current period
(1) Provision
(2) Increase from business combinations
3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
(3) Transfer to investment properties
4. Change in foreign exchange rate and
others		–270,053.18
5. Closing balance		67,318,174.15
IV. Book Value
1. Closing book balance	693,582,086.36	3,520,817,277.15	3,332,011,570.64
2. Opening book balance	689,326,918.89	3,597,902,283.01	3,285,245,870.55

(continued)

		Customer	Application management software and
Items	Trademark rights	relationship	others	Total
I. Original book value
1. Opening balance	2,771,507,897.39	1,635,555,560.33	7,212,821,183.79	22,795,763,841.72
2. Increase for the current period
(1) Acquisition			241,792,911.97	318,227,736.15
(2) Internal research and development			213,256,003.90	283,236,050.71
(3) Increase from business combinations
3. Decrease for the current period
(1) Disposal			9,227,469.01	9,227,469.01
(2) Disposal of subsidiaries
(3) Transfer to investment properties 4. Change in foreign exchange rate and
others	194,757,505.82	164,784,826.85	181,286,504.86	693,623,733.63
5. Closing balance	2,966,265,403.21	1,800,340,387.18	7,839,929,135.51	24,081,623,893.20
II. Accumulated amortization
1. Opening balance	34,235,166.67	184,372,755.73	4,907,168,057.06	8,661,591,879.89
2. Increase for the current period
(1) Provision	6,364,943.11	39,682,709.36	430,109,734.49	716,020,914.20
(2) Increase from business combinations
3. Decrease for the current period
(1) Disposal			5,590,363.48	5,590,363.48
(2) Disposal of subsidiaries
(3) Transfer to investment properties
4. Change in foreign exchange rate and
others	171,759.18	13,858,214.93	63,909,422.63	163,619,828.07
5. Closing balance	40,771,868.96	237,913,680.02	5,395,596,850.70	9,535,642,258.68
III. Impairment provision
1. Opening balance			23,643,666.33	91,231,893.66
2. Increase for the current period
(1) Provision
(2) Increase from business combinations
3. Decrease for the current period
(1) Disposal
(2) Disposal of subsidiaries
(3) Transfer to investment properties
4. Change in foreign exchange rate and				–270,053.18
others 5. Closing balance			23,643,666.33	90,961,840.48
IV. Book Value
1. Closing book balance	2,925,493,534.25	1,562,426,707.16	2,420,688,618.48	14,455,019,794.04
2. Opening book balance	2,737,272,730.72	1,451,182,804.60	2,282,009,460.40	14,042,940,068.17

• (2) At the end of the period, the intangible assets developed through the Company accounted for the 18.92% of the original value at the end of the period (accounting for 18.63% at the beginning of the period).
• (3) The amount of intangible assets pledged at the end of the period was RMB96,501,464.38, and the amount of intangible assets pledged at the beginning of the period was RMB97,328,830.10.

21. Goodwill

		Increase for the	Decrease for the	Change in foreign exchange rate
Items	Opening balance	current period	current period	and others	Closing balance
GEA	21,360,922,505.97			–89,241,338.93	21,271,681,167.04
Candy	1,946,245,938.72			226,726,259.94	2,172,972,198.66
CCR	2,141,379,302.22			232,115,027.75	2,373,494,329.97
Others	1,935,459,852.15			81,018,589.22	2,016,478,441.37
Total	27,384,007,599.06			450,618,537.98	27,834,626,137.04

In the case of a goodwill impairment test, the Company compares the carrying amount of the relevant asset group or asset group combination (including goodwill) with its recoverable amount. If the recoverable amount is less than the book value, corresponding difference will be recognized in profit or loss.

The recoverable amount of the asset group (including goodwill) is calculated with discounted estimated future cash flow method based on a management-approved 5–15 years budget. Future cash flows beyond the budget period are estimated using the estimated perpetual annual growth rate. The perpetual annual growth rate (mainly 1.5%–2.0%) adopted by the management is consistent with industry forecast data and does not exceed the long-term average growth rate of each product. The management determines the compound income growth rate (mainly 2.58%- 9.39%) and the EBITDA profit margin (mainly –0.51%–10.57%) based on historical experience and market development forecasts, and adopts the pre-tax interest rate that can reflect the specific risks of the relevant asset group as the discount rate (mainly 10.31%–12.63%). The management analyzes the recoverable amount of each asset group based on these assumptions and believes that there is no need to make provision for goodwill.

22. Long-term amortized expenses

		Increase for the	Amortization for the current	Other	Change in foreign exchange rate
Items	Opening balance	current period	period	decrease	and others	Closing balance
Renovation fees Improvement expenses on leased	204,123,378.57	121,469,346.01	125,473,432.01		350,013.36	200,469,305.93
plants	199,983,171.28	33,148,047.57	22,329,737.35		2,063,522.61	212,865,004.11
Others	194,109,883.79	26,512,021.22	31,096,899.56		1,876,505.43	191,401,510.88
Total	598,216,433.64	181,129,414.80	178,900,068.92		4,290,041.40	604,735,820.92

23. Deferred income tax assets/deferred income tax liabilities

(1) Deferred income tax assets before elimination

Items	Closing balance	Opening balance
Provision for assets impairment	691,981,589.67	601,791,456.35
Liabilities	3,154,339,908.57	3,015,752,813.85
Internal unrealized earnings eliminated due to
combination	588,137,302.88	887,557,367.83
Uncovered losses	216,845,200.00	248,331,903.96
R&D expenses	1,627,294,523.53	1,523,977,439.36
Others	627,274,920.57	620,466,885.20
Total	6,905,873,445.22	6,897,877,866.55

(2) Deferred income tax liabilities before elimination

Items	Closing balance	Opening balance
Assets amortisation	4,972,767,171.56	4,823,267,766.46
Remeasurement of fair value of the reaming equity on the day when the control right
was lost	374,198,127.62	374,198,127.62
Changes in fair value of investments in other
equity instruments	301,824,503.26	301,550,087.64
Others	439,314,164.38	468,942,561.47
Total	6,088,103,966.82	5,967,958,543.19

(3) The deferred income tax assets and the deferred income tax liabilities eliminated at the end of the period was RMB4,464,351,533.78 (amount at the beginning of the period RMB4,420,671,374.19).

24. Other non-current assets

Items	Closing balance	Opening balance
Prepayments for equipment and land	1,247,083,649.62	1,381,218,293.01
Others	411,266,775.25	378,338,600.62
Total	1,658,350,424.87	1,759,556,893.63

25. Short-term borrowings

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Borrowings — secured by pledge	68,435,097.93	46,809,229.31
Borrowings — secured by guarantee	161,714,550.04	466,702,681.40
Borrowings — secured by credit	15,868,184,989.27	13,270,855,533.22
Borrowings — secured by mortgage and
guarantee	29,280,000.00
Total	16,127,614,637.24	13,784,367,443.93

26. Derivative financial liabilities

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Forward foreign exchange contracts	440,096,398.09	71,011,310.01
Total	440,096,398.09	71,011,310.01

27. Bills payable

√ Applicable □ Not Applicable

Types	Closing balance	Opening balance
Commercial acceptance notes	11,258,358,504.79	8,488,327,100.21
Bank acceptance notes	14,150,129,961.20	12,732,037,211.60
Total	25,408,488,465.99	21,220,364,311.81

28. Accounts payables

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Accounts payables	53,257,299,256.55	54,665,277,420.32
Total	53,257,299,256.55	54,665,277,420.32

The book balance at the end of the period was mainly the unpaid expenditures on material and labour. There were no significant accounts payables aged over 1 year at the end of the period.

29. Contract liabilities

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Contract liabilities Total	5,710,603,667.36 5,710,603,667.36	10,865,337,767.67 10,865,337,767.67

The book balance at the end of the period was mainly due to the advance payment that has been collected and has not yet performed the contractual obligations. There were no significant contract liabilities aged over 1 year at the end of the period.

30. Payables for staff remuneration

√ Applicable □ Not Applicable

(1) Payables for staff remuneration

Unit and Currency: RMB

Items	Opening balance	Increase for the current period	Decrease for the current period	Closing balance
I. Short-term remuneration II. Post-employment benefits	4,970,397,275.48		17,034,336,515.06 17,693,216,743.16	4,311,517,047.38
defined contribution plan	24,053,768.47	1,273,899,140.40	1,241,280,437.44	56,672,471.43
III. Termination benefits	17,767,282.21	46,810,377.72	28,121,598.54	36,456,061.39
IV. Other benefits due within
one year	45,041,951.83	0.00	11,251,884.73	33,790,067.10
Total	5,057,260,277.99		18,355,046,033.18 18,973,870,663.87	4,438,435,647.30

(2) Short-term remuneration

√ Applicable □ Not Applicable

Items	Opening balance	Increase for the current period	Decrease for the current period	Closing balance
I. Salaries, bonus, allowances and
benefit	3,486,859,330.29		13,024,898,003.46 13,752,801,891.35	2,758,955,442.40
II. Employee welfare	387,478,465.49	595,540,683.42	561,111,371.56	421,907,777.35
III. Social benefit	266,622,546.55	917,334,162.94	903,782,280.67	280,174,428.82
IV. Housing fund	5,690,085.85	322,195,513.20	303,836,297.64	24,049,301.41
V. Labor union fee and education
fund	13,453,646.86	77,883,367.29	72,892,482.50	18,444,531.65
VI. Short-term compensated leave	278,959,789.45	289,158,119.51	309,380,283.53	258,737,625.43
VII. Others	531,333,410.99	1,807,326,665.24	1,789,412,135.91	549,247,940.32
Total	4,970,397,275.48		17,034,336,515.06 17,693,216,743.16	4,311,517,047.38

(3) Defined contribution plan

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Opening balance	Increase for the current period	Decrease for the current period	Closing balance
1. Basic pension insurance	22,019,009.13	1,213,177,585.15	1,182,699,270.41	52,497,323.87
2. Unemployment insurance	384,540.87	23,027,096.51	22,441,034.34	970,603.04
3. Enterprise annuity payment	1,650,218.47	37,694,458.74	36,140,132.69	3,204,544.52
Total	24,053,768.47	1,273,899,140.40	1,241,280,437.44	56,672,471.43

(4) Termination benefits

Items	Closing balance	Opening balance
Termination compensation	36,456,061.39	17,767,282.21
Total	36,456,061.39	17,767,282.21

31. Taxes payable

√ Applicable □ Not Applicable

Items	Closing balance	Opening balance
Value-added tax	1,080,794,130.97	961,504,803.99
Corporate income tax	2,207,094,090.18	2,649,673,418.47
Individual income tax	98,361,951.41	127,574,718.36
City maintenance and construction tax	32,038,914.11	40,152,216.35
Education surcharge	16,327,025.64	16,711,119.94
Other taxes	173,993,404.07	119,603,639.06
Total	3,608,609,516.38	3,915,219,916.17

32. Other payables

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Dividends payable	8,995,192,390.93	14,082,609.41
Other payables	21,245,355,039.98	21,732,053,154.67
Total	30,240,547,430.91	21,746,135,764.08

(1) Dividends payable

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Haier COSMO Co., Ltd.	1,214,681,202.55
Haier Group Corporation	1,035,112,291.69
Other public shareholders	6,745,398,896.69	14,082,609.41
Total	8,995,192,390.93	14,082,609.41

(2) Other payables

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Other payables	21,245,355,039.98	21,732,053,154.67
Total	21,245,355,039.98	21,732,053,154.67

The closing balance mainly included the incurred but unpaid costs. There were no significant other payables aged over 1 year at the end of the period.

33. Non-current liabilities due within one year

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Long-term borrowings due within one year	6,915,081,823.51	10,365,227,785.72
Lease liabilities due within one year	1,529,016,877.33	1,352,476,354.94
Estimated liabilities due within one year	2,633,982,143.94	2,710,430,236.34
Long term payables due within one year	44,950,023.28	50,806,318.73
Non-current liabilities due within one year	14,282,930.74	2,051,099,765.64
Bonds interest payable due within one year	11,471,250.00
Total	11,148,785,048.80	16,530,040,461.37

34. Other current liabilities

√ Applicable □ Not Applicable

Unit and Currency: RMB

Closing balance	Opening balance
637,978,483.14	624,122,847.31
715,726,430.19	1,134,910,313.73
115,030,454.66	140,912,299.35
1,468,735,367.99	1,899,945,460.39

35. Long-term borrowings

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Borrowings — secured by pledge	184,194,404.30	108,200,000.00
Borrowings — unsecured by credit	10,411,422,198.57	9,556,874,313.67
Total	10,595,616,602.87	9,665,074,313.67

The interest rates of the Company's long-term borrowings: 1.50%–5.50%.

36. Bonds payable

Items	Closing balance	Opening balance
Medium-term notes	3,511,471,250.00
Less: Bonds interest payable due within one year	11,471,250.00
Total	3,500,000,000.00

As of 30 June 2025, the balance of bonds payable is as follows:

Name of bonds	Face value	Coupon rate	Date of issue	Bonds maturity	Issue amount	Opening balance	Current issue	Interest provision at face value	Premium/ discount amortization	Current repayment	Reclassified as due within one year	Closing balance	whether there is a breach of contract
MTN001 MTN002 Total	100 100	1.99% 1.66%	2025/2/25 2025/6/17		3 years 1,500,000,000.00 3 years 2,000,000,000.00 3,500,000,000.00		1,500,000,000.00 10,364,583.33 2,000,000,000.00 3,500,000,000.00 11,471,250.00	1,106,666.67				10,364,583.33 1,500,000,000.00 1,106,666.67 2,000,000,000.00 11,471,250.00 3,500,000,000.00	No No

37. Lease liabilities

Items	Closing balance	Opening balance
Lease liabilities	6,445,269,459.30	5,833,372,352.30
Less: lease liabilities due within one year	1,529,016,877.33	1,352,476,354.94
Total	4,916,252,581.97	4,480,895,997.36

38. Long-term payables

Items	Closing balance	Opening balance
Investment from CDB development fund	36,500,000.00	36,500,000.00
Others	146,627,591.82	202,526,375.32
Less: long-term payables due within one year	44,950,023.28	50,806,318.73
Total	138,177,568.54	188,220,056.59

Under the Investment Contract of China Development Fund executed by the Company and its subsidiaries including Qingdao Haier Air Conditioner Gen Corp., Ltd., Qingdao Haier (Jiaozhou) Air-conditioning Co., Limited together with China Development Fund Co. Ltd. in 2015 and 2016, China Development Fund Co. Ltd. invested RMB73 million in Qingdao Haier (Jiaozhou) Air-conditioning Co., Limited. China Development Fund Co. Ltd. obtained an annual return of 1.2% by means of dividends or buyback premium for the above investments. As of the end of the period, the subsidiaries of the Company made buyback in amount of RMB36.5 million.

39. Long-term employee benefits payable

√ Applicable □ Not Applicable

(1) Long-term employee benefits payable

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
I. Post-employment benefits: net liability of
defined benefit plans	1,810,349,667.72	1,766,487,772.54
II. Termination benefits	575,746,527.21	541,765,948.00
III. Other long-term benefits	100,396,953.09	100,022,169.77
IV. Provision for work-related injury
compensation	173,367,783.76	153,371,556.04
Total	2,659,860,931.78	2,561,647,446.35

(2) Defined benefits plans

Some subsidiaries of the Company have set several defined benefit plans for the qualified staff. Under these plans, the employees are entitled to the retirement benefits agreed in such defined benefit plans.

These plans are exposed to interest rate risks, changes in life expectancy of the beneficiary and other risks.

The recent actuarial evaluation of the assets and the present value of defined benefit obligations under such plans are determined by using the projected unit credit method.

① The defined benefit plan of HaierU.S.ApplianceSolutions,Inc., a subsidiary of the Company

HaierU.S.ApplianceSolutions,Inc., a subsidiary of the Company has provided post-employment defined benefit plan of health care benefits to eligible employees.

Actuarial assumptions used in the defined benefit plan

Items	Rate
Discount rate	5.51%

Present value of defined benefit obligations

Items	Amount
I. Opening balance	138,011,845.57
II. Business combination not under common control
III. Defined benefit cost recognized in current profit or loss	–11,743,337.59
1. Current service cost
2. Past service cost
3. Settlement gains (losses are represented by '-')
4. Interest cost	–11,743,337.59
IV. Defined benefit cost recognized in other
comprehensive income
1. Actuarial losses (gains are represented by '-')
V. Other changes	–22,668,625.98
1. The consideration paid at the time of settlement
2. Benefit paid	–22,194,274.48
3. Exchange differences	–474,351.50
VI. Closing balance	103,599,882.00

Net liability (net asset) of the defined benefit plan

Items	Amount
I. Opening balance	138,011,845.57
II. Business combination not under common control
III. Defined benefit cost recognized in current profit or loss	–11,743,337.59
IV. Defined benefit cost recognized in
other comprehensive income
V. Other changes	–22,668,625.98
VI. Closing balance	103,599,882.00

② The defined benefit plan of CarrierRefrigerationBeneluxB.V, a subsidiary of the Company

CarrierRefrigerationBeneluxB.V., a subsidiary of the Company, has provided post-retirement defined benefit plan of health care benefits for the eligible employees.

Actuarial assumptions used in the defined benefit plan

Items	Rate
Discount rate	3.30%

Present value of defined benefit obligations

Items	Amount
I. Opening balance	1,423,443,470.41
II. Business combination not under common control
III. Defined benefit cost recognized in current profit or loss	27,876,203.99
1. Current service cost	4,550,387.66
2. Past service cost
3. Settlement gains (losses are represented by '-')
4. Interest cost	23,325,816.33
IV. Defined benefit cost recognized in other
comprehensive income	–130,196,605.30
1. Actuarial losses (gains are represented by '-')	–130,196,605.30
V. Other changes	73,768,244.65
1. The consideration paid at the time of settlement
2. Benefit paid	–23,362,234.12
3. Exchange differences	97,130,478.77
VI. Closing balance	1,394,891,313.75

Fair value of plan assets

Items	Amount
I. Opening balance	50,570,397.42
II. Business combination not under common control
III. Defined benefit cost recognized in current profit or loss
1. Interest income
IV. Defined benefit cost recognized in other
comprehensive income
1. Return on plan assets (except those included in
net interests)
2. Changes in impact of asset cap (except those
included in net interests)
V. Other changes	3,777,042.00
1. Employer contributions
2. Benefit paid
3. Exchange differences	3,777,042.00
VI. Closing balance	54,347,439.42

Net liability (net asset) of the defined benefit plan

Items	Amount
I. Opening balance	1,372,873,072.99
II. Business combination not under common control
III. Defined benefit cost recognized in current profit or loss	27,876,203.99
IV. Defined benefit cost recognized in
other comprehensive income	–130,196,605.30
V. Other changes	69,991,202.65
VI. Closing balance	1,340,543,874.33

Classification of the balance of defined benefit plans

Items	Closing balance	Opening balance
Short-term Benefit	25,763,889.81	37,042,017.07
Long-term Benefit	1,810,349,667.72	1,766,487,772.54
Total	1,836,113,557.53	1,803,529,789.61

40. Estimated liabilities

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance
Active litigation	34,489,279.27	52,893,571.31
Others	402,474,952.22	353,215,103.35
Projection of warranty expenses and
installation fees	1,967,373,906.20	1,980,153,078.26
Total	2,404,338,137.69	2,386,261,752.92

Significant assumption and estimation relating to estimation of warranty expenses and installation fees: the Company reasonably estimated the warranty expenses and installation fees rate based on its actual expenses on the warranty expenses and installation fees as well as sales data in the past. The Company estimated the warranty expenses and installation fees that are likely to be incurred in the future according to its policies on the warranty expenses and installation fees, as well as the actual sales data.

41. Deferred income

√ Applicable □ Not Applicable

Items	Opening balance	Increase for the current period	Decrease for the current period	Closing balance
Government grants	1,252,216,590.03	118,604,129.24	59,442,075.14	1,311,378,644.13
Total	1,252,216,590.03	118,604,129.24	59,442,075.14	1,311,378,644.13

42. Share capital

		Increase for the	Decrease for the
Share category	Opening balance	current period	current period	Closing balance
I. Restricted shares
1. State-owned shares
2. Shares held by domestic
non-state-owned legal entities
3. Shares held by domestic
individuals
4. Shares held by offshore non-state-
owned legal entities
II. Non-restricted shares	9,382,913,334			9,382,913,334
1. Ordinary shares in RMB	6,254,501,095			6,254,501,095
2. Domestic listed foreign Shares
3. Offshore listed foreign Shares	3,128,412,239			3,128,412,239
4. Others
III. Total shares	9,382,913,334			9,382,913,334

43. Capital reserve

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Opening balance	Increase for the current period	Decrease for the current period	Closing balance
Capital premium (Share premium) Others capital reserve Total	18,567,161,037.20 1,743,057,184.84 20,310,218,222.04	6,098,611.77 221,073,939.39 227,172,551.16	692,993,540.95 692,993,540.95	17,880,266,108.02 1,964,131,124.23 19,844,397,232.25

The main reasons for the change in capital premium: capital reduction by the minority shareholders for the current period resulted in the decrease in capital premium of RMB305,871,527.15; share premium in the current period was offset by combination under common control of RMB385,944,236.13.

The main reasons for the change in other capital reserves: the amortized share-based payment for the current period included in other capital reserves of RMB221,073,939.39.

44. Treasury stock

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Opening balance	Increase for the current period	Decrease for the current period	Closing balance
Treasury stock	3,510,728,776.44	856,403,284.46		4,367,132,060.90
Total	3,510,728,776.44	856,403,284.46		4,367,132,060.90

The main reasons for the change in treasury stock: the repurchase of treasury stock for the current period of RMB856,403,284.46.

45. Other comprehensive income

Items	Opening balance	Amounts for the current period
					Attributable to
		Amount before	Deduction of	Attributable to the	minority
		current income	impact of income	parent company	shareholders
		tax	tax	after tax	after tax	Others	Closing balance
a	–362,738,623.59	30,761,163.87		28,468,182.86	2,292,981.01		–334,270,440.73
b	–122,083,113.66	–166,241,633.23	33,928,506.29	–130,457,670.38	–1,855,456.56		–252,540,784.04
c	83,057,616.24	1,711,876,540.52		1,715,243,628.31	–3,367,087.79		1,798,301,244.55
d	1,081,059,271.89	–377,719,032.49	83,807,965.31	–293,914,281.42	3,214.24		787,144,990.47
e	146,207,709.59	134,750,500.02	1,107,369.60	135,857,881.73	–12.11		282,065,591.32
Total	825,502,860.47	1,333,427,538.69	118,843,841.20	1,455,197,741.10	–2,926,361.21		2,280,700,601.57

Notes:

• (1) Item a, b, and c are other comprehensive income that will be reclassified to profit or loss, the details are as follows: Item a represents other comprehensive income classified to profit and loss under the equity method. Item b represents cash flow hedge reserves (the effective part of the cash flow hedge profit and loss). Item c represents exchange differences on translation of financial statements denominated in foreign currencies.
• (2) Item d and e are other comprehensive income that cannot be reclassified into profit or loss. Details are as follows: Item d represents the change in fair value of investments in other equity instruments.

Item e represents changes arising from remeasurement of net liabilities or assets of defined benefit plans.

46. Surplus reserve

√ Applicable □ Not Applicable

Unit and Currency: RMB

		Increase for the	Decrease for the
Items	Opening balance	current period	current period	Closing balance
Statutory surplus reserve	5,248,946,090.86			5,248,946,090.86
Discretionary surplus reserve	26,042,290.48			26,042,290.48
Reserve fund	11,322,880.64			11,322,880.64
Enterprise expansion fund	10,291,630.47			10,291,630.47
Total	5,296,602,892.45			5,296,602,892.45

Pursuant to the Company Law of the People's Republic of China and the Articles of Association, the Company is required to appropriate the statutory surplus reserve at 10% of its net profit of the year. When the accumulated statutory surplus reserve reaches 50% of the registered capital, no further withdrawal will be made.

47. Undistributed profits

Items	Amounts
Undistributed profits at the end of previous year	79,288,144,269.76
Change in accounting policy
Combination under common control	186,221,964.94
Undistributed profits at the beginning of the year	79,474,366,234.70
Add: net profit attributable to owners of the parent company	12,032,995,820.27
Other transfer in	–58,758,990.66
Adjustment due to implementation of enterprise accounting standard
Profit available for distribution for the year	91,448,603,064.31
Less: appropriation of statutory surplus reserve
Dividend payable for ordinary shares	–8,991,794,045.13
Undistributed profits at the end of the period	82,456,809,019.18

48. Operating income and operating cost

(1) Operating income

Items	Amount for the current period	Amount for the previous period
Primary business	155,737,423,233.75	141,200,772,557.97
Other Business	756,611,215.10	781,710,047.78
Total	156,494,034,448.85	141,982,482,605.75

(2) Primary business income and primary business cost by product category

Categories	Amount for the current period		Amount for the previous period
	Primary	Primary	Primary	Primary
	business income	business cost	business income	business cost
Air conditioner	32,773,116,118.25	24,821,013,600.94	29,010,601,435.70	22,060,525,312.37
Refrigerator	42,517,263,682.82	30,243,865,847.23	40,858,797,164.04	29,158,061,137.72
Kitchen appliance	20,507,654,798.42	14,636,534,679.15	20,121,663,515.89	14,415,361,584.50
Water appliance	9,568,195,570.47	6,035,597,553.81	7,891,692,972.94	5,002,145,224.53
Washing machine	31,645,348,772.57	22,036,825,098.96	29,427,102,302.00	20,539,974,853.10
Equipment product and
integrated channel
services	18,725,844,291.22	16,413,846,241.67	13,890,915,167.40	12,443,153,339.38
Total	155,737,423,233.75	114,187,683,021.76	141,200,772,557.97	103,619,221,451.60

49. Taxes and surcharge

√ Applicable □ Not Applicable

Items	Amount for the current period	Amount for the previous period
City maintenance and construction tax	216,826,875.38	205,158,082.67
Education surcharge	111,002,174.00	119,339,956.37
Property tax	87,636,662.47	73,405,594.04
Land use tax	26,449,754.79	24,445,566.26
Stamp duty	207,214,672.39	160,693,601.14
Others	30,424,664.05	27,259,516.58
Total	679,554,803.08	610,302,317.06

50. Selling expenses

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amount for the current period	Amount for the previous period
Selling expenses	15,816,814,510.07	14,517,816,334.58
Total	15,816,814,510.07	14,517,816,334.58

The Company's selling expenses are mainly salary expenses, transportation and storage fees, and advertising and promotion fees.

51. Administrative expenses

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amount for the current period	Amount for the previous period
Administrative expenses	5,891,046,898.48	5,382,166,653.05
Total	5,891,046,898.48	5,382,166,653.05

The Company's administrative expenses are mainly salary expenses, office fees, depreciation and amortization of assets fees, etc.

52. R&D expenses

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amount for the current period	Amount for the previous period
R&D expenses	5,790,436,804.10	5,182,598,681.20
Total	5,790,436,804.10	5,182,598,681.20

The Company's R&D expenses are mainly salary expenses, R&D equipment expenses, inspection and testing fees.

53. Financial expenses

Items	Amount for the current period	Amount for the previous period
Interest expense	1,446,615,689.51	1,252,571,601.13
Less: interest income	908,582,647.56	947,056,127.00
Less: cash discount	102,284,390.50	62,102,125.84
Exchange gains or losses
(gains are represented by '-')	–881,376,818.22	–263,159,366.26
Others	94,770,605.30	72,791,807.54
Total	–350,857,561.47	53,045,789.57

Interest expenditure in lease liabilities for the current period was RMB176,593,110.63 (amount for the corresponding period: RMB96,013,680.91).

54. Other income

√ Applicable □Not Applicable

Unit and Currency: RMB

Classified by nature	Amount for the current period	Amount for the previous period
Government grants related to revenue	728,969,755.04	532,638,111.02
Government grants related to assets	46,244,753.38	52,786,262.32
Total	775,214,508.42	585,424,373.34

55. Investment income (losses are represented by '-')

Items	Amount for the current period	Amount for the previous period
Long-term equity investments income calculated
by the equity method	850,409,233.36	913,969,362.35
Investment income from disposal of long-term
equity investments	–4,387,023.49	–14,953,215.38
Investment income from other equity instrument
investments during holding period	3,225,726.29	2,996,902.10
Income from wealth management products	45,175,048.95	29,641,941.56
Investment income from disposal of financial
assets measured at fair value with changes
included in current profit or loss	22,835,518.25	76,000.00
Total	917,258,503.36	931,730,990.63

Items	Amount for the current period	Amount for the previous period
Changes in fair value of equity investments	–4,275,003.34	–54,049,574.20
Changes in fair value of fund investments	25,935,689.85	22,787,943.83
Others	13,092,854.12	1,696,032.55
Total	34,753,540.63	–29,565,597.82

56. Gains on changes in fair value (losses are represented by '-')

57. Credit impairment losses

√ Applicable □ Not Applicable

Items	Amount for the current period	Amount for the previous period
Bad debts losses on bills receivables	184,079.11	360,918.35
Bad debts losses on accounts receivable	–55,292,827.56	–136,457,834.87
Bad debts losses on other receivable	–16,803,339.40	66,301,974.49
Total	–71,912,087.85	–69,794,942.03

Items	Amount for the current period	Amount for the previous period
Impairment losses on inventory	–464,995,039.52	–428,210,654.99
Impairment losses on other current assets	–279,221,989.21	–280,012,125.83
Impairment losses on fixed assets
Impairment losses on construction in progress
Impairment losses on intangible assets
Impairment losses on contract assets	103,983.91	1,738,301.13
Impairment losses on long-term equity investments
Impairment losses on prepayments		46,943.81
Total	–744,113,044.82	–706,437,535.88

58. Impairment losses on assets (losses are represented by '-')

59. Gains on disposal of assets

√ Applicable □ Not Applicable

Items	Amount for the current period	Amount for the previous period
Gains on disposal of non-current assets Losses on disposal of non-current assets	6,280,751.77 –13,648,789.31	9,015,344.34 –10,585,042.83
Total	–7,368,037.54	–1,569,698.49

60. Non-operating income

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amount for the current period	Amount for the previous period
Gains on disposal of non-current assets	4,626,638.73	96,154.87
Quality claims and fines Others Total	23,563,630.75 93,665,386.66 121,855,656.14	24,265,721.43 52,128,870.17 76,490,746.47

61. Non-operating expenses

√ Applicable □ Not Applicable

Items	Amount for the current period	Amount for the previous period
Losses on disposal of non-current assets	18,593,317.72	7,312,366.85
Others	239,145,458.34	89,585,857.27
Total	257,738,776.06	96,898,224.12

62. Income tax expenses

(1) Statement of income tax expenses

Items	Amount for the current period	Amount for the previous period
Current income tax expense	2,258,469,724.26	2,273,026,691.14
Deferred income tax expense	253,470,624.41	–65,850,873.88
Total	2,511,940,348.67	2,207,175,817.26

(2) Reconciliation between accounting profit and income tax expenses for the current period

Items	Amounts
Total accounting profit	14,997,056,148.11
Income tax expense calculated pursuant to statutory tax rate	3,749,264,037.03
Impact from different tax rates applicable to subsidiaries	–1,395,463,023.45
Impact from adjustment to income tax in prior periods	–238,625,913.73
Impact from non-taxable income	–238,916,572.24
Impact from non-deductible cost, expense and loss	215,003,853.81
Impact from deductible provisional differences or deductible
losses of unrecognized deferred tax	447,958,728.00
Others	–27,280,760.75
Total income tax expense	2,511,940,348.67

63. Other comprehensive income

√ Applicable □ Not Applicable

Please refer to notes VII.45 for details.

64. Cash flow statement items

(1) Cash related to operating activities Other cash received from operating activities √ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amount for the current period
Deposits and securities	271,876,028.06
Government grants	466,806,344.50
Non-operating income excluding government grants	36,649,145.18
Interest income	654,969,731.79
Others	81,883,220.07
Total	1,512,184,469.60

Other cash paid to operating activities

√ Applicable □ Not Applicable

Items	Amount for the current period
Cash paid on selling and after-sales expenses	7,723,584,328.13
Cash paid on administrative and R&D expenses	3,623,107,522.91
Cash paid on financial expenses	88,422,457.30
Non-operating expenses	18,627,498.30
Deposits and securities	32,264,475.02
Others	58,659,663.70
Total	11,544,665,945.36

(2) Cash related to investing activities

Other cash received from significant investing activities √ Applicable □ Not Applicable

Items	Amount for the current period
Redemption of wealth management products	19,962,026,830.53
Total Other cash paid to significant investing activities	19,962,026,830.53
√ Applicable □ Not Applicable
	Unit and Currency: RMB
	Amount for the
Items	current period
Purchase of wealth management products	26,918,044,657.46
Total	26,918,044,657.46
Other cash received from investing activities √ Applicable □ Not Applicable
	Unit and Currency: RMB
Items	Amount for the current period
Recovery of amounts from disposal of equity interests in
previous years	128,938,719.56
Others	2,490,086.58
Total	131,428,806.14

(3) Cash related to financing activities

√ Applicable □ Not Applicable

Unit and Currency: RMB

Other cash received from financing activities

Items	Amount for the current period
Amount recovered from the capital pool of COSMOPlat Mould
(Qingdao) Co., Ltd.	111,646,384.65
Total	111,646,384.65
Other cash paid to financing activities

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amount for the current period
Repurchase of shares	856,403,284.46
Cash paid to lease	813,449,403.83
Purchase of minority interests in subsidiaries	2,155,055,760.34
Cash paid for business combination under common control	77,749,769.26
Others	2,904,023.09
Total	3,905,562,240.98

Changes of various liabilities arising from financing activities

√ Applicable □ Not Applicable

Items	Opening balance		Increase for the current period	Decrease for the current period		Closing balance
		Non-cash		Non-cash
		Cash change	change	Cash change	change
Short-term borrowings Long-term borrowings		13,784,367,443.93 11,512,725,588.49	218,280,882.32	9,347,387,559.64	40,371,717.86	16,127,614,637.24
(including those due within one year) Lease liabilities (including those due within one	20,030,302,099.39	2,306,085,839.54	146,536,745.55	4,972,226,258.10		17,510,698,426.38
year) Bonds payable (including those due within one	5,833,372,352.27		1,464,770,128.25	813,449,403.83	39,423,617.39	6,445,269,459.30
year)		3,500,000,000.00	11,471,250.00			3,511,471,250.00
Total		39,648,041,895.59 17,318,811,428.03	1,841,059,006.12	15,133,063,221.57	79,795,335.25	43,595,053,772.92

65. Supplementary information to the cash flow statement

	Amount for the	Amount for the
Supplementary information	current period	previous period
1. Net profit adjusted to cash flow of
operating activities:
Net profit	12,485,115,799.44	10,773,597,554.50
Add: impairment provision for assets	744,113,044.82	706,437,535.88
Losses from credit impairment	71,912,087.85	69,794,942.03
Depreciation of fixed assets, depletion of oil and gas assets, depreciation of
biological assets for production	2,519,985,504.97	2,321,884,231.99
Amortization of right-of-use assets	771,315,015.94	735,739,606.98
Amortization of intangible assets	716,020,914.20	689,256,426.61
Amortization of long-term prepaid
expenses	178,900,068.92	236,321,231.56
Losses from disposal of fixed assets, intangible assets and other long-term
assets (gains are represented by "—")	21,334,716.53	8,785,910.47
Losses from changes of fair value (gains
are represented by "—")	–34,753,540.63	29,565,597.82
Financial expenses (gains are represented by "—")	1,326,152,965.53	803,559,417.21
Losses from investments (gains are represented by "—")	–917,258,503.36	–931,730,990.63
Decrease in deferred income tax assets
(increase is represented by "—")	217,417,921.39	–18,620,089.52
Increase of deferred income tax liabilities (decrease is represented by "—")	36,052,703.02	–47,230,784.35
Decrease in inventories (increase is represented by "—")	–772,501,496.05	–383,440,948.12
Decrease of operational account
receivables (increase is represented by
"—")	–1,945,082,457.96	–3,781,790,557.04
Increase of operational account payables
(decrease is represented by "—")	–4,559,914,956.76	–2,961,721,296.82
Others	280,235,993.49	173,652,814.86
Net cash flow generated from operational
activities	11,139,045,781.34	8,424,060,603.43

(1) Supplementary information to the cash flow statement

	Amount for the	Amount for the
Supplementary information	current period	previous period
2. Significant investment and financing
activities not involving cash inflows
and outflows:
Capital transferred from debts
Convertible corporate bonds due within
one year
Fixed assets under finance lease
3. Net changes of cash and cash
equivalents:
Cash balance at the end of the period	54,514,391,673.07	55,403,830,583.32
Less: cash balance at the beginning of
the period	54,994,595,280.18	56,715,672,668.25
Add: cash equivalents balance at the end
of the period
Less: cash equivalents balance at the
beginning of the period
Net increase of cash and cash
equivalents	–480,203,607.11	–1,311,842,084.93

(2) Composition of cash and cash equivalents

Items	Closing balance	Opening balance
I. Cash	54,514,391,673.07	54,994,595,280.18
Including: Cash on hand	1,685,740.35	560,953.91
Bank deposits always available for
payment	53,646,652,252.87	54,256,005,280.85
Other monetary funds always available for
payment	866,053,679.85	738,029,045.42
II. Cash equivalents
Including: bond investments due within
three months
III. Closing balance of cash and cash
equivalents	54,514,391,673.07	54,994,595,280.18
Including: restricted cash and cash
equivalents used by the parent
company or subsidiaries of
the Group

(3) Monetary funds that are not cash and cash equivalents

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing balance	Opening balance	Reasons
Deposit	769,431,523.05	532,703,901.59	Poor marketability, not readily
Restricted special account deposit	40,756,203.22	36,317,505.47	realizable, or not available
Others	32,523,137.48	33,937,935.59	for payment
Total	842,710,863.75	602,959,342.65	/

(4) Information about Supplier Financing Arrangements

• 1) Terms and conditions of supplier financing arrangements
  • ① Accounts payable financing factoring: The subsidiaries of the Company engage in accounts payable financing with banks, whereby the subsidiaries of the Company apply to the banks for the banks to directly pay the supplier on the due date of the accounts payable. Upon the expiration of the agreed financing period (generally 6–12 months), the subsidiaries of the Company will repay the corresponding amount to the banks. When the banks make payment to the supplier on behalf of the subsidiaries, the subsidiaries of the Company cease to recognize the related accounts payable and simultaneously incur a liability to the banks.
  • ② Accounts payable supply chain factoring: The subsidiaries of the Company conduct supply chain financing business. According to the relevant arrangements, participating suppliers can choose to receive payment for invoices under this arrangement in advance from financial institutions without being influenced by the Company. Regardless of whether the supplier opts for early payment, the subsidiaries of the Company will repay the full invoice amount on the agreed payment due date and are not responsible for paying interest or other fees to the financial institutions. Since this arrangement does not extend the original payment period, the subsidiaries' debts to the financial institutions are classified as accounts payable.

Item	Closing balance	Opening balance
Short-term borrowings	128,166,335.69	98,355,349.41
Including: Amounts received by
suppliers from financing
provider	128,166,335.69	98,355,349.41
Accounts payable	9,124,785,121.93	8,502,906,169.43
Including: Amounts received by
suppliers from financing
provider	5,045,915,845.75	4,674,536,705.90

The payment period for comparable accounts payable not under supplier financing arrangements ranges from 30 to 270 days.

Items Closing balance Opening balance Balance in foreign currency Exchange rate Balance in RMB Balance in foreign currency Exchange rate Balance in RMB Monetary funds USD 2,342,544,643.15 7.1586 16,769,340,082.48 2,212,325,253.41 7.1884 15,903,078,851.59 EUR 90,052,655.68 8.4024 756,658,434.09 171,400,140.17 7.5257 1,289,906,034.89 JPY 5,230,348,450.42 0.049594 259,393,901.05 4,381,349,907.64 0.046233 202,562,950.28 HKD 451,020,938.83 0.9120 411,331,096.21 539,613,158.97 0.9260 499,681,785.21 Others 3,515,374,745.41 3,453,401,844.51 Subtotal 21,712,098,259.24 21,348,631,466.48 Accounts receivables USD 1,258,488,324.01 7.1586 9,009,014,516.28 1,463,282,401.93 7.1884 10,518,659,218.06 EUR 666,945,428.33 8.4024 5,603,942,266.96 637,522,791.08 7.5257 4,797,805,268.81 JPY 4,331,666,640.12 0.049594 214,824,675.35 4,138,295,194.99 0.046233 191,325,801.75 Others 7,254,967,234.95 4,807,501,407.14 Subtotal 22,082,748,693.54 20,315,291,695.76 Short-term borrowings USD 965,044,955.47 7.1586 6,908,370,818.26 774,590,743.79 7.1884 5,568,068,102.65 EUR 111,437,799.93 8.4024 936,344,970.14 129,161,874.07 7.5257 972,033,515.70 JPY 0.049594 1,952,854,108.54 0.046233 90,286,304.00 HKD 770,000,000.00 0.9120 702,240,000.00 2,530,000,000.00 0.9260 2,342,780,000.00 Others 2,561,041,908.66 1,734,146,904.27 Subtotal 11,107,997,697.06 10,707,314,826.62 Accounts payables USD 1,947,283,184.27 7.1586 13,939,821,402.91 2,204,807,610.20 7.1884 15,849,039,025.17 EUR 688,313,334.47 8.4024 5,783,483,961.59 799,305,156.44 7.5257 6,015,330,815.80 JPY 3,734,984,438.04 0.049594 185,232,818.22 4,562,773,337.01 0.046233 210,950,699.69 NZD 156,447,192.17 4.3475 680,154,167.94 144,506,699.36 4.0955 591,827,187.21 Others 4,174,823,217.11 3,963,471,194.55 Subtotal 24,763,515,567.77 26,630,618,922.42 Non-current liabilities due within one year USD 500,000,000.00 7.1586 3,579,300,000.00 500,000,000.00 7.1884 3,594,200,000.00 EUR 74,640,143.00 8.4024 627,156,337.54 573,987,092.00 7.5257 4,319,654,658.26 Others 999,885,485.96 941,786,481.62 Subtotal 5,206,341,823.50 8,855,641,139.88 Long-term borrowings USD 660,000,000.00 7.1586 4,724,676,000.00 660,000,000.00 7.1884 4,744,344,000.00 EUR 200,000,000.00 8.4024 1,680,480,000.00 Subtotal 6,405,156,000.00 4,744,344,000.00

66. Monetary items in foreign currency

67. Leases

(1) As lessee

√ Applicable □ Not Applicable

Variable lease payments not included in the measurement of lease liabilities:

√ Applicable □ Not Applicable

RMB39,906,692.00

Lease expenses of short-term leases or leases of low-value assets which are subject to simplified treatment:

√ Applicable □ Not Applicable

RMB689,733,552.24

Total cash outflow for leases: 1,543,089,648.07 (Unit and Currency:RMB)

The leased assets leased by the Company include housing and buildings, production equipment, transportation equipment, office equipment and others used in the course of operations. Some of the leases contain renewal options and termination options.

(2) As lessor

• a. Lease incomes from operating leases as lessor for the current period: RMB25,464,848.81, including incomes related to variable lease payments not included in lease receipts: nil.
• b. Undiscounted lease receipts for the next five years:

		Undiscounted lease receipts
Lease receipts		per year
	Closing amount	Opening amount
Within 1 year	59,345,996.78	11,744,103.00
1 to 2 years	59,883,319.31	10,343,953.00
2 to 3 years	62,855,681.29	10,343,953.00
3 to 4 years	66,006,384.98	10,343,953.00
4 to 5 years	69,346,130.90	10,343,953.00
Over 5 years	189,526,144.08	132,155,812.00
Total	506,963,657.34	185,275,727.00

The leased assets leased out by the Company are mainly housing, buildings and land use rights. For details of changes of the leased assets, please refer to Note VII.16.

VIII. RESEARCH AND DEVELOPMENT EXPENDITURE

1. By the nature of expenses

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amount for the current period	Amount for the previous period
Independent research and development expenses	5,739,193,531.77	5,088,836,211.86
Outsourcing research and development expenses	277,375,105.19	362,452,756.21
Total	6,016,568,636.96	5,451,288,968.07
Including: expensed research and development
expenditure	5,790,436,804.10	5,182,598,681.20
Capitalized research and development expenditure	226,131,832.86	268,690,286.87

2. Development expenditure on research and development projects eligible for capitalization

		Decrease for the current period
Items	Opening balance	Increase for the current period	Recognized as intangible asset	Included in current profit and loss	Change in foreign exchange rate and others	Closing balance
Living Environment Intelligent
Detection PROGRAM	28,814,783.25	117,555,459.48	146,370,242.73
OWNERSHIP EXPERIENCE
PROGRAM	51,656,319.93	7,096,261.81	48,028,438.77		–89,037.53	10,635,105.44
91ABD.ERP IT PROGRAM	28,007,204.85	12,887,648.20	164,768.71		–154,992.65	40,575,091.69
Others	158,789,284.89	88,592,463.37	88,672,600.50		26,184,311.38	184,893,459.14
Total	267,267,592.92	226,131,832.86	283,236,050.71		25,940,281.20	236,103,656.27

IX. CHANGES OF CONSOLIDATION SCOPE

1. Business combination not under common control

□ Applicable √ Not Applicable

2. Business combination under common control

√ Applicable □ Not Applicable

(1) Business combination under common control occurring in the current period

Name of the acquiree	The proportion of equity acquired in the business combination	The basis for the transaction of constituting business combination under common control	Combination date	Recognition basis of combination date
COSMOPlat Mould (Qingdao) Co., Ltd.	100.00%	Controlled by Haier Group Corporation before and after combination	2025.3	Transfer of voting rights
(Continued)
	The income of the	Net profit of the

Name of the acquiree	acquiree from the beginning of the current period to combination date	acquiree from the beginning of the current period to combination date	The income of the acquiree during the comparison period	Net profit of the acquiree during the comparison period
COSMOPlat Mould (Qingdao) Co., Ltd.	139,744,829.73	3,593,306.97	133,233,842.59	–5,554,270.73

(2) Combination cost

√ Applicable □ Not Applicable

Combination cost	—— Cash	—— Equity
COSMOPlat Mould (Qingdao) Co., Ltd.	77,749,769.26

(3) The carrying amount of the assets and liabilities of the acquiree as of the combination date

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	COSMOPlat Mould (Qingdao) Co., Ltd.
	Combination date	End of the previous period
Monetary funds	8,151,371.17	13,712,033.13
Accounts receivables	36,498,914.84	298,755,305.13
Inventories	138,787,502.80	145,441,470.58
Contract assets	10,457,165.36	10,294,407.38
Other current assets	12,292,032.78	13,922,096.30
Investments in other equity instruments		86,992,207.36
Fixed assets	73,851,879.90	94,570,444.38
Construction in progress	2,842,390.82	5,949,707.82
Intangible assets	8,660,560.56	8,265,155.63
Accounts payables	–229,495,562.35	–219,041,447.08
Payables for staff's remuneration	–6,839,598.34	–16,710,350.13
Taxes payable	–640,750.97	–137,995.99
Other current liabilities	–1,956,603.11	–8,653,112.52
Deferred income	–17,089,283.86	–20,604,153.94
Net assets	35,520,019.60	412,755,768.05
Less: minority interests
Net assets acquired	35,520,019.60	412,755,768.05

a. Acquiree's assets and liabilities

3. Disposal of subsidiary

Whether single disposal of investment in subsidiary will result in losing control power:

Items	Qingdao Haier Kitchen IoT Technology Co., Ltd. (青島海 尔厨聯网物聯科技 有限公司)	Haier Israel Innovation Center Ltd
Equity disposal price	—	—
Proportion of equity disposal	100%	100%
Method of equity disposal	Cancellation	Cancellation
Time of loss-of-control	June 2025	March 2025
Basis for determination the time of loss-of- control	Cancellation	Cancellation
Difference between consideration and its share of
net assets of the subsidiary as respect to the
disposal in the consolidated level	–110,214.59	–4,296,665.23

4. Changes of consolidation scope due to other reasons

√ Applicable □Not Applicable

• (1) During the period, Qingdao Ruibo Ecological Environmental Technology Co., Ltd. (青岛瑞博 生 态 环 保科技有限公司), a subsidiary of the Company, established Qingdao Haier Environmental Protection Material Technology Co., Ltd. (青岛海尔环保材料科技有限公司).
• (2) During the period, Qingdao Haier Home AI Industry Innovation Center Co., Ltd., a subsidiary of the Company, established Haier Jingling Technology (Zhejiang) Co., Ltd. (海尔景龄科技 (浙江)有限公司).
• (3) During the period, Qingdao Haier Intelligent Home Appliance Technology Co., Ltd., a subsidiary of the Company, established Qingdao Haiyi Wenhua Commercial Management Co., Ltd. (青岛海逸文华商業管理有限公司).

X. INTERESTS IN OTHER ENTITIES

1. Interests in subsidiaries

(1) Composition of the Group

Name of subsidiary	Principal place of business	Place of registration	Nature of business	Shareholding Direct Indirect	% of voting right	Method
Flourishing Reach Limited	Mainland of China	Bermuda	Group company, which mainly engage in investment holding, the production and sale of washing machines and water heaters, distribution service	100.00%	100.00%	Establishment
Haier Electronics Group Co., Ltd.	Mainland of China and Hong Kong	Bermuda	Group company, which mainly engage in investment holding, the production and sale of water equipment, distribution service	100.00%	100.00%	Establishment
Haier U.S. Appliance Solutions, Inc.	the United States	the United States	Group company, which mainly engage in home appliances production and distribution business	100.00%	100.00%	Establishment
Haier Singapore Investment Holding Co., Ltd.	Singapore and other overseas areas	Singapore	Group company, which mainly engage in home appliances production and distribution business	100.00%	100.00%	Business combination under common control
Haier New Zealand Investment Holding Company Limited	New Zealand	New Zealand	Group company, which mainly engage in home appliances production and distribution business	100.00%	100.00%	Business combination under common control
Candy S.p.A	Europe	Italy	Group company, which mainly engage in home appliances production and distribution business	100.00%	100.00%	Business combination not under common control
Carrier Refrigeration Benelux B.V.	Europe	Germany	Group company, which mainly engage in home appliances production and distribution business	100.00%	100.00%	Business combination under common control

Principal place of
Name of subsidiary	business	Place of registration	Nature of business	Shareholding Direct	Indirect	% of voting right	Method
Kwikot (Haier) SA (Pty) Ltd	South Africa	South Africa	Mainly engage in water heater production and distribution business		100.00%	100.00%	Business combination under common
Qingdao Haier Air Conditioner Gen Corp., Ltd.	Qingdao High-tech Zone	Qingdao High-tech Zone	Manufacture and sale of household air-conditioners	92.37%		92.37%	control Business combination under common
Guizhou Haier Electronics Co., Ltd.	Huichuan District, Zunyi City, Guizhou Province	Huichuan District, Zunyi City, Guizhou Province	Manufacture and sale of refrigerator	59.00%		59.00%	control Business combination under common
Hefei Haier Air conditioning Co., Limited	Hefei Haier Industrial Park	Hefei Haier Industrial Park	Manufacture and sale of air-conditioners	100.00%		100.00%	control Business combination under common
Wuhan Haier Electronics Holding Co., Ltd.	Wuhan Haier Industrial Park	Wuhan Haier Industrial Park	Manufacture and sale of air-conditioners	59.86%		59.86%	control Business combination under common
Qingdao Haier Air Conditioner Electronics Co., Ltd.	Qingdao Development Zone	Qingdao Development Zone	Manufacture and sale of air-conditioners	97.43%		97.43%	control Business combination under common
Qingdao Haier Information Plastic Development Co., Ltd.	Qingdao High-tech Zone	Qingdao High-tech Zone	Manufacturing of plastic products	100.00%		100.00%	control Business combination under common
Dalian Haier Precision Products Co., Ltd.	Dalian Export Expressing Zone	Dalian Export Expressing Zone	Manufacture and sale of precise plastics	90.00%		90.00%	control Business combination under common control
Hefei Haier Plastic Co., Ltd.	Hefei Economic & Technological Development Area	Hefei Economic & Technological Development Area	Manufacture and sale of plastic parts	95.17%	4.83%	100.00%	Business combination under common control
Qingdao Meier Plastic Powder Co., Ltd.	Qingdao Development Zone	Qingdao Development Zone	Manufacture of plastic powder, plastic sheet and high-performance coatings	40.00%	60.00%	100.00%	Business combination under common
Chongqing Haier Precision Plastic Co., Ltd.	Jiangbei District, Chongqing City	Jiangbei District, Chongqing City	Plastic products, sheet metal work, electronics and hardware	90.00%	10.00%	100.00%	control Business combination under common
Qingdao Haier	Qingdao High-tech	Qingdao High-tech	Manufacture and production of	97.91%		97.91%	control Establishment
Refrigerator Co., Ltd. Qingdao Haier Refrigerator (International) Co., Ltd.	Zone Pingdu Development Zone, Qingdao	Zone Pingdu Development Zone, Qingdao	fluorine-free refrigerators Manufacture of refrigerators	100.00%		100.00%	Establishment
Qingdao Household Appliance Technology and Equipment	Qingdao High-tech Zone	Qingdao High-tech Zone	Research and development of home appliances mold and technological equipment	100.00%		100.00%	Establishment
Research Institute Qingdao Haier Whole Set Home Appliance Service Co., Ltd.	Qingdao High-tech Zone	Qingdao High-tech Zone	Research, development and sales of health- related small home appliance	98.33%		98.33%	Establishment
Qingdao Haier Special Refrigerator Co., Ltd.	Qingdao Development Zone	Qingdao Development Zone	Manufacture and sales of fluorine-free refrigerators	100.00%		100.00%	Establishment
Qingdao Haier Dishwasher Co., Ltd.	Qingdao Development Zone	Qingdao Development Zone	Manufacture of dish washing machine and gas stove	99.59%		99.59%	Establishment

	Principal place of					% of voting
Name of subsidiary	business	Place of registration	Nature of business	Shareholding Direct	Indirect	right	Method
Qingdao Haier Special Freezer Co., Ltd.	Qingdao Development Zone	Qingdao Development Zone	Research, manufacture and sales of freezer and other	96.78%		96.78%	Establishment
Dalian Haier Air	Dalian Export	Dalian Export	refrigeration products Air conditioner processing and	90.00%		90.00%	Establishment
conditioning Co., Ltd. Dalian Haier Refrigerator	Expressing Zone Dalian Export	Expressing Zone Dalian Export	manufacturing Refrigerator processing and	100.00%		100.00%	Establishment
Co., Ltd. Qingdao Haier Electronic Plastic Co., Ltd.	Expressing Zone Qingdao Development Zone	Expressing Zone Qingdao Development Zone	manufacturing Development, assembling and sales of plastics, electronics and products	100.00%		100.00%	Establishment
Wuhan Haier Freezer Co., Ltd	Wuhan Economic & Technological Development Zone High-tech Industrial Park	Wuhan Economic & Technological Development Zone High-tech Industrial Park	Research, manufacture and sales of freezer and other refrigeration products	82.93%	4.36%	87.29%	Establishment
Qingdao Haidarui Procurement Service Co., Ltd.	Qingdao High-tech Zone	Qingdao High-tech Zone	Develop, purchase and sell electrical products and components	98.00%	2.00%	100.00%	Establishment
Qingdao Haier Intelligent Home Appliance Technology Co., Ltd.	Qingdao High-tech Zone	Qingdao High-tech Zone	Development and application of home appliances, communication, electronics and network engineering technology	91.46%	1.01%	92.47%	Establishment
Chongqing Haier Air-conditioning Co., Ltd.	Jiangbei District, Chongqing City	Jiangbei District, Chongqing City	Manufacture and sales of air conditioners	76.92%	23.08%	100.00%	Establishment
Qingdao Haier Precision Products Co., Ltd.	Qianwang ang Road, Jiaonan City	Qianwang ang Road, Jiaonan City	Development and manufacture of precise plastic, metal plate, mold and electronic products for home appliances		70.00%	70.00%	Establishment
Qingdao Haier Air Conditioning Equipment Co., Ltd.	Jiaonan City, Qingdao	Jiaonan City, Qingdao	Manufacture of home appliances and electronics		100.00%	100.00%	Establishment
Dalian Free Trade Zone Haier Air-conditioning Trading Co., Ltd.	Dalian Export Expressing Zone	Dalian Export Expressing Zone	Domestic trade		100.00%	100.00%	Establishment
Dalian Free Trade Zone Haier Refrigerator Trading Co., Ltd.	Dalian Export Expressing Zone	Dalian Export Expressing Zone	Domestic trade		100.00%	100.00%	Establishment
Chongqing Haier Electronics Sales Co., Ltd.	Jiangbei District, Chongqing City	Jiangbei District, Chongqing City	Sales of home appliances	95.00%	5.00%	100.00%	Establishment
Chongqing Haier Refrigeration Appliance Co., Ltd.	Jiangbei District, Chongqing City	Jiangbei District, Chongqing City	Processing and manufacturing of refrigerator	84.95%	15.05%	100.00%	Establishment
Hefei Haier Refrigerator Co., Ltd.	Hefei Haier Industrial Park	Hefei Haier Industrial Park	Processing and manufacturing of refrigerator	100.00%		100.00%	Establishment
Qingdao Haier Intelligent Building Technology Co., Ltd.	Qingdao Development Zone	Qingdao Development Zone	Air-conditioning engineer		100.00%	100.00%	Establishment
Chongqing Lianmai Electric Appliance Sales Co., Ltd. (重庆 聯邁电器銷售有限公 司)	Jiangbei District, Chongqing City	Jiangbei District, Chongqing City	Sales of home appliances and electronics		51.00%	51.00%	Establishment
Qingdao Haier (Jiaozhou) Air-conditioning Co., Limited	Jiaozhou City, Qingdao	Jiaozhou City, Qingdao	Manufacture and sale of air-conditioners		100.00%	100.00%	Establishment
Qingdao Haier Component Co., Ltd.	Jiaozhou City, Qingdao	Jiaozhou City, Qingdao	Manufacture and sales of plastic and precise sheet metal products		100.00%	100.00%	Establishment

Name of subsidiary	Principal place of business	Place of registration	Nature of business	Shareholding Direct	Indirect	% of voting right	Method
Haier Shareholdings	Hong Kong	Hong Kong	Investment	100.00%		100.00%	Establishment
(Hong Kong) Limited Harvest International	Cayman Islands	Cayman Islands	Investment		100.00%	100.00%	Establishment
Company Shenyang Haier	Shenbei New Area,	Shenbei New Area,	Manufacture and sales of	100.00%		100.00%	Establishment
Refrigerator Co., Ltd. Foshan Haier Freezer Co., Ltd.	Shenyang City Sanshui District, Foshan City	Shenyang City S Sanshui District, Foshan City	refrigerator Manufacture and sales of refrigerator	100.00%		100.00%	Establishment
Zhengzhou Haier Air-conditioning Co.,	Zhengzhou Economic and Technological	Zhengzhou Economic and Technological	Manufacture and sales of freezer	100.00%		100.00%	Establishment
Ltd. Qingdao Haidayuan Procurement Service	Development Zone Qingdao Development Zone	Development Zone Qingdao Development Zone	Develop, purchase and sell electrical products and	100.00%		100.00%	Establishment
Co., Ltd. Qingdao Haier Intelligent Technology	Qingdao High-tech Zone	Qingdao High-tech Zone	components Development and research of home appliance products	100.00%		100.00%	Establishment
Development Co., Ltd. Qingdao Hairi High Technology Co., Ltd.	Qingdao High-tech Zone	Qingdao High-tech Zone	Design, manufacture and sales of product model and mould		100.00%	100.00%	Business combination under common
Qingdao Hai Gao Design and Manufacture Co., Ltd.	Qingdao High-tech Zone	Qingdao High-tech Zone	Industrial design and prototype production		75.00%	75.00%	control Business combination under common control
Zhongshan Haier HV Equipment Co., Ltd. (中山海尔暖通设备有	Zhongshan	Zhongshan	Sales of home appliances		100.00%	100.00%	Establishment
限公司) Qingdao Haier HV Equipment Technology Co., Ltd. (青島海尔暖	Qingdao	Qingdao	Manufacture and sale of air conditioning equipment		100.00%	100.00%	Establishment
通设备科技有限公司) Shanghai Haier Medical Technology Co., Ltd.	Shanghai	Shanghai	Wholesale and retail of medical facility		66.87%	66.87%	Establishment
Qingdao Haier Technology Co., Ltd.	Qingdao	Qingdao	Development and sales of software and information product	100.00%		100.00%	Business combination under common control
Qingdao Haier Technology Investment	Qingdao	Qingdao	Entrepreneurship investment and consulting	100.00%		100.00%	Establishment
Co., Ltd. Qingdao Casarte Smart Living Appliances Co.,	Qingdao	Qingdao	Development, production and sales of appliances		100.00%	100.00%	Establishment
Ltd. Qingdao Haichuangyuan Appliances Sales Co.,	Qingdao	Qingdao	Sales of home appliances and digital products		100.00%	100.00%	Establishment
Ltd. Haier Overseas Electric Appliance Co., Ltd.	Qingdao	Qingdao	Sales of home appliances, international freight	100.00%		100.00%	Establishment
Haier Group (Dalian) Electrical Appliances Industry Co., Ltd.	Dalian	Dalian	forwarding Sales of home appliances, international freight forwarding	100.00%		100.00%	Business combination under common control
Qingdao Haier Central Air Conditioning Co., Ltd.	Qingdao	Qingdao	Production and sales of air and refrigeration equipment		100.00%	100.00%	Establishment
Chongqing Haier Home Appliance Sale Hefei Co., Ltd.	Hefei	Hefei	Sales of home appliances		100.00%	100.00%	Establishment
Qingdao Weixi Smart Technology Co., Ltd.	Qingdao	Qingdao	Intelligent sanitary ware		85.00%	85.00%	Establishment

	Principal place of
Name of subsidiary	business	Place of registration	Nature of business	Shareholding Direct	Indirect	% of voting right	Method
Haier U+smart Intelligent Technology (Beijing) Co., Ltd.	Beijing	Beijing	Software development	100.00%		100.00%	Establishment
Haier (Shanghai) Electronics Co., Ltd.	Shanghai	Shanghai	Sales, research and development of home appliances	100.00%		100.00%	Establishment
Shanghai Haier Zhongzhi Fang Chuang Ke Management Co., Ltd.	Shanghai	Shanghai	Business management consulting, chuangke management	100.00%		100.00%	Establishment
Qingdao Haier Smart Kitchen Appliance Co., Ltd.	Qingdao	Qingdao	Production and sales of kitchen smart home appliances		85.82%	85.82%	Establishment
GE Appliance (Shanghai) Co., Ltd.	Shanghai	Shanghai	Sales of home appliances		100.00%	100.00%	Establishment
Qingdao Haier Special Refrigerating Appliance Co., Ltd.	Qingdao	Qingdao	Production and sales of home appliances		100.00%	100.00%	Establishment
Shanghai Zhihan Technology Co., Ltd. (上海摯瀚科技有限公 司)	Shanghai	Shanghai	Promotion of technological development		100.00%	100.00%	Establishment
Laiyang Haier Smart Kitchen Appliance Co., Ltd.	Laiyang	Laiyang	Production and sales of home appliances		100.00%	100.00%	Establishment
Hefei Haier Air Conditioning Electronics Co., Ltd.	Hefei	Hefei	Production and sales of home appliances		100.00%	100.00%	Establishment
Haier (Shanghai) Home Appliance Research and Development Center Co., Ltd.	Shanghai	Shanghai	Research and development of home appliances		100.00%	100.00%	Establishment
Haier (Shenzhen) R&D Co., Ltd.	Shenzhen	Shenzhen	Development, research and technical services of household and commercial electrical		100.00%	100.00%	Establishment
Guangzhou Haier Air Conditioner Co., Ltd.	Guangdong	Guangdong	Manufacturing of refrigeration and air conditioning equipment		100.00%	100.00%	Establishment
Qingdao Yunshang Yuyi IOT Technology Co., Ltd.	Qingdao	Qingdao	IoT technology research and development		60.00%	60.00%	Establishment
Qingdao Jijia Cloud Intelligent Technology Co., Ltd.	Qingdao	Qingdao	R&D and sales of lighting appliances		80.00%	80.00%	Establishment
Qingdao Haimeihui Management Consulting Co., Ltd. (青島海美匯管理諮詢 有限公司)	Qingdao	Qingdao	Leasing and business services		100.00%	100.00%	Establishment
Wuxi Yunshang Internet of Clothing Technology Co., Ltd. (無錫云裳衣 聯网科技有限公司)	Wuxi	Wuxi	Internet of Things technology R & D		100.00%	100.00%	Establishment
Qingdao Haidacheng Procurement Service Co., Ltd.	Qingdao	Qingdao	Develop, purchase and sell electrical products and components	100.00%		100.00%	Establishment
Guangdong Haier Intelligent Technology Co. Ltd. (廣東海尔智 能科技有限公司)	Guangzhou	Guangzhou	Scientific research and technology service sector		76.72%	76.72%	Business combination not under common control

	Principal place of
Name of subsidiary	business	Place of registration	Nature of business	Shareholding Direct	Indirect	% of voting right	Method
Beijing Haixianghui Technology Co., Ltd. (北京海享匯科技有限 公司)	Beijing	Beijing	Scientific research and technology service sector		100.00%	100.00%	Establishment
Haier Smart Home Experience Cloud Ecological Technology Co., Ltd. (海尔智家体 驗云生態科技有限公 司)	Qingdao	Qingdao	Technology development of smart home products, whole furniture customization, etc.	100.00%		100.00%	Establishment
Haier Smart Home (Qingdao) Network Co., Ltd. (海尔智家(青島) 网絡有限公司)	Qingdao	Qingdao	Technical services, development, consulting, transfer, etc.		100.00%	100.00%	Establishment
Haier Smart Home (Qingdao) Network Operation Co., Ltd. (海 尔智家(青島)网絡 營有限公司)	Qingdao	Qingdao	Residential interior decoration, professional construction operation, special equipment installation, upgrading and repair, etc.		100.00%	100.00%	Establishment
Qingdao Internet of Wine Technology Co., Ltd. (青島酒聯网物聯科技 有限公司)	Qingdao	Qingdao	Urban distribution and transportation services, import and export of goods, technology import and export and food business, etc.		100.00%	100.00%	Establishment
Qingdao Linghai Air Conditioning Equipment Co., Ltd. (青島菱海空調設备有 限公司)	Qingdao	Qingdao	Manufacture and production of air conditioner and refrigeration equipment		100.00%	100.00%	Establishment
Qingdao Haixiangxue Human Resources Co., Ltd. (青島海享学人力 資源有限公司)	Qingdao	Qingdao	Professional intermediary activities	100.00%		100.00%	Establishment
Jiangxi Haier Medical	Jiangxi	Jiangxi	Wholesale and retail of medical		100.00%	100.00%	Establishment
Technology Co., Ltd. Qingdao Haizhi Shenlan	Qingdao	Qingdao	equipment Technical service development		100.00%	100.00%	Establishment
Technology Co., Ltd. Qingdao Haishengze	Qingdao	Qingdao	Air conditioning equipment		100.00%	100.00%	Establishment
Technology Co., Ltd. Qingdao Hailvyuan Recycling Technology	Qingdao	Qingdao	technical services Electrical and electronic products waste treatment		100.00%	100.00%	Establishment
Co., Ltd. Qingdao Haier HVAC Equipment Co., Ltd. (青島海尔暖通空調设 备有限公司)	Qingdao	Qingdao	Manufacture and sale of air-conditioners	75.00%	25.00%	100.00%	Establishment
Qingdao Haier Home AI Industry Innovation Center Co., Ltd. (青島 海尔家庭人工智能產 業創新中心有限公司)	Qingdao	Qingdao	Integrated service of AI industry application system		100.00%	100.00%	Establishment
Zhejiang Weixi IoT Technology Co., Ltd. (浙江衛玺物聯科技有 限公司)	Zhejiang	Zhejiang	IoT application service		100.00%	100.00%	Establishment
Qingdao Haier Quality Inspection Co., Ltd. (青島海尔質量檢測有 限公司)	Qingdao	Qingdao	Inspection and testing of home appliance	100.00%		100.00%	Business combination under common control

	Principal place of					% of voting
Name of subsidiary	business	Place of registration	Nature of business	Shareholding Direct	Indirect	right	Method
Qingdao Haiyongcheng Certification Service Co., Ltd.(青島海永成 認證服務有限公司)	Qingdao	Qingdao	Product certification service		100.00%	100.00%	Business combination under common control
Qingdao Zhonghai Borui Testing Technology Service Co., Ltd.(青島 中海博睿檢測技術服 務有限公司)	Qingdao	Qingdao	Home appliance testing and technology consulting		100.00%	100.00%	Business combination under common controls
Qingdao Haier Special Plastic Development Co., Ltd.	Qingdao	Qingdao	Manufacture and sale of refrigerator doors		100.00%	100.00%	Business combination under common controls
Qingdao Haizhiling Air Conditioning Engineering Co., Ltd. (青島海智菱空調工程 有限公司)	Qingdao	Qingdao	Software development and sale of daily necessities		100.00%	100.00%	Establishment
Haier Smart Home (Xiongan, Hebei) Technology Co., Ltd. (海尔智家科技 (河北雄 安) 有限公司)	Qingdao	Qingdao	Promotion of energy-saving technology		100.00%	100.00%	Establishment
Qingdao Ruibo Ecological Environmental Technology Co., Ltd. (青島瑞博生態環保科 技有限公司)	Qingdao	Qingdao	Environmental and AI technology consulting	89.13%		89.13%	Establishment
Qingdao Sanyiniao Technology Co., Ltd. (青島三翼鸟科技有限 公司)	Qingdao	Qingdao	Technology service and advertisement design		100.00%	100.00%	Establishment
Qingdao Jingzhi Recycle Environmental Technology Co., Ltd. (青島鯨智再生環保科 技有限公司)	Qingdao	Qingdao	Operation of dangerous waste		100.00%	100.00%	Establishment
Qingdao Yunshang Jieshen Yilian Technology Co., Ltd. (青島云裳洁神衣聯科 技有限公司)	Qingdao	Qingdao	Professional cleaning and sale of daily necessities	51.00%		51.00%	Establishment
Shanghai Yunshang Yuyi IoT Technology Co., Ltd. (上海云裳羽衣物 聯科技有限公司)	Shanghai	Shanghai	Professional cleaning and sale 100.00% of daily necessities		100.00%	Establishment
Shijiazhuang Yunshang Yilian Technology Co., Ltd. (石家庄云裳衣聯 科技有限公司)	Shijiazhuang	Shijiazhuang	Professional cleaning and sale of daily necessities		51.00%	51.00%	Establishment
Nanjing Yunshang Yilian Technology Co., Ltd. (南京云裳衣聯科技有 限公司)	Nanjing	Nanjing	Professional cleaning and sale of daily necessities		80.00%	80.00%	Establishment
Shanxi Yunshang Yilian Technology Co., Ltd. (山西云裳衣聯科技有 限公司)	Shanxi	Shanxi	Professional cleaning and sale of daily necessities		51.00%	51.00%	Establishment

	Principal place of
Name of subsidiary	business	Place of registration	Nature of business	Shareholding Direct Indirect	% of voting right	Method
Tianjin Yunshang Yilian Technology Co., Ltd. (天津云裳衣聯网科技	Tianjin	Tianjin	Professional cleaning and sale of daily necessities	51.00%	51.00%	Establishment
有限公司) Chengdu Yunshang Meier Yilian Technology Co., Ltd. (成都云裳美	Chengdu	Chengdu	Professional cleaning and sale of daily necessities	80.00%	80.00%	Establishment
尔衣聯科技有限公司) Qingdao Haier Smart Dishwasher Co., Ltd. (青島海尔智慧洗碗机 有限公司)	Qingdao	Qingdao	Manufacture, research and development and sales of home appliances	100.00%	100.00%	Establishment
Qingdao Haixiangmian Technology Co., Ltd. (青島海享眠科技有限 公司)	Qingdao	Qingdao	Sale of food and daily necessities	100.00%	100.00%	Establishment
Qingdao Haier Kitchen IoT Technology Co., Ltd. (青島海尔厨聯网 物聯科技有限公司)	Qingdao	Qingdao	Technology service and sale of daily necessities	100.00%	100.00%	Establishment
Tibet Haifeng Intelligent Innovation Technology Co., Ltd. (西藏海峰智 能創新科技有限公司)	Tibet	Tibet	Development of software and medical equipment	100.00%	100.00%	Establishment
Qingdao Haixiangzhi Technology Co., Ltd. (青島海享智科技有限 公司)	Qingdao	Qingdao	Manufacturing of home appliances	100.00%	100.00%	Establishment
Qingdao Haier Refrigeration Appliance Co., Ltd. (青島海尔制 冷电器有限公司)	Qingdao	Qingdao	Manufacturing of home appliances	100.00%	100.00%	Establishment
Chongqing Haier Washing Appliance Co., Ltd. (重庆海尔洗 涤电器有限公司)	Chongqing	Chongqing	Manufacturing of home appliances	100.00%	100.00%	Establishment
Tonghai Energy Technology Development Co., Ltd. (同海能源科技發展有 限公司)	Beijing	Beijing	Technology development service	84.32%	84.32%	Business combination not under common control
Qingdao Haier Youyang Technology Co., Ltd. (青島海尔有養科技有 限公司)	Qingdao	Qingdao	Technology development service	51.00%	51.00%	Establishment
Qingdao Haier Yikang Technology Co., Ltd. (青島海尔益康科技有 限公司)	Qingdao	Qingdao	Technology development service	100.00%	100.00%	Establishment
Qingdao Haier Smart Dishwasher Co., Ltd. (青島海尔智慧洗碗机 有限公司)	Qingdao	Qingdao	Manufacturing of home	100.00%	100.00%	Establishment
Zhongshan Haier HV Equipment Co., Ltd.(中 山海尔暖通设备有限 公司)	Zhongshan	Zhongshan	appliances	100.00%	100.00%	Establishment
Qingdao Haier HV Equipment Technology Co., Ltd. (青島海尔暖 通设备科技有限公司)	Qingdao	Qingdao	Manufacturing of home	100.00%	100.00%	Establishment

Name of subsidiary	Principal place of business	Place of registration	Nature of business	Shareholding Direct	Indirect	% of voting right	Method
Jingzhou Haier Environmental Protection Material Technology Co., Ltd. (荆州海尔环保材料科 技有限公司)	Jingzhou	Jingzhou	Renewable Energy Recycling		100.00%	100.00%	Establishment
Jingzhou Haizhi Cycle Technology Co., Ltd. (荆州海智循环科技有 限公司)	Jingzhou	Jingzhou	Renewable Energy Recycling		100.00%	100.00%	Establishment
Qingdao Haier Environmental Protection Material Technology Co., Ltd. (青島海尔环保材料科 技有限公司)	Qingdao	Qingdao	Renewable Energy Recycling		51.00%	51.00%	Establishment
Haier Jingling Technology (Zhejiang) Co., Ltd.(海 尔景龄科技(浙江)有 限公司)	Zhejiang	Zhejiang	Technology development service		66.00%	66.00%	Establishment
Qingdao Haiyi Wenhua Commercial Management Co., Ltd. (青島海逸文华商業管 理有限公司)	Qingdao	Qingdao	Park Management Service		95.56%	95.56%	Establishment
Microenterprises such as Qingdao Hai Heng Feng Electrical Appliances Sale & Service Co., Ltd.	All over the country	All over the country	Sales of home appliances				Establishment

Reasons for including subsidiaries which the Company has 50% or less of the equity into the scope of consolidated financial statements:

At the end of the reporting period, the Company had substantial control over the finance and operation of companies like Qingdao Hai Heng Feng Electrical Appliances Sale & Service Co., Ltd, which were included into the scope of consolidated financial statements.

(2) Material non-wholly owned subsidiaries

2. Transactions leading to the change of shareholding in subsidiaries but not losing the control

√ Applicable □ Not Applicable

(1) Description of changes in the share of owners' equity in subsidiaries: √ Applicable □ Not Applicable

Capital contribution by minority shareholders of the subsidiary of the Company leads to changes in the Company's shareholding ratio.

(2) Impact of the transactions on minority interest and the equity attributable to shareholders of the Company:

Items	Amount
Total Consideration for acquisition/disposal	2,153,437,783.43
Less: share of net assets of subsidiaries in respect to the
shareholding proportion acquired/disposed	2,152,502,266.28
Difference	–935,517.15
Including: adjustment to decrease capital reserve	–304,169,114.78

3. Interests in joint ventures and associates

√ Applicable □ Not Applicable

(1) Joint ventures and associates

	Principal place of	Place of		Nature of	Accounting treatment
Name of joint venture and associates	business	registration	Nature of business	business	of investment
Haier Group Finance Co., Ltd	Qingdao	Qingdao	Financial services	42.00%	Equity method
Bank of Qingdao Co., Ltd	Qingdao	Qingdao	Commercial Bank	8.19%	Equity method
Wolong Electric (Jinan) Motor Co., Ltd.	Jinan	Jinan	Motor Manufacturing	30.00%	Equity method
Qingdao Hegang New Material Technology Co., Ltd. (青岛河钢新材料科技股份有限 公司)	Qingdao	Qingdao	Steel plate manufacturing	23.94%	Equity method
Qingdao Haier SAIF Smart Home Industry Investment Center (Limited Partnership)	Qingdao	Qingdao	Venture Capital	63.13%	Equity method
Mitsubishi Heavy Industries Haier (Qingdao) Air-conditioners Co., Ltd.	Qingdao	Qingdao	Manufacturing of home appliances	45.00%	Equity method
Qingdao Haier Multimedia Co., Ltd.	Qingdao	Qingdao	R&D and sales of television	20.20%	Equity method
Baoshihua Energy Technology Co., Ltd. (宝石花能源科技有限公司)	Beijing	Beijing	Technology service development	20.00%	Equity method
Zhengzhou Highly Electric Appliance Co., Ltd. (郑州海立电器有限公司)	Zhengzhou	Zhengzhou	Manufacture and sale of press	49.00%	Equity method

Name of joint venture and associates	Principal place of business	Place of registration	Nature of business	Nature of business	Accounting treatment of investment
Zhejiang Futeng Fluid Technology Co., Ltd.	Huzhou	Huzhou	Gas compression machinery development and manufacturing	48.00%	Equity method
Hongtong Environmental Technology (Guangzhou) Co., Ltd. (宏通环境技术(廣州)有限公司)	Guangzhou	Guangzhou	Machinery and equipment development and manufacturing	15.00%	Equity method
Qingdao Haimu Investment Management Co., Ltd.	Qingdao	Qingdao	Investment management	49.00%	Equity method
Qingdao Haimu Smart Home Investment Partnership (Limited Partnership)	Qingdao	Qingdao	Investment management	24.00%	Equity method
Qingdao Guochuang Intelligent Household Appliance Research Institute Co., Ltd. (青岛国创智能家电研究院有限公司)	Qingdao	Qingdao	Development of home appliances	35.51%	Equity method
Guangzhou Heying Investment Partnership (Limited Partnership)	Guangzhou	Guangzhou	Investment	49.00%	Equity method
Qingdao Home Wow Cloud Network Technology Co., Ltd	Qingdao	Qingdao	Home online service	22.10%	Equity method
Bingji (Shanghai) Corporate Management Co., Ltd.	Shanghai	Shanghai	Investment management	45.00%	Equity method
Shangang Luhai International Logistics (Jinan) Co., Ltd. (山港陆海国际物流(济南)有限公司)	Jinan	Jinan	Logistic service	40.00%	Equity method
Haier Best Water Technology Co., Ltd. (倍世海尔饮水科技有限公司)	Qingdao	Qingdao	Water equipment technology development service	49.00%	Equity method
Huizhixiangshun Equity Investment Fund (Qingdao) Partnership (Limited Partnership)	Qingdao	Qingdao	Investment management	30.00%	Equity method
Qingdao RRS Huizhi Investment Co., Ltd.	Qingdao	Qingdao	Investment management	50.00%	Equity method
Qingdao Xiaoshuai Intelligent Technology Co., Ltd. (青岛小帅智能科技股份有限公司)	Qingdao	Qingdao	Information technology development	32.13%	Equity method
Qingdao Xinshenghui Technology Co., Ltd. (青岛鑫晟汇科技有限公司)	Qingdao	Qingdao	Technology service development	20.00%	Equity method
Ningbo Beilian Intelligent Technology Co., Ltd.(宁波贝立安智能科技有限公司)	Ningbo	Ningbo	Technology service development	35.00%	Equity method
Qingdao Oriental Haisheng Technology Co., Ltd. (青岛東方海盛科技有限公司)	Qingdao	Qingdao	Technology service development	49.90%	Equity method
Konan Electronic Co., Ltd	Japan	Japan	Motor Manufacturing	50.00%	Equity method
HPZ LIMITED	Nigeria	Nigeria	Manufacturing of home appliance	25.01%	Equity method
HNR (Private) Company Limited	Pakistan	Pakistan	Manufacturing of home appliance	31.72%	Equity method
Controladora Mabe, S.A. de C.V.	Mexico	Mexico	Manufacturing of home appliance	48.41%	Equity method

(1) The basic profile and financial information of important associates

√ Applicable □ Not Applicable

Unit and Currency: RMB

① The basic profile of important associates: Haier Group Finance Co., Ltd. (hereinafter referred to as "Finance company") was established by Haier Group Corporation and its three affiliates. Registration place and principal place of business: No.178–2 Haier Road, Laoshan District, Qingdao City. The Company's subsidiaries hold an aggregate of 42.00% equity interest in Finance Company.

② Financial information of important associates:

Items	Finance company
	Closing balance/	Opening balance/
	Amount for the	Amount for the
	current period	previous period
Current assets	56,917,526,305.59	55,206,996,489.12
Non-current assets	19,491,481,313.77	20,913,398,205.82
Total assets	76,409,007,619.36	76,120,394,694.94
Current liabilities	56,225,741,230.14	55,911,360,017.96
Non-current liabilities	274,745,478.17	639,275,539.37
Total liabilities	56,500,486,708.31	56,550,635,557.33
Minority interests
Equity attributable to shareholders of the parent
company	19,908,520,911.05	19,569,759,137.61
Including: share of net assets calculated per
shareholding percentage	8,361,578,782.64	8,219,298,837.80
Operating income	573,153,401.34	931,067,464.94
Net profit	898,763,418.72	677,251,560.13
Other comprehensive income	–1,645.28	17,229.38
Total comprehensive income	898,761,773.44	677,268,789.51
Dividend received from associates for the year	235,200,000.00	235,200,000.00

(2) Summarized financial information of insignificant joint ventures and associates

	Closing balance/ Amount for the	Opening balance/ Amount for the
Investment in associates	current period	previous period
Bank of Qingdao Co., Ltd.	3,764,246,964.41	3,473,162,128.86
Wolong Electric (Jinan) Motor Co., Ltd.	197,806,527.66	198,467,631.66
Qingdao Hegang New Material Technology Co., Ltd.
	344,972,463.63	342,315,345.52
(青岛河钢新材料科技股份有限公司) Qingdao Haier SAIF Smart Home Industry Investment
Center (Limited Partnership)	191,276,594.86	191,276,594.86
Mitsubishi Heavy Industries Haier (Qingdao)
Airconditioners Co., Ltd.	770,422,412.45	698,845,993.61
Qingdao Haier Multimedia Co., Ltd.	88,300,000.00	88,300,000.00
Baoshihua Energy Technology Co., Ltd.
(宝石花能源科技有限公司)	29,723,148.59	31,132,443.76
Zhengzhou Highly Electric Appliance Co., Ltd.
(郑州海立电器有限公司)	98,560,581.01	98,560,581.01
Zhejiang Futeng Fluid Technology Co., Ltd.	73,460,549.11	73,460,549.11
Hongtong Environmental Technology (Guangzhou) Co.,
Ltd. (宏通环境技术(廣州)有限公司)	6,464,386.26	6,464,386.26
Qingdao Haimu Investment Management Co., Ltd.	2,692,755.00	2,692,755.00
Qingdao Haimu Smart Home Investment Partnership
(Limited Partnership)	56,749,040.79	56,749,040.79
Qingdao Guochuang Intelligent Household Appliance
Research Institute Co., Ltd.
(青岛国创智能家电研究院有限公司)	42,936,225.76	40,920,413.54
Guangzhou Heying Investment Partnership (Limited
Partnership)	132,620,094.53	132,620,094.53
Qingdao Home Wow Cloud Network Technology Co.,
Ltd	–25,184.86	1,083,682.47
Bingji (Shanghai) Corporate Management Co., Ltd.	1,122,845,148.33	1,095,450,007.15
Shangang Luhai International Logistics (Jinan) Co., Ltd.
(山港陆海国际物流(济南)有限公司)	59,879,950.97	58,941,327.06
Haier Best Water Technology Co., Ltd.
(倍世海尔饮水科技有限公司)	150,493,919.92	148,369,638.40
Huizhixiangshun Equity Investment Fund (Qingdao)
Partnership (Limited Partnership)	171,896,075.25	188,907,510.60
Qingdao RRS Huizhi Investment Co., Ltd.	4,083,482.78	4,083,482.78
Qingdao Xiaoshuai Intelligent Technology Co., Ltd.
(青岛小帅智能科技股份有限公司)	11,703,982.52	9,578,046.65
Qingdao Xinshenghui Technology Co., Ltd.
(青岛鑫晟汇科技有限公司)	11,964,358.97	11,365,227.21
Ningbo Beilian Intelligent Technology Co., Ltd.
(宁波贝立安智能科技有限公司)	3,487,924.33	3,724,499.78

Investment in associates	Closing balance/ Amount for the current period	Opening balance/ Amount for the previous period
Qingdao Oriental Haisheng Technology Co., Ltd. (青岛
東方海盛科技有限公司)	9,980,000.00
Konan Electronic Co., Ltd	61,062,612.37	59,415,065.89
HNR (Private) Company Limited	169,600,837.60	140,530,747.42
HPZ LIMITED	11,203,257.77	11,203,257.77
Controladora Mabe, S.A. de C.V.	5,563,416,529.51	5,638,478,867.77
Middle East Airconditioning Company, Limited		7,389,990.91
Total book balance	13,151,824,639.52	12,813,489,310.37
Total amount of the following financial data of
associates calculated based on shareholding
percentage
— Net profit	504,763,812.03	629,523,707.09
— Other comprehensive income	30,761,854.88	21,625,261.80
— Total comprehensive income	535,525,666.91	651,148,968.89

XI. SEGMENT REPORT

√ Applicable □ Not Applicable

The Company is principally engaged in manufacture and sales of home appliances and relevant services business, manufacture of upstream home appliances parts, distribution of products of third party, logistics and after-sale business.

The Company has five business segments: (1) Household Food Storage and Cooking Solutions: mainly manufacturing and selling refrigerator/freezers and kitchen appliances; (2) Air Solutions: mainly manufacturing and selling air conditioners; (3) Household Laundry Management Solutions: mainly manufacturing and selling washing machines and dryers; (4) Household Water Solutions: mainly manufacturing and selling water home appliances such as water heaters and water purifiers; (5) Other business: mainly include channel, equipment components, small home appliance business and others. The management of the Company assesses operating performance of each segment and allocates resources according to the division. Sales between segments were mainly based on market price.

Due to centralized management under the headquarters or exclusion from the assessment scope of segment management, the total assets of segments exclude monetary funds, financial assets held for trading, derivative financial assets, dividends receivable, held-for-sale financial assets, other current assets, debt investment, long-term accounts receivable, long-term equity investment, other equity instruments investment, other non-current financial assets, goodwill and deferred income tax assets; the total liabilities of segments exclude long-term and short-term borrowings, financial liabilities held for trading, derivative financial liabilities, taxes payable, interests payable, dividends payable, held-for-sale liabilities, bonds payable, deferred income tax liabilities and other non-current liabilities; profits of segments exclude financial expenses, profit or loss in fair value changes, income from investment, and income on disposal of assets, Non-value-added tax refundable upon imposition component of other income, non-operating incomes and expenses and income tax.

(1) Information of reportable segments

Segment information for the period

Household Food Storage and Cooking Solutions
Segment information	Refrigerator/freezers	Kitchen appliances	Air Solutions	Household Laundry Management Solutions
Segment revenue Including: external revenue	42,853,322,004.79 42,734,835,187.88	20,671,670,604.28 20,628,620,545.09	32,978,231,317.88 32,855,731,341.38	32,005,647,939.47 31,938,194,415.35
Inter-segment revenue	118,486,816.91	43,050,059.19	122,499,976.50	67,453,524.12
Total segment operating cost	38,927,852,080.32	18,701,282,563.37	30,877,590,612.23	28,522,588,338.91
Segment operating profit	3,925,469,924.47	1,970,388,040.91	2,100,640,705.65	3,483,059,600.56
Total segment assets	53,748,578,037.44	24,783,748,732.02	45,611,063,319.72	39,041,719,547.72
Total segment liabilities	65,315,995,784.03	14,013,094,521.81	43,246,858,948.06	25,411,403,395.19

(continued)

Segment information	Household Water Solutions	Other business	Inter-segment eliminations	Total
Segment revenue	9,793,078,353.02	67,712,677,512.62	–49,520,593,283.21	156,494,034,448.85
Including: external revenue	9,690,773,037.89	18,645,879,921.26	—	156,494,034,448.85
Inter-segment revenue	102,305,315.13	49,066,797,591.36	–49,520,593,283.21	—
Total segment operating cost	8,290,916,129.40	67,369,708,462.33	–49,522,176,147.33	143,167,762,039.23
Segment operating profit	1,502,162,223.62	342,969,050.29	1,582,864.12	13,326,272,409.62
Total segment assets	15,067,350,286.07	102,648,915,510.06	–122,161,543,862.99	158,739,831,570.04
Total segment liabilities	9,047,327,086.92	92,135,183,582.27	–122,022,184,806.99	127,147,678,511.29

Segment information for the corresponding period of last year

Household Food Storage and Cooking Solutions
Segment information	Refrigerator/ freezers	Kitchen appliances	Air Solutions	Household Laundry Management Solutions
Segment revenue	41,127,956,870.22	20,275,302,895.20	29,234,848,611.97	29,736,595,881.54
Including: external revenue	41,022,856,775.64	20,228,275,282.99	29,074,828,944.30	29,601,746,705.79
Inter-segment revenue	105,100,094.58	47,027,612.21	160,019,667.67	134,849,175.75
Total segment operating cost	37,540,201,155.61	18,468,429,192.68	27,501,511,688.24	26,617,225,082.23
Segment operating profit	3,587,755,714.61	1,806,873,702.52	1,733,336,923.73	3,119,370,799.31
Total segment assets	50,542,675,724.28	21,839,636,887.29	32,728,708,862.96	37,335,152,980.59
Total segment liabilities	71,520,224,809.93	14,943,277,260.43	29,805,083,060.27	27,393,275,290.67

(continued)

	Household Water		Inter-segment
Segment information	Solutions	Other business	eliminations	Total
Segment revenue	8,106,193,795.05	59,844,086,881.64	–46,342,502,329.87	141,982,482,605.75
Including: external revenue	8,011,173,935.80	14,043,600,961.23		141,982,482,605.75
Inter-segment revenue	95,019,859.25	45,800,485,920.41	–46,342,502,329.87
Total segment operating cost	6,902,559,378.74	59,590,489,665.21	–46,387,427,695.96	130,232,988,466.75
Segment operating profit	1,203,634,416.31	253,597,216.43	44,925,366.09	11,749,494,139.00
Total segment assets	11,352,587,655.40	98,430,952,654.13	–96,919,489,838.22	155,310,224,926.43
Total segment liabilities	4,228,086,063.74	81,313,928,140.48	–96,780,130,782.22	132,423,743,843.30

(2) Geographical information

'Other countries/regions' in this report refers to all other countries/regions (including Hong Kong and Macau Special Administration Region and Taiwan) other than the mainland China for the purpose of information disclosure

a. External transaction revenue

Items	Amount for the current period	Amount for the previous period
Mainland China	77,415,039,692.18	71,158,282,181.31
Other countries/regions	79,078,994,756.67	70,824,200,424.44
Among which:
America	40,016,409,441.71	39,079,401,455.27
Australia	3,257,604,123.30	3,224,852,882.97
South Asia	8,665,895,537.29	6,541,908,201.63
Europe	17,995,460,767.32	14,504,641,098.47
Southeast Asia	4,130,278,679.37	3,491,588,857.32
Middle East and Africa	2,439,437,910.62	1,474,675,819.82
Japan	1,957,898,837.66	1,826,967,375.51
Others	616,009,459.40	680,164,733.45
Total	156,494,034,448.85	141,982,482,605.75

b. Total non-current assets

Items	Closing balance	Opening balance
Mainland China	30,494,688,089.44	30,199,437,868.54
Other countries/regions	37,860,078,674.87	35,855,840,703.95
Total	68,354,766,764.31	66,055,278,572.49

Total non-current assets exclude: debt investments, long-term receivable, long-term equity investments, other equity instrument investments, other non-current financial assets, goodwill and deferred income tax assets.

XII. DISCLOSURE OF FAIR VALUE

1. Assets and liabilities measured at fair value

The level to which the fair value measurement result belongs is determined by the lowest level to which the input value is significant to the fair value measurement as a whole:

• Level 1: Unadjusted quotes for the same asset or liability in an active market.
• Level 2: Inputs that are directly or indirectly observable for related assets or liabilities, except for Level 1 inputs.

Level 3: Unobservable inputs of related assets or liabilities.

At the end of the period

Items	Input used for fair value measurement
	Quotes in an	Important	Important
	active market	observable input	unobservable
	(Level 1)	(Level 2)	input (Level 3)	Total
Continuously measured at fair value
Financial assets held for trading	389,695,653.64	8,317,511,328.41	108,241,333.57	8,815,448,315.62
Including: Bank wealth management
products		8,317,511,328.41		8,317,511,328.41
Investment fund	314,831,875.05			314,831,875.05
Investment in equity instruments	74,863,778.59		108,241,333.57	183,105,112.16
Derivative financial assets		79,365,117.40		79,365,117.40
Including: Forward foreign exchange
contract		77,736,648.25		77,736,648.25
Forward commodity contracts		1,628,469.15		1,628,469.15
Financing receivables		1,248,197,448.34		1,248,197,448.34
Including: Bills receivable		1,115,591,707.01		1,115,591,707.01
Accounts receivable		132,605,741.33		132,605,741.33
Other equity instruments	26,258,327.10		5,623,897,924.15	5,650,156,251.25
Including: Equity instruments measured
at fair value through other
comprehensive income	26,258,327.10		5,623,897,924.15	5,650,156,251.25
Derivative financial liabilities		440,096,398.09		440,096,398.09
Including: Forward foreign exchange
contract		440,096,398.09		440,096,398.09

At the beginning of the period

Items	Input used for fair value measurement
	Quotes in an	Important	Important
	active market	observable input	unobservable
	(Level 1)	(Level 2)	input (Level 3)	Total
Continuously measured at fair value
Financial assets held for trading	381,340,384.56	746,436,121.40	108,241,333.57	1,236,017,839.53
Including: Bank wealth management
products		746,436,121.40		746,436,121.40
Investment fund	294,404,349.36			294,404,349.36
Investment in equity instruments	86,936,035.20		108,241,333.57	195,177,368.77
Derivative financial assets		142,709,716.91		142,709,716.91
Including: Forward foreign exchange
contract		138,404,575.66		138,404,575.66
Forward commodity contracts		50,459.81		50,459.81
Cross currency interest rate
swap contracts		4,254,681.44		4,254,681.44
Financing receivables		412,922,615.25		412,922,615.25
Including: Bills receivable		235,730,229.72		235,730,229.72
Accounts receivable		177,192,385.53		177,192,385.53
Other equity instruments	26,140,832.98		6,047,540,037.84	6,073,680,870.82
Including: Equity instruments measured
at fair value through other
comprehensive income	26,140,832.98		6,047,540,037.84	6,073,680,870.82
Derivative financial liabilities		71,011,310.01		71,011,310.01
Including: Forward foreign exchange
contract		71,011,310.01		71,011,310.01

For financial instruments traded in an active market, the Company determines its fair value based on its quotes in an active market; for financial instruments not traded in an active market, the Company uses valuation techniques to determine its fair value.

2. The basis for determining the fair value of the continual Level 2 fair value measurement items

Items	Fair value at the end of the period	Valuation techniques
Financial assets held for trading
Including: Bank wealth management products	8,317,511,328.41	Discounted cash flow
Derivative financial assets
Including: Forward foreign exchange contract	77,736,648.25	Discounted cash flow
Forward commodity contracts	1,628,469.15	Discounted cash flow
Financing receivables
Including: Bills receivable	1,115,591,707.01	Discounted cash flow
Accounts receivable	132,605,741.33	Discounted cash flow
Derivative financial liabilities
Including: Forward foreign exchange contract	440,096,398.09	Discounted cash flow

3. Continual Level 3 fair value measurement major items, the valuation techniques adopted and information of important parameters

Items	Fair value at the end of the period	Valuation technique	Significant unobservable input	Range	Sensitivity of fair value to the input
Other equity instruments Including:
1. COSMO IoT Technology Co., LTD. (卡奥斯物聯科 技股份有限 公司)	2,795,887,119.07	Market approach	1. Average P/S multiple of peers 2. Discount for lack of marketability	1. 3.51 to 3.59 2. 32.47% to 34.47%	1. 1% increase (decrease) in average P/S multiple of the Comparable Companies would result in increase (decrease) in fair value by RMB22.05 million. 2. 1% increase (decrease) in the lack of marketability would result in decrease (increase) in fair value by RMB32.92 million.
2. SINOPEC Fuel Oil Sales Corporation Limited (中国 石化銷售股份 有限公司)	1,328,800,000.00	Market approach	1. Average P/E multiple of peers 2. Discount for lack of marketability	1. 44.31 to 45.21 2. 25.97% to 27.97%	1. 1% increase (decrease) in average P/E multiple of the Comparable Companies would result in increase (decrease) in fair value by RMB13.20 million. 2. 1% increase (decrease) in the lack of marketability would result in decrease (increase) in fair value by RMB18.10 million.

4. Financial instruments not measured at fair value

Financial assets and financial liabilities not measured at fair value include: monetary funds, bills receivable, accounts receivable, other receivables, other current assets, long-term and short-term borrowings, bills payable, accounts payable, other payables, long-term payables, bonds payable, etc. The difference between the book value and the fair value of financial assets and financial liabilities not measured at fair value at the end of the period is small.

XIII. RELATED PARTIES AND RELATED-PARTY TRANSACTIONS

(I) Explanation for basis of identifying related party

According to Accounting Standards for Business Enterprises No. 36 — Related Party Disclosures, parties are considered to be related if one party has the ability to control or jointly control the other party or exercise significant influence over the other party. Parties (two or more than two) are also considered to be related if they are subject to common control, joint control or significant influence from another party.

According to Management Practices for Information Disclosure of Listed Company (China Securities Regulatory Commission Order No. 182), related legal entity or individual will be identified as related parties in certain occasions.

(II) Relationships between related parties

1. Information about the parent company and other companies holding shares of the Company

	Type of		Registered	Legal	Relationships with	Interest in the	Voting rights to the
Name	enterprise	Registered place	capital	representative	the Company	Company	Company
Haier Group Corporation	Collective ownership company	Qingdao High-tech Zone Haier Park	311,180,000	Zhou Yunjie	Parent Company	11.43%	11.43%
Haier COSMO Co., Ltd. (海尔卡奥斯 股份有限公司)	Joint-stock company	Qingdao High-tech Zone Haier Park	404,500,000	Zhou Yunjie	Subsidiary of Parent Company	13.41%	13.41%
HCH (HK) Investment Management Co., Limited	Private company	Hong Kong	HKD10,000	/	Parties acting in concert of Parent Company	5.74%	5.74%
Qingdao Haier Venture & Investment Information Co., Ltd.	Company with limited liability	Qingdao Free Trade Zone	923,000,000	Zhou Yunjie	Parties acting in concert of Parent Company	1.84%	1.84%
Qingdao Haichuangzhi Management Consulting Enterprise (Limited Partnership)	Limited partnership company	Qingdao High-tech Zone Haier Park	1,616,120,000	/	Parties acting in concert of Parent Company	1.43%	1.43%
Haier International Co., Limited	Private company	Hong Kong	HKD2	/	Parties acting in concert of Parent Company	0.62%	0.62%

2. Subsidiaries of the Company

√ Applicable □ Not Applicable

The details of the subsidiaries of the Company are detailed in Note X.1. Interests in subsidiaries

3. Joint ventures and associates of the Company

√ Applicable □ Not Applicable

The details of important joint ventures and associates of the Company are detailed in Note VII.14 and X.3.

4. Connected companies with no relationship of control

Name	Relationship with the Company
Wuhan Haizhi Real Estate Development Co., Ltd. (武汉海智房地產开發有限公司)	Subsidiary of Haier Group
Qingdao Manniq Intelligent Technology Co., Ltd.	Subsidiary of Haier Group
Qingdao Maidirui Ecological Environment Technology Co., Ltd. (青岛迈帝瑞生态环境科 技有限公司)	Subsidiary of Haier Group
Qingdao Oasis Technology Co., Ltd.	Subsidiary of Haier Group
Qingdao Haiyun Chuangzhi Business Development Co., Ltd.	Subsidiary of Haier Group
Qingdao Haina Cloud Intelligent System Co., Ltd.	Subsidiary of Haier Group
Qingdao Haier Parts Procurement Co., Ltd.	Subsidiary of Haier Group
Qingdao Haier International Trading Co., Ltd.	Subsidiary of Haier Group
Qingdao Haier International Travel Agency Co., Ltd.	Subsidiary of Haier Group
COSMO Industrial Intelligence Research Institute (Qingdao) Co., LTD (卡奥斯工業智能研究院 (青岛)有限公司)	Subsidiary of Haier Group
Cosmoplat Chuangzhi IOT Technology Co., Ltd.	Subsidiary of Haier Group
Feiketeng Intelligent Technology (Qingdao) Co., Ltd. (斐科腾智能科技(青岛)有限公司)	Subsidiary of Haier Group
Dalian Haier International Trade Co., Ltd.	Subsidiary of Haier Group
Haier International Co., Ltd.	Subsidiary of Haier Group
Wuxi Haizhi Real Estate Co., Ltd. (无锡海智置業 有限公司)	Subsidiary of Haier Group
Qingdao Lingzhi Electronic Technology Co., Ltd. (青岛領智电子科技有限公司)	Subsidiary of Haier Group
Qingdao Junyi Holding Group Co., Ltd. (青岛君一控股集團有限公司)	Subsidiary of Haier Group
Qingdao Haizhi Hengshan Real Estate Co., Ltd. (青岛海智衡山置業有限公司)	Subsidiary of Haier Group
Qingdao Haiyunlian Industrial Development Co., Ltd. (青岛海云聯產業發展有限公司)	Subsidiary of Haier Group
Qingdao Haier Parts Procurement Co., Ltd.	Subsidiary of Haier Group
Qingdao Haier Optoelectronics Co., Ltd. (青岛海尔光电有限公司)	Subsidiary of Haier Group

Name	Relationship with the Company
Qingdao Dingxin Electronic Technology Co., Ltd. (青岛鼎新电子科技有限公司)	Subsidiary of Haier Group
Qingdao Dingteng Industrial Technology Co., Ltd. (青岛顶腾工業科技有限公司)	Subsidiary of Haier Group
COSMO Digital Technology (Qingdao) Co., Ltd. (卡奥斯数字科技(青岛)有限公司)	Subsidiary of Haier Group
Henan Anshuo Electric Co., Ltd. (河南安硕电器有限公司)	Subsidiary of Haier Group
Foshan Haiyongchuang Investment Management Co., Ltd. (佛山海永创投資管理有限公司)	Subsidiary of Haier Group
Hayes Haier Appliances Co., Ltd.	Subsidiary of Haier Group
Thailand Histar Technology Co., Ltd	Subsidiary of Haier Group
Wolong Electric (Jinan) Motor Co., Ltd.	Associate
Mitsubishi Heavy Industry Haier (Qingdao) Air Conditioner Co., Ltd.	Associate
HNR (Private) Company Limited	Associate
Controladora Mabe S.A.de C.V.	Associate
Qingdao Home Wow Cloud Network Technology Co., Ltd.	Associate
Qingdao Haier New Materials R & D Co., Ltd	Associate of subsidiary of Haier Group

(III) Related party transactions

1. Details of the Company's procurement of goods and services from related parties are as follows:

√ Applicable □ Not Applicable

Related parties	Amount for the current period	Amount for the previous period
Controladora Mabe S.A.de C.V.	7,834,225,655.54	7,687,926,090.90
Qingdao Haier Parts Procurement Co., Ltd.	2,411,176,212.11	3,059,386,453.56
HNR (Private) Company Limited	2,384,856,286.98	1,729,101,867.08
Other related parties	3,268,864,410.08	3,281,847,133.11
Total	15,899,122,564.71	15,758,261,544.65

1. Details of the Company's sales of goods to related parties are as follows: √ Applicable □ Not Applicable

Unit and Currency: RMB

Related parties	Amount for the current period	Amount for the previous period
Controladora Mabe S.A.de C.V.	782,468,364.24	723,506,543.36
HNR (Private) Company Limited	542,516,067.71	331,070,763.13
Qingdao Haier International Trading Co., Ltd.	227,851,808.24	283,889,750.78
Mitsubishi Heavy Industry Haier (Qingdao) Air
Conditioner Co., Ltd.	113,130,201.33	29,021.75
Other related parties	398,333,574.56	607,514,557.04
Total	2,064,300,016.08	1,946,010,636.06

3. Amount of unsettled items of related parties

Items and name of customers	Closing Balance	Opening Balance
Bills receivable:
COSMO Digital Technology (Qingdao) Co., Ltd.
(卡奥斯数字科技(青岛)有限公司)	4,237,280.79
Qingdao Haiyun Chuangzhi Business
Development Co., Ltd.	3,837,442.58	5,525,942.99
Wuxi Haizhi Real Estate Co., Ltd. (无锡海智置業
有限公司)	1,562,502.60	795,626.82
Qingdao Haizhi Hengshan Real Estate Co., Ltd.
(青岛海智衡山置業有限公司)	904,819.96	526,132.39
Cosmoplat Chuangzhi IOT Technology Co., Ltd.		12,712,495.66
Other related parties	2,568,772.21	2,539,002.43
Accounts receivable:
HNR (Private) Company Limited	435,957,820.61	488,559,920.90
Mitsubishi Heavy Industry Haier (Qingdao) Air
Conditioner Co., Ltd.	177,144,013.97	16,206,223.73
Qingdao Oasis Technology Co., Ltd.	131,085,131.17	102,960,367.75
Qingdao Home Wow Cloud Network Technology
Co., Ltd.	37,298,970.59	26,282,212.73
Qingdao Maidirui Ecological Environment
Technology Co., Ltd. (青岛迈帝瑞生态环境科 技有限公司)	34,436,214.04	34,693,294.31
Qingdao Dingteng Industrial Technology Co., Ltd.
(青岛顶腾工業科技有限公司)	24,767,243.27	17,714,787.50
Qingdao Haina Cloud Intelligent System Co., Ltd.	18,867,764.93	18,686,494.15
Other related parties	216,405,784.88	151,563,701.28
Prepayments:
Qingdao Haier Parts Procurement Co., Ltd.	188,836,432.77	319,433,156.93
Qingdao Haier International Trading Co., Ltd.	23,011,155.21	13,105,977.20
Hayes Haier Appliances Co., Ltd.	16,288,252.00	694,374.00

	Closing	Opening
Items and name of customers	Balance	Balance
Other related parties	10,867,175.46	585,536,857.89
Other receivables:
Foshan Haiyongchuang Investment Management
Co., Ltd. (佛山海永创投資管理有限公司)	25,000,000.00
Controladora Mabe S.A.de C.V.	12,272,076.17	17,263,596.82
Qingdao Junyi Holding Group Co., Ltd. (青岛君
一控股集團有限公司)	10,381,906.05
Wuhan Haizhi Real Estate Development Co., Ltd.
(武汉海智房地產开發有限公司)	8,231,801.50	8,231,801.50
Haier International Co., Ltd.	3,850,380.22	3,617,694.35
Qingdao Haiyunlian Industrial Development Co.,
Ltd. (青岛海云聯產業發展有限公司)	3,780,305.81	3,731,122.30
Qingdao Oasis Technology Co., Ltd	3,368,579.25
Qingdao Haier International Trading Co., Ltd	3,238,893.02	20,305,273.82
Other related parties	17,426,579.46	146,103,793.34
Bills payable:
Qingdao Haier New Materials R & D Co., Ltd.	455,209,329.84	336,704,809.61
Wolong Electric (Jinan) Motor Co., Ltd.	38,796,579.00	6,643,894.00
Accounts payable:
Controladora Mabe S.A.de C.V.	1,401,566,311.92	1,036,070,558.18
Qingdao Haier International Trading Co., Ltd.	110,329,652.31	220,206,536.59
HNR (Private) Company Limited	105,770,296.18	2,019,530.59
Qingdao Haier New Materials R & D Co., Ltd.	98,780,783.89	92,751,346.46
Qingdao Lingzhi Electronic Technology Co., Ltd.
(青岛領智电子科技有限公司)	76,979,990.05	32,483,627.17
Dalian Haier International Trading Co., Ltd.	72,364,408.14	34,191,943.53
Thailand Histar Technology Co., Ltd	62,037,020.26	68,202,373.17
Qingdao Dingxin Electronic Technology Co., Ltd.
(青岛鼎新电子科技有限公司)	56,236,331.95	10,779,491.89
Wolong Electric (Jinan) Motor Co., Ltd.	45,645,744.97	71,939,568.11
Other related parties	470,165,286.88	408,806,408.28
Contract liabilities:
Qingdao Haier International Trading Co., Ltd.	100,023,464.66	45,490.79
Mitsubishi Heavy Industry Haier (Qingdao) Air
Conditioner Co., Ltd.	35,274,630.60	399.60
Qingdao Haier Parts Procurement Co., Ltd.	30,642,209.77
Wolong Electric (Jinan) Motor Co., Ltd.	19,505,816.07
Other related parties	36,610,255.17	35,442,758.48
Other payables:
Dalian Haier International Trading Co., Ltd.	21,899,297.26	21,899,297.26
Qingdao Manniq Intelligent Technology	21,704,973.67	46,404,473.49
Co., Ltd.	13,822,205.20	21,925,926.08
Feiketeng Intelligent Technology (Qingdao) Co.,
Ltd.(斐科腾智能科技(青岛)有限公司)	13,715,135.65	15,356,340.96
Qingdao Haier International Travel Agency Co.,
Ltd.	12,251,014.68	15,933,086.90
COSMO Industrial Intelligence Research Institute
(Qingdao) Co., LTD	10,396,897.44
(卡奥斯工業智能研究院(青岛)有限公司)

Items and name of customers	Closing Balance	Opening Balance
Qingdao Haier Optoelectronics Co., Ltd.
(青岛海尔光电有限公司)	6,028,308.41	4,866,175.06
Qingdao Haier International Trading Co., Ltd.	5,050,465.00
Henan Anshuo Electric Co., Ltd.
(河南安硕电器有限公司)	22,978,417.49	118,435,364.39
Other related parties
Dividends payable:
Haier COSMO Co., Ltd. (海尔卡奥斯股份有限
公司)	1,214,681,202.55
Haier Group Corporation	1,035,112,291.69
Qingdao Haier Venture & Investment Information
Co., Ltd. (青岛海尔创業投資諮詢有限公司)	166,230,610.50
Qingdao Haichuangzhi Management Consulting
Enterprise (Limited Partnership)
(青岛海创智管理諮詢企業(有限合夥))	129,113,722.61

4. Other related party transactions

√ Applicable □ Not Applicable

(1) On 30 March 2023, Haier Group Corporation and Haier Group Finance Co., Ltd. (hereafter, the "Finance Company") renewed the Financial Services Framework Agreement, and the "resolution on the renewal of the Financial Services Framework Agreement between Haier Smart Home Co., Ltd. and Haier Group Corporation and the estimated amount of connected transaction" was considered and passed at the general meeting. The Financial Services Framework Agreement became effective from the passing of the resolution.

Various current balances of the Company and the Finance Company are as follows:

Items	Closing Balance	Opening Balance
Monetary funds deposited at the Finance
Company	20,194,208,511.13	20,498,535,069.50
Debt investment deposited at the Finance
Company	12,065,000,000.00	12,605,000,000.00
Debt investment due within one year deposited
at the Finance Company	1,617,500,000.00	327,500,000.00
Other current assets deposited at the Finance
Company	89,500,000.00	453,550,000.00
Loans of the Finance Company	2,294,062,603.51	196,200,183.66
Interest receivable from the Finance Company	1,487,164,042.35	1,164,072,073.76
Interest payable to the Finance Company	17,175,060.62	2,070,180.99
Bills issued	8,029,203,957.89	7,770,695,481.53
Foreign exchange derivatives of the Finance
Company	–629,666.94	2,413,311.00

Items	Amount for the current period	Amount for the previous period
Interest income of the Finance
Company	411,893,046.61	439,523,818.78
Interest expense of the Finance
Company	14,237,380.91
Service fee of the Finance Company	4,336,109.25	4,425,427.95
Spot foreign exchange business
(foreign exchange settlement and
sale)	3,239,292,158.45	2,455,313,888.20

Various balances of the Company and the Finance Company are as follows:

• (2) The lease expense of the Company and its subsidiaries for production and operation leased from related parties for the current period was RMB30 million (amount for the corresponding period: RMB57 million).
• (3) Haier Group Corporation provided joint liability guarantee for certain bills payable of the subsidiaries of the Company with the guaranteed amount of RMB1,789 million at the end of the period (amount at the beginning of the period: RMB2,182 million).
• (4) The Company's subsidiary, Haier Pakistan (Private) Limited, has a loan balance of RMB497 million from its related party, HNR Private Limited.

(IV) Pricing Policy

1. Related-party Sales

Some related parties purchase components through the independent procurement platform of the Company, purchase electrical appliances for sales from the Company, and receive after-sales services, R&D service, housing rental and other business provided by the company due to their business needs. In April 2022, according to the implementation of connected transactions in the early stage and the relevant listing requirements in Hong Kong, the Company and Haier Group Corporation revised and signed the Product and Materials Sales Framework Agreement, the Service Provision Framework Agreement and the Property Leasing Framework Agreement on the basis of the original execution contract, which agreed on the financial connected transactions. The pricing principle included that both parties should agree on the price which is not less favourable than those provided by the Company to the Independent Third Parties on arm's length to ensure the fairness and reasonableness of connected transactions. The valid term of the agreement commenced from 1 January 2023 to 31 December 2025, which can be renewed for another three years upon expire.

2. Related-party Procurement

In addition to independent procurement platform, the Company entrusted Haier Group Corporation and its subsidiaries for procurements of part of raw materials. Moreover, the Company entrusted Haier Group Corporation and its subsidiaries to provide the Company with logistics and distribution, energy and power, basic research and testing, equipment leasing, house leasing and maintenance, greening and cleaning, gift procurement, design, consulting, various ticket booking and other services. In April 2022, according to the implementation of connected transactions in the early stage and the relevant listing requirements in Hong Kong, the Company and Haier Group Corporation revised and signed the Product and Materials Sales Framework Agreement, the Service Provision Framework Agreement and the Property Leasing Framework Agreement on the basis of the original execution contract, which agreed on the financial connected transactions. The pricing principle included that both parties should agree on the price which is not less favourable than those provided by the Company to the Independent Third Parties on arm's length to ensure the fairness and reasonableness of connected transactions. The valid term of the agreement commenced from 1 January 2023 to 31 December 2025, which can be renewed for another three years upon expire.

3. Financial aspect

Some of the financial services such as deposit and loan service, discounting service and foreign exchange derivatives needed by the Company are provided by Haier Group Corporation, its subsidiaries and other companies. According to the Financial Service Agreement entered among the Company, Haier Group Corporation and other parties, the price of financial services is determined by the principle of not less favourable than market value fair. The Company is entitled to decide whether to keep cooperation relationship with them with the knowledge of the price prevailing in the market and in combination with its own interests. While performing the agreement, the Company could also require other financial service institutions to provide related financial services basing on actual situation. In order to meet the Company's demands such as the avoidance of foreign exchange fluctuation risk, the Company may choose Haier Group Finance Co., Ltd. to provide some foreign exchange derivative business after comparing with comparable companies. The Company will uphold the safe and sound, appropriate and reasonable principle, under which all foreign exchange capital business shall have a normal and reasonable business background to eliminate speculative operation. At the same time, the Company has specified the examination and permission rights, management positions and responsibilities at all levels for its foreign exchange capital business to eradicate the risks of operation by persons and improved its response speed to risks on the premise that the risks are effectively controlled. In March 2023, the Company and Haier Group Corporation renewed the Financial Services Framework Agreement, which agreed on the financial connected transactions. The pricing principle included the deposit interest rate not lower than the maximum interest rate of major banks listed and the loan interest rate not less favourable than the market price to ensure the fairness and reasonableness of connected transactions. The valid term of the agreement lasts until 31 December 2026, which can be renewed for another three years upon expire.

4. Others

The Company signed the Intellectual Property Licensing Framework Agreement with Haier Group Corporation in November 2020. According to the agreement, Haier Group has agreed to grant or procure its subsidiaries and contact persons to grant the license to the Company at nil consideration to use all its intellectual property rights, including but not limited to trademarks, patents, copyrights and logos for the products, packaging, services and business introduction documents of the Company. The date of the Intellectual Property Licensing Framework Agreement shall be permanently effective from the listing date. When such specific intellectual property rights expire and are not renewed by Haier Group, our right to use certain intellectual property rights under the Intellectual Property Licensing Framework Agreement will terminate.

XIV. SHARE-BASED PAYMENTS

1. Equity instruments

(1) Details

√ Applicable □ Not Applicable

Unit of number: shares Unit and Currency of Amount: RMB

		Granted during the period	Exercised during the period			Vested during the period		Lapsed during the period
Categories of participants	Number	Amount	Number	Amount	Number	Amount	Number	Amount
Directors and senior
management	956,512.00	19,873,999.82			171,547.00	3,909,858.59	1,114,664.00	8,878,280.27
Staff		6,370,513.00 132,363,811.65			777,372.00	17,717,678.50		34,254,021.00 283,222,451.28
Total		7,327,025.00 152,237,811.46			948,919.00	21,627,537.09		35,368,685.00 292,100,731.55

(2) Outstanding share options or other equity instruments at the end of the period √ Applicable □ Not Applicable

	Outstanding share options at the end of the period		Outstanding other equity instruments at the end of the period
		The remaining		The remaining
Share-based payment items	Exercise price	contractual term	Exercise price	contractual term
2021 First Option	RMB25.63 per share	September 2021 — September
		2026
2021 Second Option	RMB25.63 per share	December 2021 — December
		2026
2022 Option	RMB23.86 per share	June 2022 — June 2026
2023 Stock Ownership Plan A			N/A	July 2023 — July 2025
2023 Stock Ownership Plan H			N/A	July 2023 — July 2025
2024 Stock Ownership Plan A			N/A	August 2024 — August 2026
2024 Stock Ownership Plan H			N/A	August 2024 — August 2026
2023 Restricted Shares			N/A	July 2023- June 2026
2024 Restricted Shares			N/A	June 2024- May 2027
2025 Restricted Shares			N/A	June 2025- June 2028

2. Equity-settled share-based payments

√ Applicable □ Not Applicable

Unit and Currency: RMB'00,000,000

Method of determining the fair value of equity instrument on the date of grant	Closing price of share on the date of grant, Black-Scholes Model
Important parameters of the fair value of equity instrument on the date of grant	Historical volatility rate, risk-free rate, yield rate
Basis for determining the number of exercisable equity instruments	The best estimate of the management
Reason for significant differences between current and prior period estimates	Nil
Accumulated amount of equity-settled share based payment included in the capital	RMB13.06
reserve

3. Cash-settled share-based payments

□ Applicable √ Not Applicable

4. Share-based payments for the current period

√ Applicable □ Not Applicable

Unit and Currency: RMB

Categories of participants	Equity-settled share-based payment	Cash-settled share-based payment
Director, Senior management	37,348,957.05
Staff	183,724,982.34
Total	221,073,939.39

5. Modification and termination of share-based payments

XV. CONTINGENCIES

As of 28 August 2025, the Company has no significant contingencies that need to be disclosed.

XVI. EVENTS AFTER THE BALANCE SHEET DATE

According to the resolution of the 2nd meeting of the 12th session of the Board of Directors of the Company held on 28 August 2025, the profit for the period is proposed to be distributed on the basis of the total number of shares on the record date after deducting the repurchased shares from the repurchased account when the plan is implemented in the future, the Company will declare cash dividend of RMB2.69 (including taxes) for every 10 shares to all shareholders.

XVII. RISKS RELATED TO FINANCIAL INSTRUMENTS

√ Applicable □ Not Applicable

The book value of various financial instruments on the balance sheet date is as follows:

Financial assets

Items	Closing Balance
	Financial assets measured at fair value and changes of which included in current profit and	Measured at	Financial assets measured at fair value and changes of which included in other comprehensive
	loss	amortized cost	income	Total
Monetary funds		55,357,102,536.82		55,357,102,536.82
Financial assets held for trading	8,815,448,315.62			8,815,448,315.62
Derivative financial assets			79,365,117.40	79,365,117.40
Bills receivable		6,907,611,901.39		6,907,611,901.39
Accounts receivable		31,125,796,665.70		31,125,796,665.70
Financing receivables			1,248,197,448.34	1,248,197,448.34
Other receivables		4,228,793,070.44		4,228,793,070.44
Non-current assets due within one year		2,307,574,005.86		2,307,574,005.86
Other current assets		115,221,674.82		115,221,674.82
Debt investments		14,590,918,331.42		14,590,918,331.42
Long-term receivables		139,022,168.65		139,022,168.65
Other equity instruments			5,650,156,251.25	5,650,156,251.25

Financial assets (continued)

Items	Opening Balance
	Financial assets		Financial assets
	measured at fair		measured at fair
	value and		value and
	changes of which		changes of which
	included in		included in other
	current profit and loss	Measured at amortized cost	comprehensive income	Total
Monetary funds		55,597,554,622.83		55,597,554,622.83
Financial assets held for trading	1,236,017,839.53			1,236,017,839.53
Derivative financial assets			142,709,716.91	142,709,716.91
Bills receivable		12,179,856,870.01		12,179,856,870.01
Accounts receivable		26,494,845,510.56		26,494,845,510.56
Financing receivables			412,922,615.25	412,922,615.25
Other receivables		3,601,357,495.02		3,601,357,495.02
Other current assets		491,724,709.59		491,724,709.59
Non-current assets due within one year		1,439,758,652.55		1,439,758,652.55
Debt investments		15,474,759,856.99		15,474,759,856.99
Long-term receivables		224,724,107.31		224,724,107.31
Other equity instruments			6,073,680,870.82	6,073,680,870.82

Financial liabilities

Items	Financial liabilities measured at fair	Closing Balance Financial liabilities measured at
	value	amortised cost	Total
Short-term borrowings		16,127,614,637.24	16,127,614,637.24
Derivative financial liabilities	440,096,398.09		440,096,398.09
Bills payable		25,408,488,465.99	25,408,488,465.99
Accounts payable		53,257,299,256.55	53,257,299,256.55
Other payables		30,240,547,430.91	30,240,547,430.91
Non-current liabilities due in one year		6,926,553,073.51	6,926,553,073.51
Long-term borrowings		10,595,616,602.87	10,595,616,602.87
Bond payables		3,500,000,000.00	3,500,000,000.00
Long-term payables		138,177,568.54	138,177,568.54

Financial liabilities (continued)

Items	Financial liabilities measured at fair	Opening Balance Financial liabilities measured at
	value	amortised cost	Total
Short-term borrowings		13,784,367,443.93	13,784,367,443.93
Derivative financial liabilities	71,011,310.01		71,011,310.01
Bills payable		21,220,364,311.81	21,220,364,311.81
Accounts payable		54,665,277,420.32	54,665,277,420.32
Other payables		21,746,135,764.08	21,746,135,764.08
Non-current liabilities due in one year		12,389,280,182.98	12,389,280,182.98
Long-term borrowings		9,665,074,313.67	9,665,074,313.67
Long-term payables		188,220,056.59	188,220,056.59

Please refer to related items in Note VII for details on each of the financial instruments of the Company. Risks related to these financial instruments and the risk management policies taken by the Company to mitigate these risks are summarized below. The management of the Company manages and monitors these risk exposures to ensure the above risks are well under control.

1. Credit risk

The credit risk of the Company mainly arises from bank deposits, bills receivable, accounts receivable, interest receivable, other receivables and wealth management products.

(1) The Company's bank deposits and wealth management products are mainly deposited in Haier Finance Co., Ltd., state-owned banks and other large and medium-sized listed banks. The interest receivables are mainly the accrued interests from fixed deposits which are deposited in the above banks. The Group does not believe there is any significant credit risk due to defaults of its counterparties which would cause any significant loss. (2) Accounts receivable and bills receivable: The Company only trades with approved and reputable third parties. All customers who are traded by credit are subject to credit assessment according to the policies of the Company, and the payment terms shall be determined on a reasonable basis. The Company monitors the balances of accounts receivable on an ongoing basis and purchases credit insurance for receivables of large-amount credit customers in order to ensure the Company is free from material bad debts risks. (3) Other receivables of the Company mainly include export tax refund, borrowings and contingency provision. The Company strengthened its management and continuous monitoring in respect of these receivables and relevant economic business based on historical data, so as to ensure that the Company's significant risk of bad debts is controllable and will be further reduced.

2. Liquidity risk

Liquidity risk is the risk that an enterprise may encounter deficiency of funds in fulfilling obligations associated with financial liabilities. To control such risk, the Company utilizes various financing methods such as notes settlement and bank loans to strive for a balance between sustainable and flexible financing. It also has obtained bank credit facilities from several commercial banks to satisfy its needs for working capital and capital expenditures.

3. Exchange rate risk

The Company's businesses are based in mainland China, USA, Japan, Southeast Asia, South Asia, central and east Africa, Europe, and Australia, etc. and are settled in RMB, USD, and other currencies.

The Company's overseas assets and liabilities denominated in foreign currencies as well as transactions to be settled in foreign currencies expose the Company to fluctuations in exchange rates. The Company's finance department is responsible for monitoring the size of transactions in foreign currencies and assets and liabilities denominated in foreign currencies to minimize the risk of exposure to fluctuation in exchange rate; the Company resorts the way of signing forward foreign exchange contracts to avoid the risk of exchange fluctuation.

4. Interest rate risk

The Company's interest rate risk arises primarily from its long- and short- term bank loans and bonds payables which are interest-bearing debts. Financial liabilities with floating interest rates expose the Company to cash flow interest rate risk, while financial liabilities with fixed interest rates expose the Company to fair value interest rate risk. The Group determines the relative proportion of fixed-interest rate and floating interest rate contracts in light of the prevailing market conditions.

XVIII. OTHER SIGNIFICANT EVENTS

As of 28 August 2025, the Company has no other significant events that need to be disclosed.

XIX. NOTES TO MAIN ITEMS OF FINANCIAL STATEMENTS OF THE PARENT COMPANY

1. Accounts receivable

Aging	Closing Balance	Opening Balance
Within 1 year	693,244,700.84	467,689,337.45
1–2 years	628,512,946.09	714,128,728.58
2–3 years	639,447,810.65	378,071,982.79
Over 3 years	586,003,840.60	529,373,541.54
Accounts receivable balance	2,547,209,298.18	2,089,263,590.36
Allowance for bad debts
Net accounts receivable	2,547,209,298.18	2,089,263,590.36

Changes in bad debt provision for accounts receivable in the current period:

Items	Opening Balance	Increase for the current period		period	Decrease for the current	Closing Balance
		Provision for			Write-off and
		the current	Other		other
		period	increase	Reversal	movement

Allowance for bad

debts

2. Other receivables

√ Applicable □ Not Applicable

Items	Closing Balance	Opening Balance
Interest receivable	66,600,316.50	137,951,583.62
Dividend receivable	3,615,317,738.91	955,746,044.23
Other receivables	58,557,152,555.17	34,215,510,473.88
Total	62,239,070,610.58	35,309,208,101.73

Interest receivable

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing Balance	Opening Balance
Within 1 year	30,639,716.27	70,005,254.26
More than 1 year	35,960,600.23	67,946,329.36
Total	66,600,316.50	137,951,583.62

Dividend receivable

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Closing Balance	Opening Balance
Within 1 year	2,659,571,694.68	385,746,044.23
More than 1 year	955,746,044.23	570,000,000.00
Total	3,615,317,738.91	955,746,044.23

Other receivables

① The disclosure of other receivables by aging is as follows:

Aging	Closing Balance	Opening Balance
Within 1 year	48,546,317,312.85	23,315,358,021.45
More than 1 year	10,014,901,515.69	10,903,518,725.80
Other receivables balance	58,561,218,828.54	34,218,876,747.25
Allowance for bad debts	4,066,273.37	3,366,273.37
Net other receivables	58,557,152,555.17	34,215,510,473.88

② Changes in bad debt provision for other receivables in the current period:

		Increase for the current period Provision for		Decrease for the current period Write-off and
Items	Opening Balance	the current period	Other increase	Reversal	other movement	Closing Balance
Allowance for bad debts	3,366,273.37	700,000.00				4,066,273.37

3. Long-term equity investment

√ Applicable □ Not Applicable

(1) Details of long-term equity investments:

	Closing Balance		Opening Balance
			Provision for
Items	Book balance	impairment	Book balance	impairment
Long-term equity investment
Including: Long-term equity investments in
subsidiaries	59,214,568,571.82		7,100,000.00 59,022,876,043.31	7,100,000.00
Long-term equity investments in
associates	3,477,408,814.49	109,300,000.00	3,287,178,712.86	109,300,000.00
Total	62,691,977,386.31		116,400,000.00 62,310,054,756.17	116,400,000.00

(2) Long-term equity investments to subsidiaries

		Increase/		Impairment provisions
	Opening	Decrease		at the end
Name of investee	Balance	for the period	Closing Balance	of the period
I. Subsidiaries:
Chongqing Haier Electronics Sales Co., Ltd.	9,500,000.00		9,500,000.00
Haier Group (Dalian) Electrical Appliances
Industry Co., Ltd	34,735,489.79		34,735,489.79
Qingdao Haier Refrigerator Co., Ltd.	402,667,504.64		402,667,504.64
Qingdao Haier Special Refrigerator Co.,
Ltd.	426,736,418.99		426,736,418.99
Qingdao Haier Information Plastic
Development Co., Ltd.	102,888,407.30		102,888,407.30
Dalian Haier Precision Products Co., Ltd.	41,836,159.33		41,836,159.33
Hefei Haier Plastic Co., Ltd.	72,350,283.21		72,350,283.21
Qingdao Haier Technology Co., Ltd.	16,817,162.03		16,817,162.03
Qingdao Household Appliance Technology
and Equipment Research Institute	66,778,810.80		66,778,810.80
Qingdao Meier Plastic Powder Co., Ltd.	24,327,257.77		24,327,257.77
Chongqing Haier Precision Plastic Co., Ltd.	47,811,283.24		47,811,283.24
Qingdao Haier Electronic Plastic Co., Ltd.	69,200,000.00		69,200,000.00
Dalian Haier Refrigerator Co., Ltd.	138,600,000.00		138,600,000.00
Dalian Haier Air-conditioning Co., Ltd.	99,000,000.00		99,000,000.00
COSMOPlat Mould (Qingdao) Co., Ltd.		53,324,428.51	53,324,428.51
Hefei Haier Air-conditioning Co., Limited	79,403,123.85		79,403,123.85
Qingdao Haier Refrigerator (International)
Co., Ltd.	238,758,240.85		238,758,240.85
Qingdao Haier Air-Conditioner Electronics
Co., Ltd.	1,131,107,944.51		1,131,107,944.51
Qingdao Haier Air Conditioner Gen Corp.,
Ltd.	220,636,306.02		220,636,306.02
Qingdao Haier Special Freezer Co., Ltd.	471,530,562.76		471,530,562.76

		Increase/		Impairment provisions
Name of investee	Opening Balance	Decrease for the period	Closing Balance	at the end of the period
Qingdao Haier Dishwasher Co., Ltd.	206,594,292.82		206,594,292.82
Wuhan Haier Freezer Co., Ltd.	47,310,000.00		47,310,000.00
Wuhan Haier Electronics Holding Co., Ltd.	100,715,445.04		100,715,445.04
Chongqing Haier Air-conditioning Co., Ltd	100,000,000.00		100,000,000.00
Hefei Haier Refrigerator Co., Ltd.	49,000,000.00		49,000,000.00
Qingdao Haier Whole Set Home Appliance
Service Co., Ltd.	118,000,000.00		118,000,000.00
Chongqing Haier Refrigeration Appliance
Co., Ltd.	91,750,000.00		91,750,000.00
Haier Shanghai Zhongzhi Fang Chuang Ke
Management Co., Ltd.	2,000,000.00		2,000,000.00
Qingdao Haier Special Refrigerating
Appliance Co., Ltd.	100,000,000.00		100,000,000.00
Haier Shareholdings (Hong Kong) Limited	35,448,380,641.24	138,368,100.00	35,586,748,741.24
Shenyang Haier Refrigerator Co., Ltd.	100,000,000.00		100,000,000.00
Foshan Haier Freezer Co., Ltd.	100,000,000.00		100,000,000.00
Zhengzhou Haier Air-conditioning Co., Ltd. Qingdao Haidayuan Procurement Service	100,000,000.00		100,000,000.00
Co., Ltd.	20,000,000.00		20,000,000.00
Qingdao Haier Intelligent Technology
Development Co., Ltd.	130,000,000.00		130,000,000.00
Qingdao Haier Technology Investment Co.,
Ltd.	410,375,635.00		410,375,635.00
Qingdao Casarte Smart Living Appliances
Co., Ltd.	10,000,000.00		10,000,000.00
Haier Overseas Electric Appliance Co., Ltd.	500,000,000.00		500,000,000.00
Haier (Shanghai) Electronics Co., Ltd.	12,500,000.00		12,500,000.00
Haier U+smart Intelligent Technology
(Beijing) Co., Ltd.	143,000,000.00		143,000,000.00
Haier Electronics Group Co., Ltd.	3,979,407,602.61		3,979,407,602.61	7,100,000.00
Flourishing Reach Limited (SPVX)	12,751,300,336.02		12,751,300,336.02
Qingdao Haidarui Procurement Service Co.,
Ltd.	107,800,000.00		107,800,000.00
Qingdao Haier Intelligent Household
Appliances Co., Ltd.	326,400,000.00		326,400,000.00
Qingdao Haidacheng Procurement Service
Co., Ltd.	100,000,000.00		100,000,000.00
Qingdao Haier Quality Inspection Co., Ltd.	18,657,135.49		18,657,135.49
Qingdao Haier Home AI Industry Innovation
Center Co., Ltd.	100,000,000.00		100,000,000.00
Haier Zhjia Experience Cloud Ecological
Technology Co., Ltd.	100,000,000.00		100,000,000.00
Qingdao Ruibo Ecological Environmental
Technology Co., Ltd.	55,000,000.00		55,000,000.00
Total	59,022,876,043.31	191,692,528.51	59,214,568,571.82	7,100,000.00

(3) Long-term equity investments to associates

		Increase/Decrease for the current period
		Increased/	Investment
		decreased	income			Impairment
		amount for the	recognized under			provisions at the
Name of investee	Opening Balance	current period	equity method	Others	Closing Balance	end of the period
Wolong Electric (Jinan)
Motor Co., Ltd.	193,369,088.85		14,593,823.15	–15,000,000.00	192,962,912.00
Qingdao Haier SAIF Smart
Home Industry
Investment Center
(Limited Partnership)	191,276,594.86				191,276,594.86
Bank of Qingdao Co., Ltd.	1,375,893,627.61		88,115,757.76	27,197,537.58	1,491,206,922.95
Mitsubishi Heavy Industries
Haier (Qingdao)
Air-conditioners Co.,
Ltd.	698,845,993.61		71,576,418.84		770,422,412.45
Qingdao Haier Carrier
Refrigeration Equipment
Co., Ltd.	416,283,326.98		1,089,446.19		417,372,773.17	21,000,000.00
Qingdao Haier Multimedia
Co., Ltd	88,300,000.00				88,300,000.00	88,300,000.00
Qingdao HBIS New
Material Technology
Co., Ltd.	323,210,080.95		6,843,983.51	–4,186,865.40	325,867,199.06
Total	3,287,178,712.86		182,219,429.45	8,010,672.18	3,477,408,814.49	109,300,000.00

4. Operating revenue and operating cost

√ Applicable □ Not Applicable

Item	Revenue	Amount for the current period Cost	Amount for the previous period Revenue Cost
Primary Business	412,412,887.84	388,616,965.82	209,681,355.52	183,992,284.05
Other Business Total	41,377,431.52 453,790,319.36	33,009,861.52 421,626,827.34	41,920,259.24 251,601,614.76	39,451,949.45 223,444,233.50

5. Investment income

√ Applicable □ Not Applicable

Unit and Currency: RMB

Items	Amount for the current period	Amount for the previous period
Investment income from long-term equity investment accounted for using cost method	2,659,571,694.68	302,819,744.23
Long-term equity investments income calculated
by the equity method	182,219,429.45	180,476,867.12
Income from wealth management products	29,446,717.52	24,878,729.85
Investment income from investment in other equity
instrument during the holding period	322,683.64
Total	2,871,560,525.29	508,175,341.20

XX. APPROVAL OF FINANCIAL REPORT

This financial report was approved for publication by the Board of Directors of the Company on 28 August 2025.

XXI. OTHER SUPPLEMENTARY INFORMATION

1. Basic earnings per share and diluted earnings per share

	Amount for the current period Earnings per share (RMB)			Amount for the previous period Earnings per share (RMB)
Items	Weighted average return on net assets	Basic earnings per share	Diluted earnings per share	Weighted average return on net assets	Basic earnings per share	Diluted earnings per share
Net profit attributable to ordinary shareholders of the Company Net profit attributable to ordinary shareholders of the Company after deduction of non-recurring	10.34%	1.30	1.29	9.82%	1.13	1.12
profit or loss	10.05%	1.27	1.26	9.43%	1.10	1.09

2. Non-recurring profit or loss

√ Applicable □ Not Applicable

Items	Amount
Profit or loss from disposal of non-current assets,
including the write-off of provision for asset impairment	–25,721,740.02
Government subsidies included in current profit or loss,
except for government subsidies that are closely related
to the Company's normal business operations,
conformed to requirements of state policies and
granted according to specific criteria, and have a
sustained impact on the Company's profit or loss	511,165,290.49
Profit or loss arising from changes in fair value of financial
assets and financial liabilities held by non-financial
entities, and profit or loss arising from disposal of
financial assets and financial liabilities, except for
effective hedging activities related to the Company's
normal business operations	57,589,058.88
Net profit or loss of subsidiaries arising from business
combinations under common control of the current
period from the beginning of the period to the date of
consolidation	3,593,306.97
Other non-operating income and expenses except the
aforementioned items	–121,916,440.93
Less: Effect of income tax	–70,186,916.68
Effect of minority equity interest (After Tax)	–23,935,295.14
Total	330,587,263.57

For the Company's recognition of items that are not listed in the "Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 — Non-recurring Profit or Loss" as non-recurring profit or loss items and the amount of which is significant, and for non-recurring profit or loss items as illustrated in the "Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to the Public No.1 — Non-recurring Profit or Loss" designated as recurring profit or loss items, reasons shall be specified.

□ Applicable √ Not Applicable

Haier Smart Home Co., Ltd. Chairman: LI Huagang 28 August 2025

Information of amendment

SECTION IX Responsibility Statement

"As the executive directors of the Board of Haier Smart Home Co., Ltd, we hereby confirm to the best of our knowledge, and in accordance with the applicable reporting principles, that the financial statements give a true and fair view of the assets, liabilities, financial position and profit or loss of the company; and the management report includes a fair review of the development and performance of the business including the results and the position of the company, together with a description of the principal opportunities and risks associated with the expected development of the company"

Qingdao, 28 August 2025

The Board of Haier Smart Home Co., Ltd

Li Huagang

Kevin Nolan