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Infore Environment Technology Group Co., Ltd. Annual Report 2023
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Infore Environment Technology Group Co., Ltd.
2023 Annual Report
April 2024
2023 Annual Report
Part I Important Notice, Table of Contents and Definitions
The Board of Directors, the Board of Supervisors as well as the directors, supervisors and senior officers of Infore Environment Technology Group Co., Ltd. warrant that the information in this report contains no misrepresentations, misleading statements or material omissions, and jointly and severally accept liability for the truthfulness, accuracy and completeness of information in this report.
Ma Gang, the Company's legal representative, Wang Qingbo, the Company's principal officer in charge of accounting, and Wu Shanshan, the principal officer of the Company's accounting division (head ofaccounting) warrant that the financial statements contained in this report are truthful, accurate and complete.
All directors ofthe Company attended the Board meeting to review this report.
Any forward-looking statements such as future plans mentioned in this report shall not be considered as promises to investors. Investors are advised to pay attention to possible investment risks.
The Board has approved a proposal on dividend plan as follows: Based on the total share capital (minus shares in the Company's repurchase account) on the date of record for the 2023 final dividend plan, a cash dividend of RMB 1.25 (tax inclusive) per 10 shares will be distributed to the shareholders, with no capitalization of the capitalreserve to share capital.
| PartIImportantNotice,TableofContentsandDefinitions2 | |
|---|---|
| PartIICompanyProfileandPrincipalFinancialIndicators | 6 |
| PartIIIManagementDiscussionandAnalysis12 | |
| PartIVCorporateGovernance42 | |
| PartVEnvironmentalandSocialResponsibility64 | |
| PartVISignificantEvents | 73 |
| PartVIIShareChangesandShareholderInformation | 85 |
| PartVIIIInformationonPreferenceShares93 | |
| PartIXInformationonBonds | 94 |
| PartXFinancialReport97 |
Documents Available for Reference
(I) Financial statements with signatures and seals of the legal representative of the Company, principal officer in charge of accounting and principal officer of the accounting division.
(II) Original audit report with the seal of the accounting firm, and signed and stamped by certified public accountants (CPAs).
(III) Originals ofall corporate documents and announcements publicly disclosed on the website designated by the CSRC during the reporting period.
The originals and legally effective photocopies of the aforesaid documents are available at the Company and the stock exchange for inspection by investors.
| Term | means | Definition | |
|---|---|---|---|
| Company,theCompany,InforeEnviro | means | InforeEnvironmentTechnologyGroupCo.,Ltd. | |
| ZoomlionEnvironmental | means | ChangshaZoomlionEnvironmentalIndustryCo.,Ltd. | |
| InforeTechnology | means | GuangdongInforeTechnologyCo.,Ltd. | |
| GreenOrientalCompany | means | ShenzhenGreenOrientalEnvironmentalProtectionCo.,Ltd. | |
| CSRC | means | ChinaSecuritiesRegulatoryCommission | |
| SZSE | means | ShenzhenStockExchange | |
| GeneralMeetingsofShareholders | means | GeneralMeetingsofShareholdersofInforeEnvironmentTechnologyGroupCo.,Ltd. | |
| BoardofDirectors,theBoard | means | BoardofDirectorsofInforeEnvironmentTechnologyGroupCo.,Ltd. | |
| BoardofSupervisors | means | BoardofSupervisorsofInforeEnvironmentTechnologyGroupCo.,Ltd. | |
| CompanyLaw | means | CompanyLawofthePeople'sRepublicofChina | |
| SecuritiesLaw | means | SecuritiesLawofthePeople'sRepublicofChina | |
| ArticlesofAssociation | means | ArticlesofAssociationofInforeEnvironmentTechnologyGroupCo.,Ltd. |
Definitions
Part II Company Profile and Principal Financial Indicators
I. Company Information
| Stockabbreviation | InforeEnviro | Stockcode | 000967 | |||
|---|---|---|---|---|---|---|
| Shareslistedon | ShenzhenStockExchange | |||||
| Chinesename | 盈峰环境科技集团股份有限公司 | |||||
| Chineseabbreviatedname | 盈峰环境科技集团 | |||||
| Englishname(ifany) | InforeEnvironmentTechnology | GroupCo.,Ltd. | ||||
| Legalrepresentative | MaGang | |||||
| Registeredaddress | 1818RenminWestRoad,DongguanStreet,ShangyuDistrict,ShaoxingCity,ZhejiangProvince,China | |||||
| Postalcode | 312300 | |||||
| Historicalupdatestoregisteredaddress | OnFebruary29,2016,theCompanychangeditsregisteredaddressto1818RenminWestRoad,DongguanStreet,ShangyuDistrict,ShaoxingCity,ZhejiangProvince,China,fromShangpuTown,ShangyuCity,ZhejiangProvince. | |||||
| Officeaddress | 23/F,InforeCenter,7-8YixingRoad,XinchengArea,BeijiaoTown,ShundeDistrict,FoshanCity,GuangdongProvince | |||||
| Postalcode | 528300 | |||||
| Companywebsite | www.inforeenviro.com | |||||
| [email protected] |
II. Contact Details
| BoardSecretary | SecuritiesRepresentative | |
|---|---|---|
| Name | JinTaotao | WangFei |
| Address | 23/F,InforeCenter,7-8YixingRoad,XinchengArea,BeijiaoTown,ShundeDistrict,FoshanCity,GuangdongProvince | 23/F,InforeCenter,7-8YixingRoad,XinchengArea,BeijiaoTown,ShundeDistrict,FoshanCity,GuangdongProvince |
| Telephone | 0757-26335291 | 0757-26335291 |
| Fax | 0757-26330783 | 0757-26330783 |
| [email protected] | [email protected] |
III. Information Disclosure and Access
| Stockexchangewebsiteonwhichthereportispublished | ShenzhenStockExchange:http://www.szse.cn/ |
|---|---|
| Publicationsandwebsitesonwhichthereportispublished | ChinaSecuritiesJournal,SecuritiesTimes,SecuritiesDaily,ShanghaiSecuritiesJournal,andCninfo(http://www.cninfo.com.cn/) |
| Placewherethereportislodged | SecuritiesDepartment,23/F,InforeCenter,7-8YixingRoad,XinchengArea,BeijiaoTown,ShundeDistrict,FoshanCity |
IV. Changes to Registered Information
| UnifiedSocialCreditCode | 913300006096799222 | |
|---|---|---|
| ChangestotheCompany'sprincipalactivitiessinceitslisting(ifany) | Sinceitwentpublicin2000,theCompanyhaschangeditsbusinessscopefivetimes.ScopeofbusinessasatNovember18,1993:theresearch,developmentandproductionofventilators,air-coolingandwater-coolingequipment,airconditioners,refrigerators,quick-freezingequipment,moldsandpowergenerators.Export(refertothedocumentsofapprovalfromtheMinistryofForeignTradeandEconomicCooperationfordetails);OnJuly2,2002,thescopeofbusinessexpandedtoinclude"metalandplastic-steelcompositepipesandprofiles".OnNovember14,2003,scopeofbusinessexpandedtoinclude"environmentalengineering".OnFebruary29,2016,astrategictransformationledtoanexpansionoftheCompany'sscopeofbusinessto:R&D,maintenance,andoperationservicesofenvironmentalmonitoringinstruments,development,consulting,andservicesofenvironmentalmanagementtechnologies,operationservicesofenvironmentalmanagementfacilities;designandconstructionofenvironmentalengineering,environmentalengineering,municipalengineering,andwaterconservancyandotherwater-relatedprojects,technologicaldevelopmentandservicesforwaterpollutioncontrol,watertreatment,andecologicalrestoration;R&D,sales,andtechnicalconsultingservicesofcommunicationproducts,networkproducts,mechatronicproducts,automaticcontrolproducts,intelligentbuildingandcommunityproducts,aswellassoftwareproducts;design,development,investment,operationmanagement,andtechnicalconsultingservicesofrelevantsupportingfacilitiesforthedisposalandrecycleofmunicipalwasteandsolidwaste;salesofventilatorsandair-cooled,water-cooled,andairconditioningequipment;operationofimportandexportbusinesses;industrialinvestment,investmentmanagement,assetmanagement,andinvestmentconsultation;OnMay18,2016,"investment,theoperationofimportandexportbusiness,industrialinvestment,investmentmanagementandassetmanagement"wereremovedfromtheCompany'sscopeofbusiness.OnJune28,2019,theCompany'sscopeofbusinesswasupdatedto:R&D,manufacturing,sales,technicalconsultation,maintenanceandoperationservicesofsanitationequipment,specialoperationrobots,newenergyvehicles(NEV),environmentalmonitoringequipment,specialequipmentenvironmentalprotection,carchargingequipmentandparts;equipmentleasing;design,operationsmanagement,technologicaldevelopmentandtechnicalservicesofsupportingfacilitiesrelatingtodisposalandrecyclingofmunicipalgarbageandsolidwaste;design,construction,operationsmanagement,technologicaldevelopment,technicalservicesofenvironmentalengineering,municipalengineering,gardenengineering,electricpowerengineering,waterconservancyengineering,waterpollutiontreatmentengineering,airpollutiontreatmentengineering,andsoilremediationengineering;operationalcleaning,collection,transportationandtreatmentservicesofurbanhouseholdgarbage(operatingwithlicense);development,technicalconsultationandtechnicalservicesofenvironmentalprotection,IoTandInternettechnologies;softwaredevelopmentandsales;salesofventilators,aircooling,watercoolingandairconditioningequipment;importandexportbusinessandinvestmentconsultation. | thefor |
| ChangestotheCompany'scontrollingshareholderssinceitsincorporation(ifany) | 1.In2000,theCompanywentpublic,anditslargestshareholderwasZhejiangFan&Air-cooledEquipmentCo.,Ltd.2.OnFebruary23,2006,theformercontrollingshareholderoftheCompany,ZhejiangShangfengIndustryGroupCo.,Ltd.,andtheCompany'sshareholder,MideaGroupCo.,Ltd.,transferredtheirrespectivestocksof9,575,027sharesand24,897,984sharestoGuangdongInforeGroupCo.,Ltd.GuangdongInforeGroupCo.,Ltd.becametheCompany'slargestshareholder.3.OnAugust5,2008,theCompany'scontrollingshareholder,GuangdongInforeGroupCo.,Ltd.changeditsnameto"GuangdongInforeHoldingInvestmentGroupCo.,Ltd."4.OnSeptember30,2010,GuangdongInforeHoldingInvestmentGroupCo.,Ltd.changeditsnameto"InforeHoldingInvestmentGroupCo.,Ltd."ThelatterbecametheCompany'scontrollingshareholder.5.OnJanuary4,2019,theprivateplacementofnewsharesforthepurchaseofnewassetswasmade,andtheCompanyissued1,017,997,382sharestoNingboInforeAssetManagementCo.,Ltd.toacquireits51%equityinterestinZoomlionEnvironmental.NingboInforeAssetManagementCo.,Ltd.becametheCompany'slargestshareholder.Asattheendofthereportingperiod,theCompany'scontrollingshareholderwasNingboInforeAssetManagementCo.,Ltd. |
V. Other Relevant Information
The accounting firm engaged by theCompany
| Nameofaccountingfirm | Pan-ChinaCertifiedPublicAccountantsLLP(SpecialGeneralPartnership) |
|---|---|
| Officeaddressofaccountingfirm | 27/F,Run'aoBusinessCenter(T2),QianjiangCenturyCBD,XiaoshanDistrict,HangzhouCity,ZhejiangProvince |
| Authorizedsignatories | BianShanshan,andWeiXiaohui |
The sponsor engaged by the Company to exercise constant supervision over the Company during the reporting period
Applicable □Not applicable
| Sponsor | Sponsor'sofficeaddress | Representative | Supervisoryperiod |
|---|---|---|---|
| HuaxingSecurities | HuaxingSecurities,2301,RafflesCityTheBundEastTower, | LiZeming,Zheng | |
| Co.,Ltd. | No.1089DongdamingRoad,HongkouDistrict,Shanghai | Zaoshun | 2023 |
The financial advisor engaged by the Company to exercise constant supervision over the Company during the reporting period
□Applicable Not Applicable
VI. Major Accounting Data and Financial Indicators
Whether the Company needs to retrospectively adjust or restate accounting data in previous years
□Yes No
| 2023 | 2022 | YoYchange | 2021 | |
|---|---|---|---|---|
| Operatingrevenue(RMB) | 12,631,050,967.34 | 12,255,992,938.42 | 3.06% | 11,866,291,611.45 |
| Netprofitattributabletothelistedcompany'sshareholders(RMB) | 498,383,730.00 | 418,794,179.13 | 19.00% | 752,792,198.66 |
| Netprofitattributabletothelistedcompany'sshareholdersafternonrecurringgainsandlosses(RMB) | 444,753,430.22 | 324,753,411.18 | 36.95% | 557,050,456.60 |
| Netcashflowsfromoperatingactivities(RMB) | 1,385,556,509.49 | 1,662,482,287.71 | -16.66% | 809,218,720.13 |
| Basicearningspershare(RMB/share) | 0.16 | 0.13 | 23.08% | 0.24 |
| Dilutedearningspershare(RMB/share) | 0.16 | 0.13 | 23.08% | 0.24 |
| Weightedaveragereturnonequity | 2.88% | 2.41% | 0.47% | 4.51% |
| December31,2023 | December31,2022 | YoYchange | December31,2021 | |
| Totalassets(RMB) | 29,048,201,560.36 | 29,271,291,859.98 | -0.76% | 28,362,883,652.30 |
| Netassetsattributabletothelistedcompany'sshareholders(RMB) | 17,437,509,156.73 | 17,288,602,018.09 | 0.86% | 16,927,565,990.33 |
The lower of net profit before and after non-recurring gains and losses is negative for the most recent three fiscal years, and the latest auditor's report shows there is uncertainty as to the Company's ability to continue as a going concern.
□Yes No
The lower of net profit before and after non-recurring gains and losses is negative. □Yes No
VII. Accounting Data Differences Arising from Domestic/Overseas Accounting Standards
1. Differences in net profit and net assets under Chinese Accounting Standards and International Accounting Standards
□Applicable Not Applicable
No such differences during the reporting period.
2. Differences in net profit and net assets under Chinese Accounting Standards and Overseas Accounting Standards
□Applicable Not Applicable
No such differences during the reporting period.
VIII. Quarterly Key FinancialIndicators
Unit: RMB
| Q1 | Q2 | Q3 | Q4 | |
|---|---|---|---|---|
| Operatingrevenue | 2,671,198,594.33 | 3,461,432,009.54 | 2,857,777,560.35 | 3,640,642,803.12 |
| Netprofitattributabletothelistedcompany'sshareholders | 156,375,931.23 | 216,592,838.32 | 230,043,358.95 | -104,628,398.50 |
| Netprofitattributabletothelistedcompany'sshareholdersafternonrecurringgainsandlosses | 132,592,018.43 | 194,972,218.23 | 216,119,614.54 | -98,930,420.98 |
| Netcashflowsfromoperatingactivities | -372,981,710.55 | 482,209,744.40 | 213,560,033.15 | 1,062,768,442.49 |
Whether the financial indicators above or their sums differ materially from those in the Company's disclosed quarterly and interim reports
□Yes No
IX. Non-recurring Gains and Losses Items and Amounts
Applicable □Not applicable
Unit: RMB
| Item | Amountin2023 | 2022 | 2021 | Note |
|---|---|---|---|---|
| Gainorlossforthedisposalofnon-currentassets(inclusiveofprovisionstowriteoffimpairedassets) | -4,146,549.53 | -2,289,681.16 | 6,337,251.97 | - |
| Governmentsubsidiesrecognizedasgainorlossduringthereportingperiod(exclusiveofgovernmentsubsidiesgivenintheCompany'sordinarycourseofbusinessbasedontheestablishedcriteriaandhavingacontinuousimpactontheCompany'sgainorlossasperthegovernmentpoliciesorregulations) | 52,966,550.75 | 80,268,041.82 | 55,341,877.03 | - |
|---|---|---|---|---|
| Gainorlossarisingfromchangesinfairvalueoffinancialassetsandfinancialliabilitiesheldbynonfinancialenterprisesaswellasfromthedisposaloffinancialassetsandfinancialliabilities(exclusiveofeffectivehedgesthatariseinrelationtotheCompany'sordinarybusinessoperations) | - | 0.00 | -79,222,823.84 | - |
| Capitalcollectedfromnon-financialenterprisesthatwasrecognizedasgainorlossduringthereportingperiod | 52,623.28 | 1,280,730.46 | 3,173,551.55 | |
| Gainorlossonentrustingotherpartieswithinvestmentorassetmanagement | 12,111,406.99 | 19,091,108.25 | 29,170,261.66 | Incomefromwealthmanagementproducts:RMB12,111,406.99. |
| Reversalofprovisionsforimpairedreceivablesthathavebeenindividuallytestedforimpairment | 484,240.00 | - | - | - |
| Gain/lossondebtrestructuring | -3,130,560.92 | -5,380,200.00 | - | - |
| Operatingrevenueandexpensesotherthantheaboveitems | 9,532,774.64 | 2,164,235.04 | 2,598,028.75 | - |
| Othergainsandlossesthatfallintothedefinitionofnonrecurringgainsandlosses | - | 19,785,940.63 | 172,459,718.81 | - |
| Taxrebates,reductions | - | 1,004,379.44 | 3,768,945.18 | - |
| andexemptionsgrantedultraviresorwithoutofficial | ||||
|---|---|---|---|---|
| documentsofapprovalLess:Incometax | 11,730,712.09 | 22,153,064.81 | -8,007,245.43 | - |
| Minorityinterestaffected(aftertax) | 2,509,473.34 | -269,278.28 | 5,892,314.48 | - |
| Total | 53,630,299.78 | 94,040,767.95 | 195,741,742.06 | -- |
Details on other gains and losses that fall into the definition of non-recurring gain/loss:
□Applicable Not Applicable
No such cases during the reporting period.
Explanation of classification of non-recurring gains and losses listed in the Explanatory Announcement No. 1 on Information Disclosure by Companies Of ering Securities to the Public — Non-recurring Gains and Losses as recurring gains and losses
□Applicable Not Applicable
No such cases during the reporting period.
Part III Management Discussion and Analysis
I. Industry Performance During Reporting Period
1. Industry overview
Infore Enviro is a leading investor and operator in the smarturban service industry, primarily engaging in two areas: urban cleaning services and environmental protection equipment.Urban cleaning services refer to the comprehensive activities ofcollecting, comprehensively treating and recycling domestic and industrialwaste, and managing related social activities to minimize the environmental impact of urban waste and ensure a clean and hygienic working and living environment for city dwellers. Specifically, these services include cleaning, maintenance and watering of urban roads, squares, and other public spaces; collecting and transporting domestic waste from residential areas and public spaces; construction, maintenance, and service of sanitation facilities such as public toilets, waste bins, and garbage transfer stations; terminal harmless treatment of urban waste and special waste; planning, construction, and maintenance of urban landscapes and green spaces.
- Development trends
2023 marked the beginning of full implementation of the guiding principles of the 20th CPC National Congress, and was a crucial year for implementing China's 14th Five-Year Plan. The urban service marketmaintained robust momentum thanks to the sanitation marketization reform and the "urban steward" model. Driven by policy incentives, demand for environmental protection equipment remained high, indicating a positive outlook over the long term. However, the market experienced a continued decline from the previous year due to macroeconomic challenges, decline in government's fiscal payment capacity, and downturn in customers' budgets.
Increase in annual amount and total amount of urban services contracts in the past eight years:
Total sales of environmental protection equipment, and sales of pure-electric environmental protection equipment in the past eight years:
Urban service is an essential item of government spending, as it is closely related to people's livelihoods. The sector's long-term
growth is not entirely connected with short-term economic volatility, and it is tied with long-term economic trends, policy directives, environmental requirements, and people's living standards, without notable seasonal and regional features.
As the existing sanitation equipment gradually enters a replacement cycle and the supportive policies for new energy increase in 2024, the new energy sanitation market in China will reach an economic inflection point. With the introduction of franchise management measures and supportive policies, the sanitation franchise market will fully expand. Itis expected that the overall growth trend of the sanitation industry will remain unchanged.
- Development priorities
(1) Comprehensive adoption of new energy-powered and smart environmental protection equipment
As China advances ecological construction, achieving carbon peak and neutrality has been included in the national plan for ecological endeavors. Against this backdrop, more and more cities are launching large-scale initiatives to transition their environmental protection equipment toward new energy sources, particularly the increased adoption of low-noise and less-emissions new energy-powered sanitation vehicles. The penetration rate of new energy solutions in the environmental protection equipment sector reached 8.4% in 2023. As the marketscales up and costs decrease, the life-cycle cost of new energy sanitation vehicles has become significantly lower than that of oil-powered vehicles. This signifies that the comprehensive transition of environmental protection equipment to new energy sources is entering a phase of rapid acceleration.
The traditional sanitation industry is characterized by its labor-intensive nature. With the aging population and the changing career preferences of younger generations, labor demand is skyrocketing, and labor costs remain high. This has given rise to the development of smart environmental protection equipment.Sanitation cleaning and maintenance is a low-growth area of application, and the technology is relatively mature and has begun to show economic viability. Current autonomous sanitation vehicles can replace certain human operations on closed and semi-closed roads. They can automatically perform scheduled cleaning tasks during off-peak hours of traffic in parks and other areas. Managers can remotely monitor the status of the robots in real time. This significantly reduces the workload of sanitation workers, and minimizes their exposure to harsh working environment while reducing management costs and alleviating labor shortages. As a significant part of the optimization of urban management models, the future of urban/rural services is increasingly steered towards one that is smart, and requires less oreven no human labor, signifying a vast development space and application prospects in this sector.
(2) Smart urban services
As urbanization accelerates, the gradual transition from traditional "sanitation integration" to a smarter, more precise, and more efficient "urban steward" model has become a consensus in the new round of urban service reform. Traditional sanitation management models can no longer meet the demand for modern urban development. The emergence of smart urban services offers a solution for sustainable urban development. By leveraging Internet of Things (IoT) and mobile Internet,smart urban services enable full-process and real-time monitoring of all environmental sanitation service personnel, vehicles, objects, and events, assist in rationally designing sanitation management models, boosting operating quality, reducing operating costs, and making sanitation management effective through statistical data and assessments. All smart urban services are deployed on the Smart Urban Management Cloud and connected to the Smart City Network, and are provided to managers and workers in a cloud-based manner anytime. As technology continues to advance and applications continue to expand, smart urban services will play a more important role in the future, driving cities towards a greener, lower-carbon, and more sustainable future.
Drawing on its insights into the currentstate of the environmental protection industry, Infore Enviro began its foray into the field of urban stewardship in 2021 with a forward-looking perspective. Incorporating sophisticated technologies in "intelligent equipment, smart services, and Smart Sanitation Cloud Platform", Infore Enviro has created an "Infore Mode" encompassing "full series of intelligent equipment + full-scenario smart urban services". The Company's 5G intelligent cleaning robots can work through human machine collaboration and auto driving, and have strong cleaning capabilities. They can complete high-precision automated cleaning tasks, based on real-time positioning, autonomous navigation, obstacle avoidance and detour, and autonomous safe operation, on complex outdoor roads and under dynamically changing scenarios. In collaboration with the new digital and intelligent management model and the remote monitoring and management model of the Smart Sanitation Cloud Platform, they are capable of 24/7, all-round,
seamless, precise, and efficient operation, maintenance, supervision, and management of service personnel, vehicles, objects, and events. On top of these strengths, the Company provides customers with tailored smart solutions to urban services including "smart supervision, smart operation, smart service", as wellas a new model featuring "management + service + operation" for the whole process of urban public space, public resources, and public projects, which enables real transition from management to service, and from governance to operation, to meet the needs for refined urban management.
For a detailed analysis on the industry,please referto Discussion and Analysis on the Future Development of the Company.
II. Principal Business During the Reporting Period
1. Principal activities
In terms of urban service business, Infore Enviro has created an "Infore Mode" encompassing "full series of intelligent equipment + full-scenario smart urban services" by incorporating sophisticated technologies in "intelligent equipment, smart services, and Smart Sanitation Cloud Platform". The services range from road cleaning and maintenance, snow and ice removal, waste collection and transportation, waste sorting, municipal infrastructure maintenance, urban landscaping, water area cleaning to marine sanitation. The Company also offers customers one-stop services including planning, design, investment, construction, and operation of environmental sanitation projects. In terms of business scope, the Company implements an "urban steward + sanitation integration" dual strategy. Regarding business model, the Company pursues diversification through "government procurement", "franchising", and "equity cooperation". As such, it has consistently maintained its industry-leading position in the long-cycle urban service market.
In 2023, the Company ranked No.2 for increase in annual amount of urban service contracts, and ranked No.3 for total amount of urban service contracts. The Company ranked No.1 in terms of sales of environmental protection equipment in 2023 for the 23rd consecutive year in China.
2. Principal products
In terms of intelligent equipment, leveraging its leading position in the environmental protection equipment industry, strong R&D and manufacturing capabilities and a well-established nationwide sales network, the Company forged a most comprehensive suite of environmental protection equipment of over 400 models within the industry, providing customers with a wide range of solutions including various sanitation and cleaning equipment, waste collection and transportation equipment, and new and clean energy environmental protection equipment. The Company's range of products spans from cleaning and maintenance equipment, waste collection and transportation equipment, waste compression station equipment, kitchen food waste recycling equipment, municipal and landscaping equipment,to emergency snow and ice removal equipment. An industry leader in intelligent equipment R&D, the Company developed 5G intelligent cleaning robots, autonomous sanitation vehicles, small smart cleaning robots, smart energy storage equipment for industrial and commercial use, etc.
Smart Sanitation Cloud Platform is a big data smart urban service cloud platform developed in-house and a pioneering platform in China's sanitation industry that encompasses the full industrial chain. The platform, with an investment of nearly RMB 200 million, supported by over 25 smart urban service-related copyrighted software and patents and integrating 5G, AI, big data, cloud computing,edge computing and other advanced technologies to form an immersive framework and develop core technologies such as integrated IoT applications, data communication, video command and control, safe driving tests, IoT software and hardware compatible technologies and big data applications. Through the platform, the Company can monitor all environmental sanitation service personnel, vehicles, objects, and events on a real-time basis. The Company has designed robust sanitation management models to boost operating quality, reduce operating costs, and make sanitation management effective through statistical data and assessments. At present, the platform is providing intelligentservices for more than 80,000 products of customers across China, with over 40,000 daily active users. In the future, the Company will continue to apply digital technologies and create innovative intelligent equipment and smart services. Moreover, through in-depth integration into smart city development, it will continuously boost the application of smart corporate cloud platforms to become a leader and enablerin the digitaltransformation of the environmental sanitation sector by dint of intelligence.
In terms of smart services, the Company's "Environmental Sanitation APP" enables remote monitoring, data collection and procedural approval for its line-up of smart equipment and products during operations.Through visualized operational data and automatic business analysis, the Smart Sanitation Cloud Platform is capable of digitalized equipment management, sophisticated process management, and quantified materials management. This drives a digitalized, intelligent, IT-based, and integrated management approach throughout the entire sanitation process.
-
- Technology accumulation and innovation
- (1) Cumulative R&D capabilities
Infore Enviro's R&D team of environmental protection equipment comprises experts from national research institutions, who have a long track record in scientific research. Based on China's status ofenvironmental governance, the Company has builtthe most comprehensive environmental industry system in China, providing customers with complete sets of equipment and solutions for road cleaning and maintenance, solid waste collection and transportation, municipal emergency rescue, landscaping and maintenance, snow and ice removal, kitchen food waste treatment, environmental governance and water treatment. The Company's advanced technologies in environmental protection equipment powered by new energy and hydrogen energy are at the forefront of the industry. The Company owns 1,155 patents, including 599 utility patents, 447 utility model patents, and 109 design patents. It leads the industry in terms ofthe number of technical and utility patents. Many national, industry, and local standards have been made under the direction of Infore Enviro. With provincial research centers, the Company has been recognized as a National Intellectual Property Model Enterprise, and a National Intellectual Property Competitive Enterprise and received numerous awards, including the China Patent Excellence Award, China Machinery Industry Science and Technology Award, Hunan Provincial Science and Technology Progress Award, and Huaxia Construction Science and Technology Award. It has obtained the first autonomous drive test license in sanitation. Furthermore, the Company was identified by the Ministry of Industry and Information Technology (MIIT)as a leading enterprise with key tasks in new-generation AI industry innovation,making it a top player in China's AI domain and a member of the "national team" of intelligent cleaning robot innovators.
During the reporting period, the Company invested RMB 353 million in R&D for continuous improvement and innovation in product tech, with 353 patent applications, including 95 utility patents, 197 utility model patents, and 61 design patents. It has made remarkable R&D results and is leading the industry in this regard.(2) Innovation of cloud platform
Smart Sanitation Cloud Platform is a big data smart cloud platform that was developed in-house by the Company. By integrating advanced underlying technologies such as big data, cloud computing, IoT, mobile Internet and AI into the platform, the Company developed core technologies such as integrated IoT applications, data communication, video command and dispatch, safe driving tests, IoT software and hardware compatible technologies and big data applications. The seamless integration of environmental protection equipment and operations allows the platform to achieve real-time connectivity between urban service personnel, vehicles, objects, and events as wellas standardized, digitalized and smart operation and management. The Company established a digital operation and management system for smart services, which, through smart and safe operation that requires less human labor and energy consumption, enables it to develop competitive advantages with smart services.
The platform is supported by over 20 urban service-related software copyrights and patents and has won accolades such as the MIIT's 2019 Pilot Demonstration of the Integration of Key Industries and the Internet,2021 Outstanding Cases of Mobile IoT, 2021 Excellent Industrial App of Hunan, 2022 Changsha's Key R&D Project − Garbage Classification Collection and Transportation System Based on Image Recognition and CNN Deep Learning Algorithm, and 2022 Changsha Torch Plan for Intelligent Vehicle Industry Ecosystem. The platform has provided smart services to over 80,000 products ofcustomers.
(3) Leader in new energy
Pioneering the development of new energy in the sanitation industry, the Company offers the most comprehensive portfolio of new energy products in the industry. Infore Enviro started the research and development of new energy-powered environmental protection equipment in 2007 and successfully developed the first pure-electric sweeper truck in China in July 2008. The Company was tasked with the cleaning and sanitation of the streets during the 2008 Beijing Olympics. Over three decades of sustained R&D in sanitation vehicles and over a decade of hard work have led Infore Enviro into developing over 40 types of new energy vehicles (NEV) for cleaning, washing, waste collection and urban sanitation. The Company's nearly 200 vehicle models form the most comprehensive suite of new energy-powered sanitation vehicles in China. The Company launched its fifth generation of new energy powered environmental protection equipment,as the industry's most comprehensive range of products, including over 100 varieties that cover road sweeping and washing, garbage transportation, urban landscape,solar power cleaning, and mobile charging. Additionally, it unveiled the industry's first domain controller platform to fully integrate the chassis-control system of the chassis and upper installation, with platformized hardware, integrated software, modular functionality and scene-based products. The Company
has reduced system costs by 9% while increasing system performance by 15%, leading the innovative development of new energy sanitation. This helps customers lower purchasing and operating costs. The Company sold 1,974 pure-electric powered sanitation vehicles in 2023, with a marketshare of 32.4%, ranking No.1 in the industry, according to the motor vehicle accident liability insurance data released by the National Financial Regulatory Administration.
(4) Pioneer in intelligent cleaning robots
The Company has independently developed over 10 models ofintelligent cleaning robots (both basic and 5G smart models are available) and offers the most comprehensive suite of cutting-edge intelligent cleaning robots in the market. The entire series of products are integrated with core technologies such as green new energy, 5G+AIOT cluster control, AI, machine vision, 360-degree image recognition and are equipped with sensors such as laser radar, ultrasonic radar, high precision differential GPS, 360-degree cameras, allowing for smart operations and smart navigation of intelligent cleaning robots as wellas paving the way for a more diverse operational capacity in a wide range of locations and scenarios. The Company's first "5G Cloud + Intelligent Cleaning Robot" is a smart remote cluster model of operation that redefines how sanitationis carried out. By raising the standards of digitalization and efficiency in the industry drastically and reducing safety risks to sanitation personnelas wellas labor costs, the new model of operation presents remarkable economic and social benefits for the community and economy.
The Company's 5G intelligent cleaning robot crew has been deployed in Shenzhen, Changsha and Suzhou. The crew has become a new benchmark for smart urban services and has been repeatedly recognized by government agencies and other associations as a model for technological innovation that breathes new life into the traditional sanitation industry with AI. The 5G smart sanitation robot crew digitalizes and informatizes urban sanitation, raises the capabilities for and standards of informatization in the sanitation industry and improves the standards of sophisticated management of urban public services, creating a better living environment for the people.
Other businesses of the Company primarily include environmental monitoring, solid waste treatment, and ventilator equipment manufacturing.
The Company's environmental monitoring business covers the monitoring of smoke, air quality, haze, water quality, water conservation, soil and dust and the provision of an integrated one-stop service for environmental protection, water conservation, water supply and smart cities. Product sales are the main business operations, supplemented by the provision of services for operation and maintenance.
The Company's solid waste disposal business primarily encompasses the incineration of domestic waste to generate energy, the landfilling of domestic waste, the recycling of food waste and the utilization of solid waste in industrial parks. With waste-to-energy projects as the core, the industrial parks of solid waste recycling are equipped with treatment facilities for domestic waste disposal, hazardous waste disposal, sludge treatment, food waste treatment, sewage treatment, construction wastewater treatment, ecological restoration of landfills, leachate treatment and fly ash disposal. Their operating model is public-private partnership (PPP).
The Company's ventilation machinery manufacturing covers ventilators, mufflers, dampers, refrigerators, magnetic levitation fans, blowers and nuclear-grade dampers for nuclear power, subways, tunnels, rail transportation, industrial and civil construction and other areas. Its fans are mainly sold via a combination of direct sales and retailers.
III. Analysis of Core Competitiveness
1. Industry leader in sanitation equipment
The Company sold 1,974 pure-electric powered sanitation vehicles in 2023, with a market share of 32.4%, ranking No.1 in the industry, according to the motor vehicle accident liability insurance data released by the National Financial Regulatory Administration. As a leader in China's sanitation equipment sector, ranking No.1 in terms of sales of sanitation equipment for the 23rd consecutive year, the Company owns state-of-the-art technologies and offers the most comprehensive range of environmental protection equipment. In terms of R&D, the Company has mastered industry-leading technologies in new energy-powered environmental protection equipment,intelligent cleaning robots and autonomous environmental sanitation vehicles, and obtained the
first drive test license in environmental sanitation from the government. The Company developed the world's first intelligent cleaning robot crew and successfully deployed the crew in Orange Isle, a 5A level national scenic spot in Changsha City, Hunan Province. The Company's 5G autonomous intelligent cleaning robot crew has also been deployed in the college town in Changsha. The Company has developed a comprehensive suite of environmental protection equipment that spans over 400 models and allows the Company to meet the diverse sanitation demand across the country.As one of the pioneers in environmental protection equipment,the Company developed the first wet and dry vacuum sweeper truck, the first fully hydraulic mini road sweeper, the first tunnel road washer, the first pure-electric road sweeper and the first natural gas-powered road washer in China. The Company has extensive proven experience in the environmental sanitation industry and become the most influential brand in the industry.
- Fast-growing urban services with standardized management
The Company established anew sanitation ecosystem with its operational model of "mechanized production+smart operation+standardized service". With its new operational model, the Company aimsfor the centralized management of services and planning, visual monitoring of the entire process of sanitation, swift response to emergencies and closed-loop management. With smart analysis performed on all data and improvements to management and controls that are based on evidence and rigorous science, the Company strives to standardize services, refine sanitation management by virtue of smart technologies, grow business rapidly, build key competitive advantages, and lead in the new era of smart urban services.
From 2016 to 2023, the Company recorded a contract amount of RMB 1.237 billion, RMB 5.561 billion, RMB 8.711 billion, RMB 9.72 billion, RMB 12.574 billion, RMB 8.435 billion, RMB 9.251 billion, and RMB 7.652 billion respectively and an annual service contract amount of RMB 55 million, RMB 305 million, RMB 429 million, RMB 855 million, RMB 1.248 billion, RMB 1.228 billion, and RMB 1.819 billion, and RMB 1.553 billion, respectively for urban services. The Company's operating revenue from urban services increased by 35.38% YoYto RMB 5.63 billion in 2023.
3. "Direct repair+" after-sales service
After-sales service isa criticaltouchpoint for companies to connect with customers,and high-quality after-sales service isa company's core competitive edge. Based on product lifecycle management, the Company launched a "Speedy Service" Program that follows the "1314" service standards—responding to customers within 15 minutes; departing within 30 minutes and arriving at material service areas within 2 hours; addressing general faults within 1 day and material faults within 3 days; offering free services four times each quarter. For this service program, the Company has deployed resources, including one platform, 300 service outlets, 1,000 service engineers, and 400 service stations.Currently, Infore Enviro can deliver timely, warm, quality, fairly-priced, and trustworthy services to its customers.
4. Corporate culture and management team
Corporate culture isthe cornerstone of a company's creativity and unity as wellas an important part of a company's key competitive advantages. With the corporate mission of "Cleaner World, Better Future", the Company sticks to the corporate philosophy of "simple and professional with quick execution" and the core values of "our clients are vital to us; ouremployees are our partners in our endeavors; we aim to be achievement-oriented - competence beats mediocrity; and technology innovation is the basis for our development." We adopt the development strategy with leading technology at the center, being order-driven as the means, and motivating talent as the basis, and are committed to becoming a respected and trusted leader in providing intelligent equipment and services with cleaning robots at its core. After years of efforts, the Company has deeply incorporated the core elements of its corporate culture into operations.These principles have guided its business segments, branches, and subsidiaries in benchmarking operations, advancing refined management, and high-quality growth.
The Company is helmed by a pragmatic and competent management team. The Company's management team endorses the corporate culture and shares the same management philosophy. Each member of the team complements the others' strengths and has clearly defined responsibilities. As a whole, the team is united and possesses strong executive abilities. With abundant industry experience and forward-looking vision, the team identifies industry trends with precision and speed and seizes market opportunities promptly. For many years, the Company has promoted stock incentives and employee stock ownership programs as wellas set up team management frameworks for cornerstone partnerships, senior partnerships and general partnerships, gathering a group of
passionate trailblazers who share the Company's values, building a community for key employees in the Company and propelling the Company towards stable, healthy and long-term growth.
IV. Analysis ofPrincipal Business
1. Overview
Infore Enviro faced severe external challenges in 2023 amidst the macroeconomic situation. Despite that, the Company remained committed to its development strategies and annual business plan, with a strong emphasis on its core "5115" strategy. It significantly improved its internal operations by strengthening its key teams and intensifying technological innovation and product research and development. As a result, the Company maintained its position as an industry leader in smart urban services based on its established R&D advantages in environmental protection equipment.
In 2023, the Company generated RMB 498,383,700 in net profitattributable to the listed company's shareholders and RMB 12,631,051,000 in operating revenue. As at the end of the reporting period, the Company reported RMB 29,048,201,600 in total assets and RMB 17,437,509,200 in net assets attributable to the listed company's shareholders. During the reporting period, the Company registered rapid growth in urban services while maintaining its leadership in the environmental protection equipment sector.
- Ranked No.2 for increase in annual amount of urban service contracts in 2023
According to Huanjing Sinan, Infore Enviro signed 82 urban service projects across 18 Chinese provinces in 2023. These new contracts have an annual amount of RMB 1.553 billion, ranking No.2 in the industry, and a total amount of RMB 7.652 billion, ranking No.3 in the industry. The Company's operating revenue from urban services increased by 35.38% YoY to RMB 5.63 billion. As at the end of the reporting period, Infore Enviro was running 263 urban service projects.These contracts have an annual amount of RMB 6.567 billion and a total amount of RMB 60.018 billion. The Company's executory contracts totalRMB 43.809 billion. The Company performed well in terms of sustainable operation.
- Ranked No.1 in terms of sales ofsanitation equipment in 2023
The Company sold 12,319 pieces of environmental protection equipment in 2023, according to the motor vehicle accident liability insurance data released by the National Financial Regulatory Administration. The sales of environmental protection equipment amounted to RMB 5.085 billion, ranking No.1 in the industry in China for the 23rd consecutive year.
- Ranked No.1 in terms of sales ofnew energy-powered environmental protection equipment in 2023
The Company sold 1,974 pure-electric powered sanitation vehicles in 2023, with a market share of 32.4%, ranking No.1 in the industry, according to the motor vehicle accident liability insurance data released by the National Financial Regulatory Administration.
- Improvement in quality and efficiency, and high-quality development
With the key goal of "achieving high-quality development", centering on all steps of production and operation, the Company explored multiple methods for improving its asset operation capabilities to reduce existing assets and control incremental assets. It dismissed high-risk orders, strengthened the classification and accountability mechanisms for contract risks, enhanced recovery of corporate sales revenue, and accelerated operational turnover efficiency. In 2023, the Company recorded RMB 1,385,556,500 in net cash flows from operating activities, and YoY increase of 1.79% and 1.23% in gross profit margin from the two core business segments: intelligent equipment and smart services, leading to the improvement in operational quality ultimately, improvement in quality and efficiency, and effectively driving high-quality sustainable development.
- Digital transformation and the setup of a highly efficient operating system
Infore Enviro continued to digitalize value chains as digitalization has been one of its core transformation strategies. The Company fully digitalized all applications and processes across value chains using one system and platform under Infore Enviro. By expanding online coverage and enhancing standardization and information technology, it advanced the comprehensive digitalization and visualization for decision-making support across all segments, supported operations management with data, accelerated the
monetization of data assets, improved its refined process management, enhanced control capabilities, reduced costs and risks, and empowered operations.It eventually managed to cut costs and increase efficiencies.
- High cash dividends for shareholders
Valuing investor return, the Company has been implementing an active profit distribution policy. It has paid high cash dividends for many years in a row as return for its shareholders. According to the 2023 profit distribution plan (proposed) approved at the six meeting of the Tenth Board of Directors, a cash dividend of RMB 1.25 (tax inclusive) per 10 shares will be distributed to the shareholders, based on the total share capital (minus shares in the Company's repurchase account) on the date of record for the plan. A total cash dividend of around RMB 396 million (tax inclusive) is expected to be distributed, accounting for 79.43% of the net profit attributable to the listed company's shareholders in 2023. As the proposed plan is awaiting the approval of the General Meeting of Shareholders, the actual dividend amount will be disclosed by the Company in the relevant announcements.
In the past three years (2021–2023), the Company has paid RMB 1.056 billion in cash dividends, accounting for 41.45%, 83.18% and 79.43% of the net profit attributable to the listed company's shareholders, respectively.
- Active fulfillment of social responsibility as part of its corporate responsibility
In 2023, while seeking business growth, the Company fulfilled its social responsibility as it got involved in poverty alleviation and disaster relief efforts. In terms of poverty alleviation, the Company took an active part in various initiatives, including making donations, such as the Shangyu Fourth Round Poverty Alleviation and Assistance Charity Fund, the "Warmth of the Ancient City" Relief and Assistance Foundation, and other charity funds or foundations, including those supporting individuals with disabilities. These monetary contributions are used for a wide range of purposes, including poverty alleviation,education, medical and elder care, disaster relief, innovative poverty reduction efforts, and public welfare projects.The Company also readily responds to emergency situations. In response to floods caused by typhoons and continued heavy rainfall, particularly in Beijing and Hebei,the Company swiftly put in place an emergency rescue mechanism with local partners and customers and sent dedicated teams to ensure the proper functioning of equipment through around-the-clock personneland vehicle services. Its service engineers worked tirelessly to keep sanitation vehicle functioning properly and deliver essential supplies promptly, becoming key contributors to the post-disaster reconstruction efforts.
2. Revenue and cost
(1) Breakdown of operating revenue
Unit: RMB
| 2023 | 2022 | |||||
|---|---|---|---|---|---|---|
| Amount | Asapercentageofoperatingrevenue | Amount | Asapercentageofoperatingrevenue | YoYchange | ||
| Totalrevenue | 12,631,050,967.34 | 100% | 12,255,992,938.42 | 100% | 3.06% | |
| Sector | ||||||
| Smarturbanservice | 10,715,122,532.51 | 84.83% | 10,242,746,845.77 | 83.57% | 4.61% | |
| Others | 1,915,928,434.83 | 15.17% | 2,013,246,092.65 | 16.43% | -4.83% | |
| Product | ||||||
| Intelligentequipment | 5,085,372,879.14 | 40.26% | 6,084,414,800.17 | 49.64% | -16.42% | |
| Smartservice | 5,629,749,653.37 | 44.57% | 4,158,332,045.60 | 33.93% | 35.38% | |
| Others | 1,915,928,434.83 | 15.17% | 2,013,246,092.65 | 16.43% | -4.83% | |
| Region | ||||||
| Domestic | 12,584,153,957.04 | 99.63% | 12,237,181,369.71 | 99.85% | 2.84% | |
| Overseas | 46,897,010.30 | 0.37% | 18,811,568.71 | 0.15% | 149.30% | |
| Wholesale |
| Directsales | 11,172,859,318.43 | 88.46% | 10,735,356,968.50 | 87.59% | 4.08% |
|---|---|---|---|---|---|
| Retail | 1,458,191,648.91 | 11.54% | 1,520,635,969.92 | 12.41% | -4.11% |
(2) Sectors, products, regions or sales models accounting for over 10% of operating revenue or profit
Applicable □Not applicable
| Unit:RMB | ||||||
|---|---|---|---|---|---|---|
| Operatingrevenue | Operatingcost | Grossprofitmargin | YoYchangeinoperatingrevenue | YoYchangeinoperatingcosts | YoYchangeingrossprofitmargin | |
| Sector | ||||||
| Smarturbanservice | 10,715,122,532.51 | 8,366,738,029.64 | 21.92% | 4.61% | 4.28% | 0.25% |
| Others | 1,915,928,434.83 | 1,378,744,058.28 | 28.04% | -4.83% | -4.67% | -0.13% |
| Product | ||||||
| Intelligentequipment | 5,085,372,879.14 | 3,675,986,033.73 | 27.71% | -16.42% | -18.44% | 1.79% |
| Smartservice | 5,629,749,653.37 | 4,690,751,995.91 | 16.68% | 35.38% | 33.41% | 1.23% |
| Others | 1,915,928,434.83 | 1,378,744,058.28 | 28.04% | -4.83% | -4.67% | -0.13% |
| Region | ||||||
| Domestic | 12,584,153,957.04 | 9,712,142,988.74 | 22.82% | 2.84% | 2.73% | 0.07% |
| Overseas | 46,897,010.30 | 33,339,099.18 | 28.91% | 149.30% | 109.52% | 13.50% |
| Wholesale | ||||||
| Directsales | 11,172,859,318.43 | 8,647,595,286.40 | 22.60% | 4.08% | 4.35% | -0.21% |
| Retail | 1,458,191,648.91 | 1,097,886,801.52 | 24.71% | -4.11% | -7.16% | 2.48% |
The Company's main business data for the yearwas adjusted to take into account revised statisticalstandards that were updated during the reporting period
□Applicable Not Applicable
(3) Whether revenue from goods sales higher than revenue from rendering services
Yes □No
| Sector | Item | Unit | 2023 | 2022 | YoYchange |
|---|---|---|---|---|---|
| Sales | Unit | 14,903 | 17,674 | -15.68% | |
| Intelligentequipment | Production | Unit | 15,216 | 16,221 | -6.20% |
| Inventory | Unit | 1,947 | 1,634 | 19.16% |
Explanation of data with YoY differences that exceed 30%
□Applicable Not Applicable
(4) Fulfillment of material sales/procurement contracts signed during the reporting period
□Applicable Not Applicable
(5) Breakdown of operating costs
Sector
| 2023 | 2022 | |||||
|---|---|---|---|---|---|---|
| Sector | Item | Amount | Asapercentageofoperatingcost | Amount | Asapercentageofoperatingcost | YoYchange |
| Smarturbanservice | Rawmaterials | 3,578,986,019.54 | 42.78% | 4,021,886,417.92 | 50.13% | -11.01% |
| Smarturbanservice | Laborexpense | 1,762,380,063.07 | 21.06% | 1,056,998,188.36 | 13.17% | 66.73% |
| Smarturbanservice | Depreciation | 504,195,683.78 | 6.03% | 423,631,356.77 | 5.28% | 19.02% |
| Smarturbanservice | Utilities | 403,490,139.16 | 4.82% | 463,060,371.23 | 5.77% | -12.86% |
| Smarturbanservice | Othermanufacturingoverhead | 2,117,686,124.09 | 25.31% | 2,057,720,725.63 | 25.65% | 2.91% |
| Others | Rawmaterials | 596,485,884.08 | 43.27% | 729,321,140.14 | 50.43% | -18.21% |
| Others | Laborexpense | 125,343,062.94 | 9.09% | 97,064,385.84 | 6.71% | 29.13% |
| Others | Depreciation | 163,979,538.70 | 11.89% | 140,507,354.03 | 9.72% | 16.71% |
| Others | Utilities | 24,003,170.66 | 1.74% | 26,661,871.00 | 1.84% | -9.97% |
| Others | Othermanufacturingoverhead | 468,932,401.90 | 34.01% | 452,659,020.35 | 31.30% | 3.60% |
Unit: RMB
NoteLabor costs in relation to smart urban services rose significantly over the previous year, primarily because revenue from smart service increased during the current period, resulting in a corresponding increase in supporting facilities, labor costs, and labor outsourcing costs.
(6) Changes in the scope of consolidated financial statements for the reporting period
Yes □No
For details of the changes in the scope of the consolidated financial statements during the reporting period, please refer to Note 8 "Changes in the Scope of Consolidation" in Part X Financial Statements.
(7) Material changes in the business, products or services during the reporting period
□Applicable Not Applicable
(8) Major customers and suppliers
Major customers ofthe Company
| Totalsalestotopfivecustomers(RMB) | 768,801,478.51 | |
|---|---|---|
| Totalsalestotopfivecustomersasapercentageofannualtotalsales | 6.09% | |
| Totalsalestorelatedpartiesamongtopfivecustomersasapercentageofannualtotalsales | 0.00% |
Top five customers
| No.Customer | Salesrevenue(RMB) | Asapercentageofannualtotalsales | |
|---|---|---|---|
| ----------------- | --------------------------- | --------------------------------------------------------- | -- |
| 1 | CustomerA | 184,221,542.53 | 1.46% |
|---|---|---|---|
| 2 | CustomerB | 159,156,813.97 | 1.26% |
| 3 | CustomerC | 151,343,512.56 | 1.20% |
| 4 | CustomerD | 139,862,294.97 | 1.11% |
| 5 | CustomerE | 134,217,314.48 | 1.06% |
| Total | -- | 768,801,478.51 | 6.09% |
Other information about major customers
□Applicable Not Applicable
Major suppliers ofthe Company
| Totalpurchasesfromtopfivesuppliers(RMB) | 1,548,979,382.34 |
|---|---|
| Totalpurchasesfromtopfivesuppliersasapercentageofannualtotalpurchases | 19.85% |
| Totalpurchasesfromrelatedpartiesamongtopfivesuppliersasapercentageofannualtotalpurchases | 0.00% |
Top five suppliers
| No. | Supplier | Purchaseduringthereportingperiod(RMB) | Asapercentageoftotalpurchases |
|---|---|---|---|
| 1 | SupplierA | 625,907,194.69 | 8.02% |
| 2 | SupplierB | 448,675,120.98 | 5.75% |
| 3 | SupplierC | 245,457,742.48 | 3.15% |
| 4 | SupplierD | 128,693,061.92 | 1.65% |
| 5 | SupplierE | 100,246,262.27 | 1.28% |
| Total | -- | 1,548,979,382.34 | 19.85% |
Other information about major suppliers
□Applicable Not Applicable
3. Expenses
Unit: RMB
| 2023 | 2022 | YoYchange | Reasonformaterialchange | |
|---|---|---|---|---|
| Sellingexpenses | 794,334,952.02 | 762,970,847.95 | 4.11% | -- |
| Administrativeexpenses | 726,159,237.45 | 609,601,680.23 | 19.12% | Mainlyduetoincreaseinrevenuefromsmartserviceduringthecurrentperiod,resultinginacorrespondingincreaseinremunerationofmanagementmembers. |
| FinancialExpenses | 75,321,084.87 | 101,839,423.91 | -26.04% | Mainlyduetoincreaseindepositinterestincomeanddecreaseinloaninterestexpensesduringthecurrentperiod. |
| R&Dexpenses | 344,030,239.33 | 340,775,707.34 | 0.96% | -- |
4. R&D investments
Applicable □Not applicable
| NameofmajorR&Dprojects | Objectives | Progress | Proposedgoals | ExpectedimpactonfuturedevelopmentoftheCompany |
|---|---|---|---|---|
| IntelligentMagneticLevitationTurbineCentrifugalCompressorEquipmentforBlowerandVacuumSystems | Toexploreandexpandthesegment | Mass-producedandlaunchedonthemarket | Toindustrializetheresultandgeneratemarketorders | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| Nuclear-gradeCentrifugalRoofFan | Toexploreandexpandthesegment | Mass-producedandlaunchedonthemarket | Toindustrializetheresultandgeneratemarketorders | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| Three-phaseCentrifugalBlowerforNuclearIslands | Tomeettheenergyefficiencyrequirementsofcentrifugalblowerfornuclearislands | Mass-producedandlaunchedonthemarket | Toindustrializetheresultandgeneratemarketorders | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| AutomaticOnlineWaterQualityMonitorfortheContentofTotalThallium | Toexpandtheproductrangefortheonlinemonitoringofthalliumindomesticsewageandindustrialwastewater | Mass-producedandlaunchedonthemarket | Todevelopatypeofautomaticonlinewaterqualitymonitorforthecontentoftotalthallium | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| AutomaticWaterSampler | Todevelopnewproductssuitableforpretreatmentforsurfacewaterstations,withfunctionssuchasretentionofnon-compliantsamplesandsynchronoussampleretention | Mass-producedandlaunchedonthemarket | Todevelopatypeofpretreatmentequipmentforsurfacewaterstations,i.e.,samplerwithfunctionssuchasretentionofnon-compliantsamplesandsynchronoussampleretention | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| OzoneAnalyzer | Toexpandtheproductrangefortheonlinemonitoringofambientatmosphericozone | R&Dcompleted | Todevelopatypeofhighlyaccurateozoneanalyzer | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| PollutionSourceCO2Analyzer | Toexpandtheproductrangefortheonlinemonitoringofpollutinggreenhousegases | R&Dcompleted | TodevelopatypeofonlineautomaticmonitorofCO2emissions | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| ContinuousMonitoringSystemforVolatileOrganicCompoundsinAmbientAir | Toexpandtherangeofscientificinstruments,enablingonlinemonitoringof116typesofVOCsinambientair | R&Dcompleted | Todevelopasetofonlinemonitoringsystemof116typesofVOCs | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| AutonomousUnmannedSweepingRobot | Todevelopatypeofunmannedsweepingrobot | R&Dcompleted | Tosuccessfullydevelopatypeofunmannedsweepingrobot | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| OutdoorUnmannedDrivingOperatingSystemR&D(PhaseII) | Toconductspecializedtechnologydevelopmentforoutdoorunmanneddrivingtechnologytoenhancetechnicalcapabilities | R&Dcompleted | Tosuccessfullydeveloptheoutdoorunmanneddrivingtechnology(phaseII) | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| ResearchonPneumaticNoiseControlandEnergy-SavingPneumaticConveyingTechnology | Tofurtherreduceproductenergyconsumptionandnoise | R&Dcompleted | Toreduceenergyconsumptionandnoiseofexistingproducts | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
|---|---|---|---|---|
| Third-generationLeakage-freeCompressionGarbageTruck | 1.Tosolvetheproblemoflowloadingcapacityoftheexistingproduct;2.Tosolvetheproblemsofmaterialaccumulationandscatteringonthetopofthegarbagebinintheexistingproduct;3.Tosolvetheproblemofodorleakageduetotheunsealedopenendoftheexistingproduct. | R&Dcompleted | Todevelopawetwastecollectionandcompressiontruckwithfeaturessuchasfullsealing,noleakage,andlargeloadingcapacity | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| 18-tonPure-ElectricDual-fanRoadCleaners | Toaddressenergyconsumption,noise,andotherproblemsoftheproduct | R&Dcompleted | Toimprovetheperformanceoftheexistingproduct | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
| 18-tonFrontCollectionGreenHedgeTrimmer | Toexpandtheproductrangeforlandscapemaintenance,suchasthetrimming,collectionofgreenbeltsonhighways,roadexpressways,andurbanroads,thepruningofhighbranchesofbushonroadside,andslopemowing | ringR&Dcompleted | Todevelopaspecializedvehiclewithfront-mountedboomarmandquick-changesystemfortransitionsbetweenvariouslandscapingtoolstomanagetrimmingtasksinavarietyofsettings,includinggreenbelts,roadsides,andslopes | ThishelpstheCompanyimproveitskeycompetitiveadvantages |
Information about R&D personnel
| 2023 | 2022 | Change | |||||
|---|---|---|---|---|---|---|---|
| NumberofR&Dpersonnel | 1,212 | 1,415 | -14.35% | ||||
| R&Dpersonnelasapercentageoftotalstaff | 5.99% | 8.23% | -2.24% | ||||
| EducationbackgroundofR&Dpersonnel | |||||||
| Bachelor'sdegree | 802 | 995 | -19.40% | ||||
| Master'sdegree | 358 | 374 | -4.28% | ||||
| Doctoraldegree | 11 | 12 | -8.33% | ||||
| Collegedegree | 41 | 34 | 20.59% | ||||
| AgecompositionofR&Dpersonnel | |||||||
| <30years | 471 | 662 | -28.85% | ||||
| 30~40years | 560 | 641 | -12.64% | ||||
| >40years | 181 | 112 | 61.61% |
Information about R&D investments
| 2023 | 2022 | Change | |
|---|---|---|---|
| R&Dinvestments(RMB) | 352,849,905.78 | 364,237,563.22 | -3.13% |
| R&Dinvestmentsasa | 2.79% | 2.97% | -0.18% |
| percentageofoperatingrevenue | |||
|---|---|---|---|
| CapitalizedR&Dinvestments(RMB) | 8,819,666.45 | 23,461,855.88 | -62.41% |
| CapitalizedR&DinvestmentsasapercentageoftotalR&Dinvestments | 2.50% | 6.44% | -3.94% |
Reasons and impacts ofmaterial change in R&D personnel composition
□Applicable Not Applicable
Reasons for significant YoY change in total R&D investments as a percentage of operating revenue
□Applicable Not Applicable
Reasons and rationale for significant change in capitalization rate of R&D investment
Applicable □Not applicable
The capitalization rate of R&D investment decreased by 3.94% YoY, mainly due to the decrease in the investment in R&D projects under development during the reporting period.
5. Cash flow
| Unit:RMB | |||
|---|---|---|---|
| Item | 2023 | 2022 | YoYchange |
| Subtotalofcashinflowsfromoperatingactivities | 14,265,101,402.26 | 14,255,237,258.75 | 0.07% |
| Subtotalofcashoutflowsfromoperatingactivities | 12,879,544,892.77 | 12,592,754,971.04 | 2.28% |
| Netcashflowsfromoperatingactivities | 1,385,556,509.49 | 1,662,482,287.71 | -16.66% |
| Subtotalofcashinflowsfrominvestingactivities | 1,691,155,211.72 | 5,558,632,508.54 | -69.58% |
| Subtotalofcashoutflowsfrominvestingactivities | 2,766,885,333.81 | 6,696,412,810.26 | -58.68% |
| Netcashflowsfrominvestingactivities | -1,075,730,122.09 | -1,137,780,301.72 | 5.45% |
| Subtotalofcashinflowsfromfinancingactivities | 1,486,267,737.80 | 2,381,374,197.63 | -37.59% |
| Subtotalofcashoutflowsfromfinancingactivities | 2,462,201,245.03 | 2,447,214,731.68 | 0.61% |
| Netcashflowsfromfinancingactivities | -975,933,507.23 | -65,840,534.05 | -1,382.27% |
| Netincreaseincashandcashequivalents | -664,519,991.45 | 461,918,360.27 | -243.86% |
Explanation of main impact factor of material change of the data YoY
Applicable □Not applicable
The cash inflows from investing activities decreased by 69.58% YoY, and the cash outflows from investing activities declined by 58.68% YoY, mainly due to the YoY decrease in the purchase and redemption of wealth management products during the reporting period.
The cash inflows from financing activities decreased by 37.59% YoY, and the net cash flows from financing activities dropped by 1,382.27% YoY, mainly due to optimization of the debt mix during the reporting period, resulting in more repayments ofloans than new borrowings.
Explanation of reasons for the material difference between net cash flows from operating activities during the reporting period and net profit for the year
□Applicable Not Applicable
V. Analysis ofNon-Core Business
Applicable □Not applicable
Unit: RMB
| Amount | Asapercentageoftotalprofit | Reasonsforgeneration | Recurrentornonrecurrent | |
|---|---|---|---|---|
| Investmentincome | -51,597,205.92 | -8.46% | -- | RMB4,960,692.79isthereturnsonlong-termequityinvestmentscalculatedusingtheequitymethod,whichisrecurrent;theotherportionisnon-recurrent. |
| Gainorlossonchangesinfairvalue | 0.00% | -- | No | |
| Impairmentofassets | -123,390,769.02 | -20.23% | Mainlyduetoprovisionofgoodwillimpairmentloss | No |
| Non-operatingrevenue | 19,846,705.60 | 3.25% | -- | No |
| Non-operatingexpenses | 13,031,066.19 | 2.14% | -- | No |
VI. Assets and Liabilities
1. Material changes ofasset items
Unit: RMB
| December | 31,2023 | January | 1,2023 | Reasonformaterialchange | ||
|---|---|---|---|---|---|---|
| Amount | Asapercentageoftotalassets | Amount | Asapercentageoftotalassets | Change | ||
| Cashandcashequivalents | 4,411,376,583.78 | 15.19% | 4,728,203,530.46 | 16.15% | -0.96% | -- |
| Accountsreceivable | 5,867,669,476.86 | 20.20% | 5,625,792,472.37 | 19.22% | 0.98% | -- |
| Contractassets | 74,803,489.48 | 0.26% | 101,023,854.33 | 0.35% | -0.09% | -- |
| Inventories | 971,229,637.15 | 3.34% | 881,038,036.95 | 3.01% | 0.33% | -- |
| Investmentproperties | 1,138,868.60 | 0.00% | 27,105,435.03 | 0.09% | -0.09% | -- |
| Long-termequityinvestment | 681,629,084.69 | 2.35% | 676,829,959.84 | 2.31% | 0.04% | -- |
| Fixedassets | 2,338,316,124.14 | 8.05% | 2,268,287,202.01 | 7.75% | 0.30% | -- |
|---|---|---|---|---|---|---|
| Constructioninprogress | 288,057,018.89 | 0.99% | 41,073,267.68 | 0.14% | 0.85% | -- |
| Right-of-useassets | 25,125,671.95 | 0.09% | 31,859,454.24 | 0.11% | -0.02% | -- |
| Short-termborrowings | 126,939,855.26 | 0.44% | 440,103,105.44 | 1.50% | -1.06% | -- |
| Contractliabilities | 306,777,173.57 | 1.06% | 274,289,978.25 | 0.94% | 0.12% | -- |
| Long-termborrowings | 1,884,356,851.73 | 6.49% | 1,922,306,226.32 | 6.57% | -0.08% | -- |
| Leaseliabilities | 16,170,790.76 | 0.06% | 23,255,624.30 | 0.08% | -0.02% | -- |
| Intangibleassets | 5,984,348,824.39 | 20.60% | 6,048,114,364.49 | 20.66% | -0.06% | -- |
| Offshoreassets | accountforhighproportion |
□Applicable Not Applicable
2. Assets and liabilities measured at fair value
Applicable □Not applicable
Unit: RMB
| Item | Openingbalance | Gain/lossonchangesinfairvalueduringtheperiod | Cumulativechangesinfairvalueincludedinequity | Accrualofimpairmentduringtheperiod | Purchaseamountduringtheperiod | Salesamountduringtheperiod | Otherchanges | Closingbalance |
|---|---|---|---|---|---|---|---|---|
| Financialassets | ||||||||
| 4.Investmentsinotherentityinstruments | 15,352,971.01 | 15,352,971.01 | ||||||
| Subtotaloffinancialassets | 15,352,971.01 | 15,352,971.01 | ||||||
| Total | 15,352,971.01 | 15,352,971.01 | ||||||
| Financialliabilities | 0.00 | 0.00 |
Other changes
Whether any material changes occurred to the measurement attributes ofthe Company's major assets during the reporting period □Yes No
3. Restricted asset rights as atthe end of the reporting period
Unit: RMB
| Items | Closingbalance | Carryingamountsat | Typeofrestriction | Reasonforrestriction |
|---|---|---|---|---|
| ------- | -------------------- | --------------------------- | --------------------------- | ------------------------------ |
| theendoftheperiod | ||||
|---|---|---|---|---|
| Cashandcashequivalents | 495,231,329.24 | 495,231,329.24 | Guarantee,freeze,etc. | Deposits,escrowaccounts,frozenduetolitigationpreservation |
| Notesreceivable-bankacceptance | 4,472,210.78 | 4,472,210.78 | Endorsementordiscount | Endorsedordiscountedbutundue |
| Notesreceivable-tradeacceptance | 407,749.04 | 349,861.59 | Endorsementordiscount | Endorsedordiscountedbutundue |
| Accountsreceivable | 357,237,223.82 | 338,232,491.18 | Pledged | Pledged |
| Receivablefinancing | 55,280,364.20 | 55,280,364.20 | Pledged | Pledged |
| Long-termaccountsreceivableandnon-currentassetsduewithinoneyear | 66,695,425.00 | 61,841,516.63 | Factoringfinancingandpledgewithrecourse | Factoringfinancingandpledgewithrecourse |
| Fixedassets | 72,439,458.40 | 27,881,359.42 | Mortgaged | Mortgaged |
| Intangibleassets | 84,779,751.51 | 77,778,795.88 | Mortgaged | Mortgaged |
| 100%equityinterestinBiyangFengheNewEnergyPowerCo.,Ltd. | 105,047,950.25 | 105,047,950.25 | Pledged | |
| 100%equityinterestinFunanCompany | 78,720,044.41 | 78,720,044.41 | Pledged | |
| 100%equityinterestinPoyangGreenlanderRenewableEnergyCo.,Ltd. | 76,768,690.77 | 76,768,690.77 | Pledged | Mortgaged[Note] |
| 75%equityinterestinLianjiangCompany | 112,692,107.66 | 112,692,107.66 | Pledged | |
| 25%equityinterestinLianjiangCompany | 37,564,035.89 | 37,564,035.89 | Freeze | Frozenforlitigationpreservation |
| Total | 1,547,336,340.97 | 1,471,860,757.90 |
[Note]: The pledged amount refers to the Company's proportionate share in net assets ofeach entity.
VII. Investments
1. Overview
Applicable □Not applicable
| Investmentamountforthereportingperiod(RMB) | Investmentamountforthepriorperiod(RMB) | Change |
|---|---|---|
| 7,056,438.75 | 106,000,002.00 | -93.34% |
2. Material equity investments made during the reporting period
□Applicable Not Applicable
3. Material non-equity investments ongoing during the reporting period
□Applicable Not Applicable
4. Financial investments
(1) Securities investments
□Applicable Not Applicable
No such cases during the reporting period.
(2) Derivatives investments
□Applicable Not Applicable
No such cases during the reporting period.
5. Use of proceeds from fundraising activities
Applicable □Not applicable
(1) Overall use of proceeds
Applicable □Not applicable
Unit: RMB 10,000
| Year | Fundraisingtype | Totalamountofproceeds | Netamountofproceeds | Totalamountofproceedsusedduringtheperiod | Accumulativeamountofproceedsused | Totalamountofproceedswithchangeofuseduringthereportingperiod | Accumulativeamountofproceedswithchangeofuse | Shareofaccumulativeproceedswithchangeofuse | Totalamountofunusedproceeds | Purposeandtrackingofunusedproceeds | Proceedsleftidleforover2years |
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2020 | Publicofferingofconvertiblecorporatebonds | 147,618.96 | 145,733.62 | 3,956.73 | 38,836.42 | 0 | 0 | 0.00% | 107,743.13 | RMB1billionwilltemporarilyreplenishworkingcapital,theremainingamountwillbeusedtoimplementrecentinvestmentprojects. | and0 |
| Total | -- | 147,618.96 | 145,733.62 | 3,956.73 | 38,836.42 | 0 | 0 | 0.00% | 107,743.13 | -- | 0 |
Explanation of the overall use of proceeds
According to the Approval of the Public Of ering of Convertible Corporate Bonds by Infore Environment Technology Group Co., Ltd. (Z.J.X.K. [2020] No. 2219) issued by the CSRC,the lead underwriter of the Company, Huaxing Securities Co., Ltd. (formerly known as Huajing Securities, hereinafter "Huaxing Securities") issued 14,761,896 convertible corporate bonds ("CBs") to the public with the offering price of RMB 100 and apar value of RMB 100 for each CB, raising a total of RMB 1,476,189,600.00. Specifically, priority allotment of 9,405,386 CBs were issued to original shareholders ofthe Company, accounting for 63.71% of the total amount of this public offering; 5,304,730 CBs were issued to public investors through online channels, accounting for 35.94%
of the total amount of this public offering; 51,780 CBs were to be underwritten by the lead underwriter, accounting for 0.35% of the total amount of this public offering. Proceeds in this offering had been remitted to the Company's raised fund supervision account by the lead underwriter Huaxing Securities on November 10, 2020, and the amount actually received after deducting RMB 15,238,100 of underwriting and sponsorship fees (tax exclusive) was RMB 1,460,951,500. After deducting RMB 3,615,300 (tax exclusive) of external fees that were directly related to CB such as online offering expenses, printing fee for the prospectus, fees ofthe reporting accountant, counsel fee, credit rating fee, information disclosure expenses, and issuance commission fee, the net amount of proceeds from this offering wasRMB 1,457,336,200. The availability of the above-mentioned proceeds has been verified by Pan-China Certified Public Accountants LLP in its Capital Verification Report (T.J.Y. [2020] No.490).
As at December 31, 2023, the accumulated use of fundraising proceeds was RMB 388,364,200, and the total amount of fundraising proceeds not yet used was RMB 1,077,431,300.
(2) Projects with committed investment of proceeds
Applicable □Not applicable
Unit: RMB 10,000
| Committedinvestmentprojectsandinvestmentofexcessiveproceeds | Whetherprojectshavebeenchanged(includingpartialchange) | Totalamountofproceeds | Adjustedtotalinvestmentamount(1) | Investmentamountduringthereportingperiod | Accumulativeinvestmentamountasattheendofthereportingperiod(2) | Investmentprogressasattheendofthereportingperiod(3)=(2)/(1) | Datewhentheprojectsarereadyfortheirintendeduse | Benefitsrealizedduringthereportingperiod | Whethertheestimatedreturnisrealized | Whethertherearematerialchangesintheprojectfeasibility |
|---|---|---|---|---|---|---|---|---|---|---|
| Committed | investment | projects | ||||||||
| Theprojectofthecomprehensivesmartsanitationallocationcenter | No | 129,638.49 | 129,638.49 | 3,956.73 | 22,741.29 | 17.54% | December31,2024 | 8,757.61 | Notapplicable | No |
| Replenishmentofworkingcapital | No | 16,095.13 | 16,095.13 | 0 | 16,095.13 | 100.00% | Notapplicable | Nobenefitgeneratedseparately | Notapplicable | No |
| Subtotalofcommittedinvestmentprojects | -- | 145,733.62 | 145,733.62 | 3,956.73 | 38,836.42 | -- | -- | 8,757.61 | -- | -- |
| Investmentof | excessive | proceeds | ||||||||
| Notapplicable | ||||||||||
| Repaymentofbankloans(ifany) | -- | 0 | 0 | 0 | 0 | 0.00% | -- | -- | -- | -- |
| Replenishmentofworkingcapital(ifany) | -- | 0 | 0 | 0 | 0 | 0.00% | -- | -- | -- | -- |
| Subtotalofinvestmentofexcessiveproceeds | -- | 0 | 0 | 0 | 0 | -- | -- | -- | -- |
| Total | -- | 145,733.62 | 145,733.62 | 3,956.73 | 38,836.42 | -- | -- | 8,757.61 | -- | -- | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Project-by-projectdetailsandreasonsforfailuretorealizeplannedprogressandexpectedreturn(includingthereasonsforchoosing"N/A"for"Whethertheexpectedreturnisrealized") | OnAprilfromthedeliberatedandtheadjusttheaboveinvestmentallocationsanitationexpectationsequipmentsuppliersadjustedproceeds. | 26,2024,Publicandapprovedsixthmeetinginvestmentprojectstoprogresscenterwasserviceduetoandtheforsometheproject's | theProposalIssuanceofattheoftheTenthprogressbyDecember31,ofthemainlybasedprojects.theimpactofdesignationprojectsontheinvestment | ontheDelayA-sharesixthmeetingBoardofchangingthe2026.TheprojectoftheontheTheproject'stheofornumberofprogressto | ofPartoftheConvertibleoftheTenthSupervisors.dateforadjustmentcomprehensivecurrentbusinessinvestmentoveralldeclineinrestrictionsonorders.ensurethe | ProjectsofCorporateBoardofTheCompanytheintendedwasmadesmartsizeoftheprogressfelldemandforsanitationTherefore,qualityand | ProceedsBondswasDirectorsagreedtouseofthebecausethesanitationCompany'sshortofsanitationequipmenttheCompanyfulluseof | ||||
| Explanationsproject | ofthematerialfeasibility | changes | inthe | Notapplicable | |||||||
| Amount,proceeds | purpose, | andprogressof | excessive | Notapplicable | |||||||
| Locationinvestment | changesintheprojectsofthe | implementationproceeds | of | Notapplicable | |||||||
| Adjustmentsinvestment | totheprojectsofthe | implementationproceeds | methodof | Notapplicable | |||||||
| Earlyinvestmentinvestment | andprojectsofthe | placementofproceeds | the | Notapplicable | |||||||
| Temporaryreplenishmentofworkingcapitalwithidleproceeds | ApplicableTheProposalWorkingBoardofbythefundraisingreplenishmentoperation12monthsBoardofTheCompanyforTemporarytheCompanyreplenishmentonOctoberTheProposalWorkingTenthBoardSupervisorsfundraisingreplenishmentoperationmonthsasBoardofproceedswasRMB | onUsingCapitalwasDirectorsandCompanyonproceedsofrelatedtotheasattheDirectors.issuedreturnedofworking24,2023onUsingCapitalwasofheldonproceedsofrelatedtoatthedateDirectors.usedbythe1,000,000,000. | Partofdeliberatedththe19October26,ofnoworkingcapital,Company'sdatewhenthetheAnnouncementReplenishmentofallcapitalforaperiodPartofdeliberatedDirectorsandOctober28,ofnoworkingcapital,itsprincipalwhentheAsatDecemberCompanyfor | theIdleandapprovedMeetingofthe2022,morethanwhichshallmainbusinessesProposalwasontheWorkingCapitaltheRMB1totherelevantnotexceedingtheIdleandapprovedtheFourth2023,morethanwhichshallbusinessesProposalwas31,2023,temporary | Fundraisingstatthe21NinthBoardallowingtheRMB1beusedwithadeliberatedReturnofonOctoberbillionofdesignated12months.FundraisingattheMeetingofallowingtheRMB1beusedwithatenordeliberatedthebalancereplenishment | ProceedstoMeetingofofSupervisorsCompanytobillionforforthetenorofnoandapprovedFundraising25,proceedsforaccountforProceedstoFourthMeetingtheTenthCompanytobillionforfortheofnomoreandapprovedoftheidleofworking | ReplenishtheNinthhelduseidletemporaryproductionandmorethanbytheProceeds2023,inwhichtemporaryproceedsReplenishoftheBoardofuseidletemporaryproductionandthan12bythefundraisingcapital | ||||
| Theamounttheproceeds | ofandreasonsfromthe | fortheproject | balanceofimplementation | Notapplicable | |||||||
| Purposeand | trackingof | theunused | proceeds | TheProposal | onUsing | Partof | theIdle | Fundraising | Proceedsto | Replenish |
| WorkingCapitalwasdeliberatedandapprovedattheFourthMeetingofthe | |
|---|---|
| TenthBoardofDirectorsandtheFourthMeetingoftheTenthBoardof | |
| SupervisorsheldonOctober28,2023,allowingtheCompanytouseidle | |
| fundraisingproceedsofnomorethanRMB1billionfortemporary | |
| replenishmentofworkingcapital,whichshallbeusedfortheproductionand | |
| operationrelatedtoitsprincipalbusinesseswithatenorofnomorethan12 | |
| monthsasatthedatewhentheProposalwasdeliberatedandapprovedbythe | |
| BoardofDirectors.AsatDecember31,2023,thebalanceoftheidlefundraising | |
| proceedsusedbytheCompanyfortemporaryreplenishmentofworkingcapital | |
| wasRMB1,000,000,000.TheotherunusedproceedsofRMB77,431,300were | |
| keptinthedesignatedproceedsaccountintheformofdemanddepositstobe | |
| usedfortheconstructionofthecorrespondinginvestmentprojects. | |
| Problemsintheuseofproceedsanddisclosure,orothercases | Notapplicable |
(3) Changed projects ofproceeds
□Applicable Not Applicable No such cases during the reporting period.
VIII. Sale of Material Assets and Equity Investments
1. Sale of material assets
□Applicable Not Applicable
No such cases during the reporting period.
2. Sale of material equity investments
□Applicable Not Applicable
IX. Analysis ofMajor Subsidiaries and Joint Stock Companies
Applicable □Not applicable
Main subsidiaries and joint stock companies with an over 10% influence on the Company's net profit
Unit: RMB
| Companyname | Typeofcompany | Principalactivities | Registeredcapital | Totalassets | Netassets | Operatingrevenue | Operatingprofit | Netprofit |
|---|---|---|---|---|---|---|---|---|
| ChangshaZoomlionEnvironmentalIndustryCo.,Ltd. | Subsidiary | Smarturbanservice | 2,351,529,800 | 17,721,351,611.36 | 8,074,408,455.97 | 10,689,866,567.16 | 815,342,983.52 | 712,220,602.56 |
Acquisition and disposal of subsidiaries during the reporting period
Applicable □Not applicable
| Companyname | Acquisitionanddisposalofsubsidiariesduringthereportingperiod | Effectsontheoveralloperationsandperformance |
|---|---|---|
| HubeiYinglingTestingTechnologyServiceCo.,Ltd. | Businesscombinationnotundercommoncontrol | PositiveeffectsontheCompany'sbusiness |
| LiaochengChipingYingshengEnvironmentalSanitationServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
|---|---|---|
| JiangmenLvyingUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| FuzhouChangleYingshengUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ChongqingBananYingheUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| GuangzhouYingtaiUrbanManagementServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| FoshanShundeYingchuangUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| PuningHonglianEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| HefeiYingshengUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| FengyangYingheEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| SanyaYinglianUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| FuzhouYingheEnvironmentalDevelopmentCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ChuzhouTongyingEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| YongxinYingheEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| LianjiangYinglianUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| GuangzhouYingzhiUrbanEnvironmentalSanitationServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ShenzhenLonggangYinglianEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ShenzhenYinglianLandscapingEngineeringCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| YangjiangYingheUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| RenshouYingheUrbanandRuralSanitationServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ChibiYinglianEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ShenzhenLonggangYingjiUrbanServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| WuyiYingheEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| XuchangJian'anTongyingEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| FoshanShundeYinglianUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| TaizhouYingheEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ChangshaYingheEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| HuichangYingmaoEnvironmentalManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| TangshanYinglianEnvironmentalManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| YongfengYingheEnvironmentalSanitation | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ManagementCo.,Ltd. | ||
|---|---|---|
| NanjingYinglianEnvironmentalTechnology | Incorporation | PositiveeffectsontheCompany'sbusiness |
| Co.,Ltd. | ||
| SuzhouWujiangYingheEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| XiajiangYingheEnvironmentalSanitationManagementCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| LongquanTongyingEnvironmentalSanitationServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| XinhuaYinglianModernEnvironmental | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ServiceCo.,Ltd.GuangxiLuochengYingxinUrban | Incorporation | PositiveeffectsontheCompany'sbusiness |
| EnvironmentalServiceCo.,Ltd. | ||
| SuzhouYingfenEnvironmentalIndustryCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| RenshouZhongyingSanitationServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| NantongLianyingEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| HuazhouLianshengUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| HeyuanZijinLianshengUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| TangshanYingxingSanitationEquipmentManufacturingCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| QuanzhouYingxinUrbanEnvironmentalServiceCo.,Ltd. | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ZhejiangYolshIntelligentEmergency | Incorporation | PositiveeffectsontheCompany'sbusiness |
| EquipmentCo.,Ltd.HeyangYingheUrbanEnvironmentalService | Incorporation | PositiveeffectsontheCompany'sbusiness |
| Co.,Ltd.XuzhouTongyingEnvironmentalSanitation | Incorporation | PositiveeffectsontheCompany'sbusiness |
| ServiceCo.,Ltd. | Assetoptimization;Nomaterialimpactonthe | |
| MeishanPengshanZhongfengEnvironmentalIndustryCo.,Ltd. | De-registration | Company'sproduction,operationand |
| ChengduYinglianEnvironmentalManagementCo.,Ltd. | De-registration | performanceAssetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| GuangxiGuipingYingheEnvironmentalSanitationManagementCo.,Ltd. | De-registration | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| ShengzhouYingheEnvironmentalSanitationManagementCo.,Ltd. | De-registration | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| ChongyangYinglianEnvironmentalProtectionCo.,Ltd. | De-registration | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| YiyangYinglianEnvironmentalSanitationManagementCo.,Ltd. | De-registration | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| WanningYinglianEnvironmentalIndustryCo.,Ltd. | De-registration | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| ShenzhenLonghuaDistrictYinglianUrbanServiceCo.,Ltd. | De-registration | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| GuangdongInforeSmartTechnologyCo.,Ltd. | De-registration | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
|---|---|---|
| AnhuaYingshengEnvironmentalSanitationServiceCo.,Ltd. | De-registration | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| GuchengYinglianUrbanEnvironmentalServiceCo.,Ltd. | Transfer | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| ZaozhuangYinglianUrbanEnvironmentalServiceCo.,Ltd. | Transfer | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| YichunYinglianUrbanEnvironmentalServiceCo.,Ltd. | Transfer | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| ChongqingYinglianUrbanEnvironmentalSanitationServiceCo.,Ltd. | Transfer | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
| HuaibeiZhongfengUrbanEnvironmentalServiceCo.,Ltd. | Transfer | Assetoptimization;NomaterialimpactontheCompany'sproduction,operationandperformance |
Fact sheet of major subsidiaries
X. Structured Entities Controlled by the Company
□Applicable Not Applicable
XI. Future Prospects ofthe Company
- (I) Market opportunities
-
- The 2023 national policies are favorable for the development of the sanitation industry
On January 30, the Ministry of Industry and Information Technology, together with other seven state departments issued the Notice on Organizing the Pilot Program of Pilot Zones for Full Electrification of Public Service Vehicles, requiring that there should be a significant rise in the proportion of new energy vehicles in incremental and upgraded vehicles in pilot areas, with an 80% levelin terms of buses, taxis, sanitation, postal and express delivery, and urban logistics vehicles fueled by new energy. This policy is favorable for the development of the industry.
The Opinions of the Central Committee of the CPC and the State Council on Fulfilling the Key Work of Comprehensively Promoting Rural Revitalization in 2023, which was issued on February 13, requires that efforts should be made to solidly advance the improvements in the rural living environment and increase the intensity of improvements in the village public space. This directly benefits the waste collection and transportation equipment sector.
On May 17, the National Development and Reform Commission (NDRC) issued the Guidelines on Accelerating the Construction of Charging Infrastructure to Better Support New Energy Vehicle Purchases in the Countryside and Rural Revitalization. This policy encourages regions with suitable conditions to increase support for the adoption of new energy vehicles (NEV) in public transport, road passenger transport, taxis, law enforcement, sanitation, and logistics.
The State Council, at a policy briefing held on June 21, announced a pilot program for the full electrification of public vehicles. This program involves an implementation plan for heavy-duty truck electrification, and acceleration of the electrification of urban buses, logistics vehicles, taxis, sanitation vehicles, and heavy trucks.
On June 30, the General Office of NDRC and other departments issued the Notice on Addressing Shortcomings in Public Sanitation and Environmental Facilities and Carrying Out Clean-up and Rectification in Urban and RuralEnvironmental Sanitation. This notice sets out initiatives to improve urban environmental sanitation and rural living environments, and address deficiencies in urban and rural waste and sewage treatment.
On July 25, the NDRC issued the Notice on the Action Plan for Upgrading Environmental Infrastructure Construction (2023- 2025). This plan calls for accelerating improvements in domestic waste sorting facilities and systems, reasonably blueprinting the construction of collection points, stations, and transfer compression stations, and enhancing collection and transportation networks. This document also aimsto address the shortage of domestic waste incineration capacity in county-level regions by encouraging the use of the model of collection at villages, transportation in towns, and processing in counties ornearby to promote the construction of facilities in towns with established status and rural areas.
On July 31, the NDRC and other departments issued the Notice on Several Measures to Promote Automobile Consumption. This policy encourages the purchase of new energy vehicles for government agencies, public transport, taxis, postal services, sanitation, and landscaping in appropriate areas when new vehicles are needed or old vehicles need to be upgraded.
On August 25, the Ministry of Industry and Information Technology and six other departments issued the Notice on the Work Plan for Stabilizing Growth in the Automobile Industry (2023-2024). This plan requires organizing the pilot program of pilot zones for full electrification of public service vehicles, accelerating the adoption of new energy buses, taxis, sanitation, postal and express delivery, and urban logistics vehicles, studying, exploring and promoting pilot projects for zero-emission heavy-duty truck in regional freight transport to further increase the electrification level of public service vehicles. It also callsfor comprehensively promoting the demonstration of fuel cell vehicles and steadily increasing the applications offuel cell vehicles.
On October 24,the sixth meeting of the 14th Standing Committee of the National People's Congress adopted a resolution on the issuance by the State Council of additional government bonds and the plan to adjust the 2023 central budget. The central government issued an additional RMB 1 trillion of 2023 government bonds in the fourth quarter. These funds were allocated directly to local governments through transfer payments, for them to focus on rebuilding disaster-stricken areas and addressing deficiencies in disaster prevention and relief infrastructure.
On November 15,the Ministry of Industry and Information Technology, the Ministry of Transport, and six other departments issued the Notice on Launching the First Batch of Pilot Program of Pilot Zones for the Full Electrification of Public Service Vehicles. This notice identifies fifteen cities, namely Beijing, Shenzhen, Chongqing, Chengdu, Zhengzhou, Ningbo, Xiamen, Jinan, Shijiazhuang, Tangshan, Liuzhou, Haikou, Changchun, Yinchuan and Ordos, as pilot zones to explore replicable experiences and models, to play a demonstrative and leading role in the full market expansion of NEVs and the development of a green and low carbon transport system. The document sets out a pilot program that focuses on promoting NEVs in various sectors, including government vehicles, city buses, sanitation trucks, taxis, postal and delivery vehicles, urban logistics vehicles, airport vehicles, and heavy-duty trucks for specific applications, and the goal is to deploy over 600,000 NEVs.
On November 21,the third round of centralecological and environmental inspection commenced, with five inspection teams dispatched to Fujian, Henan, Hainan, Gansu, and Qinghai for a month-long inspection.The inspections focused on environmental issues in implementation of major regional strategies, major ecological damage, environmental pollution, environmental risks, and related responses; environmental infrastructure construction and operation; rectification of issues, ecological and environmental issues that have been raised by the people as major concerns; and the implementation of the principle that both Party committees and governments take responsibility, and officials perform their duties while also taking responsibility for ecological and environmental protection.
On November 30,the State Council issued the Notice on the Action Plan for Continuous Improvement of Air Quality. This plan sets out targets ofreducing PM2.5 concentrations by 10% compared to 2020 levels, and limiting the proportion of days with severe or severer air pollution to less than 1% in all prefecture-level and above cities; reducing PM2.5 concentrations by 20% in the Beijing- Tianjin-Hebei Region and surrounding areas, and 15% in Fenwei Plain, and achieving overall compliance with national standards on PM2.5 concentration in Yangtze River Delta Region, and maintaining Beijing's PM2.5 concentration below 32 microgramsper cubic
meter. In key regions, at least 80% of newly added or updated public buses, taxis, urban logistics vehicles, and light sanitation vehicles should be fueled by new energy. In prefecture-level and above cities, the mechanical cleaning rate of roads within the built up area should reach around 80%, and the mechanical cleaning rate of roads in counties should reach around 70%.
On December 25,the Ministry of Ecology and Environment issued the Notice on Issuing the Comprehensive Action Plan for Tackling Air Pollution in the Beijing-Tianjin-Hebei Region and Surrounding Areas and the Fenwei Plain during the Autumn and Winter of 2023-2024. This plan requires that by the end of December 2023, the construction or renovation of VOCs treatment facilities should be completed at 1,040 enterprises, and VOCs fugitive emissions should be addressed at 1,217 enterprises. At least 80% of newly added or updated public service vehicles, such as public buses, taxis, logistics vehicles, and light sanitation vehicles, should be fueled by new energy.
- The demand for urban services will keep increasing
The source of urban services revenue is the government budget with the nature of rigid expenditure and is less affected by macroeconomic regulation factors. The business is characterized by continuity and stability.
(1) The scale of demand for services driven by urbanization
As urbanization continues, the construction of urban roads will directly increase the area for road cleaning, urban housing, compound construction, and urban greening, hence increasing the demand for environmental protection equipment and urban cleaning services. Furthermore, sanitation is one of the prerequisites for each province, city, and district to construct urban upgrades such as "national civilized cities", "national hygienic cities", "national model cities of environmental protection", and "national ecological garden cities". From 2015 to 2022, the area of road cleaning in China's cities and counties increased from 9.678 billion square meters to 13.337 billion square meters, an overall increase of nearly 37.8%; the domestic waste removed and transported in cities and counties rose from 258 million tons to 317 million tons, an overall growth of 22.9%, according to the statistics from the National Bureau of Statistics and the Ministry of Housing and Urban-Rural Development. Driven by urbanization, the release of urban service demand is constantly facilitated in order to maintain the cleanliness and sanitation of urban roads, residential compounds, and municipal gardens, as well as the normal transfer and treatment of domestic waste.
(2) The "Beautiful Countryside" kick-started, and the rural sanitation market is gradually gaining momentum
The Five-Year Action Plan for the Remediation and Improvement of Rural Living Environment (2021-2025) requires that "the rural toilet revolution shall be firmly implemented", "the promotion of rural domestic sewage treatment shall be accelerated", and "the standard of rural domestic waste treatment shall be improved comprehensively". In the era of building "beautiful villages" and boosting urban and rural sanitation integration, projects like promotion by all counties and comprehensive management have emerged continuously and the rural sanitation market will enter a new stage for furtherrapid market expansion. This willcreate vast opportunities for urban services and the entire sanitation industry.
(3) Continued promotion of waste classification and the continued release of market demand
In September 2020, President Xi Jinping chaired the meeting of the CentralComprehensively Deepening Reforms Commission, at which the Several Opinions on Further Promoting Domestic Waste Classification was deliberated and approved. The accelerated implementation of waste classification policies would overturn the traditional domestic waste collection and transportation system. Conventional sanitation vehicles will no longer meet the needs of classified collection and transportation. Domestic waste is treated in four steps,namely "dumping", "collection", "transportation", and "disposal",requiring upgrades and renovation of traditional sanitation technology and equipment. Additionally, making the system smart requires increased investment, spurring a continuous release of market demand.
(4) Full electrification of public service vehicles and increasing demand for new energy-powered environmental protection equipment
On January 30, 2023, the MIIT, together other seven other state departments issued the Notice on Organizing the Pilot Program of Pilot Zones for Full Electrification of Public Service Vehicles, setting out to launch nationwide pilot programs of pilot zones for full electrification of public service vehicles from 2023 to 2025. The document requires that there should be a significant rise in the proportion of NEVs in incremental and upgraded vehicles in pilot areas, with an 80% level in terms of buses, taxis, sanitation, postal
and express delivery, and urban logistics vehicles fueled by new energy. Since 2012, China has made a guiding policy to accelerate the cultivation of the new energy vehicle industry, and has successively released important documents for its promotion. After a period of development, new energy-powered sanitation vehicles are poised for significant growth.
(5) The increasing mechanization will drive the growth in the environmental protection equipment market
The increase in mechanization rate ofthe sanitation industry will reduce the cost of sanitation operations and relieve the financial burden of governments and enterprises. With the expansion of China's urban and rural road cleaning areas, the mechanization rate of the sanitation industry is gradually increasing. According to the 2022 Urban and Rural Construction Statistical Yearbook, at the end of 2022, the mechanical cleaning space of roads in cities across the country reached 11.1 billion square meters, with a mechanization rate of 79.7%; the mechanical cleaning space of roads in counties across the country reached 2.4 billion square meters, with a mechanization rate of 78.4%. This indicates that there is still room for development in terms ofthe mechanization level of sanitation industry in China. In the future, as labor costs continue to rise, the mechanization of sanitation operations will become the main development direction of the domestic sanitation market, and it will cover road cleaning, guardrail cleaning, waste collection & transportation, and other segments.
(6) The trend of aging population will drive the expansion of the environmental protection equipment market
The frequent adjustments made by China in terms of minimum wages in different cities have largely influenced the operating costs ofurban service enterprises. The defects including high operating costs and low working efficiency in the traditional manual urban service model have increased the business pressure on sanitation operation enterprises. Furthermore, China's elderly population reached 297 million at the end of 2023, accounting for 21.1% of the nation's total population, according to the State Statistics Bureau. The aging trend will exacerbate the workforce deficit in the urban service industry. Meanwhile, with the diversification of job options, the number of young and middle-aged laborers who are willing to engage in sanitation work is also decreasing. Therefore, improving the mechanization rate of the sanitation industry and expanding the use of environmental protection equipment is not only a realistic need in the face of the labor market shortage, but also the requirement for the development of urban sanitation level.
(7) Industrial breakthrough fueled by technological advancement
The rapid development of 5G and AI technology has widened industrial boundaries and opened up a slew of new opportunities. Small-sized smart devices and smart services will be the new bonanza, introducing new variables and increments for the sector. Smart, less humanized, or even unmanned sanitation will be a general trend.
(II) Business plan for 2023
In 2023, the Company closely revolved around its development strategy and annual business plan, focusing on its core strategic business. It improved internal operations, and actively promoted smart urban services, achieving its business plan relatively well for 2023. The Company's business targets set at the beginning of the yearwere: RMB 80 billion in the planned cumulative contract amount of smart urban services and RMB 6.5 billion in annualrevenue. The actual planned cumulative contract amount of smart urban services reached RMB 60.018 billion, while annual revenue posted RMB 5.63 billion.
In 2023, the Company failed to accomplish its annual revenue target of RMB 6.5 billion for smart services, with an achievement rate of 86.62%. It also failed to accomplish its operating target of RMB 80 billion in total contract amount, with an achievement rate of 75.02%. The reason for the Company's failure to achieve the operating target of the total contract amount is a decrease in orders with long cycles of more than 5 years in the market,resulting in a slight decrease in the total contract amount of orders obtained by the Company. In 2024, the Company will take into account the market trends, diversify its operations and actively attract short- and medium-cycle projects.2024 operating target: to achieve a cumulative contract amount of RMB 100 billion forsmart urban service solutions, and to
realize an annual revenue of RMB 10 billion; from 2020 to 2024, the planned cumulative contract amount would be RMB 100 billion, so as to achieve an annual revenue of RMB 10 billion.
The Company will continue to increase resource input in its strategic core business, smart urban service, striving to be one of the top-ranking enterprises in the industry in the next five years.
In 2024, the Company will continue to follow its strategy of technology and product leadership, with further focus on its core business – smart urban services. At the same time, itwill expand its presence in new energy products, including solar panel brackets as well as energy storage products for industrial and commercial purposes.
(III) Plan for use of funds
2024 is a key period for the Company's rapid development. Given its big demand for funding, the Company will make a funding supply and demand plan that fits its development. Apart from making full use of its own funds, the Company will also furtherstrengthen the management of accounts receivable while optimizing the financial structure to enable strong financial guarantees for its business development and control financial risks. The main funding sources are diverse,including any and combination of issuance of financing bills, medium-term notes, cash flows from operating activities, and bank loans.
(IV) Main risk factors that may adversely affect the achievement of the Company's future development strategies and business objectives
- Policy-related risksAs the state attaches more importance to environmental protection and environmental governance, unprecedented development opportunities will also appear in the environmental protection industry, but such industry is also highly dependent on national industrial policies since it is typically policy-driven. Adjustments to macroeconomic policies, tax policies, environmental industry policies and environmental management policies will affect the Company's performance.
Countermeasures: To raise the scientific decision-making capacity of managers and boost the Company's resilience against policy-related risks, the Company will pay careful attention to changes in national macroeconomic policies and strengthen research and analysis ofindustry policies.
- Operation management risks
As the Company continuously expands its business scale,enriches its business types, broadens its markets and develops more subsidiaries, its asset scale, personnel scale and organization scale are also undergoing rapid expansion,causing its organizational structure and management system to become more complex. Although the Company has formed a complete set of management policies for internal control and improved it annually,the difficulties and risksin the management and control are still increasing due to the differences in industry attributes, geographic distribution, cultural characteristics and corporate culture of its branch institutions.
Countermeasures: the Company is concentrating on strengthening the management and risk control systems, further improving the operation management system and business process, continuing to refine management, and strengthening the risk control and culture of subsidiaries, all while strengthening the talent team.
- Heightened market competition risks
The sanitation industry in China is an emerging comprehensive industry that is still in the early stages ofmarketization and has a relatively low level of concentration. However, the industry is currently in a period of rapid growth. With its rapid growth, the involvement of upstream and downstream enterprises, and the continuous participation of new enterprises in different sectors, market competition will continue to intensify. The Company will likely face the risk of losing market share in the future.
Countermeasures: the Company will continue to pursue a technology-driven development strategy in order to preserve its technological leadership in the industry and, as a result, solidify its marketleadership.
XII. Visits Paid tothe Company for Purposes ofResearch, Communication, and Interview during the Reporting Period
Applicable □Not applicable
| Time | Venue | Method | Visitortype | Visitor | Maincontentofdiscussionandmaterialsprovided | Referenceofthestudy'sbasicinformation |
|---|---|---|---|---|---|---|
| April24, | Foshan, | Byphone | Institution | HarvestFund,China | Operatingstatus | Fordetails,pleasereferto |
| 2023 | Guangdong | FutureCapital,Haitong | andR&Ddirection | theRecordSheetInvestor | ||
|---|---|---|---|---|---|---|
| Province | Securities,Greenwoods | oftheCompany | RelationsActivities | |||
| AssetManagement,GF | disclosedbytheCompany | |||||
| Securities,Changjiang | onApril24,2023on | |||||
| Securities,Huatai | Cninfo | |||||
| Securities,Huatai | (www.cninfo.com.cn) | |||||
| SecuritiesAsset | ||||||
| Management,China | ||||||
| MerchantsSecurities, | ||||||
| NationalGreen | ||||||
| DevelopmentFund, | ||||||
| TianfengSecurities, | ||||||
| SoochowSecurities, | ||||||
| IndustrialSecurities, | ||||||
| GuotaiJunanSecurities, | ||||||
| EverbrightSecurities, | ||||||
| HuachuangSecurities, | ||||||
| etc. | ||||||
| "Interactive | Business | Fordetails,pleasereferto | ||||
| Platformfor | Online | developmentstatus | theRecordSheetof | |||
| May12, | Investor | communication | andfuturebusinessstrategyofthe | InvestorRelations | ||
| 2023 | Relations" | onInternet | Others | Investors | Activitiesdisclosedbythe | |
| on | platform | Company's | CompanyonMay12,2023 | |||
| Panorama | segments | onCninfo | ||||
| Network | (www.cninfo.com.cn) | |||||
| ChangjiangSecurities, | ||||||
| NortheastSecurities, | Fordetails,pleasereferto | |||||
| CITICSecurities,Harvest | Marketsituation | theInvestorRelations | ||||
| December | Foshan, | Fund,PenghuaFund | andcore | Activitiesdisclosedbythe | ||
| 17,2023 | Guangdong | Byphone | Institution | Management,ChinaLife | competitivenessof | CompanyonDecember18, |
| Province | Asset,MinshengRoyalFund,OrientFund,ABC- | theCompany'sproducts | 2023onCninfo | |||
| CAFundManagement, | (www.cninfo.com.cn) | |||||
| etc. | ||||||
XIII. Implementation of the Action Plan for Quality and Return Improvements
Whether the Company disclosed the Action Plan for Quality and Return Improvements. □Yes No
Part IV Corporate Governance
I. General Information of Corporate Governance
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The Company continuously perfects its corporate governance structure in strict accordance with the requirements of the Company Law, the Securities Law and the relevant laws and regulations of the CSRC. The Board of Directors has four special committees, namely, Strategy Committee, Audit Committee, Nomination Committee, and Remuneration & Appraisal Committee, dedicated to providing advice and recommendations to ensure the Board of Directors' deliberation and decision-making are professional and efficient.
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The Company convenes the AnnualGeneral Meeting of Shareholders in strict accordance with the relevant provisions ofthe Articles of Association and Rules of Procedure for General Meeting of Shareholders. The Board of Directors, which is the decision making body of the Company, conscientiously implements the resolutions of General Meetings of Shareholders. The Board of Supervisors exercises its supervisory authorities and powers in strict accordance with the regulations, and it supervises the financial affairs of the Company as wellas duty performance and actions of directors and senior officers, thus safeguarding the legitimate rights and interests of the Company and all shareholders. The Management of the Company strictly implements the resolutions of General Meetings of Shareholders and Meetings of the Board of Directors and executes decisions. All functional departments and subsidiaries ofthe Company are responsible for day-to-day operations.
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During the reporting period, in order to regulate its insider information management, ensure confidentiality of insider information and effective registration and management of insiders who have access to insiderinformation, effectively prevent securities violations of laws and regulations such as insider trading, maintain the fairness of information disclosure, and protect the legitimate rights and interests of the general investors, the Company promptly, truthfully and fully recorded all the persons with access to the insider information before disclosure at stages such as discussion and planning, demonstration and consultation, establishment and in phases such as reporting, transmission, preparation, examination, resolution, and disclosure,as wellrelevant information archives regarding the content, time, place, basis and method, etc. for the insiders to know the insider information, and file with the relevant regulatory authorities to strictly prevent the occurrence of insider trading, pursuant to the laws and regulations such as the Securities Law, the Measures for the Administration of Information Disclosure by Listed Companies, as wellas the relevant provisions of the Articles of Association, Information Disclosure Management Policy, and Policy on Internal Reporting of Material Information of the Company.
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The Company discloses information in strict accordance with the provisions of the Company Law, the Securities Law, the Rules Governing the Listing of Shares on SZSE, and other relevant laws, regulations and normative documents, as wellas the Information Disclosure Management Policy, to ensure that it makes true, accurate, complete, timely and fair information disclosure to increase the openness and transparency of its operations. The Company has received no disciplinary actions such as criticism and reprimand from the stock exchange for issues relating to information disclosure. During the reporting period, there were no governance irregularities such as the provision of undisclosed information to the controlling shareholder and the de facto controller.
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During the reporting period, there was no change in the stock price arising from leakage of inside information of the Company. As part of its nextsteps, the Company will constantly improve its corporate governance structure, further standardize corporate operations, and raise the level of corporate governance pursuant to relevant laws and regulations as wellas the requirements of the SZSE.
As to the actual status ofcorporate governance whether there is any material departure from laws, administrative regulations and the rules issued by the CSRC on listed company governance
□Yes No
As to the actual status of governance of the Company, there is no material non-compliance with laws, administrative regulations, and the rules issued by the CSRC on the governance of listed companies.
II. Independence of the Company from the Controlling Shareholder and De Facto Controller and on Ensuring Company's Assets, Personnel, Finance, Structure and Businesses and Other Aspects
The Company is completely independent of the controlling shareholder in terms of businesses, personnel, assets, organization and finance, etc., and has fully independent businesses and operation capacity. Details are as follows:
(1) Business independence: The Company's businesses are independent of the controlling shareholder, and the controlling shareholder and its affiliates are not engaged in any businesses in competition with the Company.
(2) Personnel separation: The personnel of the Company are independent of the controlling shareholder, and the President, CFO, Board Secretary and other senior officers ofthe Company do not hold positions other than directors in the controlling shareholder, the financial officers of the Company do not have a part-time job in affiliated companies. The Company has put in place independent policies on labor, personnel and remuneration management and established an independent labor and personnel management department. Thus, its labor,personnel and remuneration management are completely independent.
(3) Integrity of assets: The Company owns independent and complete assets and has independent production, supply and sales systems, and there is no horizontal competition between the Company and its controlling shareholder in the manufacturing and operation of the same products.
(4) Organizational independence: The Company is organizationally complete, and there isno superior-subordinate relationship between its controlling shareholder and functional departments thereof and the Company and functional departments thereof. The Company's Board of Directors, Board of Supervisors and other internal institutions operate fully independently.
(5) Financial separation: The Company's finance isentirely independent, with an independent financial department. It has also established an independent accounting system and financial accounting management policy dedicated to independent accounting, independent opening of bank accounts and independent tax payment.
III. Horizontal Competition
□Applicable Not Applicable
IV. Annual and Extraordinary General Meetings of Shareholders Convened During the Reporting Period
1. General meetings ofshareholders convened during the reporting period
| Meeting | Type | Investorparticipationratio | Dateofthemeeting | Disclosuredate | Meetingresolution |
|---|---|---|---|---|---|
| Thefirstextraordinarygeneralmeetingofshareholdersin2023 | Extraordinarygeneralmeetingofshareholders | 45.17% | January12,2023 | January13,2023 | TheAnnouncementontheResolutionsoftheFirstExtraordinaryGeneralMeetingofShareholdersin2023(AnnouncementNo.:2023-004)waspublishedontheSecuritiesDaily,theSecuritiesTimes,theChinaSecuritiesJournal,andCninfo(http://www.cninfo.com.cn),whicharethemediadesignatedbytheCompanyforinformationdisclosure. |
| The2022Annual | AnnualGeneral | 72.23% | May22,2023 | May23,2023 | TheAnnouncementontheResolutionsofthe2022Annual |
| General | Meetingof | GeneralMeetingofShareholders |
|---|---|---|
| Meetingof | Shareholders | (AnnouncementNo.:2023-030) |
| Shareholders | waspublishedontheSecurities | |
| Daily,theSecuritiesTimes,the | ||
| ChinaSecuritiesJournal,and | ||
| Cninfo(http://www.cninfo.com.cn), | ||
| whicharethemediadesignatedby | ||
| theCompanyforinformation | ||
| disclosure. |
2. Extraordinary general meeting of shareholders convened at the request of preference shareholders with resumed voting rights
□Applicable Not Applicable
V. Information of directors, supervisors and senior officers
1. Basic information
| Name | Gender | Age | Position | Incumbent/Former | Starttenure | ofEndoftenure | Beginningnumberofsharesheld | Numberofsharesincreasedduringtheperiod | Numberofsharesdecreasedduringtheperiod | Otherchanges | Endingnumberofsharesheld | Reasonsforshareincrease/decrease |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| MaGang | Male | 45 | ChairmanoftheBoardandPresident | Incumbent | December4,2014 | January11,2026 | 1,654,600 | 0 | 00 | 1,654,600 | N/A | |
| SuBin | Male | 46 | Director | Incumbent | September6,2021 | January11,2026 | 0 | 0 | 00 | 0 | N/A | |
| KuangGuangxiong | Male | 45 | Director | Incumbent | January30,2019 | January11,2026 | 0 | 0 | 00 | 0 | N/A | |
| ShenKe | Male | 53 | Director | Incumbent | January30,2019 | January11,2026 | 0 | 0 | 00 | 0 | N/A | |
| ZhangYu | Male | 46 | IndependentDirector | Incumbent | December26,2019 | January11,2026 | 0 | 0 | 00 | 0 | N/A | |
| LiRuidong | Male | 47 | IndependentDirector | Incumbent | December26,2019 | January11,2026 | 0 | 0 | 00 | 0 | N/A | |
| LiYingzhao | Male | 62 | IndependentDirector | Incumbent | January12,2023 | January11,2026 | 0 | 0 | 00 | 0 | N/A | |
| JiaoWanjiang | Male | 43 | ChairmanoftheBoardofSupervisors | Incumbent | November14,2016 | January11,2026 | 308,692 | 0 | 00 | 308,692 | N/A | |
| LiuKan | Male | 40 | Supervisor | Incumbent | December26,2019 | January11,2026 | 0 | 0 | 00 | 0 | N/A | |
| LinMeiling | Female | 39 | EmployeeSupervisor | Incumbent | November14,2016 | January11,2026 | 0 | 0 | 00 | 0 | N/A | |
| WangQingbo | Male | 48 | VicePresidentCFO | &Incumbent | April2022 | 29,January11,2026 | 800 | 0 | 00 | 800 | N/A | |
| JinTaotao | Male | 41 | VicePresidentandSecretaryof | Incumbent | December26,2019 | January11,2026 | 0 | 0 | 00 | 0 | N/A |
| theBoardofDirectors | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Total | -- | ---- | -- | -- | -- | 1,964,092 | 0 | 00 | 1,964,092 | -- |
Whether any director or supervisor left office or any senior officer was dismissed during their tenure during the reporting period
□Yes No
Changes of the Company's directors, supervisors and senior officers
Applicable □Not applicable
| Name | Positionheld | Type | Date | Reason |
|---|---|---|---|---|
| LiYingzhao | IndependentDirector | Elected | January12,2023 | Newmemberelection |
2. Position and biographical information
Professional backgrounds, major work experience and current posts in the Company of the incumbent directors, supervisors and senior officers:
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Mr. Ma Gang, born in 1979, holding a master's degree, is Chairman of the Tenth Board of Directors of Infore Enviro. Starting in December 2014, he has been serving as President of the Company. He joined Midea Group in June 2001, and held successively the positions of R&D Engineer, branch salesman and Regional Director at Midea Rice Cooker Division, General Manager at Midea Small Domestic Appliance Sales Company in China, President of China Marketing Headquarters of Midea Daily Home Electric Appliance Group, Vice President and Domestic Sales General Manager atMidea Small Domestic Appliance Division, Vice President of Midea Small Domestic Appliance Division and General Manager at Midea Water Material Product Company, and Deputy Director at Midea Domestic MarketDepartment.
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Mr. Su Bin, born in 1978, holding a Master's degree, is Director of the Tenth Board of Directors of Infore Enviro. Starting in October 2020, he has been Vice President of Infore Group Co., Ltd. From March 2013to October 2020, he held successively the positions of Executive President and President of Fosun Group's Energy and Environment Group, as well as the Executive President and Vice President of Fosun Capital, etc. He was a Partner of Mingli China Growth Fund from January 2009 to February 2013 and an Executive Director of Hongshang Industrial Holding Group Co.,Ltd. from March 2003 to December 2008.
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Mr. Kuang Guangxiong, born in 1979, holding a master's degree, is a PRC Certified Public Accountant and International Accountant, in addition to Director of the Tenth Board of Directors of Infore Enviro. He has been Vice President of Infore Group from October 2018 till now. From July 2002 to October 2018, he held successively the positions of Financial Manager atMidea Daily Home Electric Appliance Group, Financial Manager atMidea subsidiary in the US, Financial Director at Midea Kitchen Appliances Division, Financial Director atMidea Commercial Air Conditioner Division, and Financial Director atMidea-KUKA Joint Venture in China.
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Mr. Shen Ke, born in 1971, holding a master's degree, is Director of the Tenth Board of Directors of Infore Enviro. He has been Vice President of Zoomlion Heavy Industry Science and Technology Co., Ltd. from September 2020 till now. From July 2003 to September 2020, he held the positions of Head of the Investment Development Department, Board Secretary, and Investment Director at Zoomlion Heavy Industry Science and Technology Co., Ltd.
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Mr. Zhang Yu, born in 1978, holding a doctorate degree, is Independent Director of the Tenth Board of Directors of Infore Enviro. He has served as Associate Professor and Professor atChina Europe International Business School since 2015 till now, and held the position of Assistant Professor at University of California, Irvine from 2008 to 2015.
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Mr. Li Ruidong, born in 1977, holding a bachelor's degree, is Independent Director of the Tenth Board of Directors ofInfore Enviro. He has been President and Editor-in-chief atthe China Environment Magazine since November 2013 till now. He served as Assistant to General Manager of Environmental Protection Magazine Co., Ltd. from February 2012 to November 2013, and Director of the Office of the Environmental Protection Magazine from March 2008 to January 2012.
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Mr. Li Yingzhao, born in 1962, holding a doctorate degree, is Professor of Accounting at School of Business Administration, South China University of Technology, and he serves as Independent Director of the Tenth Board of Directors of Infore Enviro. He also currently serves as Independent Director at Guangdong TLOONG Technology Group Co., Ltd., and External Supervisor of Nanhai Rural Commercial Bank Co., Ltd. He served as Independent Director atsuch listed companies as Guangzhou Friendship Group Co., Ltd. and Shenzhen Zhongjin Lingnan Nonfemet Co., Ltd. He has participated in the SZSE training and received the Independent Director Qualification.
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Mr. Wang Qingbo, born in 1976, holding a bachelor's degree, is Vice President and CFO of Infore Enviro. He previously served as Vice President and Vice President of Finance at Guangdong NVC Lighting Technology Co., Ltd., Vice President of Finance at Guangdong Xinbang Logistics Co., Ltd., CFO at Midea Annto Logistics Division, Deputy CFO at Midea Small Domestic Appliance Division, Financial Manager atMidea Industrial Design Company, and Financial Supervisor at Midea Fan Factory.
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Mr. Jin Taotao, born in 1983, holding a master's degree, is Vice President and Board Secretary of Infore Enviro. He held the positions of Engineer at the Environmental Planning Institute of the Ministry of Ecology and Environment (formerly the Ministry of Environmental Protection) from September 2005 to April 2016, Vice President at Infore Environment Technology Group Co., Ltd. from May 2016 to June 2019, and Board Secretary at Stariver Environmental Technology Co., Ltd. from July 2019 to November 2019. Mr. Jin Taotao joined the SZSE board secretaries training program in November 2019 and obtained the qualification certificate for Board Secretary.
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Mr. Jiao Wanjiang, born in 1981, holding a master's degree, is Chairman of the Tenth Board of Supervisors of Infore Enviro. He is currently the General Manager of the Business Department of Infore Environment Technology Group Co.,Ltd. He successively served as Head of the Operation Management Department and General Manager of the Solid Waste Treatment Department of Infore Environment Technology Group Co., Ltd. He joined Midea in July 2005.He successively held the positions of Domestic Sales Branch Manager of Guangdong Midea Small Domestic Appliance Sales Company in China, Senior Product Planning Manager at Headquarters and Head of Brand & Marketing Department of Headquarters.
-
Mr. Liu Kan, born in 1984, holding a bachelor's degree, is Supervisor of the Tenth Board of Supervisors ofInfore Enviro. He has served the Company since February 2016 till now, and is currently Director of the Operation Management Department of a subsidiary. He held the positions ofGeneral Manager atInfore Network Technology Co., Ltd. from 2017 to November 2019, Director of the Operation Management Department of Universtar Science & Technology (Shenzhen) Co., Ltd. from 2016 to 2017, and Rice Cooker Product Planning Manager atMidea Small Domestic Appliance Shenzhen Branch and Midea Small Domestic Appliance Division from 2006 to 2015.
-
Ms. Lin Meiling, born in 1985, holding a bachelor's degree, is Supervisor of the Tenth Board of Supervisors ofInfore Enviro. She iscurrently the Director of Human Resources at Infore Environment Technology Group Co.,Ltd. Starting in 2010, she has been responsible for the administration and HR affairs ofthe Company.
Positions held in shareholder entities:
Applicable □Not applicable
| Nameofthepersonnelholdingposition | Shareholderentity | Positionheldattheshareholderentity | Startoftenure | Endoftenure | Receivingremunerationorallowancefromtheshareholdingentityornot |
|---|---|---|---|---|---|
| MaGang | InforeGroupCo.,Ltd. | Director | March6,2018 | April1,2024 | No |
| SuBin | InforeGroupCo.,Ltd. | DirectorandCo-President | November13,2020 | - | Yes |
| KuangGuangxiong | InforeGroupCo.,Ltd. | DirectorandCo-President | October1,2018 | - | Yes |
| ShenKe | ZoomlionHeavyIndustryScienceandTechnology | VicePresident | June29,2015 | - | Yes |
| Co.,Ltd. | |||
|---|---|---|---|
| Statementsonpositionsheldinshareholderentities | - |
Positions held in other entities:
Applicable □Not applicable
| Nameofthepersonnelholdingposition | Nameofotherentity | Positionheldinotherentity | Startoftenure | Endoftenure | Receivingremunerationorallowancefromotherentitiesornot |
|---|---|---|---|---|---|
| SuBin | BeijingBainationPicturesCoLtd. | Director | March18,2021 | - | No |
| SuBin | KUKAHomeCo.,Ltd. | Director | February2,2024 | - | No |
| SuBin | GuangzhouHolly'sInternationalAuctionCo.,Ltd. | Director | August5,2021 | - | No |
| SuBin | NingboInforeEquityInvestmentFundManagementCo.,Ltd. | Manager,ExecutiveDirector | April21,2021 | - | No |
| SuBin | NanjingKeleCompositeMaterialsCo.,Ltd. | GeneralManager | March6,2017 | - | No |
| SuBin | ZhuhaiAofeiInforePrivateEquityFundManagementCo.,Ltd. | GeneralManager,Chairman | September27,2022 | - | No |
| SuBin | ShenzhenHongfengBusinessManagementCo.,Ltd. | ViceChairman | September25,2023 | - | No |
| SuBin | ShanghaiFudehuiTradingCo.,Ltd. | Unknown | April1,2023 | - | No |
| KuangGuangxiong | GuangdongInforeFinanceConnectSmallLoanCo.,Ltd. | Director | July6,2020 | - | No |
| KuangGuangxiong | KUKAHomeCo.,Ltd. | Director | February2,2024 | - | No |
| KuangGuangxiong | GuangzhouBaopuInvestmentCo., | Ltd.Director | April22,2022 | - | No |
| KuangGuangxiong | GuangdongInforeMaterialTechnologyCo.,Ltd. | Chairman | October9,2023 | - | No |
| KuangGuangxiong | InforeCapitalManagementCo.,Ltd. | Director | March14,2019 | - | No |
| KuangGuangxiong | Yinghe(Shenzhen)RoboticsandAutomationTechnologyCo.,Ltd. | Director | August5,2020 | - | No |
| ShenKe | BichampCuttingTechnology(Hunan)Co.,Ltd. | Director | July5,2014 | - | No |
| ShenKe | ChasingJixiangLifeInsuranceCompanyLimited | Director | October31,2012 | - | No |
| ShenKe | ZoomlionCapitalCo.,Ltd. | Director | October22,2015 | - | No |
| ShenKe | ZoomlionEarthWorkingMachineryCo.,Ltd. | ExecutiveDirector,Manager | July29,2020 | - | No |
| ShenKe | ZoomlionFinanceCo.,Ltd. | Director | May28,2015 | - | No |
| ShenKe | ShaanxiZoomlionWestEarthmovingMachineryCo.,Ltd. | ExecutiveDirector | July30,2020 | - | No |
| ShenKe | ZoomlionPurongFinancialLeasingCo.,Ltd. | Director | April12,2016 | - | No |
| ShenKe | ZoomlionAgricultureCo.,Ltd. | Director | October31,2023 | - | No |
| ShenKe | HunanTeliHydraulicCo.,Ltd. | Supervisor | March11,2020 | - | No |
| ShenKe | HunanFangshengCompanyLimited | Supervisor | January30,2018 | - | No |
|---|---|---|---|---|---|
| ShenKe | ZoomlionIntelligentAgricultureCo.,Ltd. | Director | November5,2020 | - | No |
| ShenKe | ZoomlionBusinessFactoring(China)Co.,Ltd. | Director | October11,2023 | - | No |
| ShenKe | HunanXiangjiangPrivateEquityFundManagementCo.,Ltd. | Director | April28,2021 | - | No |
| ShenKe | HunanZoomlionEmergencyDeviceCo.,Ltd. | Director | August17,2017 | - | No |
| ShenKe | HunanZoomlionInternationalTradeCo.,Ltd. | Director | September23,2002 | - | No |
| ShenKe | ZoomlionHeavyMachineryZhejiangCo.,Ltd. | Chairman | November8,2023 | - | No |
| ShenKe | ChongqingZoomlionShenghongMachineryManufacturingCo.,Ltd. | ExecutiveDirector | January5,2024 | - | No |
| ShenKe | HunanZhongchenRolledSteelManufacturingEngineeringCo.,Ltd. | Director | May20,2020 | - | No |
| ShenKe | BeijingJunlaiCapitalManagement.CompanyLimited | Director | June22,2018 | - | No |
| ShenKe | ChangshaZhonglianZhitongTrenchlessTechnologyCo.,Ltd. | Director | April13,2009 | - | No |
| ZhangYu | ChinaEuropeInternationalBusinessSchool | Professor | July1,2015 | - | Yes |
| ZhangYu | GuangzhouMINOEquipmentCo., | IndependentLtd.Director | July28,2020 | - | Yes |
| ZhangYu | Aidite(Qinhuangdao)TechnologyCo.,Ltd. | Director | February1,2022 | - | Yes |
| LiRuidong | ChinaEnvironmentMagazine | PresidentandEditor-in-chief | November1,2013 | - | Yes |
| LiYingzhao | JiangxiGreenRecyclingCo.,Ltd. | Director | November19,2020 | - | Yes |
| LiYingzhao | GuangdongTLOONGTechnologyGroupCo.,Ltd. | IndependentDirector | July21,2022 | - | Yes |
| LiYingzhao | ChinaBroadnetGuangzhouNetworkCo.,Ltd. | IndependentDirector | April27,2021 | - | Yes |
| JiaoWanjiang | GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | Director | November9,2016 | - | No |
| WangQingbo | GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | Supervisor | February23,2023 | - | No |
| Statementsonpositionsheldinotherentities | - |
Punishments imposed in the past three years by the securities regulator on the incumbent directors, supervisors and senior officers as well as those who left office during the reporting period:
□Applicable Not Applicable
3. Remuneration of directors, supervisors and senior officer
Decision-making procedure, determination basis and actual payments ofremuneration for directors, supervisors and senior officers
The remunerations ofthe directors, supervisors and senior officers of the Company for 2023 are strictly in compliance with the Remuneration Plan for Directors, Supervisors and Senior Oficers in 2023 deliberated and adopted by the Company, the Rules of Procedure for the Board of Directors formulated by the Company, the Rules of Procedure for the Board of Supervisors and the
Articles of Association of the Company, as well as the relevant provisions of the Company Law. The remuneration of the Company's directors, supervisors and senior officers shall be determined on the basis of reasonable remuneration in the market and the Company's performance appraisal results. The actual remuneration of the independent directors ofthe Company is paid on an annual basis. The actual remuneration of senior officers is partly on a monthly basis, and the part linked to the Company's performance ispaid at year-end.
Remuneration of directors, supervisors and senior officers of the Company during the reporting period
Unit: RMB 10,000
| Name | Gender | Age | Position | Incumbent/Former | Totalpre-taxremunerationfromtheCompany | ReceivingremunerationfromtheCompany'srelatedpartiesornot |
|---|---|---|---|---|---|---|
| MaGang | Male | 45 | ChairmanoftheBoardandPresident | Incumbent | 290.17 | No |
| SuBin | Male | 46 | Director | Incumbent | 0 | Yes |
| KuangGuangxiong | Male | 45 | Director | Incumbent | 0 | Yes |
| ShenKe | Male | 53 | Director | Incumbent | 0 | Yes |
| LiYingzhao | Male | 62 | IndependentDirector | Incumbent | 10 | No |
| ZhangYu | Male | 46 | IndependentDirector | Incumbent | 10 | No |
| LiRuidong | Male | 47 | IndependentDirector | Incumbent | 10 | No |
| JiaoWanjiang | Male | 43 | ChairmanoftheBoardofSupervisors | Incumbent | 88.34 | No |
| LiuKan | Male | 40 | Supervisor | Incumbent | 122.12 | No |
| LinMeiling | Female | 39EmployeeSupervisor | Incumbent | 16.12 | No | |
| WangQingbo | Male | 48 | VicePresident&CFO | Incumbent | 80.1 | No |
| JinTaotao | Male | 41 | VicePresidentandSecretaryoftheBoardofDirectors | Incumbent | 75.44 | No |
| Total | -- | -- | -- | -- | 702.29 | -- |
Other information
□Applicable Not Applicable
VI. Performance of Duties by Directors during the Reporting Period
1. Information on the Board of Directors during the reporting period
| Meeting | Dateofthemeeting | Disclosuredate | Meetingresolution |
|---|---|---|---|
| The1stmeetingoftheTenthBoardofDirectors | January12,2023 | January13,2023 | TheAnnouncementontheResolutionsoftheFirstMeetingoftheTenthBoardofDirectors(AnnouncementNo.:2023-002)waspublishedontheSecuritiesDaily,theSecuritiesTimes,theChinaSecuritiesJournal,andCninfo(www.cninfo.com.cn),whicharethemediadesignatedbytheCompanyforinformationdisclosure. |
| The2ndmeetingoftheTenthBoardofDirectors | April24,2023 | April25,2023 | TheAnnouncementontheResolutionsoftheSecondMeetingoftheTenthBoardofDirectors(AnnouncementNo.:2023-009)waspublishedintheSecuritiesDaily,theSecuritiesTimes,theChinaSecuritiesJournal,andCninfo(www.cninfo.com.cn),whicharethemediadesignatedbytheCompanyforinformationdisclosure. |
| The3rdmeetingoftheTenthBoardofDirectors | August25,2023 | August26,2023 | TheAnnouncementontheResolutionsoftheThirdMeetingoftheTenthBoardofDirectors(AnnouncementNo.:2023-038)waspublishedintheSecuritiesDaily,theSecuritiesTimes,theChinaSecuritiesJournal,andCninfo(www.cninfo.com.cn),whicharemedia |
| thedesignatedbytheCompanyforinformationdisclosure. | |||
|---|---|---|---|
| The4thmeeting | AnnouncementontheResolutionsoftheFourthMeetingoftheThe | ||
| TenthBoardofDirectors(AnnouncementNo.:2023-045)was | |||
| oftheTenth | October27,2023 | October28,2023 | publishedintheSecuritiesDaily,theSecuritiesTimes,theChina |
| Boardof | SecuritiesJournal,andCninfo(www.cninfo.com.cn),whicharethe | ||
| Directors | mediadesignatedbytheCompanyforinformationdisclosure. |
2. Attendance of directors atBoard meetings and general meetings of shareholders
| Attendanceofdirectors | atBoardmeetings | andgeneral | meetings | ofshareholders | |||
|---|---|---|---|---|---|---|---|
| Director'sname | NumberofBoardmeetingsheld | NumberofBoardmeetingsattendedonsite | NumberofBoardmeetingsattendedbywayoftelecoms | NumberofBoardmeetingsattendedthroughproxy | NumberofBoardmeetingsabsentwithapologies | HavingfailedtoattendtwoconsecutiveBoardmeetingsinpersonornot | Numberofgeneralmeetingsofshareholdersattended |
| MaGang | 4 | 4 | 0 | 0 | 0No | 2 | |
| SuBin | 4 | 4 | 0 | 0 | 0No | 2 | |
| KuangGuangxiong | 4 | 4 | 0 | 0 | 0No | 2 | |
| ShenKe | 4 | 4 | 0 | 0 | 0No | 2 | |
| ZhangYu | 4 | 4 | 0 | 0 | 0No | 2 | |
| LiRuidong | 4 | 4 | 0 | 0 | 0No | 2 | |
| LiYingzhao | 4 | 4 | 0 | 0 | 0No | 2 |
Explanation of failure to attend two consecutive Board meetings
3. Objections raised to relevant matters ofthe Company
Whether any directors raised an objection to any relevant matter of the Company
□Yes No
Directors did not raise any objection to the relevant matters ofthe Company during the reporting period.
4. Other information about the performance of duties by directors
Whether any recommendations from directors were adopted by the Company
Yes □No
Explanation of adoption/rejection of directors' recommendations for the Company
During the reporting period, the directors of the Company acted in a diligent and responsible manner,and actively attended Board meetings and general meetings of shareholders in strict compliance with provisions and requirements in the Articles of Association of the Company, the Rules of Procedure for the Board of Directors as wellas relevant laws and regulations. Based on the actual situation of the Company, the directors proposed relevant opinions on the Company's material governance and operation decisions, reached a consensus through adequate communication and discussion, firmly supervised and promoted the execution of resolutions of the Board of Directors, ensured the decision-making was scientific, timely and highly efficient and protected the legitimate rights and interests ofthe Company and all shareholders.
VII. Information on Special Committees ofthe Board during the Reporting Period
| MembersNameoftheNumber | Dateof | Meetingcontents | Important | Other | Specific | |
|---|---|---|---|---|---|---|
| -- | ---------------------------------------- | ------------ | --------------------- | ----------- | ------- | ---------- |
| committee | of | the | opinions | information | information | ||
|---|---|---|---|---|---|---|---|
| meetings | meeting | and | on | onmatters | |||
| held | suggestions | performance | that | ||||
| proposed | ofduties | objections | |||||
| wereraised | |||||||
| (ifany) | |||||||
| Li | |||||||
| Yingzhao, | 1.Pre-approvaloftheFinancial | Approved | |||||
| Kuang | January | Statementsin2022AnnualReport;2. | therelevant | ||||
| Audit | Guangxiong | 5 | 16, | 2022AnnualInternalControlSelf- | proposalsof | -- | Not |
| Committee | ,Li | 2023 | AssessmentReport;3.2023Internal | this | applicable | ||
| Ruidong | AuditWorkPlanReport;4.Ex-ante | meeting. | |||||
| andZhang | Communicationof2022AnnualReport. | ||||||
| Yu | |||||||
| 1.2022AnnualReportandits | |||||||
| summary;2.2022AnnualFinal | |||||||
| FinancialAccountingReport;3.2022 | |||||||
| ProfitDistributionPlanProposal;4. | |||||||
| 2023FirstQuarterReport;5.AssuranceReportonthePlacement | |||||||
| andUseofFundraisingProceedsin | |||||||
| 2022;6.ProposalontheDelayofPart | |||||||
| oftheProjectsofProceedsfromthe | |||||||
| LiYingzhao, | 5 | PublicIssuanceofA-shareConvertible | |||||
| CorporateBonds;7.Proposalon | |||||||
| ChangestoAccountingPolicyofthe | |||||||
| CompanyandItsSubsidiaries;8. | |||||||
| ProposalonProvisionforImpairment | |||||||
| ofGoodwillin2022;9.Proposalon | |||||||
| EstimatedRoutineRelatedParty | |||||||
| Transactionsfor2023;10.Proposalon | |||||||
| the2023AnnualPlanforEntrusted | |||||||
| WealthManagementwithSelf-owned | |||||||
| Kuang | April21,2023 | Funds;11.ProposalonGuarantee | Approved | ||||
| Audit | Guangxiong | LimitsProvidedbytheCompanytoIts | therelevant | Not | |||
| Committee | ,Li | Subsidiaries;12.Proposalonthe | proposalsof | -- | applicable | ||
| Ruidong | ProvisionofBuyer'sCreditGuarantees | this | |||||
| andZhang | forCustomers;13.Proposalonthe | meeting. | |||||
| Yu | ApplicationforComprehensiveCredit | ||||||
| LinesfromBanksandtheAuthorization | |||||||
| fortheChairmantoSignBankCredit | |||||||
| Contracts;14.Proposalon | |||||||
| ContinuouslyCarryingoutAccountsReceivableFactoring;Proposalon15. | |||||||
| RelatedPartyTransactionsfor | |||||||
| TemporaryBorrowingFundsProvided | |||||||
| byInforeGroupCo.,Ltd.tothe | |||||||
| Companyin2023;16.Proposalon | |||||||
| ProfessionalServicesforthe | |||||||
| ProcurementInformationSystemand | |||||||
| RelatedTransactions;17.Proposalon | |||||||
| theReappointmentofAccounting | |||||||
| Firms;18.SummaryReportof2022 | |||||||
| Auditor'sReportbyPan-China | |||||||
| CertifiedPublicAccountantsLLP | |||||||
| (SpecialGeneralPartnership);19. | |||||||
| 2022AnnualInternalControlSelf |
| AuditCommittee | LiYingzhao,KuangGuangxiongandLiRuidong | 5 | August24,2023 | AssessmentReport;Proposalon20.RevisingArticlesofAssociation.1.SummaryofInternalAuditfortheFirstHalfof2023;2.2023InterimReportanditssummary;3.SpecialReportonthePlacementandUseofFundraisingProceedsintheFirstHalfof2023;4.RevisedProcedureforAnnualReportWorkofAuditCommittee;5.RevisedInternalAuditManagementPolicy;6.RevisedProcedureforAnnualReportWorkofIndependentDirectors;7.RevisedAccountabilityPolicyforMaterialErrorsinAnnualReportInformationDisclosure. | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
|---|---|---|---|---|---|---|---|
| AuditCommittee | LiYingzhao,KuangGuangxiongandLiRuidongLi | 5 | October26,2023 | 1.InternalControlWorkSummaryfortheThirdQuarterof2023;2.ThirdQuarterReportfor2023;3.ProposalontheUseofPartofIdleFundraisingProceedstoTemporarilyReplenishWorkingCapital. | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
| AuditCommittee | Yingzhao,KuangGuangxiong,LiRuidongandZhangYu | 5 | December11,2023 | CommunicationonPre-approvalof2023AnnualReport | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
| Remuneration&AppraisalCommittee | LiRuidong,KuangGuangxiongandZhangYu | 3 | January12,2023 | 1.ReviewingthePerformanceoftheCompany'sDirectorsandSeniorOficersinFulfillingTheirDutiesin2022andConductingAnnualPerformanceAssessmentBasedonAssessmentCriteriaandRemunerationPoliciesandPlans;2.ImplementationoftheRemunerationPlanforDirectors,Supervisors,andSeniorOficersin2022. | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
| Remuneration&AppraisalCommittee | LiRuidong,KuangGuangxiongandZhangYu | 3 | April21,2023 | ProposalontheRemunerationPlanforDirectors,Supervisors,andSeniorOficersin2023 | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
| Remuneration&AppraisalCommittee | LiRuidong,KuangGuangxiongandZhangYu | 3 | August24,2023 | ProposalontheAdjustmentoftheExercisePriceoftheThirdStockOptionIncentiveScheme | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
| NominationCommittee | ZhangYu,MaGangandLiYingzhao | 1 | January12,2023 | 1.ProposalonElectingMr.MaGangasChairmanoftheTenthBoardofDirectors;2.ProposalontheCompositionoftheSpecialCommitteesoftheTenthBoardofDirectors;3.ProposalonAppointingtheTenthSeniorManagementTeam;4.Proposal | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
| onAppointingMs.WangFeiasSecuritiesRepresentativeofthe | |||||||
|---|---|---|---|---|---|---|---|
| Company. | |||||||
| StrategyCommittee | MaGang,SuBinandShenKe | 3 | April21,2023 | 1.President'sWorkReport2022;2.ProposalontheDelayofPartoftheProjectsofProceedsfromthePublicIssuanceofA-shareConvertibleCorporateBonds;3.Proposalonthe2023AnnualPlanforEntrustedWealthManagementwithSelf-ownedFunds;4.ProposalonContinuouslyCarryingoutAccountsReceivableFactoring;5.ProposalontheSuspensionofDownwardRevisionoftheConversionPriceofInforeConvertibleBonds. | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
| StrategyCommittee | MaGang,SuBinandShenKe | 3 | August24,2023 | RevisedWorkingRulesforPresident | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
| StrategyCommittee | MaGang,SuBinandShenKe | 3 | October26,2023 | ProposalonUsingPartoftheIdleFundraisingProceedstoReplenishWorkingCapital | Approvedtherelevantproposalsofthismeeting. | -- | Notapplicable |
VIII. Work of the Board of Supervisors
Whether the Board of Supervisors identified any risk in the Company in its supervision during the reporting period
□Yes No
The Board of Supervisors has no objection to supervisory matters during the reporting period.
IX. Information on Employees ofthe Company
1. Number, specialty and educational backgrounds of employees
| Numberofin-serviceemployeesoftheparentcompanyattheendofthereportingperiod | 196 |
|---|---|
| Numberofin-serviceemployeesofthemajorsubsidiariesattheendofthereportingperiod | 20,034 |
| Totalnumberofin-serviceemployeesattheendofthereportingperiod | 20,230 |
| Totalnumberofpaidemployeesduringthereportingperiod | 20,230 |
| Numberofretireestowhomtheparentcompanyoritsmajorsubsidiariesneedtopayretirementpensions | 0 |
| Specialty | |
| Specialtycategory | Numberofpeopleinthespecialty |
| Productionpersonnel | 15,969 |
| Salespersonnel | 1,220 |
| Technicalpersonnel | 1,637 |
| Financepersonnel | 173 |
| Administrativepersonnel | 1,231 |
|---|---|
| Total | 20,230 |
| Educational | level |
| Typesofeducationallevel | Numberofpeople |
| Doctoraldegree | 11 |
| Master'sdegree | 474 |
| Bachelor'sdegree | 2,501 |
| College | 2,274 |
| Belowcollege | 14,970 |
| Total | 20,230 |
2. Remuneration policy
The remuneration of employees is paid on time according to the remuneration policy of the Company. The fixed remuneration of employees is determined by the Company according to the position value and individual performance, and the floating salary of employees is determined according to the Company's individual performance assessment results. The Company swings the weight of salary payment towards strategic professionals to ensure that the income level of core talent is competitive in the market. The employee remuneration policy is subject to dynamic adjustments based on regional conditions, talent supply, staff turnover, the extent of changes in the industry environment and the corporate payment capacity.
3. Training plan
The Company pursues a talent strategy of high quality, high incentives, high performance, and high cultural identity. To support employees through targeted and efficient training, Infore Enviro has put in place a 3-tier training system that covers the company level, division level, and department level.
The Company has set up the Employee Skills Enhancement Center, focusing on improving the competence and capabilities of employees while actively promoting corporate culture. By continuously strengthening the trainer team, and improving online learning platforms and other key resources, while maintaining standardized training management processes, the Company is committed to creating a collaborative and efficient organizational climate that empowers employees and promotes individual growth.
Its learning and development programs comprehensively cover three key areas: new skills, expertise, and leadership. Leadership development is facilitated through a string of well-designed programs such as AscentProgram, Exploration Program, and Climbing Program. These initiatives aim to guide employees in continuously scaling new heights in their professional growth and development. Expertise programs, focusing on job-specific skills, are carried out in diverse forms such as specialized training camps, marketing and R&D lectures in order to help employees meet job requirements and adapt to market changes. To better support new employees in swiftly integrating into the Company and achieving a career transformation within 90 days, both from campus and social recruiting, a wide range of training programs are carried out, such as the Young Talent Training Camp, Graduate Training Program, and programs specific to new employees from social recruiting.
Moreover, a fair and competitive career development system for employees has been established to ensure that each individual has opportunities for continuous growth and promotion. The Company regularly conducts comprehensive assessments to promote employees, as part of its tangible actions to support career advances. In 2023, successful promotions for over three hundred professional employees are not only a recognition of theirhard work and talent, butalso the outcomes oftalent development strategy.
4. Labor outsourcing
Applicable □Not applicable
| Totalhoursoflaboroutsourced | 65,861,146.46 |
|---|---|
| Totalpaymentforlaboroutsourcing(RMB) | 789,175,464.30 |
X. Company's Profit Distribution and Converting Capital Reserve into Share Capital
Formulation, execution or adjustments of profit distribution policy, especially cash dividend policy during the reporting period Applicable □Not applicable
According to the Articles of Association, while satisfying the conditions of cash dividend and ensuring the Company's normal operation and long-term development, the Company shall in principle pay cash dividend on an annualbasis. The Board of Directors may propose interim cash dividends depending on the Company's profit status, cash flow status, developmentstage and capital requirements. The Company shall maintain the continuity and stability of the profit distribution policy. When the conditions for cash dividends are met, the cumulative profit distributed in cash in the recentthree years shallnot be less than 30% ofthe average annual distributable profit realized in the recent three years.
During the reporting period, the Company distributed profit in strict accordance with the provisions of the Articles of Association and fully protected the legitimate rights and interests of small and medium investors. Independent directors have voiced their opinions on the proposal on the annual profit distribution of the Company.
| Specialremarksonthe | cashdividendpolicy |
|---|---|
| WhetheritcomplieswiththeCompany'sArticlesofAssociationorresolutionsofthegeneralmeetingsofshareholders: | Yes |
| Whetherdividenddistributionstandardsandratioareexplicitandclear: | Yes |
| Whetherthedecision-makingprocedureandmechanismarecomplete: | Yes |
| Whetherindependentdirectorsdiligentlyperformedtheirdutiesandplayedtheirduerole: | Yes |
| IntheeventthattheCompanydoesnotdistributecashdividends,itshalldisclosethespecificreasonsandthenextstepstoelevatethelevelofreturnforinvestors. | Notapplicable |
| Whetherminorityshareholdershavetheopportunitytofullyexpresstheiropinionsanddemandandwhethertheirlegalrightsandinterestsareadequatelyprotected: | Yes |
| Incaseofadjustingorchangingthecashdividendpolicy,whethertheconditionsandproceduresinvolvedareincompliancewithapplicableregulationsandtransparent: | Yes |
The Company made profits during the reporting period and the parent company's profits distributable to shareholders were positive, but no proposal for cash dividend distribution was put forward.
□Applicable Not Applicable
- Profit distribution and converting capital surplus into share capital for the reporting period
Applicable □Not applicable
| Bonussharesper10shares(share) | 0 |
|---|---|
| Dividendper10shares(RMB)(taxinclusive) | 1.25 |
| Totalsharesasthebasisfortheproposalforprofitdistribution(share) | 3,166,941,288.00 |
| Cashdividends(RMB)(taxinclusive) | 395,867,661.00 |
| Cashdividendsinotherforms(suchassharerepurchase) | 0.00 |
| (RMB) | |||
|---|---|---|---|
| Totalcashdividends(inclusiveofthoseinotherforms)(RMB) | 395,867,661.00 | ||
| Distributableprofit(RMB) | 786,431,614.32 | ||
| Totalcashdividends(inclusiveofthoseinotherforms)asapercentageoftotaldistributedprofit | 50.34% | ||
| Informationonthiscashdividend | |||
| Others |
Details about the proposal for profit distribution and converting capital reserve into share capital
The profit distribution plan for 2023 is asfollows: Based on the total share capital (minus company shares in the Company's repurchase account) on the date of record for the 2023 profit distribution plan, a cash dividend of RMB 1.25 (tax inclusive) per 10 shares will be distributed to the shareholders, with no bonus issue from either profit or capital reserves.
At the end of 2022, the Company reported RMB 559,764,885.53 in profits available for distribution and RMB 211,401,343.85 in retained earnings after cash dividends. In 2023, the Company realized a net profit of RMB 63,892,252.27 and a surplus reserve of RMB 63,892,252.27. As a result, profits available for distribution at the end of 2023 reached RMB 786,431,614.32. When the profit distribution plan for 2023 is implemented, if the total share capital(minus shares in the Company's repurchase account) on the date of record for the plan remains unchanged, which is 3,166,941,288, a cash dividend of RMB 1.25 (tax inclusive) will be distributed for every 10 shares, totaling RMB 395,867,661. As a result, retained earnings after cash dividends willbe RMB 390,563,953.32. If the total share capitalchanges due to reasons such as the conversion of convertible bonds, share repurchases, stock incentive exercise, and the listing of new shares from refinancing before the plan is implemented, the Company will maintain the policy of distributing RMB 0.125 (tax inclusive) per share and adjust the total cash dividends accordingly.
XI. Company's Implementation of Stock Option Incentive Scheme and Employee Stock Ownership Plan or Other Employee Incentive Measures
Applicable □Not applicable
1. Stock incentive
Overview of the Third Stock Option Incentive Scheme:
-
On April 22, 2021, the Proposal on Matters Related to the Exercise in the Second Exercise Period of the Third Stock Option Incentive Scheme was deliberated and approved at the 13th meeting of the Ninth Board of Directors and the 12th meeting of the Ninth Board of Supervisors. A total of 17,814,000 stock options of the Third Stock Option Incentive Scheme were deemed fit to be exercised at RMB 6.34 per share voluntarily in the second exercise period. Prior to the exercise of stock option, if the Company has dividend distribution, capital reserve transferred to share capital, distribution of share bonus, share split, share reduction or increase issue in stocks, etc., the exercise price of stock options will be adjusted accordingly.
-
On August 19,2021, the 14th meeting of the Ninth Board of Directors and the 13th meeting of the Ninth Board of Supervisors held by the Company deliberated and approved the Proposal for Adjustment of the Exercise Prices of the Second and Third Stock Option Incentive Schemes. In view of the fact that the Company's 2020 annual equity distribution was completed on July 8, 2021, according to relevant provisions on the adjustment of the exercise price of the Third Stock Option Incentive Scheme (Draft), if the Company has capital reserve transferred to share capital, distribution of share bonus, share split, share reduction, dividend distribution or share allotments, etc. within the validity period of the stock options, the exercise price of stock options will be adjusted accordingly. After the implementation of this equity distribution, the exercise price of the Third Stock Option Incentive Scheme will be adjusted from RMB 6.34 per share to RMB 6.22 per share.
-
On August 24,2022, the 19th meeting of the Ninth Board of Directors and the 18th meeting of the Ninth Board of Supervisors held by the Company deliberated and approved the Proposal for Adjustment of the Exercise Price of the Third Stock Option Incentive Scheme. In view of the fact that the Company's 2021 annual equity distribution was completed on July 20, 2022, according to relevant provisions on the adjustment of the exercise price of the Third Stock Option Incentive Scheme (Revised Draft), if the Company has capital reserve transferred to share capital, distribution of share bonus, share split, share reduction, dividend distribution or share
allotments, etc. within the validity period of the stock options, the exercise price of stock options will be adjusted accordingly. After the implementation of this equity distribution, the exercise price of the Third Stock Option Incentive Scheme will be adjusted from RMB 6.22 per share to RMB 6.12 per share.
- On October 26, 2022, the 21st Meeting of the Ninth Board of Directors and the 19th meeting of the Ninth Board of Supervisors held by the Company deliberated and approved the Proposal for the Adjustment of the Eligible Participants and the Number of Options to Be Exercised under the Third Stock Option Incentive Scheme and Cancellation of Partial Stock Options and the Proposal for Matters Relating to Option Exercise during the Third Exercise Period of the Third Stock Option Incentive Scheme of the Company.
(1) The Company's 22 recipients resigned and were identified by the Company's Board of Directors as no longer suitable for incentives. According to the Third Stock Option Incentive Scheme (Revised Draft), their 1,788,000 stock options in total were canceled for the second and third exercise periods.After the adjustments, the number of recipients of the Third Stock Option Incentive Scheme was adjusted from the original 231 to 209, and the number of locked stock options granted was adjusted from 23,752,000 to 21,964,000.
(2) The exercise conditions for the third exercise period under the Third Stock Option Incentive Scheme have been met, and the total number of exercisable options is 21,964,000, which are exercised by individual exercise at the price of RMB 6.12 per share. Prior to the exercise of stock option, if the Company has dividend distribution, capital reserve transferred to share capital, distribution of share bonus, share split, share reduction or increase issue in stocks, etc., the exercise price of stock options will be adjusted accordingly.
-
On December 27, 2022, the Proposal on the Cancellation of Expired, Unexercised Stock Options for the Second Exercise Period of the Third Stock Option Incentive Scheme was deliberated and approved at the 22nd meeting of the Ninth Board of Directors and the 20th meeting of the Ninth Board of Supervisors. The 231 recipients exercised 16,409,380 stock options, with 1,404,620 unexercised during the second exercise period of the Third Stock Option Incentive Scheme.According to the Third Stock Option Incentive Scheme (Revised Draft), the Board of Directors agreed to cancel the 1,404,620 expired stock options. After the completion of the cancellation, the Company's Third Stock Option Incentive Scheme will continue to be implemented in accordance with the requirements.
-
On August 25, 2023, the 3rd meeting of the Tenth Board of Directors and the 3rd meeting of the Tenth Board of Supervisors held by the Company deliberated and approved the Proposal for Adjustment of the Exercise Price of the Third Stock Option Incentive Scheme. In view of the fact that the Company's 2022 annual equity distribution was completed on July 18, 2023, according to relevant provisions on the adjustment of the exercise price of the Third Stock Option Incentive Scheme (Revised Draft), if the Company has capital reserve transferred to share capital, distribution of share bonus, share split, share reduction, dividend distribution or share allotments, etc. within the validity period of the stock options, the exercise price of stock options will be adjusted accordingly. After the implementation of this equity distribution, the exercise price of the Third Stock Option Incentive Scheme will be adjusted from RMB 6.12 per share to RMB 6.01 per share.
-
On January 8, 2024, the Proposal on the Cancellation of Expired,Unexercised Stock Options for the Third Exercise Period of the Third Stock Option Incentive Scheme was deliberated and approved at the 5th extraordinary meeting of the Tenth Board of Directors. According to the provisions of the Third Stock Option Incentive Scheme (Revised Draft), the Board of Directors agreed to cancel the 21,964,000 expired stock options of209 recipients unexercised during the third exercise period. After the cancellation, the Third Stock Option Incentive Scheme will be fully implemented.
For details, please refer to announcements published on April 23, 2021, August 21, 2022, August 25, 2022, October 27,2022, December 28,2022, August 26, 2023, and January 9, 2024 on the media for information disclosure designated by the Company and Cninfo (http://www.cninfo.com.cn).
Equity incentives granted to directors and senior officers of the Company:
□Applicable Not Applicable
Appraisal mechanism and incentives for senior officers
The Company has established asound performance assessment and incentive system. The Board of Directors has the Remuneration & Appraisal Committee as the administrative agency for the appointment and remuneration appraisal of the senior officers of the Company, which shall be responsible for formulating remuneration standards and schemes for senior officers, reviewing their performance of duties and formulating scientific and reasonable remuneration schemes and submitting to the Board for review and discussion.The current senior officers of the Company shall be subjectto comprehensive performance appraisal based on their positions, the current remuneration policy of the Company, the Company's actual operating performance, individual performance, performance of duties and achievement of responsibilities and goals, and the result of such appraisal shall serve as the basis to determine their remunerations. The Company pays the remunerations of senior officers based on schedule. During the reporting period, the senior officers of the Company conscientiously performed their duties in strict accordance with the Company Law, the Articles of Association and the relevant laws and regulations, actively implemented relevant resolutions of the General Meetings ofShareholders and Board meetings, and completed tasks ofthe year in a quite good way.
2. Implementation of the employee stock ownership plan
Applicable □Not applicable
Information on all effective employee stock ownership plans during the reporting period
| Scopeofemployees | Numberofemployees | Totalnumberofsharesheld | Changes | Asapercentageofthetotalsharecapitalofthelistedcompany | Sourceoffundstoimplementtheplan |
|---|---|---|---|---|---|
| Directors(excludingindependentdirectors),supervisors,seniorofficers,andbackbonepersonnel(technology,marketing,production,etc.)oftheCompany. | 134 | 64,789,616 | AsatOctober12,2023,thelock-upperiodfortheCompany'sSecondEmployeeStockOwnershipPlanexpired,withemployees'cumulativeholdingof64,789,616sharesoftheCompany,accountingfor2.04%oftheCompany'stotalsharecapital. | 2.04% | Employees'legitimateremuneration,self-raisedfunds,andotherfundsobtainedbymeanspermittedbylawsandregulations. |
Shareholding of directors, supervisors and senior officers in the employee stock ownership plan during the reporting period
| Name | Position | Numberofsharesheldatthebeginningofthereportingperiod(share) | Numberofsharesheldattheendofthereportingperiod(share) | Asapercentageofthetotalsharecapitalofthelistedcompany |
|---|---|---|---|---|
| MaGang | Chairman&President | 17,246,996 | 17,246,996 | 0.54% |
| WangQingbo | VicePresident&CFO | 4,159,493 | 4,159,493 | 0.13% |
| JinTaotao | VicePresident&BoardSecretary | 2,462,005 | 2,462,005 | 0.08% |
| JiaoWanjiang | ChairmanoftheBoardofSupervisors | 1,846,504 | 1,846,504 | 0.06% |
| LiuKan | Supervisor | 155,495 | 155,495 | 0.00% |
Changes in the asset management institution during the reporting period
□Applicable Not Applicable
Changes in equity arising from disposal of sharesby holders during the reporting period
□Applicable Not Applicable
Exercise of shareholders' rights during the reporting period
NA
Other relevant circumstances and explanations of the employee stock ownership plan during the reporting period
□Applicable Not Applicable
Change of the members ofthe employee stock ownership plan management committee
□Applicable Not Applicable
The financial impact of the employee stock ownership plan on the listed company during the reporting period and relevant accounting treatment
□Applicable Not Applicable
Termination of the employee stock ownership plan during the reporting period
□Applicable Not Applicable
Other statements:
NA
3. Other employee incentive measures
□Applicable Not Applicable
XII. Establishment and Implementation of the Internal Control Policy during the Reporting Period
1. Establishment and implementation of internal control
(1) Internal control development
Infore Enviro has established and improved rules and regulations relating to corporate governance and internal control in accordance with the requirements of the Company Law, the Securities Law, the Basic Standard for Enterprise Internal Control, the Rules Governing the Listing of Shares on SZSE and other statutory documents. The operations of the General Meeting of Shareholders, the Board of Directors and the Board of Supervisors in Infore Enviro are in compliance with the provisions of the relevant laws, regulations, the Articles of Association of the Company, the Rules of Procedures for the General Meeting of Shareholders, the Rules of Procedures for the Board of Directors, and the Rules of Procedures for the Board of Supervisors. Corresponding internal management policy with respect to such material issues as financial accounting, fundraising, external investment, external guarantee, related party transactions and information disclosure has been established in Infore Enviro to ensure the legality and compliance of day-to-day operations and decision-making procedures for material matters.
(2) Internal control implementation
(a) Execution of information disclosure management policies
Upon verification, the Company effectively complied with the Information Disclosure Management Policy in 2023,with good performance in information disclosure, and was not subject to punishments by the securities regulatory authorities for violation of rules on information disclosure.
(b) Implementation of financial internal control policies
Upon verification, with respect to finance and accounting, the Company has established the relevant internal management policy in accordance with the requirements of the Accounting Standards for Enterprises, the Company Law and other relevant laws and
regulations, which can ensure the accuracy and reliability of the financial and accounting information and the security and effectiveness of the financial and accounting systems.
(c) Implementation of other internal control policies
Upon verification, Infore Enviro complied with the provisions of the Articles of Association and the relevant rules and regulations, performed necessary decision-making procedures, and implemented the internal control policy quite well.
2. Details of material internal control deficiencies identified during the reporting period
□Yes No
XIII. Management and Control of the Company over the Subsidiaries during the Report Period
| Companyname | Integrationplan | Integrationprogress | Problemsintheintegration | Resolutionmeasurestaken | Resolutionprogress | Follow-upresolutionplan |
|---|---|---|---|---|---|---|
| Not | Not | Not | Not | Not | Not | Not |
| applicable | applicable | applicable | applicable | applicable | applicable | applicable |
XIV. Assessment Report or Audit Report on Internal Control
1. Internal control assessment report
| Dateoffulldisclosureoftheinternalcontrolassessmentreport | April29,2024 | |||||
|---|---|---|---|---|---|---|
| Indextofulldisclosureoftheinternalcontrolassessmentreport | Fordetails,pleaserefertotheInternalControl(http://www.cninfo.com.cn). | AssessmentReportdisclosedonCninfo | ||||
| ThetotalassetsoftheorganizationincludedintheassessmentasapercentageofthetotalassetsintheCompany'sconsolidatedfinancialstatements | 100.00% | |||||
| TherevenueoftheorganizationincludedintheassessmentasapercentageoftherevenueintheCompany'sconsolidatedfinancialstatements | 100.00% | |||||
| Deficiencyidentificationcriteria | ||||||
| Category | Relatedtofinancialreporting | Unrelatedtofinancialreporting | ||||
| Qualitativecriteria | Materialdeficiencies:1.Fraudcommittedbydirectors,supervisorsandseniorofficersinrelationtofinancialreporting;2.MaterialmisstatementinfinancialstatementsofthecurrentperiodidentifiedbyCPAs,whichwasnotidentifiedinthecourseofthefunctioningofinternalcontrols;3.IneffectivesupervisionoverinternalcontrolbytheAuditCommitteeandinternalauditagencyoftheCompany;4.Lackofpostqualificationorobviousincompetenceofprincipalfinancialpersonnel;5.Ineffectivecompliancesupervisionand | Materialdeficiencies:Ifthelikelihoodofthedeficiencyishigh,itcouldmateriallyimpairworkefficiencyoreffectiveness,materiallyincreaseuncertaintyinoutcomes,orresultinamaterialdeviationfromexpectedtargets.Significantdeficiencies:Ifthelikelihoodofthedeficiencyismedium,itcouldsignificantlydiminishworkefficiencyoreffectiveness,significantlyincreaseuncertaintyinoutcomes,orresultinasignificantdeviationfromexpectedtargets.Generaldeficiencies: |
| violationsofregulationsthatcouldmaterially | Ifthelikelihoodofthedeficiencyislow, | |
|---|---|---|
| affectthereliabilityoffinancialstatements; | itcoulddiminishworkefficiencyor | |
| Significantdeficiencies: | effectiveness,increaseuncertaintyin | |
| 1.Noanti-fraudproceduresandcontrolshave | outcomes,orresultinadeviationfrom | |
| beenestablished; | expectedtargets. | |
| 2.Internalcontrolovertheselectionand | ||
| applicationofaccountingpolicyinlinewith | ||
| thegenerallyacceptedaccountingstandards | ||
| havenotbeenimplemented; | ||
| 3.Thereareoneormoredeficienciesinthe | ||
| controlsovertheyear-endfinancialreporting | ||
| process,anditcannotreasonablyensurethat | ||
| thefinancialstatementsarepreparedto | ||
| achievetheobjectivesofauthenticityand | ||
| completeness. | ||
| Generaldeficiencies: | ||
| Otherinternalcontroldeficienciesthatdonot | ||
| constitutematerialdeficienciesorsignificant | ||
| deficiencies. | ||
| Materialdeficiencies: | ||
| 1.Thepotentiallymisstatedamountinthe | ||
| profitstatementisgreaterthanorequalto1% | ||
| oftherevenueintheconsolidatedfinancial | ||
| statementsoftheCompanyforthemostrecent | ||
| fiscalyearor5%ofthetotalpre-taxprofit; | ||
| 2.Thepotentiallymisstatedamountinthe | ||
| balancesheetisgreaterthanorequalto1%of | ||
| thetotalassetsintheconsolidatedfinancial | ||
| statementsoftheCompanyforthemostrecent | ||
| fiscalyear. | ||
| Significantdeficiencies: | ||
| 1.Thepotentiallymisstatedamountinthe | ||
| profitstatementisgreaterthanorequalto | Materialdeficiencies:Directproperty | |
| 0.5%oftheCompany'srevenueor3%ofthe | lossamountisgreaterthanorequalto | |
| totalpre-taxprofitintheconsolidated | 1%oftheCompany'stotalassets(latest | |
| financialstatementsforthemostrecentfiscal | audited). | |
| yearbutlessthan1%oftheCompany's | Significantdeficiencies:Directproperty | |
| revenueor5%ofthetotalpre-taxprofitinthe | lossamountisgreaterthanorequalto | |
| Quantitativecriteria | consolidatedfinancialstatementsforthemost | 0.5%oftheCompany'stotalassets(latest |
| recentfiscalyear. | audited)butlessthan1%ofthe | |
| 2.Thepotentiallymisstatedamountinthe | Company'stotalassets(latestaudited). | |
| balancesheetisgreaterthanorequalto0.5% | Generaldeficiencies:Directproperty | |
| ofthetotalassetsintheconsolidatedfinancial | lossamountislessthan0.5%ofthe | |
| statementsoftheCompanyforthemostrecent | Company'stotalassets(latestaudited). | |
| fiscalyearbutlessthan1%ofthetotalassets | ||
| intheconsolidatedfinancialstatementsforthe | ||
| mostrecentfiscalyear. | ||
| Generaldeficiencies: | ||
| 1.Thepotentiallymisstatedamountinthe | ||
| profitstatementislessthan0.5%ofthe | ||
| Company'srevenueor3%ofthetotalpre-tax | ||
| profitintheconsolidatedfinancialstatements | ||
| forthemostrecentfiscalyear; | ||
| 2.Thepotentiallymisstatedamountinthe | ||
| balancesheetislessthan0.5%ofthe | ||
| consolidatedtotalassetsoftheCompanyfor | ||
| themostrecentfiscalyear. | ||
| Numberofmaterialdeficienciesrelatedtofinancialreporting | 0 | |
|---|---|---|
| Numberofmaterialdeficienciesunrelatedtofinancialreporting | 0 | |
| Numberofsignificantdeficienciesrelatedtofinancialreporting | 0 | |
| Numberofsignificantdeficienciesunrelatedtofinancialreporting | 0 |
2. Audit report on internal control
Applicable □Not applicable
| TheOpinionparagraphinthe | auditreportoninternalcontrol |
|---|---|
| InforeEnviromaintained,inallmaterialrespects,effectiveinternalinaccordancewiththeBasicStandardforEnterpriseInternal | controlrelatedtofinancialreportingasatDecember31,2023,Controlandotherapplicablerules. |
| Disclosurestatusoftheauditreportoninternalcontrol | Disclosed |
| Disclosuredateofthefullauditreportoninternalcontrol | April29,2024 |
| Indextothefullauditreportoninternalcontrol | Fordetails,pleaserefertotheInternalControlAuditReportdisclosedonCninfo(http://www.cninfo.com.cn) |
| Opiniontypeoftheauditreportoninternalcontrol | Standardunqualifiedopinion |
| Whetheranymaterialdeficiencyunrelatedtofinancialreporting | No |
Whether the accounting firm has issued the audit report with modified opinion on the Company's internal control
□Yes No
Whether the auditor's report on the Company's internal control is consistent with the self-assessment report issued by the Company's Board of Directors
Yes □No
XV. Rectification of Self-Detected Problems through the Special Campaign to Improve Governance of Listed Companies
According to the system of the CSRC for filling and reporting the specialself-examination list for the governance of listed companies, the Company conducted self-examination work during the specialcampaign based on facts and in strict accordance with the Company Law, the Securities Law, Guidelines No. 1 of SZSE for Self-regulation of Listed Companies—Standardized Operation of Companies Listed on the Main Board and other relevant laws and regulations as well as its internal rules and regulations, carefully sorted out the issues and filled in the forms. Through this self-examination, the Company believes that its corporate governance complies with the requirements of the Company Law, the Securities Law, Guidelines No. 1 of SZSE for Self-regulation of Listed Companies—Standardized Operation of Companies Listed on the Main Board and other laws and regulations, and that its corporate governance structure is sound and functions in a standardized way, without no material issues orerrors. The Company shall continue to strengthen management in the following areas:
- Further improving the internal control policy of the Company
The Company shall systemically sort out and improve its corporate governance and internal control in accordance with the latest laws and regulations and combined with the requirements ofthe regulatory authorities and its self-examination result, further perfect its internal control policy and implement the corresponding examination and approval procedure on the revised and improved relevant policies.
- Further facilitating special committees ofthe Board to play their roles
During the reporting period, the Company maintained special committees in strict accordance with the relevant laws and regulations, and the special committees conducted on-site inspection and supervised and guided the Company's operations management and the execution of resolutions ofthe Board of Directors. In the future, the Company shall continue to create conditions for members of the specialcommittees to know well the business of the Company, facilitate themselves to play their roles and provide advice and suggestions on the Company's development planning, operations management, risk control, selection and engagement of senior officers and back-up personnel, performance appraisal of senior officers, internal control and internal audit, etc., to further improve the scientific decision-making capacity and risk prevention capacity of the Company.
- Further improving the quality of information disclosure
The Company shall optimize its policy system in strict accordance with the Administration of Information Disclosure Af airs and in combination with its own situation. In day-to-day information disclosure management, the Company shall conduct information disclosure in a concise and easy-to-understand manner on the premise that the Company, its shareholders and other information disclosure obligors shall ensure the authenticity, accuracy, completeness, timeliness and fairness of information disclosure.The relevant personnel of information disclosure shall treat the information disclosure in a diligent manner, prevent errors and ensure the quality of information disclosure and elevate the level of information disclosure. During the reporting period, the Company and its relevant personnel disclosed information in strict accordance with the requirements oflaws and regulations.
- Further ramping up staff training in lawsand regulations
By optimizing internal training programs and increasing training, the Company helped its staff better understand laws, regulations, and normative documents such as the Securities Law, the Rules Governing the Listing of Shares on SZSE, and the Guidelines No. 1 of SZSE for Self-regulation of Listed Companies—Standardized Operation of Companies Listed on the Main Board. Such training also helped the Company strictly comply with relevant regulations, manage its operations in a prudentmanner, and prevent violations.
Part V Environmental and Social Responsibility
I. Material Environmental Issues
Whether the listed company and its subsidiaries are major pollutant emitters announced by national environmental authorities
Yes □No
Environmental policies and industry standards
The Company strictly abides by the laws, regulations, and emission standards, such as the Environmental Protection Law of the People's Republic of China, Water Pollution Prevention and Control Law of the People's Republic of China, Integrated Wastewater Discharge Standard, and Law of the People's Republic of China on the Prevention and Control of Air Pollution. It consistently improves its management policies and optimizes pollutant treatment facilities and technologies to minimize the discharge of pollutants.
Environmental administrative licensing
The Company has been running all its key pollutant-discharging projects according to laws and regulations for many years. During the construction period, environmental impact assessment was carried out for these projects under relevant laws and regulations such as the Environmental Protection Law of the People's Republic of China and Law of the People's Republic of China on Environmental Impact Assessment, and environmental impact assessment documents were approved by environmental authorities. Besides, the Company obtained approval from environmental authorities before pilot production, organized environmental acceptance inspection for the completed projects during pilot production, and simultaneously designed, constructed and put into use the supporting environmental facilities and the main works.
| Nameofentityorsubsidiary | Typesofmainpollutantsandcharacteristicpollutants | Namesofmainpollutantsandcharacteristicpollutants | Wayofdischarge | Numberofdischargeoutlets | Layoutofdischargeoutlets | Dischargeconcentration/intensity | Pollutantdischargestandardsimplemented | Totaldischargevolume | Totalapproveddischargevolume | Excessivedischarge |
|---|---|---|---|---|---|---|---|---|---|---|
| FoshanShundeHuaqingyuanWater | Wastewater | COD | Continuousdischarge | 1 | BeijiangRivertrunkstreamwaterway | 10.5mg/L | GB18918-2002,Class1A | 388.37t | 1606t/a | N/A |
| EnvironmentalProtectionCo.,Ltd. | Wastewater | Ammonianitrogen | Continuousdischarge | 1 | BeijiangRivertrunkstreamwaterway | 0.54mg/L | GB18918-2002,Class1A | 19.97t | 200.75t/a | N/A |
| (PhasesIandII | Wastewater | Total | Continuous | 1 | BeijiangRivertrunkstreamwaterway | 0.25mg/L | GB18918-2002, | 9.25t | 20.075t/a | N/A |
Industry discharge standards and discharge of pollutants in production and operating activities
| sewagestationsby | phosphorus | discharge | Class1A | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| thegate),FoshanShundeYuanrunWaterEnvironmentalProtectionCo.,Ltd.(PhaseIIIsewagestationbythegate) | Wastewater | Totalnitrogen | Continuousdischarge | 1 | BeijiangRivertrunkstreamwaterway | 6.08mg/L | GB18918-2002,Class1A | 224.88t | 602.25t/a | N/A |
| Wastegas | Smoke | 80mchimney | 1 | Northsideofthemainplant | 4.2mg/Nm³ | GB18485-2014 | 2.316t | 14.6t/a | N/A | |
| Wastegas | SO2 | 80mchimney | 1 | Northsideofthemainplant | 40.059mg/Nm³ | GB18485-2014 | 24.543t | 89.28t/a | N/A | |
| Wastegas | NOx | 80mchimney | 1 | Northsideofthemainplant | 146.314mg/Nm³ | GB18485-2014 | 85.702t | 96.72t/a | N/A | |
| FunanGreenlanderEnvironmentalEnergyCo.,Ltd. | Wastegas | HCl | 80mchimney | 1 | Northsideofthemainplant | 35.987mg/Nm³ | GB18485-2014 | 21.406t | / | N/A |
| Wastegas | CO | 80mchimney | 1 | Northsideofthemainplant | 15.09mg/Nm³ | GB18485-2014 | 9.365t | / | N/A | |
| Wastegas | Pb | 80mchimney | 1 | Northsideofthemainplant | 0.0146mg/Nm³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Cd | 80mchimney | 1 | Northsideofthemainplant | 0.0000945mg/Nm³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Hg | 80mchimney | 1 | Northsideofthemainplant | 0.0048mg/Nm³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Dioxins | 80mchimney | 1 | Northsideofthemainplant | 0.057ng-TEQ/m³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Smoke | 80mchimney | 1 | Westsideofthemainplant | 2.4mg/Nm³ | GB18485-2014 | 1.49t | 12t/a | N/A | |
| Wastegas | SO2 | 80mchimney | 1 | Westsideofthemainplant | 43.39mg/Nm³ | GB18485-2014 | 20.19t | 70t/a | N/A | |
| Shouxian | Wastegas | NOx | 80mchimney | 1 | Westsideofthemainplant | 202.48mg/Nm³ | GB18485-2014 | 123.53t | 144t/a | N/A |
| GreenlanderNewEnergyCo.,Ltd. | Wastegas | HCl | 80mchimney | 1 | Westsideofthemainplant | 51.97mg/Nm³ | GB18485-2014 | 29.65t | / | N/A |
| Wastegas | CO | 80mchimney | 1 | Westsideofthemainplant | 2.8mg/Nm³ | GB18485-2014 | 3.74t | / | N/A | |
| Wastegas | Pb | 80mchimney | 1 | Westsideofthemainplant | 0.0016mg/m³ | GB18485-2014 | / | / | N/A |
| Wastegas | Cd | 80mchimney | 1 | Westsideofthemainplant | 0.000694mg/m³ | GB18485-2014 | / | / | N/A | |
|---|---|---|---|---|---|---|---|---|---|---|
| Wastegas | Hg | 80mchimney | 1 | Westsideofthemainplant | 0.00082mg/Nm³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Dioxins | 80mchimney | 1 | Westsideofthemainplant | 0.038ngTEQ/m³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Smoke | 80mchimney | 1 | Eastsideofthemainplant | 1.1mg/Nm³ | GB18485-2014 | 0.85t | 6.78t/a | N/A | |
| Wastegas | SO2 | 80mchimney | 1 | Eastsideofthemainplant | 28.6mg/Nm³ | GB18485-2014 | 14.09t | 26.06t/a | N/A | |
| Wastegas | NOx | 80mchimney | 1 | Eastsideofthemainplant | 151mg/Nm³ | GB18485-2014 | 96.45t | 104t/a | N/A | |
| Wastegas | HCl | 80mchimney | 1 | Eastsideofthemainplant | 41.718mg/Nm³ | GB18485-2014 | 24.27t | / | N/A | |
| LianjiangGreenlanderNew | Wastegas | CO | 80mchimney | 1 | Eastsideofthemainplant | 28.9mg/Nm³ | GB18485-2014 | 20.36t | / | N/A |
| EnergyCo.,Ltd. | Wastegas | Pb | 80mchimney | 1 | Eastsideofthemainplant | / | GB18485-2014 | / | / | N/A |
| Wastegas | Cd | 80mchimney | 1 | Eastsideofthemainplant | / | GB18485-2014 | / | / | N/A | |
| Wastegas | Hg | 80mchimney | 1 | Eastsideofthemainplant | 0.0023mg/Nm³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Dioxins | 80mchimney | 1 | Eastsideofthemainplant | 0.063ng-TEQ/m³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Smoke | 80mchimney | 1 | Westsideofthemainplant | 0.22mg/m³ | GB18485-2014 | 0.109t | / | N/A | |
| Wastegas | SO2 | 80mchimney | 1 | Westsideofthemainplant | 22.76mg/m³ | GB18485-2014 | 16.52t | 58t/a | N/A | |
| XiantaoGreenlanderEnvironmentalPower | Wastegas | NOx | 80mchimney | 1 | Westsideofthemainplant | 208.97mg/m³ | GB18485-2014 | 118.29t | 148.85t/a | N/A |
| GenerationCo.,Ltd.(1#furnace) | Wastegas | HCl | 80mchimney | 1 | Westsideofthemainplant | 26.69mg/m³ | GB18485-2014 | 15.3t | / | N/A |
| Wastegas | CO | 80mchimney | 1 | Westsideofthemainplant | 2.77mg/m³ | GB18485-2014 | 3.47t | / | N/A | |
| Wastegas | Pb | 80mchimney | 1 | Westsideofthemainplant | 0.0029mg/m³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Cd | 80m | 1 | Westsideofthemainplant | 0.00013mg/m | GB18485-2014 | / | / | N/A |
| chimney | ³ | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Wastegas | Hg | 80mchimney | 1 | Westsideofthemainplant | / | GB18485-2014 | / | / | N/A | |
| Wastegas | Dioxins | 80mchimney | 1 | Westsideofthemainplant | 0.0014ngTEQ/m³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Smoke | 80mchimney | 1 | Westsideofthemainplant | 1.03mg/m³ | GB18485-2014 | 0.59t | / | N/A | |
| Wastegas | SO2 | 80mchimney | 1 | Westsideofthemainplant | 23.13mg/m³ | GB18485-2014 | 9.96t | 58t/a | N/A | |
| Wastegas | NOx | 80mchimney | 1 | Westsideofthemainplant | 224.04mg/m³ | GB18485-2014 | 81.9t | 148.85t/a | N/A | |
| XiantaoGreenlander | Wastegas | HCl | 80mchimney | 1 | Westsideofthemainplant | 29.33mg/m³ | GB18485-2014 | 9.78t | / | N/A |
| EnvironmentalPowerGenerationCo.,Ltd. | Wastegas | CO | 80mchimney | 1 | Westsideofthemainplant | 0.87mg/m³ | GB18485-2014 | 1.76t | / | N/A |
| (2#furnace) | Wastegas | Pb | 80mchimney | 1 | Westsideofthemainplant | 0.0032mg/m³ | GB18485-2014 | / | / | N/A |
| Wastegas | Cd | 80mchimney | 1 | Westsideofthemainplant | 0.00014mg/m³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Hg | 80mchimney | 1 | Westsideofthemainplant | / | GB18485-2014 | / | / | N/A | |
| Wastegas | Dioxins | 80mchimney | 1 | Westsideofthemainplant | 0.002ngTEQ/m³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Smoke | 80mchimney | 1 | Northsideofthemainplant | 0.7655mg/Nm³ | GB18485-2014 | 0.457t | 12t/a | N/A | |
| Wastegas | SO2 | 80mchimney | 1 | Northsideofthemainplant | 40.0409mg/Nm³ | GB18485-2014 | 23.9035t | 80t/a | N/A | |
| Wastegas | NOx | 80mchimney | 1 | Northsideofthemainplant | 223.9976mg/Nm³ | GB18485-2014 | 133.7214t | 250t/a | N/A | |
| PoyangGreenlanderRenewableEnergy | Wastegas | HCl | 80mchimney | 1 | Northsideofthemainplant | 38.3231mg/Nm³ | GB18485-2014 | 22.878t | / | N/A |
| Co.,Ltd. | Wastegas | CO | 80mchimney | 1 | Northsideofthemainplant | 2.40mg/Nm³ | GB18485-2014 | 1.433t | / | N/A |
| Wastegas | Pb | 80mchimney | 1 | Northsideofthemainplant | 0.01mg/Nm³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Cd | 80mchimney | 1 | Northsideofthemainplant | 0.00015mg/Nm³ | GB18485-2014 | / | / | N/A |
| Wastegas | Hg | 80mchimney | 1 | Northsideofthemainplant | 0.000035mg/Nm³ | GB18485-2014 | / | / | N/A | |
|---|---|---|---|---|---|---|---|---|---|---|
| Wastegas | Dioxins | 80mchimney | 1 | Northsideofthemainplant | 0.063ng/m³ | GB18485-2014 | / | / | N/A | |
| Wastegas | Smoke | 80mchimney | 1 | Southsideofthemainplant | 1.72mg/m³ | GB18485-2014 | 0.524t | 10.95t/a | N/A | |
| Wastegas | SO2 | 80mchimney | 1 | Southsideofthemainplant | 43.02mg/m³ | GB18485-2014 | 25.406t | 31.68t/a | N/A | |
| Wastegas | NOx | 80mchimney | 1 | Southsideofthemainplant | 194.13mg/m³ | GB18485-2014 | 119.737t | 159.72t/a | N/A | |
| WastegasHClBiyangFengheNewEnergyPowerCo.,WastegasCOLtd.WastegasPbWastegasCdWastegasHg | 80mchimney | 1 | Southsideofthemainplant | 30.46mg/m³ | GB18485-2014 | 18.663t | / | N/A | ||
| 80mchimney | 1 | Southsideofthemainplant | 5.76mg/m³ | GB18485-2014 | 1.817t | / | N/A | |||
| 80mchimney | 1 | Southsideofthemainplant | 0.0642mg/m³ | GB18485-2014 | / | / | N/A | |||
| 80mchimney | 1 | Southsideofthemainplant | 0.000126mg/m³ | GB18485-2014 | / | / | N/A | |||
| 80mchimney | 1 | Southsideofthemainplant | 0.003mg/m³ | GB18485-2014 | / | / | N/A | |||
| Wastegas | Dioxins | 80mchimney | 1 | Southsideofthemainplant | 0.0078ngTEQ/Nm³ | GB18485-2014 | / | / | N/A | |
| XiantaoYingheEnvironmentalProtectionCo.,Ltd. | Wastegas | Ammoniaandhydrogensulfide | Centralized | 2 | Dischargeoutletsforkitchenwasteandsludgeattheendofthedeodorizationsystem,withwastegasdischargedthroughthechimney | Ammonia:1.5mg/Nm³;Hydrogensulfide:0.06mg/Nm³ | GB14554-93 | None | / | N/A |
| Wastegas | Smoke,SO2andNOX | Centralized | 1 | Dischargeoutletsofkitchenbiogascombustionattheendofthecombustionsystem,withwastegasdischargedthroughthechimney | Smoke:20mg/Nm³;SO2:50mg/Nm³;NOX:200mg/Nm³ | GB13271-2014 | Smoke:0.00832t;SO2:0t;NOX:0.0251t | Smoke:0.241t;SO2:0.467t;NOX:1.809t | N/A | |
| Wastewater | CODandammonianitrogen | Centralized | 1 | Sewagedischargeoutletsattheendofthesewagetreatmentfacility,withsewagedischargedtothesewageplantinthewestofthecityaftercentralized | COD:500mg/L;Ammonianitrogen: | GB8978-1996 | COD:1.969t;Ammonianitrogen: | COD:4.2627t;Ammonianitrogen: | N/A |
| treatment | 45mg/L | 0.088t | 0.427t | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Wastegas | Benzene | Planned | 2 | Easternexhaustoutletofwastegasfrompaintdryingforwhole-machinecoating(longitude112°50'14.28",latitude28°13'59.99")/Westernexhaustoutletofwastegasfrompaintdryingforwhole-machinecoating(longitude112°50'12.30",latitude28°13'59.99") | 0.03905mg/m³ | EmissionStandardofVolatileOrganicCompoundsandNiforSurfaceCoating(AutomobileManufacturingandRepairIndustry)(DB43/1356-2017);1mg/m³ | 0.038624t | / | N/A | |
| ChangshaZoomlionEnvironmentalIndustryCo.,Ltd. | Wastegas | Toluene | Planned | 2 | Easternexhaustoutletofwastegasfrompaintdryingforwhole-machinecoating(longitude112°50'14.28",latitude28°13'59.99")/Westernexhaustoutletofwastegasfrompaintdryingforwhole-machinecoating(longitude112°50'12.30",latitude28°13'59.99") | 0.0514175mg/m³ | EmissionStandardofVolatileOrganicCompoundsandNiforSurfaceCoating(AutomobileManufacturingandRepairIndustry)(DB43/1356-2017);3mg/m³ | 0.057679t | / | N/A |
| Wastegas | Xylene | Planned | 2 | Easternexhaustoutletofwastegasfrompaintdryingforwhole-machinecoating(longitude112°50'14.28",latitude28°13'59.99")/Westernexhaustoutletofwastegasfrompaintdryingforwhole-machinecoating(longitude112°50'12.30",latitude28°13'59.99") | 0.300981mg/m³ | EmissionStandardofVolatileOrganicCompoundsandNiforSurfaceCoating(AutomobileManufacturingandRepairIndustry)(DB43/1356-2017);17mg/m³ | 0.27389t | / | N/A |
| N/A | 424.83t/a | 1.770279t | 1.774702mg/m³ | 2 | Planned | Non-methanehydrocarbons | Wastegas | ||
|---|---|---|---|---|---|---|---|---|---|
| Easternexhaustoutletofwastegasfrompaintdryingforwhole-machinecoating(longitude112°50'14.28",latitude28°13'59.99")/Westernexhaustoutletofwastegasfrompaintdryingforwhole-machinecoating(longitude112°50'12.30",latitude28°13'59.99") | |||||||||
| EmissionStandardofVolatileOrganicCompoundsandNiforSurfaceCoating(AutomobileManufacturingandRepairIndustry)(DB43/1356-2017);40mg/m³ |
Pollutant treatment
The Company values environmental protection and has established a management committee to coordinate its safety and environmental activities. Safety and environmental departments equipped with management personnel have also been set up across key business segments. In recent years, the Company and its subsidiaries have been strengthening environmental policies and strictly regulating the operating procedures and job responsibilities ofenvironmental facilities to ensure theirproper functioning. This has effectively controlled pollutant emissions, and no instances ofexceeding discharge standards have occurred. Throughout the routine production and operational processes, the environmental facilities integrated into the Company and its subsidiaries guarantee the uninterrupted functioning of all environmental systems.
Environmental self-monitoring plan
The Company developed the 2023 Environmental Self-Monitoring Plan for each of its key pollutant-discharging projects in accordance with environmental impact assessment requirements and relevant laws and regulations, and filed them with local ecological and environmental authorities. It has also engaged a professional third-party inspection agency to carry out regular environmental monitoring of the pollutants discharged by its projects.
Contingency plan for environmental emergencies
The Company engaged a professional third-party agency to develop a contingency plan for environmental emergencies for each of its key pollutant-discharging projects, and such plans have been approved and filed for record. In 2023, the Company carried out regular training and drills among its employees in different projects according to the requirements and contents ofthe contingency plans to enable them to timely and accurately deal with environmental pollution emergencies.
Investment in environmental governance and protection payment of environmental taxes
The Company's commitment to green development and environmental protection underpins its sustained efforts in clean production, energy conservation, consumption reduction, emission reduction, and efficiency improvement. By incorporating its environmental philosophy into day-to-day management, the Company strives to become a resource-conserving and environmental friendly business. In 2023, it invested approximately RMB 26.246 million in environmental protection and paid approximately RMB 22,800 in environmental taxes under the relevant laws and regulations.
Measures adopted during the reporting period to reduce carbon emissions and their effects
Applicable □Not applicable
The Company made rational use of waste resources and effectively reduced environmental carbon emissions through environmental protection industrial modes such as domestic waste incineration for power generation, kitchen waste resource utilization and sewage treatment. In terms of the project of domestic waste incineration for power generation, the greenhouse gas emission reduction is about 0.78-1.32kg per kilowatt-hour, and 0.36tCO2e per ton of waste, with sound emission reduction effect.
Administrative penalties for environmental issues during the reporting period
| Nameofentityorsubsidiary | Reason | Violation | Penalty | Impactontheproductionandoperationofthelistedcompany | Rectificationmeasures |
|---|---|---|---|---|---|
| SusongYingheEnvironmentalSanitationManagementCo.,Ltd. | Non-compliantoperation | ViolationofArticle69oftheHighwaySafetyProtectionRegulations | AfineofRMB200 | Ithadnomaterialimpactontheproductionandoperationofthelistedcompany. | 1.Providedtrainingfordriversinrelevantlegalprovisions;2.Strengthenedthevehiclemanagementpolicytoguaranteeadherencetoloadingprotocols;3.Carriedoutroutineinspectionstoguaranteetheprojectswereoperatedunderestablishedrules. |
| LoudiZoomlionHuabaoEnvironmentalProtectionTechnologyCo.,Ltd. | Non-compliantoperation | ViolationofArticle33oftheRegulationsontheAdministrationofPollutantDischargePermit,Table3-2,Table2-2,Table12-3andTable13ofAdministrativePenaltyDiscretionStandardsofHunanProvinceforEcologicalEnvironmentProtection,Article23oftheRegulationsontheAdministrationofEnvironmentalProtectionofConstructionProjects,andArticle38oftheMeasuresfortheAdministrationofEnvironmentalEmergencyResponse | 1.AfineofRMB865,300ontheCompany;2.AfineofRMB87,500ondirectlyaccountablepersons. | Ithadnomaterialimpactontheproductionandoperationofthelistedcompany. | 1.Conductedtrainingsessionsforemployeesinrelevantlegalprovisions;2.Formulatedandrefinedrelevantrulesandpolicies;3.Implementedroutineinspectionstoensurethatprojectswereoperatedincompliancewithrules. |
| XiangtanYinglianEnvironmentalIndustryCo.,Ltd. | Non-compliantoperation | ViolationofArticle10andArticle39oftheWaterPollutionPreventionandControlLawofthePeople'sRepublicofChina. | RMB670,000 | Ithadnomaterialimpactontheproductionandoperationofthelistedcompany. | 1.Conductedtrainingsessionsforprojectpersonnelinrelevantlegalprovisions;2.Formulatedandrefinedrelevantrulesandpolicies;3.Implementedroutineinspectionstoensurethatprojectswereoperatedincompliancewithrules. |
| ZhangjiagangZhongyingEnvironmental | Non-compliantoperation | ViolationofArticles43and65oftheRegulationsofJiangsuProvinceontheAdministrationofCityAppearanceandEnvironmentalSanitation. | Afineof5,000RMB | Ithadnomaterialimpactontheproductionand | 1.Conductedtrainingsessionsforemployeesinrelevantlegalprovisions;2.Formulatedandrefinedrelevantrulesandpolicies;3. |
| DevelopmentCo., | operationofthelisted | Implementedroutineinspectionstoensurethat | |||
|---|---|---|---|---|---|
| Ltd. | company. | projectswereoperatedincompliancewithrules. | |||
| Zhangjiagang | Ithadnomaterial | 1.Conductedtrainingsessionsforemployeesin | |||
| Zhongying | Non- | ViolationofArticles43and65oftheRegulationsof | impactonthe | relevantlegalprovisions;2.Formulatedand | |
| Environmental | compliant | JiangsuProvinceontheAdministrationofCityAppearance | Afineof5,000 | productionand | refinedrelevantrulesandpolicies;3. |
| DevelopmentCo., | operation | andEnvironmentalSanitation. | RMB | operationofthelisted | Implementedroutineinspectionstoensurethat |
| Ltd. | company. | projectswereoperatedincompliancewithrules. |
Other disclosable environmental information
The Company disclosed the environmental information of each of its key pollutant-discharging projects on the government's environmental information disclosure platform on a regular basis according to the requirements oflocal environmental authorities.
Other environmental related information
NA
II. Corporate Social Responsibility
For details, please referto the 2023 Sustainability Report disclosed at Cninfo (www.cninfo.com.cn).
III. Performance in Consolidating Achievements in Poverty Alleviation and Promoting Rural Revitalization
During the reporting period, the Company donated RMB 1,216,100 in money and materials to support poverty alleviation and rural revitalization efforts.
Part VI Significant Events
I. Performance of undertakings
1. Undertakings of the Company's de facto controller, shareholders, related parties, and acquirer, as well as the Company and other commitment makers fulfilled during the reporting period or ongoing at the period end
Applicable □Not applicable
| Undertaking | Party | Type | Content | Date | Termofundertakings | Fulfillmentofundertakings |
|---|---|---|---|---|---|---|
| Undertakingmadeatthetimeofassetrestructuring | DefactocontrollerHeJianfeng | Undertakingonnottorelinquishcontroloverthelistedcompany | Ihavenoplantorelinquishcontroloverthelistedcompanyinthenext60monthsfromthedateofcompletionofthistransaction. | January3,2019 | 60months | Itisbeingproperlyfulfilledwithoutbreach. |
| Undertakingmadeatthetimeofassetrestructuring | DefactocontrollersHeJianfeng,NingboInfore,andInforeGroup | Undertakingtoavoidhorizontalcompetition,regulateandreducerelatedpartytransactions,andmaintainindependenceofthelistedcompany | Undertakingtoavoidhorizontalcompetition,regulateandreducerelatedpartytransactions,andmaintainindependenceofthelistedcompany | August15,2018 | Indefinitely | Itisbeingproperlyfulfilledwithoutbreach. |
| Undertakingmadeatthetimeofassetrestructuring | NingboInfore,HongchuangInvestment,Zoomlion,NingboYingtai,NingboZhongfeng,NingboLiantai | Undertakingtoavoidhorizontalcompetition,andregulateandreducerelatedpartytransactions | Undertakingtoavoidhorizontalcompetition,andregulateandreducerelatedpartytransactions | August15,2018 | Indefinitely | Itisbeingproperlyfulfilledwithoutbreach. |
| Undertakingmadeatthetimeofassetrestructuring | GreenlanderInvestmentHoldingCo.,andZhengWeixian | UndertakingrelatedLtd.toperformance | TheaccumulativetotalnetprofitrecordedbyLianjiangGreenlanderNewEnergyCo.,Ltd,XiantaoGreenlanderEnvironmentalPowerGenerationCo.,Ltd.,FunanGreenlanderEnvironmentalEnergyCo.,Ltd.andShouxianGreenlanderNewEnergyCo.,Ltd.from2016to2019shallnotbelessthanRMB120million(netprofitissubjecttothelowerafterdeductingnonrecurringgainsandlosses). | October14,2015 | 48months | Notfulfilledproperly.Theauditednetprofit(netprofitisthelowerofbeforeorafterdeductingnonrecurringgainsandlosses)fortheperiodfrom2016to2019isRMB2,156,500,RMB-24,424,500,RMB-19,192,800,andRMB-625,700respectively;andthe |
| accumulatednetprofitisRMB-42,086,600whichisRMB162,086,600lessthantheperformancecommitment,indicatingafailuretoachievethecommitmentinrespectofthenetprofitfor | ||||||
|---|---|---|---|---|---|---|
| Undertakingmadeatthetimeofassetrestructuring | GreenlanderInvestmentHoldingCo.,andZhengWeixian | ProjectLtd.undertakings | 1.From2016to2019,thenewlysignedwasteincinerationpowergenerationBOTagreements(subjecttothesigningoffranchiseagreement)signedbyGreenlanderEnvironmentalshallspecifyatotaldailydisposalcapacityofnotlessthan6,500tons(asingleprojectshallhaveadailydisposalcapacityofnotlessthan500tons,ofwhichatleastoneshallbemorethan2,000tons).2.JiujiangCompanyshallstartconstructionandobtainapprovalbefore31December2020.Ifitfailstostartconstructionortheconstructionisrecoveredbythegovernment,itshallcompensatethelistedcompanyataconsiderationofnolessthanRMB5million. | October14,2015 | 48months | 2016-2019.Notfulfilledproperly.ThenewlysignedprojectsbyGreenlanderEnvironmentalfrom2016to2019totaled1,400tons,5,100tonslessthantheprojectundertaking.TheprojectinJiujianhasnotcommencedconstruction. |
| WhetherthefulfilledontimeIftheundertakingontime,non-fulfillmentplanshallbe | undertakingswereisnotfulfilledthespecificreasonsforandthenextstepselaborated | NoOnJuly18,2022,InvestmentHoldingnon-fulfillmentofRMB106,222,592.96 | theHighPeople'sCourtofCo.,Ltd.andZhengWeixianperformancecommitment.Asattheinproceedsfromenforcement | Guangdongshallpaythedateofthisofthe | ProvinceruledCompanyRMBreport,ruling,orRMB | thatGreenlander113,406,600fortheCompanyreceived99,229,334.96 |
| excludingenforcement | feesappraisalfees,servicefees, | applicable | taxes,andcosts. |
2. Where any earnings forecast was made for any of the Company's assets or projects and the reporting period is still within the forecast period, the Company shall explain whether the performance of the asset or project reaches the earnings forecast and why
□Applicable Not Applicable
II. Occupation of the Company's Capital by the Controlling Shareholder or Other Related Parties for Non-Operating Purposes
□Applicable Not Applicable No such cases during the reporting period.
III. Illegal Provision of Guarantees for External Parties
□Applicable Not Applicable No such cases during the reporting period.
IV. Explanations Given by the Board of Directors Regarding the "Modified Audit Opinion" for the Latest Period
□Applicable Not Applicable
V. Explanation of the Board of Directors, the Board of Supervisors, and Independent Directors (If Any) Regarding the "Modified Audit Opinion" for the Reporting Period
□Applicable Not Applicable
VI. Reason for Changes in Accounting Policies, Accounting Estimates or Corrections of Material Accounting Errors as Compared tothe Financial Statements for the Prior Year
Applicable □Not applicable
- Starting from January 1, 2023, the Company has adopted the regulations on accounting treatment that the exemption of initial recognition shall not apply to the deferred income tax relating to assets and liabilities arising from a single transaction in the Interpretation of China Accounting Standards for Business Enterprises No. 16 issued by the MOF. This change in accounting policy has no effect on the Company's financial statements.
VII. Reason for Changes in Scope of the Consolidated Financial Statements as Compared to the Financial Statements for the Prior Year
Applicable □Not applicable
For details of the changes in the scope of the consolidated financial statements during the reporting period, please refer to Note 8 "Changes in the Scope of Consolidation" in Part X Financial Statements.
VIII. Engagement and Disengagement of Accounting Firm
Current accounting firm
| Pan-ChinaCertifiedPublicAccountantsLLP(SpecialGeneral | |
|---|---|
| Nameofthedomesticaccountingfirm | Partnership) |
| TheCompany'spaymenttothedomesticaccountingfirm(inRMB10,000) | 315 |
| Consecutiveyearsofthedomesticauditserviceprovidedbythe | 22 |
| accountingfirm | |
|---|---|
| Namesofthedomesticcertifiedpublicaccountantsfromtheaccountingfirm | BianShanshan,WeiXiaohui |
| Consecutiveyearsofauditserviceprovidedbydomesticcertifiedpublicaccountantsfromtheaccountingfirm | 5yearsand2years,respectively |
Whether the accounting firm was changed during the current period
□Yes No
Engagement of any accounting firm for internal control audit, financial advisor, or sponsor
Applicable □Not applicable
During the year, Pan-China Certified Public Accountants LLP (Special General Partnership) was appointed as the Company's internal control auditor, and Huaxing Securities Co., Ltd. was appointed as the Company's sponsor.
IX. Possibility of Delisting after the Disclosure of This Report
□Applicable Not Applicable
X. Bankruptcy and Reorganization
□Applicable Not Applicable
No such cases during the reporting period.
XI. Material Litigation and Arbitration
□Applicable Not Applicable
During the reporting period, other lawsuits that did not meet the disclosure criteria for material litigation primarily included purchase and sales contract disputes, with a total amount of approximately RMB 466 million, which are not expected to incur any provision of large amount.
XII. Punishments and Rectifications
□Applicable Not Applicable
No such cases during the reporting period.
XIII. Credit Standing of the Company as wellas Its Controlling Shareholder and De Facto Controller
Applicable □Not applicable
During the reporting period, the Company as well as its controlling shareholder and de facto controller had good credit standing, with no such cases as non-fulfillment of effective court judgments or outstanding debts oflarge amounts due and unpaid.
XIV. Material Related Party Transactions
1. Related party transactions in relation today-to-day operations
Applicable □Not applicable
| Relatedparty | Relatedpartyrelationship | Typeofrelatedpartytransaction | Contentsofrelatedpartytransaction | Pricingprincipleofrelatedpartytransaction | Transactionprice | TransactionamountRMB10,000) | Asapercentage(inoftransactionsofsametype | ApprovedtransactionlimitRMB10,000) | Over(inapprovedlimit | Methodofsettlement | Availablemarketpricefortransactionsofsametype | Disclosuredate | Indextodisclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ZoomlionHeavyIndustry | Shareholderholdingmorethan5%oftheCompany'sshares | Goodsorfinancialservices | Goodsorfinancialservices | Marketprice | -- | 8,116.42 | 17,000 | No | Aspercontractualterms | -- | April2023 | 25,www.cninfo.com.cn | |
| Total | -- | -- | 8,116.42 | -- | 17,000 | -- | -- | -- | -- | -- | |||
| Detailsof | anylarge-amount | sales | return | N/A | |||||||||
| GivetheactualfulfillmentsituationduringtheBeforetheCompany'sroutinerelatedpartytransactionsin2023,subsidiariescomprehensivelyassessedandreportingperiod(ifany)whereanestimatebyestimatedtheirrelatedpartytransactions.However,duetochangesinthemarketandcustomerdemand,typehadbeenmadeforthetotalamountsofthereweredifferencesbetweentheCompany'srelatedpartytransactionsandtheactualsituation.Thiswasroutinerelatedpartytransactionstooccurregularbusinessactivityandhadminimalimpactonday-to-dayoperationsandperformance.duringtheperiod | |||||||||||||
| Reasonforthetransactionprice(if | anysignificantpriceandapplicable) | differencethe | betweenmarketreference | Notapplicable |
2. Related party transactions regarding purchase or sales ofassets or equity interests
□Applicable Not Applicable
No such cases during the reporting period.
3. Related party transactions regarding joint investments in external parties
□Applicable Not Applicable No such cases during the reporting period.
4. Current associated rights ofcredit and liabilities
□Applicable Not Applicable
No such cases during the reporting period.
5. Transactions with finance companies with related party relationships
Applicable □Not applicable
Deposit business
| Amountofthe | ||||||||
|---|---|---|---|---|---|---|---|---|
| Relatedparties | Relatedpartyrelationship | Maximumdailydepositlimit(inRMB10,000) | Rangeofdepositrate | Openingbalance(inRMB10,000) | Totaldepositedamount(inRMB10,000) | Totalwithdrawnamount(inRMB10,000) | Endingbalance(inRMB10,000) | |
| ZoomlionFinanceCo.,Ltd. | Relatedcompanyofshareholderholdingmorethan5%oftheCompany's | 0 | Nointerestaccrued | 31 | 31 |
| shares | |||
|---|---|---|---|
Loan business
□Applicable Not Applicable
Credit or other financial business
□Applicable Not Applicable
6. Transactions between the finance company controlled by the Company and related parties
□Applicable Not Applicable
There isno deposit, loan, credit, or other financial business between the finance company controlled by the Company and related parties.
7. Other material related party transactions
□Applicable Not Applicable
No such cases during the reporting period.
XV. Material Contracts and Execution Thereof
1. Trusts, subcontracts, and leases
(1) Trusts
□Applicable Not Applicable No such cases during the reporting period.
(2) Subcontracts
□Applicable Not Applicable No such cases during the reporting period.
(3) Leases
Applicable □Not applicable
Description of leases
In accordance with the Property Lease Contract signed between the Company and the related party Foshan Shunde Yinghai Investment Co., Ltd., the Company leased the 23rd floor of Yingfeng Business Building at 8 Yixing Road, Junlan Community, Beijiao Town, Shunde District, Foshan City, as the business premises with a gross floor area of 1,578.68 sqm. The rent payable for 2023 was RMB 1,348,100, and the actual payment was RMB 1,348,100. As at December 31, 2023, the above amounts have been settled.
Items that brought profits or losses to the Company accounting for more than 10% of the gross profit of the Company during the reporting period
□Applicable Not Applicable
No leasing items brought profits or losses to the Company accounting for more than 10% of the gross profit of the Company during the reporting period.
2. Material guarantees
Applicable □Not applicable
Unit: RMB 10,000
| Guarantees | provided | bytheCompany | andits | subsidiariesfor | externalparties | (excluding | thosefor | subsidiaries) | |||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Guaranteedparty | Disclosuredateoftheguaranteelimitannouncement | Guaranteelimit | Actualoccurrencedate | Actualguaranteeamount | Guaranteetype | Collateral(ifany) | Counter-guarantee(ifany) | Termofguarantee | Completedornot | Guaranteeforarelatedpartyornot | |
| Buyer'screditbusiness | April25,2023 | 1,687.47 | August2021 | 31,1,687.47 | Jointandseveralliabilityguarantee | N/A | -- | 4years | No | No | |
| Buyer'screditbusiness | April25,2023 | 687.85 | June27,2022 | 687.85 | Jointandseveralliabilityguarantee | N/A | -- | 3years | No | No | |
| Buyer'screditbusiness | April25,2023 | 6,122.01 | September18,2022 | 6,122.01 | Jointandseveralliabilityguarantee | N/A | -- | 1year | No | No | |
| Buyer'screditbusiness | April25,2023 | 353.7 | September9,2022 | 353.7 | Jointandseveralliabilityguarantee | N/A | -- | 1year | No | No | |
| Buyer'screditbusiness | April25,2023 | 4,306.24 | June30,2021 | 4,306.24 | Jointandseveralliabilityguarantee | N/A | -- | 3years | No | No | |
| Buyer'screditbusiness | April25,2023 | 6,787.84 | September5,2022 | 6,787.84 | Jointandseveralliabilityguarantee | N/A | -- | 2years | No | No | |
| Buyer'screditbusiness | April25,2023 | 85,054.89 | -- | -- | -- | ||||||
| Totalapprovedexternalreportingperiod | limitforguaranteeduringthe(A1) | 105,000 | Totalactualexternalthereporting | amountguaranteeduringperiod(A2) | of19,945.11 | ||||||
| Totalapprovedexternalofthereporting | limitforguaranteeattheendperiod(A3) | 105,000 | Totalactualexternalendoftheperiod(A4) | balanceofguaranteeatreporting | the19,945.11 | ||||||
| Guarantees | provided | bytheCompany | forits | subsidiaries | |||||||
| Guaranteedparty | Disclosuredateoftheguaranteelimitannouncement | Guaranteelimit | Actualoccurrencedate | Actualguaranteeamount | Guaranteetype | Collateral(ifany) | Counter-guarantee(ifany) | Termofguarantee | Completedornot | Guaranteeforarelatedpartyornot | |
| ZhejiangShangfengSpecialBlowerIndustrialCo.,Ltd. | April25,2023 | 28,600 | February3,2023 | 9,754.12 | Jointandseveralliabilityguarantee | N/A | -- | 3years | No | Yes | |
| ZhejiangShangfeng | April25,2023 | 22,350 | May22,2023 | 13,687.35 | Jointandseveral | N/A | -- | 1year | No | Yes |
| Special | liability | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Blower | guarantee | |||||||||
| Industrial | ||||||||||
| Co.,Ltd.Zhejiang | ||||||||||
| Shangfeng | Jointand | |||||||||
| Special | April25, | October31, | several | |||||||
| Blower | 2023 | 30,000 | 2023 | 2,596.74 | liability | N/A | -- | 1year | No | Yes |
| Industrial | guarantee | |||||||||
| Co.,Ltd. | ||||||||||
| Zhejiang | ||||||||||
| Shangfeng | Jointand | |||||||||
| Special | April25, | March31, | several | |||||||
| Blower | 2023 | 12,000 | 2022 | 8,700 | liability | N/A | -- | 3years | No | Yes |
| Industrial | guarantee | |||||||||
| Co.,Ltd. | ||||||||||
| Zhejiang | ||||||||||
| Shangfeng | Jointand | |||||||||
| Special | April25, | July24, | several | |||||||
| Blower | 2023 | 15,000 | 2023 | 8,105.96 | liability | N/A | -- | 1year | No | Yes |
| Industrial | guarantee | |||||||||
| Co.,Ltd. | ||||||||||
| Guangdong | Jointand | |||||||||
| Infore | April25, | March1, | several | |||||||
| Technology | 2023 | 4,000 | 2021 | 12.72 | liability | N/A | -- | 1year | No | Yes |
| Co.,Ltd. | guarantee | |||||||||
| Guangdong | Jointand | |||||||||
| Infore | April25, | August | 16, | several | ||||||
| Technology | 2023 | 5,000 | 2023 | 1,079.03 | liability | N/A | -- | 1year | No | Yes |
| Co.,Ltd. | guarantee | |||||||||
| Guangdong | ||||||||||
| InforeSmart | Jointand | |||||||||
| Sanitation | April25, | 2,000 | December | several | N/A | -- | 4years | No | Yes | |
| Technology | 2023 | 1,2021 | liability | |||||||
| Co.,Ltd. | guarantee | |||||||||
| Changsha | Jointand | |||||||||
| Zhongbiao | April25, | September | several | |||||||
| Environment | 2023 | 5,000 | 11,2021 | liability | N/A | -- | 2years | No | Yes | |
| alIndustry | guarantee | |||||||||
| Co.,Ltd. | ||||||||||
| Shenzhen | ||||||||||
| Green | Jointand | |||||||||
| Oriental | February2, | 13,000 | August | 25,2,795 | several | N/A | -- | 8years | No | Yes |
| Environment | 2016 | 2016 | liability | |||||||
| alProtection | guarantee | |||||||||
| Co.,Ltd. | ||||||||||
| Shouxian | Jointand | |||||||||
| Greenlander | April30, | 9,221 | November | 7,170.3 | several | N/A | -- | 15years | No | Yes |
| NewEnergy | 2022 | 10,2022 | liability | |||||||
| Co.,Ltd. | guarantee | |||||||||
| Xiantao | ||||||||||
| Greenlander | Jointand | |||||||||
| Environment | April30, | 27,870 | June7, | 25,210 | several | N/A | -- | 13years | No | Yes |
| alPower | 2022 | 2022 | liability | |||||||
| Generation | guarantee | |||||||||
| Co.,Ltd. | ||||||||||
| Poyang | August25, | 25,000 | April26, | 25,000 | Jointand | N/A | -- | 10years | No | Yes |
| Greenlander | 2022 | 2023 | several | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Renewable | liability | |||||||||
| EnergyCo., | guarantee | |||||||||
| Ltd. | ||||||||||
| MaomingInforeEnvironmentWaterTreatmentTechnologyCo.,Ltd. | December26,2017 | 15,000 | March20,2018 | 9,435.05 | Jointandseveralliabilityguarantee | N/A | -- | 15years | No | Yes |
| LianjiangGreenlanderNewEnergyCo.,Ltd. | April30,2022 | 9,963 | November30,2020 | 7,641.49 | Jointandseveralliabilityguarantee | N/A | -- | 15years | No | Yes |
| LianjiangGreenlanderNewEnergyCo.,Ltd. | April30,2022 | 17,600 | May25,2022 | 8,648.2 | Jointandseveralliabilityguarantee | N/A | -- | 15years | No | Yes |
| Lu'anZhongfengUrbanEnvironmentalServiceCo.,Ltd. | April23,2021 | 8,000 | June8,2021 | 7,400 | Jointandseveralliabilityguarantee | N/A | -- | 13years | No | Yes |
| TongshanTongdaWaterTreatmentTechnologyCo.,Ltd. | April25,2020 | 6,000 | February1,2021 | 925 | Jointandseveralliabilityguarantee | N/A | -- | 18years | No | Yes |
| ChangdeZelianEnvironmentalServiceCo.,Ltd. | April23,2021 | 12,000 | May26,2021 | 11,700 | Jointandseveralliabilityguarantee | N/A | -- | 15years | No | Yes |
| XiantaoYingheEnvironmentalProtectionCo.,Ltd. | August21,2020 | 30,100 | January20,2021 | 12,200 | Jointandseveralliabilityguarantee | N/A | -- | 15years | No | Yes |
| BiyangFengheNewEnergyPowerCo.,Ltd. | April25,2023 | 22,000 | May23,2022 | 21,426 | Jointandseveralliabilityguarantee | N/A | -- | 14years | No | Yes |
| ChangshaZoomlionChanggaoEnvironmentalIndustryCo.,Ltd. | October24,2019 | 10,000 | March25,2020 | 3,000 | Jointandseveralliabilityguarantee | N/A | -- | 5years | No | Yes |
| XiangtanYinglianEnvironmentalIndustryCo.,Ltd. | April30,2022 | 15,000 | July5,2022 | 4,000 | Jointandseveralliabilityguarantee | N/A | -- | 10years | No | Yes |
| Tongren | April30, | 14,300 | August | 19,9,750 | Jointand | N/A | -- | 15years | No | Yes |
| BijiangDistrictZhongfengEnvironmentalIndustryCo.,Ltd. | 2022 | 2022 | severalliabilityguarantee | |||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Huai'anYingheEnvironmentTechnologyCo.,Ltd. | August25,2022 | 15,000 | December26,2022 | 5,595 | Jointandseveralliabilityguarantee | N/A | -- | 15years | No | Yes |
| InforeZoomlionUrbanEnvironmentalServiceCo.,Ltd. | April25,2023 | 3,000 | November19,2023 | Jointandseveralliabilityguarantee | N/A | -- | 1year | No | Yes | |
| ZhejiangShangfengSpecialBlowerIndustrialCo.,Ltd. | April25,2023 | 17,000 | -- | -- | -- | |||||
| GuangdongInforeTechnologyCo.,Ltd. | April25,2023 | 1,000 | -- | -- | -- | |||||
| GuangdongInforeSmartSanitationTechnologyCo.,Ltd. | April25,2023 | 1,000 | -- | -- | -- | |||||
| LianjiangGreenlanderNewEnergyCo.,Ltd. | April25,2023 | 1,200 | -- | -- | -- | |||||
| LilingZhaoyangEnvironmentalProtectionCo.,Ltd. | April25,2023 | 50,000 | -- | -- | -- | |||||
| Huai'anChenjieEnvironmentalEngineeringCo.,Ltd. | April25,2023 | 5,000 | -- | -- | -- | |||||
| Otherwholly-ownedsubsidiaries | April25,2023 | 7,000 | -- | -- | -- | |||||
| Totalapprovedlimitforthereporting | guaranteesubsidiariesduringperiod(B1) | 231,150 | Totalactualamountduringtheperiod(B2) | guaranteeforsubsidiariesreporting | 68,935.92 | |||||
| Totalapprovedlimitforendofthe | guaranteesubsidiariesatthereportingperiod | 518,204 | Totalactualbalanceforattheendof | guaranteesubsidiariesthereporting | 205,831.96 |
| (B3) | period(B4) | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Guarantees | between | subsidiaries | |||||||||||
| Guaranteedparty | Disclosuredateoftheguaranteelimitannouncement | Guaranteelimit | Actualoccurrencedate | Actualguaranteeamount | Guaranteetype | Collateral(ifany) | Counter-GuaranteeTermofCompletedguaranteeforarelatedguaranteeornot(ifany)partyornot | ||||||
| Totallimitforthereporting | approvedguaranteesubsidiariesduringperiod(C1) | 0 | Totalactualamountduringtheperiod(C2) | guaranteeforsubsidiariesreporting | 0 | ||||||||
| Totallimitforendofthe(C3) | approvedguaranteesubsidiariesatreportingperiod | the | 0 | Totalactualbalanceforattheendofperiod(C4) | guaranteesubsidiariesthereporting | 0 | |||||||
| Totalguaranteeamount(totalofthethreekindsabove) | |||||||||||||
| Totallimitduringperiod | approvedguaranteethereporting(A1+B1+C1) | 336,150 | Totalactualamountreporting(A2+B2+C2) | guaranteeduringtheperiod | 88,881.03 | ||||||||
| Totallimitatreporting(A3+B3+C3) | approvedguaranteetheendoftheperiod | 623,204 | Totalactualbalanceatreporting(A4+B4+C4) | guaranteetheendoftheperiod | 225,777.07 | ||||||||
| Totalofthe | actualguaranteesCompany'snetassets | (A4+B4+C4)asa | percentage | 12.95% | |||||||||
| Ofwhich: | |||||||||||||
| Amountactual | ofguaranteesprovidedcontrollerandtheir | forrelatedparties | shareholders,the(D) | 0 | |||||||||
| Balanceofindirectlyforassetratio | debtguaranteestheguaranteedover70%(E) | provideddirectlypartywitha | orliability-to- | 156,651.97 | |||||||||
| Totalthe | threetypes | above | (D+E+F) | 156,651.97 | |||||||||
| Descriptionwhereliabilityorassumeapplicable). | ofofguaranteesofanycasesduringthereportingperiodunexpiredguaranteecontractsledtoguaranteehadindicationsthattheCompanymayN/Ajointandseveralliabilitiesforcompensation(if |
Description of composite guarantees
3. Entrusted cash management
(1) Entrusted wealth management
Applicable □Not applicable
Overview of entrusted wealth management during the reporting period
Unit: RMB 10,000
| AccruedimpairmentUnrecoveredamountforunrecoveredoverdueamountoverduewealth | Undueamount | Entrustedamount | Fundingsource | Type |
|---|---|---|---|---|
| ---------------------------------------------------------------------------------------------------------------- | ----------------- | --------------------- | ------------------- | ------ |
| management | |||||
|---|---|---|---|---|---|
| Bank'swealthmanagementproduct | Ownfunds | 85,630 | 0 | 0 | 0 |
| Total | 85,630 | 0 | 0 | 0 |
High-risk entrusted wealth management with a materialsingle amount or low security and low liquidity
□Applicable Not Applicable
Entrusted wealth management with expected irrecoverable principal or other circumstances that may lead to impairment
□Applicable Not Applicable
(2) Entrusted loans
□Applicable Not Applicable No such cases during the reporting period.
4. Other material contracts
□Applicable Not Applicable No such cases during the reporting period.
XVI. Other Material Events
□Applicable Not Applicable No such cases during the reporting period.
XVII. Material Events ofSubsidiaries
Applicable □Not applicable
On April 29, 2022, the Proposal on the Revised Plan of Infore Environment Technology Group Co., Ltd. for the Spin-of of Zhejiang Shangfeng Special Blower Industrial Co., Ltd. to be Listed on the ChiNext Board was deliberated and approved at the 18th meeting of the Ninth Board of Directors.
On May 24, 2022, the proposal on the spin-off of Zhejiang Shangfeng Special Blower Industrial Co., Ltd. ("Shangfeng") for listing on the ChiNext market of SZSE were deliberated and approved at the Company's 2021 Annual General Meeting of Shareholders. For details, please refer to the announcement published on April 30, 2022 on the media for information disclosure designated by the Company and Cninfo (www.cninfo.com.cn).
On June 30, 2022, SZSE accepted the application for IPO and listing on the ChiNext submitted by Shangfeng. On July 25, 2022, SZSE issued the Letter on Review and Inquiry of the Application Documents of Zhejiang Shangfeng High-tech Special Wind IndustrialCo., Ltd. for IPO and Listing on the ChiNext (S.H.H. [2022] No. 010721). Shangfeng submitted its reply to the letter on December 7, 2022.
On December 15,2022, SZSE issued the Letter on the Second Round of Review and Inquiry of the Application Documents of Zhejiang Shangfeng Special Blower Industrial Co., Ltd. for IPO and Listing on the ChiNext (S.H.H. [2022] No. 011129). Shangfeng submitted its reply to the letter on March 17, 2023.
On July 21, 2023, SZSE rendered its decision (S.Z.S.S. [2023] No. 586) to terminate the review process for the intended IPO and listing of Zhejiang Shangfeng Special Blower Industrial Co., Ltd. on the ChiNext.
Part VII Share Changes and Shareholder Information
I. Share Changes
1. Share changes
Unit: Share Before change Increase/decrease (+/-)After change Quantity Ratio New issues Shares as dividend converted from profit Shares as dividend converted from capital reserves Others Sub-total Quantity Ratio I. Restricted Shares 1,838,140 0.06% 0 0 0 -365,671 -365,671 1,472,469 0.05% 1. Shares held by the State 0 0.00% 0 0 0 0 0 0 0.00% 2. Shares held by state owned corporations 0 0.00% 0 0 0 0 0 0 0.00% 3. Shares held by other domestic investors 1,838,140 0.06% 0 0 0 -365,671 -365,671 1,472,469 0.05% Including: Shares held by domestic corporations 0 0.00% 0 0 0 0 0 0 0.00% Shares held by domestic individuals 1,838,140 0.06% 0 0 0 -365,671 -365,671 1,472,469 0.05% 4. Shares held by overseas investors 0 0.00% 0 0 0 0 0 0 0.00% Including: Shares held by overseas corporations 0 0.00% 0 0 0 0 0 0 0.00% Shares held by overseas individuals 0 0.00% 0 0 0 0 0 0 0.00% II. Unrestricted Shares 3,177,667 ,419 99.94% 1,111 0 0 365,671 366,782 3,178,034,2 01 99.95% 1. RMB- 3,177,667 ,419 99.94% 1,111 0 0 365,671 366,782 3,178,034,2 01 99.95%
| denominatedcommonshares | ||||||||
|---|---|---|---|---|---|---|---|---|
| 2.Domesticallylistedforeignshares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 00.00% |
| 3.Overseaslistedforeignshares | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 00.00% |
| 4.Others | 0 | 0.00% | 0 | 0 | 0 | 0 | 0 | 00.00% |
| III.TotalNumberofShares | 3,179,505,559 | 100.00% | 1,111 | 0 | 0 | 01,111 | 3,179,506,670 | 100.00% |
Reasons for share changes
Applicable □Not applicable
-
Upon the expiry of the lock-up period due to a change in the Company's senior officer positions, the lock-up on senior officer held shares was lifted,resulting in a decrease of 365,671 restricted shares and a commensurate rise of 365,671 unrestricted shares.
-
As at December 31,2023, 16,944 shares in total were converted from the Infore Convertible Bonds issued by the Company. In particular, 1,111 shares were converted in 2023, resulting in an increase in the Company's non-restricted shares by 1,111.
Approval of changes in share capital
Applicable □Not applicable
With the approval granted by the CSRC under Document Z.J.X.K. [2020] No. 2219, the Company publicly issued 14,761,896 convertible corporate bonds on November 4, 2020, with a par value of RMB 100 and a total amount of RMB 1,476,189,600. Per approval of SZSE, the Company's convertible corporate bonds of RMB 1,476,189,600 have been listed for trading on SZSE, starting on December 2, 2020. The Infore Convertible Bonds in this offering are convertible into the Company's shares from May 10, 2021.
Transfer of shares
Applicable □Not applicable
During the reporting period, China Securities Depository and Clearing (Shenzhen) Corporation Limited handled the share registration procedures for 1,111 shares converted from convertible corporate bonds.
Effects ofshare changes on basic earnings per share, diluted earnings per share, net asset value per share attributable to the Company's common shareholders and other financial indicators ofthe prior year and the prior accounting period, respectively
□Applicable Not Applicable
Other information that the Company deems disclosable or disclosable asrequired by the securities regulatory authorities
□Applicable Not Applicable
2. Changes in restricted shares
Applicable □Not applicable
Unit: Share
| Nameofshareholder | Numberofsharesheldatthebeginningoftheperiod | Increaseofrestrictedsharesduringtheperiod | Decreaseofrestrictedsharesduringtheperiod | Numberofsharesheldattheendoftheperiod | Reasonsfortradingrestriction | Dateofliftingtradingrestriction | |
|---|---|---|---|---|---|---|---|
| Others | 1,838,140 | 0 | 365,671 | 1,472,469 | Locked-upsharesofseniorofficers | Annualrestrictionliftingunderregulations |
| Total | 1,838,140 | 0 | 365,671 | 1,472,469 | -- | -- | |
|---|---|---|---|---|---|---|---|
| -- | ------- | ----------- | --- | --------- | ----------- | ---- | ---- |
II. Issuance and Listing of Securities
1. Issuance of securities (exclusive of preference shares) during the reporting period
□Applicable Not Applicable
2. Changes in total number of shares, shareholder structure and asset and liability structures
Applicable □Not applicable
-
Upon the expiry of the lock-up period due to a change in the Company's senior officer positions, the lock-up on senior officer held shares was lifted,resulting in a decrease of 365,671 restricted shares and a commensurate rise of 365,671 unrestricted shares.
-
With the approval granted by the CSRC under Document Z.J.X.K [2020] No. 2219, the Company publicly issued 14,761,896 convertible corporate bonds on November 4, 2020, each with a par value of RMB 100 and the total issued amount is RMB 1,476,189,600. Per approval of SZSE, the Company's convertible corporate bonds ofRMB 1,476,189,600 have been listed for trading on SZSE, starting on December 2, 2020. The Infore Convertible Bonds in this offering are convertible into the Company's shares from May 10, 2021. On January 3, 2024, the Company disclosed the Announcement on Results of Conversion of Convertible Bonds and Changes in Share Capital in the Fourth Quarter of 2023. As at December 31, 2023, 16,944 shares in total were converted from the "Infore Convertible Bonds" issued by the Company. In particular, 1,111 shares were converted in 2023, resulting in an increase in nonrestricted shares by 1,111.
3. Existing internal employee shares
□Applicable Not Applicable
III. Controlling Shareholders and De Facto Controller
1. Number of shareholders and their shareholdings
Unit: Share
| Numberofshareholdersofcommonsharesattheendofthereportingperiod | 35,253 | Numberofshareholdersattheendofthemonthpriortothedisclosuredateofthisreport | 34,412 | Numberofpreferenceshareholderswithresumedvotingpowerattheendofthereportingperiod(ifany)(seeNote8) | 0 | Numberofshareholdersvotingpowerthepreviousthedisclosurereport(ifany) | preferencewithresumedattheendofmonthpriortodateofthis(seeNote8) | 0 |
|---|---|---|---|---|---|---|---|---|
| Shareholders | holdingover | 5%oftotal | sharesortop10 | shareholders | ||||
| Nameofshareholder | Natureofshareholder | Shareholdingratio | Shareholdingsattheendofthereportingperiod | Increase/decreaseduringthereportingperiod | Numberofrestrictedsharesheld | Numberofunrestrictedsharesheld | Sharespledged,frozenSharestatus | taggedorQuantity |
| Ningbo | Domestic | 32.02% | 1,017,997,38 | 0 | 0 | 1,017,997,38 | Pledged | 610,798,429 |
| InforeAssetManagementCo.,Ltd. | non-state-ownedcorporation | 2 | 2 | ||||||
|---|---|---|---|---|---|---|---|---|---|
| ZoomlionHeavyIndustryScienceandTechnologyCo.,Ltd. | Domesticnon-state-ownedcorporation | 12.56% | 399,214,659 | 0 | 0 | 399,214,659 | Notapplicable | 0 | |
| InforeGroupCo.,Ltd. | Domesticnon-state-ownedcorporation | 11.31% | 359,609,756 | 0 | 0 | 359,609,756 | Pledged | 100,000,000 | |
| Hongchuang(Shenzhen)InvestmentCenter(LimitedPartnership) | Domesticnon-state-ownedcorporation | 9.76% | 310,423,813 | 0 | 0 | 310,423,813 | Notapplicable | 0 | |
| InforeEnvironmentTechnologyGroupCo.,Ltd.-TheSecondEmployeeStockOwnershipPlan | Others | 2.04% | 64,789,616 | 0 | 0 | 64,789,616 | Notapplicable | 0 | |
| HeJianfeng | Domesticnaturalperson | 2.00% | 63,514,690 | 0 | 0 | 63,514,690 | Notapplicable | 0 | |
| ZaraGreenHongKongLimited | Foreigncorporation | 1.72% | 54,778,335 | 0 | 0 | 54,778,335 | Notapplicable | 0 | |
| ChenLiyuan | Domesticnaturalperson | 0.98% | 31,018,000 | 0 | 0 | 31,018,000 | Notapplicable | 0 | |
| GuangdongHengjianCapitalManagementHoldingCo.,Ltd. | State-ownedcorporation | 0.88% | 28,059,147 | 0 | 0 | 28,059,147 | Notapplicable | 0 | |
| HongKongSecuritiesClearingCompanyLtd. | Foreigncorporation | 0.86% | 27,190,851 | 10,888,577 | 027,190,851 | Notapplicable | 0 | ||
| Strategiccorporation10shareholderissue(ifany) | investor/generalbecomingatopinarights(seeNote3) | Notapplicable. | |||||||
| Relatedpartyconcertrelationshiptheaforementionedshareholders | oracting-in-among | NingboInforecontrollerHeisnotawareofAdministration | AssetManagementJianfeng,anyrelatedoftheTakeover | Co.,andtheyarepersonspartyorofListed | Ltd.andInforeGroupactinginacting-in-concertCompanies)among | Co.,Ltd.concertmutually.relationship(asdefinedothershareholders | sharethesamedeApartfromthat,intheMeasuresaforementioned. | factotheCompanyforthe |
| Shareholdersaboveentrusting/entrustedwithorwaivingvotingrights | Notapplicable. | ||||||
|---|---|---|---|---|---|---|---|
| Top10shareholderswithrepurchaseaccount(ifany)(seeNote10) | NA | ||||||
| Shareholdingoftop10 | unrestrictedshareholders | ||||||
| Numberof | Typeof | share | |||||
| Name | ofshareholder | unrestrictedsharesattheendofthereportingperiod | Typeofshare | Quantity | |||
| NingboInforeAssetManagement | Co.,Ltd. | 1,017,997,382 | RMB-dominatedcommonshares | 1,017,997,382 | |||
| ZoomlionHeavyIndustry | ScienceandTechnologyCo.,Ltd. | 399,214,659 | RMB-dominatedcommonshares | 399,214,659 | |||
| InforeGroupCo.,Ltd. | 359,609,756 | RMB-dominatedcommonshares | 359,609,756 | ||||
| Hongchuang(Shenzhen)Partnership) | InvestmentCenter(Limited | 310,423,813 | RMB-dominatedcommonshares | 310,423,813 | |||
| InforeEnvironmentTechnologyEmployeeStockOwnership | Co.,Ltd.-TheGroupSecondPlan | 64,789,616 | RMB-dominatedcommonshares | 64,789,616 | |||
| HeJianfeng | 63,514,690 | RMB-dominatedcommonshares | 63,514,690 | ||||
| ZaraGreenHongKongLimited | 54,778,335 | RMB-dominatedcommonshares | 54,778,335 | ||||
| ChenLiyuan | 31,018,000 | RMB-dominatedcommonshares | 31,018,000 | ||||
| GuangdongHengjianCapital | ManagementHoldingCo.,Ltd. | 28,059,147 | RMB-dominatedcommonshares | 28,059,147 | |||
| HongKongSecuritiesClearing | CompanyLtd. | 27,190,851 | RMB-dominatedcommonshares | 27,190,851 | |||
| NingboInforeAsset | ManagementCo.,Ltd. | andInforeGroupCo., | |||||
| Relatedpartyoracting-in-concert | relationshipamongtop10 | Ltd.sharethesamede | factocontrollerHe | Jianfeng,andtheyare | |||
| unrestrictedpublicshareholders, | aswellasbetweentop10 | personsactingin | concertmutually.Apartfrom | that,theCompany | |||
| unrestrictedpublicshareholders | andtop10shareholders | isnotawareofanyrelated | partyoracting-in-concert | relationship | |||
| (asdefinedintheMeasures | fortheAdministration | oftheTakeover | |||||
| ofListedCompanies)amongothershareholdersaforementioned. | |||||||
| Top10commonshareholders | involvedinsecuritiesmargin | InforeEnvironmentTechnologyGroupCo.,Ltd.-Second | |||||
| trading(ifany)(seeNote4) | EmployeeStockOwnership | Planholds64,789,616 | sharesinthe | ||||
| Companythroughcredit | accounts. |
Top ten common shareholders involved in securities lending through securities financing transactions
□Applicable Not Applicable
Changes in the top ten common shareholders compared to the previous period
Applicable □Not applicable
Unit: Share
| Changesinthetopten | commonshareholders | comparedtotheend | ofthepreviousperiod | ||
|---|---|---|---|---|---|
| Nameofshareholder | Addition/withdrawalduringthereportingperiod | Outstandingbalancethroughsecuritiestheendof | ofsecuritieslentfinancingtransactionsattheperiod | Numberofsharesgeneralandcreditlentthroughtransactionsthathavetheendof | heldinshareholders'accounts,andsecuritiessecuritiesfinancingnotbeenreturnedbytheperiod |
| Totalnumber | Asapercentageof | Totalnumber | Asapercentageof |
| totalsharecapital | totalsharecapital | ||||
|---|---|---|---|---|---|
| HongKong | |||||
| SecuritiesClearing | Addition | 0 | 0.00% | 27,190,851 | 0.86% |
| CompanyLtd. | |||||
| NingboYingtai | |||||
| Investment | |||||
| Partnership(Limited | Withdrawal | 0 | 0.00% | 10,228,414 | 0.32% |
| Partnership) |
Whether any top 10 common shareholders or top 10 unrestricted common shareholders of the Company conducted any agreed repurchase transactions during the reporting period
□Yes No
No such cases during the reporting period.
2. Controlling shareholder
Nature of controlling shareholder: Natural person
Type of controlling shareholder: Corporation
| Nameofcontrollingshareholder | Legalrepresentative/Person-in-charge | Dateofincorporation | Organizationcode | Principalbusinessactivities |
|---|---|---|---|---|
| NingboInforeAssetManagementCo.,Ltd. | WeiTing | May2,2017 | 91330206MA290L5J3L | Assetmanagement,industrialinvestment,investmentmanagement. |
| Otherdomesticallyandoverseaslistedcompaniesascontrollingshareholdersandequityparticipantsduringthereportingperiod | Notapplicable. |
Changes in controlling shareholders during the reporting period
□Applicable Not Applicable
During the reporting period, there was no change in controlling shareholders ofthe Company.
3. De facto controller and persons acting in concert
Nature of de facto controller: Domestic natural person
Type of de facto controller: Natural person
| Nameofdefactocontroller: | Relationshipwithdefactocontroller | Nationality | Residencyinothercountry/regionornot |
|---|---|---|---|
| HeJianfeng | Himself | China | Yes |
| Mainoccupationandposition | ChairmanoftheBoardand | PresidentofInforeGroupCo., | Ltd. |
| Controllinginterestsinotherdomesticallyandoverseaslistedcompaniesinthepast10years | BeijingBainationPicturesCo.,(Stockcode:603816) | Ltd.(Stockcode:300291)Jason | Furniture(Hangzhou)Co.,Ltd. |
Change in de facto controller during the reporting period
□Applicable Not Applicable
During the reporting period, there was no change in the de facto controller of the Company.
Ownership and control relationship between the de facto controller and the Company
The de facto controller controls the Company via trust or other asset management arrangement
□Applicable Not Applicable
4. The pledged shares in the Company's controlling shareholder or largest shareholder and its persons acting in concert account for 80% of their total shareholdings
□Applicable Not Applicable
5. Other corporate shareholders with a shareholding of more than 10%
| Nameofcorporateshareholder | Legalrepresentative/Person-in-charge | Dateofincorporation | Registeredcapital | Principalbusinessormanagementactivities |
|---|---|---|---|---|
| ZoomlionHeavyIndustryScienceandTechnologyCo.,Ltd. | ZhanChunxin | August31,1999 | RMB8,677,992,236 | Development,production,andsalesofengineeringmachinery,agriculturalmachinery,sanitationmachinery,cranetrucksandexclusivechassis,fireenginesandexclusivechassis,aerialworkmachines,emergencyandrescueequipment,miningmachinery,machineryincoalmines,materialtransportationfacilities,othermachinery,metalandnon-metalmaterials,andnewhigh-techproductsofoptical-electro-mechanicalintegrationandprovisionofleasingandafter-saletechnicalservices;Salesofbuildinganddecorativematerials,vehiclesforengineeringandmetalmaterials,chemicalmaterials,andchemicalproducts(excludinghazardouschemicalsandmonitoringproducts);Salesoflubricantoil,lubricatinggreaseandhydraulicoil(excludinghazardouschemicals);Retailofrefinedoilproducts(operatedbylicensedsubsidiariesonly);Operationofcommodityandtechnologyimportandexportbusinesses;Investmentinrealestatewithself-ownedassets(withoutpermittocarryoutnationalfinanciallyregulatedandfinancialcreditbusinessessuchasabsorbingdeposits,fund-raisingandcollection,entrustedloans,andissuingnotesandlending).Salesofusedvehicles;Disassemblyandrecoveryofdisused |
6. Limitations on shareholding reduction by the Company's controlling shareholder, de facto controller, reorganizer and other commitment makers
□Applicable Not Applicable
IV. Repurchase of Shares during the Reporting Period
Progress of share repurchase
□Applicable Not Applicable
Progress of reducing the repurchased shares by way of centralized bidding:
□Applicable Not Applicable
Part VIII Information on Preference Shares
□Applicable Not Applicable
During the reporting period, the Company had no preference shares.
Part IX Information on Bonds
Applicable □Not applicable
I. Enterprise Bond
□Applicable Not Applicable During the reporting period, the Company had no enterprise bonds.
II. Corporate Bond
□Applicable Not Applicable During the reporting period, the Company had no corporate bonds.
III. Debt Financing Instruments of Non-financial Enterprises
□Applicable Not Applicable
During the reporting period, the Company had no debt financing instruments ofnon-financial enterprises.
IV. Convertible Corporate Bonds
Applicable □Not applicable
1. Previous adjustments to conversion price
With the approval granted by the CSRC under Document Z.J.X.K. [2020] No. 2219, the Company publicly issued 14,761,896 convertible corporate bonds on November 4, 2020, with a par value of RMB 100 and a total amount of RMB 1,476,189,600. The initial conversion price of this tranche of convertible bonds is RMB 8.31 per share. In case ofdistribution of bonus shares, increase of share capital through conversion, issuance of new shares (excluding the increased share capital due to the conversion of convertible corporate bonds issued this time), allotment of shares and distribution of cash dividends, the conversion price will be adjusted accordingly pursuant to relevant laws and regulations.
On July 8, 2021, the Company's equity distribution for 2020 was completed. In accordance with the issuance terms of the Prospectus for Public Of ering of Convertible Corporate Bonds by Infore Environment Technology Group Co., Ltd. and the relevant regulations ofthe CSRC on the issuance of convertible bonds, the conversion price of Infore Convertible Bonds was adjusted from the original RMB 8.31 per share to RMB 8.19 per share since July 8, 2021. The adjusted conversion price took effect on July 8, 2021.
On July 20, 2022, the Company's equity distribution for 2021 was completed. In accordance with the relevant requirements of the Prospectus for Public Of ering of Convertible Corporate Bonds by Infore Environment Technology Group Co., Ltd., the conversion price of Infore Convertible Bonds was adjusted from the original RMB 8.19 per share to RMB 8.09 per share, effective on July 20, 2022. The adjusted conversion price took effect as from July 20, 2022.
On July 18, 2023, the Company's equity distribution for 2022 was completed. In accordance with the relevant requirements of the Prospectus for Public Of ering of Convertible Corporate Bonds by Infore Environment Technology Group Co., Ltd., the conversion price of Infore Convertible Bonds was adjusted from the original RMB 8.09 per share to RMB 7.98 per share, effective on July 18, 2023. The adjusted conversion price took effect on July 18, 2023.
2. Information on cumulative conversion of bonds into shares
Applicable □Not applicable
| Abbreviatednameofconvertiblebond | Startandenddateofconversion | Totalissuednumber(sheet) | Totalissuedamount(RMB) | Accumulatedconversionamount(RMB) | Accumulatedconversionnumber(share) | ThenumberofsharesconvertedasapercentageofthetotalissuedsharesintheCompanybeforestartofconversion | Amountunconverted(RMB) | Unconvertedamountasapercentageofthetotalissuedamount |
|---|---|---|---|---|---|---|---|---|
| InforeConvertibleBonds | 2021-05-10 | 14,761,896 | 1,476,189,600.00 | 138,900.00 | 16,944 | 0.00% | 1,476,050,700.00 | 99.99% |
3. Information on top 10 convertible bond holders
| No. | Nameofconvertiblebondholder | Natureofconvertiblebondholder | Numberofconvertiblebondsheldattheendofthereportingperiod(sheet) | Amountofconvertiblebondsheldattheendofthereportingperiod(RMB) | Proportionofconvertiblebondsheldattheendofthereportingperiod |
|---|---|---|---|---|---|
| 1 | RenminStable,Double-BenefitFixed-incomePensionProduct-IndustrialandCommercialBankofChinaLimited | Others | 510,449 | 51,044,900.00 | 3.46% |
| 2 | CNPCEnterpriseAnnuityProgram-IndustrialandCommercialBankofChinaLimited | Others | 469,484 | 46,948,400.00 | 3.18% |
| 3 | CITICSecurities-SanyHeavyIndustryCo.,Ltd.-CITICSecuritiesSanyZunxiangCustomizedNo.1SingleAssetManagementProgram | Others | 460,310 | 46,031,000.00 | 3.12% |
| 4 | IndustrialandCommercialBankofChinaLimited-Aegon-industrialHengyiBondSecuritiesInvestmentFund | Others | 360,000 | 36,000,000.00 | 2.44% |
| 5 | ChinaAMCYannianyishouFixed-incomePensionProduct-AgriculturalBankofChinaLimited | Others | 343,276 | 34,327,600.00 | 2.33% |
| 6 | FullgoalFuyiAggressiveFixed-incomePensionProduct-IndustrialandCommercialBankofChinaLimited | Others | 336,594 | 33,659,400.00 | 2.28% |
| 7 | ChinaAMC-HexieHealthInsuranceCo.,Ltd.-UniversalLifeInsurance-ChinaAMC-HuajingFixedIncomeNo.1SingleAssetManagementProgram | Others | 300,791 | 30,079,100.00 | 2.04% |
| 8 | CITICBankCorporationLimited-XinAoCreditBondSecuritiesInvestmentFund | Others | 300,000 | 30,000,000.00 | 2.03% |
| 9 | NationalSocialSecurityFund210Portfolio | Others | 294,176 | 29,417,600.00 | 1.99% |
| 10 | CCBCorporationEnterpriseAnnuityProgram-IndustrialandCommercialBankofChinaLimited | Others | 292,404 | 29,240,400.00 | 1.98% |
4. Information on material changes in the profitability, asset status and credit standing of guarantor
□Applicable Not Applicable
5. Change in the Company's liabilities and credit standing, and cash arrangements for debt repayment in coming years at the end of the reporting period
On June 19, 2023, China Chengxin International Credit Rating Co., Ltd. issued the Follow-up Rating Report on the Public Of ering of Convertible Corporate Bonds by Infore Environment Technology Group Co., Ltd. (2023) (X.P.W.H.Z. [2023] Track No.0566), assigning the Company a corporate credit rating of AA +, with stable rating outlook for the coming 12 to 18 months. For details, please referto the Follow-up Rating Report on Public Of ering of Convertible Corporate Bonds by the Company disclosed by the Company (2023) on June 21, 2023 on Cninfo (www.cninfo.com.cn).
The primary sources of funding for the Company to pay the principal and interest of the convertible bonds in the future are as follows: (1) The Company seeks organic growth by strengthening financial management and increasing net cash inflows and net profits from operating activities;(2) The Company has a good credit standing and a reasonable asset mix and can obtain financing from banks and other avenues to reasonably arrange for redemption funds.
V. During the Reporting Period, the Loss in the Scope of Consolidated Statements Outstripped 10% of the Net Assets atthe End of the Previous Year
□Applicable Not Applicable
VI. Overdue Interest-Bearing Debts Other Than Bonds atthe End of the Reporting Period
□Applicable Not Applicable
VII. Violation of Rules and Regulations During the Reporting Period
□Yes No
VIII. Main Accounting Data and Financial Indicators of the Company in Last Two Years as at the End of the Reporting Period
| Unit:RMB10,000 | |||
|---|---|---|---|
| Item | Attheendofthereportingperiod | Attheendoflastyear | YoYchange |
| Currentratio | 1.75 | 1.67 | 4.79% |
| Liability-to-assetratio | 38.39% | 39.40% | -1.01% |
| Quickratio | 1.62 | 1.56 | 3.85% |
| Thereportingperiod | Theprioryear | YoYchange | |
| Netprofitafterdeductingnonrecurringgainsandlosses | 44,475.34 | 32,475.34 | 36.95% |
| EBITDA/totalliabilities | 14.29% | 12.30% | 1.99% |
| Interestcoverageratio | 4.63 | 3.79 | 22.16% |
| Cash/interestcoverageratio | 13.68 | 14.07 | -2.77% |
| EBITDA/interestcoverageratio | 9.39 | 7.39 | 27.06% |
| Loanrepaymentrate | 100.00% | 100.00% | 0.00% |
| Interestcoverageratio | 100.00% | 100.00% | 0.00% |
Part X Financial Report
Audit Report
| Typeofauditopinions | Standardunqualifiedopinion |
|---|---|
| Signingdateoftheauditor'sreport | April26,2024 |
| Nameoftheauditor | Pan-ChinaCertifiedPublicAccountantsLLP(SpecialGeneralPartnership) |
| No.oftheauditor'sreport | PCCPAAR[2024]No.4373 |
| Namesofcertifiedpublicaccountants | BianShanshan,andWeiXiaohui |
Main body of the auditor's report
To the Shareholders of Infore Environment Technology Group Co.,Ltd.:
I. Audit Opinion
We have audited the financial statements of Infore Environment Technology Group Co., Ltd. (the "Company"), which comprise the consolidated and parent company balance sheets as at December 31, 2023, the consolidated and parent company income statements, consolidated and parent company cash flow statements, and consolidated and parent company statements of changes in equity for the year then ended, as well as notes to financial statements.
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2023, and its financial performance and its cash flows for the yearthen ended in accordance with China Accounting Standards for Business Enterprises.
II. Basis for Audit Opinion
We conducted our audit in accordance with China Standards on Auditing. Our responsibilities under those standards are further described in the Certified Public Accountant's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company in accordance with the China Code of Ethics for Certified Public Accountants, and we have fulfilled other ethical responsibilities. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not express a separate opinion on these matters.
(I) Revenue recognition
- Key audit matters
Please referto section III (XXVII) and section V (II) 1 of notes to the financial statements for details.
The Company is mainly engaged in sales of environmental and sanitation machinery and ventilation equipment as well as sanitation operation service. In 2023, the operating revenue amounted to 12,631.05 million yuan, with year-over-year growth of 3.06%.
As operating revenue is one of the key performance indicators of the Company, the authenticity, accuracy and completeness of revenue recognition have a significant impact on the Company's financial statements, we have identified revenue recognition as a key audit matter.
- Responsive audit procedures
Our main audit procedures for revenue recognition are as follows:
(1) We obtained understandings of key internal controls related to revenue recognition, assessed the design of these controls, determined whether they had been executed, and tested the effectiveness of the operation;
(2) We checked sales contracts with clients, obtained understandings of main contractual terms or conditions, and assessed whether the revenue recognition method conformed to China Accounting Standards for Business Enterprises;
(3) We performed analysis procedure on operating revenue and gross margin by month, product, customer, project, etc., so as to identify whether there are significant or abnormal fluctuations and find out the reason;
(4) For revenue from sales of environmental and sanitation machinery,ventilation equipment, etc., we checked supporting documents related to revenue recognition by sampling method, including sales contracts, sales invoices, outbound delivery order, delivery note, delivery receipt, etc. For revenue from sanitation operation service, we checked supporting documents related to revenue recognition by sampling method, including sales contracts, service assessment statements, supervision schedule, etc.;
(5) We performed confirmation procedures on significant clients ofproduct sales and major clients of sanitation operation service to confirm the sales amounts in the currentperiod, and the balances of current accounts;
(6) We performed cut-off tests on the operating revenue recognized around the balance sheet date, and assessed whether the operating revenue was recognized in the appropriate period;and
(7) We checked whether information related to operating revenue had been presented appropriately in the financial statements.
(II) Impairment of accounts receivable and long-term receivables
- Key audit matters
Please refer to section III (XII) and section V (I) 3, 9 and 11 of notes to the financial statements for details.
As of December 31,2023, the book balance of accounts receivable amounted to 6,647.08 million yuan, with provision for bad debts of 779.41 million yuan, and the carrying amount amounted to 5,867.67 million yuan; the book balance of long-term receivables (including those due within one year) amounted to 1,067.49 million yuan, with provision for bad debts of 92.31 million yuan, and the carrying amount amounted to 975.18 million yuan. The carrying amount of accounts receivable and long-term receivables (collectively referred to as"receivables") totaled 6,842.85 million yuan.
Based on credit risk features of receivables, the Company's management (the "Management") measures the loss allowance at the amount of lifetime expected credit losses, either on an individual basis or on a collective basis. For receivables with expected credit losses measured on an individual basis, the Management estimates the expected cash flows, so as to identify the provision for bad debts to be accrued,based on a comprehensive consideration of information with reasonableness and evidence, which is related to the past events, the current situation and the forecast of future economic conditions. For receivables with expected credit losses measured on acollective basis, the Management classifies portfolios on the basis of ages, adjusts them based on historical credit risk loss experience and forward-looking estimations, prepares the comparison table of ages and expected
credit loss rate of receivables, so as to calculate the provision for bad debts to be accrued.As the amount of receivables is significant and the impairment testing involves significant judgment of the Management, we have identified impairment of receivables as a key audit matter.
- Responsive audit procedures
Our main audit procedures for impairment of receivables are as follows:
(1) We obtained understandings ofkey internal controls related to receivables, assessed the design of these controls, determined whether they had been executed, and tested the effectiveness of the operation;
(2) We reviewed receivables with provision for bad debts made in previous periods for their subsequent write-off or reversal, and assessed the accuracy of historical estimations made by the Management;
(3) We reviewed the consideration of the Management on credit risk assessment of receivables and objective evidence, and assessed whether the credit risk features of receivables had been appropriately identified by the Management;
(4) For receivables with expected credit losses measured on an individual basis, we obtained and checked the Management's estimations on the expected future cash flows, assessed the reasonableness of key assumptions and the accuracy of data adopted in the estimations and checked them with acquired external evidence;
(5) For receivables with expected credit losses measured on a collective basis, we assessed the reasonableness of portfolio classification on the basis of credit risk features; we assessed the reasonableness of the comparison table of ages and expected credit loss rate of receivables prepared by the Management based on the historical credit loss experience of portfolios with similar credit risk features and forward-looking estimations; we tested the accuracy and completeness ofdata used by the Management (including ages, etc.) and whether the calculation of provision for bad debts was accurate;
(6) We checked the subsequent collection of receivables and assessed the reasonableness of provision for bad debts made by the Management; and
(7) We checked whether information related to impairment of receivables had been presented appropriately in the financial statements.
(III) Impairment of goodwill
- Key audit matters
Please referto section III (XXI) and section V (I) 20 of notes to the financial statements for details.
As of December 31, 2023, the cost of goodwill amounted to 6,268.85 million yuan, with provision for impairment of 623.48 million yuan, and the carrying amount amounted to 5,645.37 million yuan, accounting for 19.43% of total assets.
The Management will perform impairment test on goodwill together with related asset groups or asset group portfolios when there is evidence indicating impairment loss in asset group or asset group portfolio related to goodwill, or at the end of each period, and the recoverable amount of related asset groups or asset group portfolios is determined based on the estimated present value of future cash flows. Key assumptions adopted in the impairment test include: revenue growth rate in detailed forecast period, growth rate for stable income, profit margin, pre-tax discount rate, etc.
As the amount of goodwill is significant and impairment test involves significant judgment of the Management, we have identified impairment of goodwill as a key audit matter.
- Responsive audit procedures
Our main audit procedures for impairment of goodwill are asfollows:
(1) We obtained understandings of key internal controls related to impairment of goodwill, assessed the design of these controls, determined whether they had been executed, and tested the effectiveness of the operation;
(2) We reviewed the present value of future cash flows estimated by the Management in previous years and the actual operating results, and assessed the accuracy of the Management's historical estimations;
(3) We obtained understandings of and assessed the competency, professional quality and objectivity of external appraisers engaged by the Management;
(4) We assessed the competency, professional quality and objectivity of external appraisers engaged by us and the appropriateness oftheir works;
(5) We assessed the reasonableness and consistency of impairment test method adopted by the Management;
(6) We assessed the reasonableness of key assumptions used in impairment test and reviewed whether relevant assumptions were consistent with overall economy environment, industry condition, management situation, historical experience, operation plan, approved budget, meeting summary and other assumptions related to the financial statements used by the Management;
(7) We reviewed the sensitivity analysis on key assumptions performed by the Management, assessed the effect of changes in key assumptions on impairment test result, and identified signs of possible management bias in choosing key assumptions;
(8) We tested the accuracy, completeness and relativity of data used in the impairment test by the Management and reviewed the internal consistency of related information in the impairment test;
(9) We tested whether the calculation of estimated present value of future cash flows by the Management was accurate; and
(10) We checked whether information related to impairment of goodwill had been presented appropriately in the financial statements.
IV. Other Information
The Management is responsible for the other information. The other information comprises the information included in the Company's annual report, but does not include the financial statements and our auditor's report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements orour knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we are required to report that fact. We have nothing to report in this regard.
V. Responsibilities of the Management and Those Charged with Governance for the Financial Statements
The Management is responsible for preparing and presenting fairly the financial statements in accordance with China Accounting Standards for Business Enterprises, as well as designing, implementing and maintaining internal control relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company's financial reporting process.
VI. Certified Public Accountant's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance isa high level of assurance, but is not a guarantee that an audit conducted in accordance with China Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions ofusers taken on the basis ofthese financial statements.
We exercise professional judgment and maintain professional skepticism throughout the audit performed in accordance with China Standards on Auditing. We also:
(I) Identify and assess the risks ofmaterial misstatement of the financial statements, whether due to fraud or error, design and perform audit proceduresresponsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of i n t e r n a l c o n t r o l .
(II) Obtain an understanding of internal control relevant to the auditin order to design audit procedures that are appropriate in the circumstances.
(III) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Management.
(IV) Conclude on the appropriateness of the Management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue asa going concern.
(V) Evaluate the overall presentation, structure and content of the financial statements, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
(VI) Obtain sufficientand appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain sole responsibility for our audit opinion.
We communicate with those charged with governance regarding the planned audit scope, time schedule and significant audit findings, including any deficiencies in internal control of concern that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and
where applicable, related safeguards.From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the currentperiod and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Pan-China Certified Public Accountants LLP Chinese Certified Public Accountant: (Engagement Partner)
Hangzhou · China Chinese Certified Public Accountant:
Date of Report: April 26, 2024
The auditor's report and the accompanying financial statements are English translations of the Chinese auditor's report and statutory financial statements prepared under accounting principles and practices generally accepted in the People's Republic of China. These financial statements are not intended to present the financial position and financial performance and cash flows in accordance with accounting principles and practices generally accepted in other countries and jurisdictions. In case the English version does not conform to the Chinese version, the Chinese version prevails.
Infore Environment Technology Group Co.,Ltd. Consolidated balance sheet as at December 31, 2023 (Expressed in Renminbi Yuan)
| Assets | NoteNo. | Closingbalance | December31,2022 |
|---|---|---|---|
| Currentassets: | |||
| Cashandbankbalances | 1 | 4,411,376,583.78 | 4,728,203,530.46 |
| Settlementfunds | |||
| Loanstootherbanks | |||
| Held-for-tradingfinancialassets | |||
| Derivativefinancialassets | |||
| Notesreceivable | 2 | 4,947,131.83 | 13,565,706.22 |
| Accountsreceivable | 3 | 5,867,669,476.86 | 5,625,792,472.37 |
| Receivablesfinancing | 4 | 146,814,501.64 | 107,316,593.41 |
| Advancespaid | 5 | 140,241,046.66 | 192,360,542.24 |
| Premiumsreceivable | |||
| Reinsuranceaccountsreceivable | |||
| Reinsurancereservereceivable | |||
| Otherreceivables | 6 | 316,661,073.26 | 385,622,271.00 |
| Financialassetsunderreverserepo | |||
| Inventories | 7 | 971,229,637.15 | 881,038,036.95 |
| Contractassets | 8 | 74,803,489.48 | 101,023,854.33 |
| Assetsheldforsale | |||
| Non-currentassetsduewithinoneyear | 9 | 552,082,464.00 | 476,505,825.28 |
| Othercurrentassets | 10 | 523,880,405.80 | 497,450,797.42 |
| Totalcurrentassets | 13,009,705,810.46 | 13,008,879,629.68 | |
| Non-currentassets: | |||
| Loansandadvances | |||
| Debtinvestments | |||
| Otherdebtinvestments | |||
| Long-termreceivables | 11 | 423,098,527.59 | 932,130,871.82 |
| Long-termequityinvestments | 12 | 681,629,084.69 | 676,829,959.84 |
| Otherequityinstrumentinvestments | 13 | 15,352,971.01 | 15,352,971.01 |
| Othernon-currentfinancialassets | |||
| Investmentproperty | 14 | 1,138,868.60 | 27,105,435.03 |
| Fixedassets | 15 | 2,338,316,124.14 | 2,268,287,202.01 |
| Constructioninprogress | 16 | 288,057,018.89 | 41,073,267.68 |
| Productivebiologicalassets | |||
| Oil&gasassets | |||
| Right-of-useassets | 17 | 25,125,671.95 | 31,859,454.24 |
| Intangibleassets | 18 | 5,984,348,824.39 | 6,048,114,364.49 |
| Developmentexpenditures | 19 | 30,338,218.08 | |
| Goodwill | 20 | 5,645,365,375.67 | 5,739,602,679.79 |
| Long-termprepayments | 21 | 31,130,797.49 | 30,210,935.91 |
| Deferredtaxassets | 22 | 116,448,305.64 | 114,577,132.19 |
| Othernon-currentassets | 23 | 488,484,179.84 | 306,929,738.21 |
| Totalnon-currentassets | 16,038,495,749.90 | 16,262,412,230.30 | |
| Totalassets | 29,048,201,560.36 | 29,271,291,859.98 |
Infore Environment Technology Group Co.,Ltd. Consolidated balance sheet as at December 31, 2023 (continued) (Expressed in Renminbi Yuan)
| Liabilities&Equity | NoteNo. | Closingbalance | December31,2022 |
|---|---|---|---|
| Currentliabilities: | |||
| Short-termborrowings | 25 | 126,939,855.26 | 440,103,105.44 |
| Centralbankloans | |||
| Loansfromotherbanks | |||
| Held-for-tradingfinancialliabilities | |||
| Derivativefinancialliabilities | |||
| Notespayable | 26 | 2,294,276,551.46 | 2,515,229,293.17 |
| Accountspayable | 27 | 2,918,543,704.46 | 2,771,961,271.66 |
| Advancesreceived | |||
| Contractliabilities | 28 | 306,777,173.57 | 274,289,978.25 |
| Financialliabilitiesunderrepo | |||
| Absorbingdepositandinterbankdeposit | |||
| Depositsforagencysecuritytransaction | |||
| Depositsforagencysecurityunderwriting | |||
| Employeebenefitspayable | 29 | 490,900,839.98 | 409,574,018.72 |
| Taxesandratespayable | 30 | 124,031,931.13 | 114,968,226.88 |
| Otherpayables | 31 | 709,941,824.77 | 657,122,287.53 |
| Handlingfeesandcommissionspayable | |||
| Reinsuranceaccountspayable | |||
| Liabilitiesheldforsale | |||
| Non-currentliabilitiesduewithinoneyear | 32 | 405,027,444.29 | 561,019,099.59 |
| Othercurrentliabilities | 33 | 36,931,126.97 | 31,616,947.24 |
| Totalcurrentliabilities | 7,413,370,451.89 | 7,775,884,228.48 | |
| Non-currentliabilities: | |||
| Insurancepolicyreserve | |||
| Long-termborrowings | 34 | 1,884,356,851.73 | 1,922,306,226.32 |
| Bondspayable | 35 | 1,360,603,802.12 | 1,308,690,556.32 |
| Including:Preferredshares | |||
| Perpetualbonds | |||
| Leaseliabilities | 36 | 16,170,790.76 | 23,255,624.30 |
| Long-termpayables | 37 | 302,949,472.95 | 315,735,814.91 |
| Long-termemployeebenefitspayable | |||
| Provisions | 38 | 1,994,511.41 | 4,575,049.22 |
| Deferredincome | 39 | 115,340,494.42 | 120,890,710.04 |
| Deferredtaxliabilities | 22 | 47,219,579.85 | 54,207,628.08 |
| Othernon-currentliabilities | 40 | 8,148,148.14 | 8,333,333.33 |
| Totalnon-currentliabilities | 3,736,783,651.38 | 3,757,994,942.52 | |
| Totalliabilities | 11,150,154,103.27 | 11,533,879,171.00 | |
| Equity: | |||
| Sharecapital | 41 | 3,179,506,670.00 | 3,179,505,559.00 |
| Otherequityinstruments | 42 | 266,914,714.33 | 266,916,341.80 |
| Including:Preferredshares | |||
| Perpetualbonds | |||
| Capitalreserve | 43 | 9,661,398,721.27 | 9,662,511,254.48 |
| Less:Treasuryshares | 44 | 94,132,795.17 | 94,132,795.17 |
| Othercomprehensiveincome | 45 | -4,630,000.00 | -4,630,000.00 |
| Specialreserve | 46 | ||
| Surplusreserve | 47 | 379,017,020.19 | 315,124,767.92 |
| Generalriskreserve | |||
| Undistributedprofit | 48 | 4,049,434,826.11 | 3,963,306,890.06 |
| Totalequityattributabletotheparentcompany | 17,437,509,156.73 | 17,288,602,018.09 | |
| Non-controllinginterest | 460,538,300.36 | 448,810,670.89 | |
| Totalequity | 17,898,047,457.09 | 17,737,412,688.98 | |
| Totalliabilities&equity | 29,048,201,560.36 | 29,271,291,859.98 |
Infore Environment Technology Group Co.,Ltd. Parent company balance sheet as at December 31, 2023
(Expressed in Renminbi Yuan)
| Assets | NoteNo. | Closingbalance | December31,2022 |
|---|---|---|---|
| Currentassets: | |||
| Cashandbankbalances | 564,746,779.67 | 632,554,163.45 | |
| Held-for-tradingfinancialassets | |||
| Derivativefinancialassets | |||
| Notesreceivable | |||
| Accountsreceivable | |||
| Receivablesfinancing | 43,226,079.68 | 118,400,000.00 | |
| Advancespaid | 450,233.21 | 638,924.48 | |
| Otherreceivables | 1 | 4,470,847,162.66 | 4,492,807,441.80 |
| Inventories | |||
| Contractassets | |||
| Assetsheldforsale | |||
| Non-currentassetsduewithinoneyear | |||
| Othercurrentassets | |||
| Totalcurrentassets | 5,079,270,255.22 | 5,244,400,529.73 | |
| Non-currentassets: | |||
| Debtinvestments | |||
| Otherdebtinvestments | |||
| Long-termreceivables | |||
| Long-termequityinvestments | 2 | 16,970,439,351.38 | 17,076,616,871.15 |
| Otherequityinstrumentinvestments | 15,352,971.01 | 15,352,971.01 | |
| Othernon-currentfinancialassets | |||
| Investmentproperty | |||
| Fixedassets | |||
| Constructioninprogress | |||
| Productivebiologicalassets | |||
| Oil&gasassets | |||
| Right-of-useassets | 1,830,027.06 | 593,318.35 | |
| Intangibleassets | 744,535.28 | 1,749,936.60 | |
| Developmentexpenditures | |||
| Goodwill | |||
| Long-termprepayments | |||
| Deferredtaxassets | |||
| Othernon-currentassets | |||
| Totalnon-currentassets | 16,988,366,884.73 | 17,094,313,097.11 | |
| Totalassets | 22,067,637,139.95 | 22,338,713,626.84 |
Infore Environment Technology Group Co.,Ltd. Parent company balance sheet as at December 31, 2023 (continued) (Expressed in Renminbi Yuan)
| Liabilities&Equity | NoteNo. | Closingbalance | December31,2022 |
|---|---|---|---|
| Currentliabilities: | |||
| Short-termborrowings | 8,006,821.92 | 20,022,000.00 | |
| Held-for-tradingfinancialliabilities | |||
| Derivativefinancialliabilities | |||
| Notespayable | 34,562,159.28 | 42,395,262.51 | |
| Accountspayable | 1,137,507.93 | 1,137,507.93 | |
| Advancesreceived | |||
| Contractliabilities | |||
| Employeebenefitspayable | 3,603,061.04 | 4,221,817.88 | |
| Taxesandratespayable | 6,535,689.77 | 6,259,662.49 | |
| Otherpayables | 783,282,804.29 | 1,064,116,084.37 | |
| Liabilitiesheldforsale | |||
| Non-currentliabilitiesduewithinoneyear | 12,180,055.74 | 311,902,807.73 | |
| Othercurrentliabilities | |||
| Totalcurrentliabilities | 849,308,099.97 | 1,450,055,142.91 | |
| Non-currentliabilities: | |||
| Long-termborrowings | 48,985,720.00 | 59,871,432.00 | |
| Bondspayable | 1,360,603,802.12 | 1,308,690,556.32 | |
| Including:Preferredshares | |||
| Perpetualbonds | |||
| Leaseliabilities | 626,060.41 | ||
| Long-termpayables | 3,000,000.00 | 3,000,000.00 | |
| Long-termemployeebenefitspayable | |||
| Provisions | 1,563,887.81 | 4,114,064.16 | |
| Deferredincome | |||
| Deferredtaxliabilities | |||
| Othernon-currentliabilities | |||
| Totalnon-currentliabilities | 1,414,779,470.34 | 1,375,676,052.48 | |
| Totalliabilities | 2,264,087,570.31 | 2,825,731,195.39 | |
| Equity: | |||
| Sharecapital | 3,179,506,670.00 | 3,179,505,559.00 | |
| Otherequityinstruments | 266,914,714.33 | 266,916,341.80 | |
| Including:Preferredshares | |||
| Perpetualbonds | |||
| Capitalreserve | 15,324,662,735.39 | 15,324,654,061.79 | |
| Less:Treasuryshares | 94,132,795.17 | 94,132,795.17 | |
| Othercomprehensiveincome | -4,630,000.00 | -4,630,000.00 | |
| Specialreserve | |||
| Surplusreserve | 344,796,630.77 | 280,904,378.50 | |
| Undistributedprofit | 786,431,614.32 | 559,764,885.53 | |
| Totalequity | 19,803,549,569.64 | 19,512,982,431.45 | |
| Totalliabilities&equity | 22,067,637,139.95 | 22,338,713,626.84 |
Infore Environment Technology Group Co.,Ltd. Consolidated income statement for the year ended December 31,2023 (Expressed in Renminbi Yuan)
| Items | NoteNo. | Currentperiodcumulative | Precedingperiodcomparative | |
|---|---|---|---|---|
| I.Totaloperatingrevenue | 1 | 12,631,050,967.34 | 12,255,992,938.42 | |
| Including:Operatingrevenue | 1 | 12,631,050,967.34 | 12,255,992,938.42 | |
| Interestincome | ||||
| Premiumsearned | ||||
| Revenuefromhandlingfeesandcommissions | ||||
| II.TotaloperatingcostIncluding:Operatingcost | 1 | 11,755,419,190.669,745,482,087.92 | 11,359,383,512.759,469,510,831.27 | |
| Interestexpenses | ||||
| Handlingfeesandcommissions | ||||
| Surrendervalue | ||||
| Netpaymentofinsuranceclaims | ||||
| Netprovisionofinsurancepolicyreserve | ||||
| Premiumbonusexpenditures | ||||
| Reinsuranceexpenses | ||||
| Taxesandsurcharges | 2 | 70,091,589.07 | 74,685,022.05 | |
| SellingexpensesAdministrativeexpenses | 34 | 794,334,952.02726,159,237.45 | 762,970,847.95609,601,680.23 | |
| R&Dexpenses | 5 | 344,030,239.33 | 340,775,707.34 | |
| Financialexpenses | 6 | 75,321,084.87 | 101,839,423.91 | |
| Including:Interestexpenses | 156,635,777.38 | 170,568,834.86 | ||
| Interestincome | 99,626,077.56 | 86,389,951.68 | ||
| Add:Otherincome | 7 | 119,986,816.29 | 119,564,678.48 | |
| Investmentincome(orless:losses) | 8 | -51,597,205.92 | -41,466,125.62 | |
| Including:Investmentincomefromassociatesandjointventures | 4,960,692.79 | 8,548,481.77 | ||
| Gainsfromderecognitionoffinancialassetsatamortizedcost | ||||
| Gainsonforeignexchange(orless:losses)Gainsonnetexposuretohedgingrisk(orless:losses) | ||||
| Gainsonchangesinfairvalue(orless:losses) | ||||
| Creditimpairmentloss | 9 | -216,352,591.11 | -104,837,162.42 | |
| Assetsimpairmentloss | 10 | -123,390,769.02 | -312,998,494.66 | |
| Gainsonassetdisposal(orless:losses) | 11 | -1,191,825.82 | 532,796.72 | |
| III.Operatingprofit(orless:losses) | 603,086,201.10 | 557,405,118.17 | ||
| Add:Non-operatingrevenue | 12 | 19,846,705.60 | 12,798,235.90 | |
| Less:Non-operatingexpenditures | 13 | 13,031,066.19 | 13,947,988.82 | |
| IV.Profitbeforetax(orless:totalloss) | 609,901,840.51 | 556,255,365.25 | ||
| Less:IncometaxexpensesV.Netprofit(orless:netloss) | 14 | 97,357,651.45512,544,189.06 | 96,963,243.68459,292,121.57 | |
| (I)Categorizedbythecontinuityofoperations | ||||
| 1.Netprofitfromcontinuingoperations(orless:netloss) | 512,544,189.06 | 459,292,121.57 | ||
| 2.Netprofitfromdiscontinuedoperations(orless:netloss) | ||||
| (II)Categorizedbytheportionofequityownership | ||||
| 1.Netprofitattributabletoownersofparentcompany(orless:netloss) | 498,383,730.00 | 418,794,179.13 | ||
| 2.Netprofitattributabletonon-controllingshareholders(orless:netloss) | 14,160,459.06 | 40,497,942.44 | ||
| VI.Othercomprehensiveincomeaftertax | -350,000.00 | |||
| Itemsattributabletotheownersoftheparentcompany | -350,000.00 | |||
| (I)Not tobereclassifiedsubsequentlytoprofitorloss1.Remeasurementsofthenetdefinedbenefitplan | -350,000.00 | |||
| 2.Itemsunderequitymethodthatwillnotbereclassifiedtoprofitorloss | ||||
| 3.Changesinfairvalueofotherequityinstrumentinvestments | -350,000.00 | |||
| 4.Changesinfairvalueofowncreditrisk | ||||
| 5.Others | ||||
| (II)Tobereclassifiedsubsequentlytoprofitorloss | ||||
| 1.Itemsunderequitymethodthatmaybereclassifiedtoprofitorloss | ||||
| 2.Changesinfairvalueofotherdebt investments | ||||
| 3.Profitorlossfromreclassificationoffinancialassetsintoothercomprehensiveincome4.Provisionforcreditimpairmentofotherdebt investments | ||||
| 5.Cashflowhedgingreserve | ||||
| 6.Translationreserve | ||||
| 7.Others | ||||
| Itemsattributabletonon-controllingshareholders | ||||
| VII.Totalcomprehensiveincome | 512,544,189.06 | 458,942,121.57 | ||
| Itemsattributabletotheownersoftheparentcompany | 498,383,730.00 | 418,444,179.13 | ||
| Itemsattributabletonon-controllingshareholders | 14,160,459.06 | 40,497,942.44 | ||
| VIII.Earningspershare(EPS): | ||||
| (I)BasicEPS(yuanpershare) | 0.16 | 0.13 | ||
| (II)DilutedEPS(yuanpershare) | 0.16 | 0.13 |
Infore Environment Technology Group Co.,Ltd.
Parent company income statement for the year ended December 31, 2023
(Expressed in Renminbi Yuan)
| Items | NoteNo. | Currentperiodcumulative | Precedingperiodcomparative | |
|---|---|---|---|---|
| I.Operatingrevenue | 1 | 156,799.03 | 818,861.05 | |
| Less:Operatingcost | 1 | 45,108.06 | 818,861.05 | |
| Taxesandsurcharges | 8,724.82 | 24,479.22 | ||
| Sellingexpenses | 188,548.41 | |||
| Administrativeexpenses | 32,795,434.31 | 37,210,341.13 | ||
| R&Dexpenses | ||||
| Financialexpenses | -46,439,991.45 | -26,702,758.90 | ||
| Including:Interestexpenses | 6,683,662.60 | 17,704,428.72 | ||
| Interestincome | 114,151,812.97 | 105,355,828.68 | ||
| Add:Otherincome | 90,205.68 | 134,351.98 | ||
| Investmentincome(orless:losses) | 2 | 627,767,256.36 | 192,483,839.36 | |
| Including:Investmentincomefromassociatesandjointventures | 32,220,248.17 | 25,737,537.83 | ||
| Gainsfromderecognitionoffinancialassetsatamortizedcost | ||||
| Gainsonnetexposuretohedgingrisk(orless:losses) | ||||
| Gainsonchangesinfairvalue(orless:losses) | ||||
| Creditimpairmentloss | -4,535,721.98 | 304,725.02 | ||
| Assetsimpairmentloss | ||||
| Gainsonassetdisposal(orless:losses) | ||||
| II.Operatingprofit(orless:losses) | 637,069,263.35 | 182,202,306.50 | ||
| Add:Non-operatingrevenue | 1,853,259.39 | 1,496,537.14 | ||
| Less:Non-operatingexpenditures | ||||
| III.Profitbeforetax(orless:totalloss) | 638,922,522.74 | 183,698,843.64 | ||
| Less:Incometaxexpenses | ||||
| IV.Netprofit(orless:netloss) | 638,922,522.74 | 183,698,843.64 | ||
| (I)Netprofitfromcontinuingoperations(orless:netloss) | 638,922,522.74 | 183,698,843.64 | ||
| (II)Netprofitfromdiscontinuedoperations(orless:netloss) | ||||
| V.Othercomprehensiveincomeaftertax | -350,000.00 | |||
| (I)Nottobereclassifiedsubsequentlytoprofitorloss | -350,000.00 | |||
| 1.Remeasurementsofthenetdefinedbenefitplan | ||||
| 2.Itemsunderequitymethodthatwillnotbereclassifiedtoprofitorloss | ||||
| 3.Changesinfairvalueofotherequityinstrumentinvestments | -350,000.00 | |||
| 4.Changesinfairvalueofowncreditrisk | ||||
| 5.Others | ||||
| (II)Tobereclassifiedsubsequentlytoprofitorloss | ||||
| 1.Itemsunderequitymethodthatmaybereclassifiedtoprofitorloss | ||||
| 2.Changesinfairvalueofotherdebtinvestments | ||||
| 3.Profitorlossfromreclassificationoffinancialassetsintoothercomprehensiveincome | ||||
| 4.Provisionforcreditimpairmentofotherdebtinvestments | ||||
| 5.Cashflowhedgingreserve | ||||
| 6.Translationreserve | ||||
| 7.Others | ||||
| VI.Totalcomprehensiveincome | 638,922,522.74 | 183,348,843.64 | ||
| VII.Earningspershare(EPS): | ||||
| (I)BasicEPS(yuanpershare) | ||||
| (II)DilutedEPS(yuanpershare) |
Infore Environment Technology Group Co.,Ltd. Consolidated cash flow statement for the year ended December 31, 2023
| (ExpressedinRenminbiYuan) | |||
|---|---|---|---|
| Items | NoteNo. | Currentperiodcumulative | Precedingperiodcomparative |
| I.Cashflowsfromoperatingactivities: | |||
| Cashreceiptsfromsaleofgoodsorrenderingofservices | 12,453,986,179.20 | 11,979,875,703.49 | |
| Netincreaseofclientdepositandinterbankdeposit | |||
| Netincreaseofcentralbankloans | |||
| Netincreaseofloansfromotherfinancialinstitutions | |||
| Cashreceiptsfromoriginalinsurancecontractpremium | |||
| Netcashreceiptsfromreinsurance | |||
| Netincreaseofpolicy-holderdepositandinvestment | |||
| Cashreceiptsfrominterest,handlingfeesandcommissions | |||
| Netincreaseofloansfromothers | |||
| Netincreaseofrepurchase | |||
| Netcashreceiptsfromagencysecuritytransaction | |||
| Receiptsoftaxrefund | 30,441,488.60 | 178,294,936.92 | |
| Othercashreceiptsrelatedtooperatingactivities | 1.(1) | 1,780,673,734.46 | 2,097,066,618.34 |
| Subtotalofcashinflowsfromoperatingactivities | 14,265,101,402.26 | 14,255,237,258.75 | |
| Cashpaymentsforgoodspurchasedandservicesreceived | 7,623,799,094.31 | 7,399,369,111.76 | |
| Netincreaseofloansandadvancestoclients | |||
| Netincreaseofcentralbankdepositandinterbankdeposit | |||
| Cashpaymentsforinsuranceindemnitiesoforiginalinsurancecontracts | |||
| Netincreaseofloanstoothers | |||
| Cashpaymentsforinterest,handlingfeesandcommissions | |||
| Cashpaymentsforpolicybonus | |||
| Cashpaidtoandonbehalfofemployees | 2,522,411,850.58 | 2,062,334,468.26 | |
| Cashpaymentsfortaxesandrates | 534,381,305.14 | 734,988,426.49 | |
| Othercashpaymentsrelatedtooperatingactivities | 1.(2) | 2,198,952,642.74 | 2,396,062,964.53 |
| Subtotalofcashoutflowsfromoperatingactivities | 12,879,544,892.77 | 12,592,754,971.04 | |
| Netcashflowsfromoperatingactivities | 1,385,556,509.49 | 1,662,482,287.71 | |
| II.Cashflowsfrominvestingactivities: | |||
| Cashreceiptsfromwithdrawalofinvestments | |||
| Cashreceiptsfrominvestmentincome | 17,581,018.93 | 24,671,510.32 | |
| Netcashreceiptsfromthedisposaloffixedassets,intangibleassetsandotherlong-termassets | 22,804,215.79 | 16,999,998.22 | |
| Netcashreceiptsfromthedisposalofsubsidiaries&otherbusinessunits | 115,100,000.00 | ||
| Othercashreceiptsrelatedtoinvestingactivities | 1.(3) | 1,650,769,977.00 | 5,401,861,000.00 |
| Subtotalofcashinflowsfrominvestingactivities | 1,691,155,211.72 | 5,558,632,508.54 | |
| Cashpaymentsfortheacquisitionoffixedassets,intangibleassetsandotherlong-termassets | 1,119,006,242.88 | 1,083,515,734.97 | |
| Cashpaymentsforinvestments | 4,900,000.00 | 130,189,561.55 | |
| Netincreaseofpledgedborrowings | |||
| Netcashpaymentsfortheacquisitionofsubsidiaries&otherbusinessunits | 43,472.96 | 83,807,513.74 | |
| Othercashpaymentsrelatedtoinvestingactivities | 1.(4) | 1,642,935,617.97 | 5,398,900,000.00 |
| Subtotalofcashoutflowsfrominvestingactivities | 2,766,885,333.81 | 6,696,412,810.26 | |
| Netcashflowsfrominvestingactivities | -1,075,730,122.09 | -1,137,780,301.72 | |
| III.Cashflowsfromfinancingactivities: | |||
| Cashreceiptsfromabsorbinginvestments | 7,119,980.00 | 57,744,844.02 | |
| Including:Cashreceivedbysubsidiariesfromnon-controllingshareholdersasinvestments | 7,119,980.00 | 34,345,285.00 | |
| Cashreceiptsfromborrowings | 1,430,455,757.80 | 2,033,074,142.02 | |
| Othercashreceiptsrelatedtofinancingactivities | 1.(5) | 48,692,000.00 | 290,555,211.59 |
| Subtotalofcashinflowsfromfinancingactivities | 1,486,267,737.80 | 2,381,374,197.63 | |
| Cashpaymentsfortherepaymentofborrowings | 1,946,364,301.72 | 1,732,314,139.87 | |
| Cashpaymentsfordistributionofdividendsorprofitsandforinterestexpenses | 471,087,036.44 | 451,503,767.45 | |
| Including:Cashpaidbysubsidiariestonon-controllingshareholdersasdividendorprofit | 7,622,681.40 | 11,792,867.41 | |
| Othercashpaymentsrelatedtofinancingactivities | 1.(6) | 44,749,906.87 | 263,396,824.36 |
| Subtotalofcashoutflowsfromfinancingactivities | 2,462,201,245.03 | 2,447,214,731.68 | |
| Netcashflowsfromfinancingactivities | -975,933,507.23 | -65,840,534.05 | |
| IV.Effectofforeignexchangeratechangesoncashandcashequivalents | 1,587,128.38 | 3,056,908.33 | |
| V.Netincreaseincashandcashequivalents | -664,519,991.45 | 461,918,360.27 | |
| Add:Openingbalanceofcashandcashequivalents | 4,580,665,245.99 | 4,118,746,885.72 | |
| VI.Closingbalanceofcashandcashequivalents | 3,916,145,254.54 | 4,580,665,245.99 |
Infore Environment Technology Group Co.,Ltd.
Parent company cash flow statement for the year ended December 31, 2023
(Expressed in Renminbi Yuan)
| Items | Currentperiod | Precedingperiod | |
|---|---|---|---|
| cumulative | comparative | ||
| I.Cashflowsfromoperatingactivities: | |||
| Cashreceiptsfromsaleofgoodsandrenderingofservices | 118,392.43 | ||
| Receiptsoftaxrefund | 1,008,139.39 | ||
| Othercashreceiptsrelatedtooperatingactivities | 448,771,549.67 | 622,328,508.84 | |
| Subtotalofcashinflowsfromoperatingactivities | 449,898,081.49 | 622,328,508.84 | |
| Cashpaymentsforgoodspurchasedandservicesreceived | |||
| Cashpaidtoandonbehalfofemployees | 12,214,656.58 | 20,656,924.48 | |
| Cashpaymentsfortaxesandrates | 19,920.85 | 24,479.22 | |
| Othercashpaymentsrelatedtooperatingactivities | 448,609,614.55 | 727,589,122.93 | |
| Subtotalofcashoutflowsfromoperatingactivities | 460,844,191.98 | 748,270,526.63 | |
| Netcashflowsfromoperatingactivities | -10,946,110.49 | -125,942,017.79 | |
| II.Cashflowsfrominvestingactivities: | |||
| Cashreceiptsfromwithdrawalofinvestments | 115,100,000.00 | ||
| Cashreceiptsfrominvestmentincome | 355,469,611.94 | 221,911,743.60 | |
| Netcashreceiptsfromthedisposaloffixedassets,intangibleassetsandotherlongtermassets | |||
| Netcashreceiptsfromthedisposalofsubsidiaries&otherbusinessunits | |||
| Othercashreceiptsrelatedtoinvestingactivities | 1,133,866,191.35 | 1,416,859,323.47 | |
| Subtotalofcashinflowsfrominvestingactivities | 1,489,335,803.29 | 1,753,871,067.07 | |
| Cashpaymentsfortheacquisitionoffixedassets,intangibleassetsandotherlongtermassets | |||
| Cashpaymentsforinvestments | 96,546,250.00 | ||
| Netcashpaymentsfortheacquisitionofsubsidiaries&otherbusinessunits | |||
| Othercashpaymentsrelatedtoinvestingactivities | 1,020,256,248.67 | 1,441,321,272.72 | |
| Subtotalofcashoutflowsfrominvestingactivities | 1,020,256,248.67 | 1,537,867,522.72 | |
| Netcashflowsfrominvestingactivities | 469,079,554.62 | 216,003,544.35 | |
| III.Cashflowsfromfinancingactivities: | |||
| Cashreceiptsfromabsorbinginvestments | 23,399,559.02 | ||
| Cashreceiptsfromborrowings | 108,000,000.00 | 96,200,000.00 | |
| Othercashreceiptsrelatedtofinancingactivities | 228,995,320.75 | ||
| Subtotalofcashinflowsfromfinancingactivities | 108,000,000.00 | 348,594,879.77 | |
| Cashpaymentsfortherepaymentofborrowings | 430,885,712.00 | 155,585,856.00 | |
| Cashpaymentsfordistributionofdividendsorprofitsandforinterestexpenses | 367,220,162.26 | 340,633,373.24 | |
| Othercashpaymentsrelatedtofinancingactivities | 1,258,782.48 | 181,368,993.06 | |
| Subtotalofcashoutflowsfromfinancingactivities | 799,364,656.74 | 677,588,222.30 | |
| Netcashflowsfromfinancingactivities | -691,364,656.74 | -328,993,342.53 | |
| IV.Effectofforeignexchangeratechangesoncashandcashequivalents | |||
| V.Netincreaseincashandcashequivalents | -233,231,212.61 | -238,931,815.97 | |
| Add:Openingbalanceofcashandcashequivalents | 631,351,957.34 | 870,283,773.31 | |
| VI.Closingbalanceofcashandcashequivalents | 398,120,744.73 | 631,351,957.34 |
Infore Environment Technology Group Co.,Ltd. Consolidated statement of changes in equity for the year ended December 31, 2023 (Expressed in Renminbi Yuan)
| Currentperiod | cumulative | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity | attributableto | parentcompany | |||||||||||
| Items | Other | equityinstruments | Other | General | Non-controlling | Totalequity | |||||||
| Sharecapital | Preferredshares | Perpetualbonds | Others | Capitalreserve | Less:Treasuryshares | comprehensiveincome | Specialreserve | Surplusreserve | riskreserve | Undistributedprofit | interest | ||
| I.Balanceattheendofprioryear | 3,179,505,559.00 | 266,916,341.80 | 9,662,511,254.48 | 94,132,795.17 | -4,630,000.00 | 315,124,767.92 | 3,963,306,890.06 | 448,810,670.89 | 17,737,412,688.98 | ||||
| Add:Cumulativechangesofaccountingpolicies | |||||||||||||
| Errorcorrectionofpriorperiod | |||||||||||||
| Businesscombinationundercommoncontrol | |||||||||||||
| Others | |||||||||||||
| II.Balanceatthebeginningofcurrentyear | 3,179,505,559.00 | 266,916,341.80 | 9,662,511,254.48 | 94,132,795.17 | -4,630,000.00 | 315,124,767.92 | 3,963,306,890.06 | 448,810,670.89 | 17,737,412,688.98 | ||||
| III.Currentperiodincrease(orless:decrease) | 1,111.00 | -1,627.47 | -1,112,533.21 | 63,892,252.27 | 86,127,936.05 | 11,727,629.47 | 160,634,768.11 | ||||||
| (I)Totalcomprehensiveincome | 498,383,730.00 | 14,160,459.06 | 512,544,189.06 | ||||||||||
| (II)Capitalcontributedorwithdrawnbyowners | 1,111.00 | -1,627.47 | -1,112,533.21 | 5,189,851.81 | 4,076,802.13 | ||||||||
| 1.Ordinarysharescontributedbyowners | 8,619,980.00 | 8,619,980.00 | |||||||||||
| 2.Capitalcontributedbyholdersofotherequityinstruments | 1,111.00 | -1,627.47 | 8,673.60 | 8,157.13 | |||||||||
| 3.Amountofshare-basedpaymentincludedinequity | |||||||||||||
| 4.Others | -1,121,206.81 | -3,430,128.19 | -4,551,335.00 | ||||||||||
| (III)Profitdistribution | 63,892,252.27 | -412,255,793.95 | -7,622,681.40 | -355,986,223.08 | |||||||||
| 1.Appropriationofsurplusreserve | 63,892,252.27 | -63,892,252.27 | |||||||||||
| 2.Appropriationofgeneralriskreserve | |||||||||||||
| 3.Appropriationofprofittoowners | -348,363,541.68 | -7,622,681.40 | -355,986,223.08 | ||||||||||
| 4.Others | |||||||||||||
| (IV)Internalcarry-overwithinequity | |||||||||||||
| 1.Transferofcapitalreservetocapital | |||||||||||||
| 2.Transferofsurplusreservetocapital | |||||||||||||
| 3.Surplusreservetocoverlosses | |||||||||||||
| 4.Changesindefinedbenefitplancarriedovertoretainedearnings | |||||||||||||
| 5.Othercomprehensiveincomecarriedovertoretained | |||||||||||||
| earnings | |||||||||||||
| 6.Others | |||||||||||||
| (V)Specialreserve | |||||||||||||
| 1.Currentperiodappropriation | 8,608,843.62 | 8,608,843.62 | |||||||||||
| 2.Currentperioduse | -8,608,843.62 | -8,608,843.62 | |||||||||||
| (VI)Others | |||||||||||||
| IV.Balanceattheendofcurrentperiod | 3,179,506,670.00 | 266,914,714.33 | 9,661,398,721.27 | 94,132,795.17 | -4,630,000.00 | 379,017,020.19 | 4,049,434,826.11 | 460,538,300.36 | 17,898,047,457.09 |
Infore Environment Technology Group Co.,Ltd. Consolidated statement of changes in equity for the year ended December 31, 2023 (continued) (Expressed in Renminbi Yuan)
| Precedingperiod | comparative | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equityattributabletoparentcompany | |||||||||||||
| Items | Otherequityinstruments | Other | General | Non-controlling | Totalequity | ||||||||
| Sharecapital | Preferredshares | Perpetualbonds | Others | Capitalreserve | Less:Treasuryshares | comprehensiveincome | Specialreserve | Surplusreserve | riskreserve | Undistributedprofit | interest | ||
| I.Balanceattheendofprioryear | 3,175,734,760.00 | 266,929,289.24 | 9,772,795,863.75 | 455,303,777.91 | -4,280,000.00 | 296,754,883.56 | 3,874,934,971.69 | 357,221,037.38 | 17,284,787,027.71 | ||||
| Add:Cumulativechangesofaccountingpolicies | |||||||||||||
| Errorcorrectionofpriorperiod | |||||||||||||
| Businesscombinationundercommoncontrol | |||||||||||||
| Others | |||||||||||||
| II.Balanceatthebeginningofcurrentyear | 3,175,734,760.00 | 266,929,289.24 | 9,772,795,863.75 | 455,303,777.91 | -4,280,000.00 | 296,754,883.56 | 3,874,934,971.69 | 357,221,037.38 | 17,284,787,027.71 | ||||
| III.Currentperiodincrease(orless:decrease) | 3,770,799.00 | -12,947.44 | -110,284,609.27 | -361,170,982.74 | -350,000.00 | 18,369,884.36 | 88,371,918.37 | 91,589,633.51 | 452,625,661.27 | ||||
| (I)Totalcomprehensiveincome | -350,000.00 | 418,794,179.13 | 40,497,942.44 | 458,942,121.57 | |||||||||
| (II)Capitalcontributedorwithdrawnbyowners | 3,770,799.00 | -12,947.44 | -110,284,609.27 | -361,170,982.74 | 60,341,209.93 | 314,985,434.96 | |||||||
| 1.Ordinarysharescontributedbyowners | 3,761,991.00 | -112,538,093.97 | -361,170,982.74 | 46,970,675.00 | 299,365,554.77 | ||||||||
| 2.Capitalcontributedbyholdersofotherequityinstruments | 8,808.00 | -12,947.44 | 66,691.53 | 62,552.09 | |||||||||
| 3.Amountofshare-basedpaymentincludedinequity | 3,868,552.56 | 170,516.82 | 4,039,069.38 | ||||||||||
| 4.Others | -1,681,759.39 | 13,200,018.11 | 11,518,258.72 | ||||||||||
| (III)Profitdistribution | 18,369,884.36 | -330,422,260.76 | -9,249,518.86 | -321,301,895.26 | |||||||||
| 1.Appropriationofsurplusreserve | 18,369,884.36 | -18,369,884.36 | |||||||||||
| 2.Appropriationofgeneralriskreserve | |||||||||||||
| 3.Appropriationofprofittoowners | -312,052,376.40 | -9,249,518.86 | -321,301,895.26 | ||||||||||
| 4.Others | |||||||||||||
| (IV)Internalcarry-overwithinequity | |||||||||||||
| 1.Transferofcapitalreservetocapital | |||||||||||||
| 2.Transferofsurplusreservetocapital | |||||||||||||
| 3.Surplusreservetocoverlosses | |||||||||||||
| 4.Changesindefinedbenefitplancarriedovertoretainedearnings | |||||||||||||
| 5.Othercomprehensiveincomecarriedovertoretained | |||||||||||||
| earnings | |||||||||||||
| 6.Others | |||||||||||||
| (V)Specialreserve | |||||||||||||
| 1.Currentperiodappropriation | 8,693,981.54 | 8,693,981.54 | |||||||||||
| 2.Currentperioduse | -8,693,981.54 | -8,693,981.54 | |||||||||||
| (VI)Others | |||||||||||||
| IV.Balanceattheendofcurrentperiod | 3,179,505,559.00 | 266,916,341.80 | 9,662,511,254.48 | 94,132,795.17 | -4,630,000.00 | 315,124,767.92 | 3,963,306,890.06 | 448,810,670.89 | 17,737,412,688.98 |
Infore Environment Technology Group Co.,Ltd. Parent company statement of changes in equity for the year ended December 31, 2023 (Expressed in Renminbi Yuan)
| Currentperiodcumulative | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Items | Otherequity | instruments | Other | ||||||||
| Sharecapital | Preferredshares | Perpetualbonds | Others | Capitalreserve | Less:Treasuryshares | comprehensiveincome | Specialreserve | Surplusreserve | Undistributedprofit | Totalequity | |
| I.Balanceattheendofprioryear | 3,179,505,559.00 | 266,916,341.80 | 15,324,654,061.79 | 94,132,795.17 | -4,630,000.00 | 280,904,378.50 | 559,764,885.53 | 19,512,982,431.45 | |||
| Add:Cumulativechangesofaccountingpolicies | |||||||||||
| Errorcorrectionofpriorperiod | |||||||||||
| Others | |||||||||||
| II.Balanceatthebeginningofcurrentyear | 3,179,505,559.00 | 266,916,341.80 | 15,324,654,061.79 | 94,132,795.17 | -4,630,000.00 | 280,904,378.50 | 559,764,885.53 | 19,512,982,431.45 | |||
| III.Currentperiodincrease(orless:decrease) | 1,111.00 | -1,627.47 | 8,673.60 | 63,892,252.27 | 226,666,728.79 | 290,567,138.19 | |||||
| (I)Totalcomprehensiveincome | 638,922,522.74 | 638,922,522.74 | |||||||||
| (II)Capitalcontributedorwithdrawnbyowners | 1,111.00 | -1,627.47 | 8,673.60 | 8,157.13 | |||||||
| 1.Ordinarysharescontributedbyowners | |||||||||||
| 2.Capitalcontributedbyholdersofotherequityinstruments | 1,111.00 | -1,627.47 | 8,673.60 | 8,157.13 | |||||||
| 3.Amountofshare-basedpaymentincludedinequity | |||||||||||
| 4.Others | |||||||||||
| (III)Profitdistribution | 63,892,252.27 | -412,255,793.95 | -348,363,541.68 | ||||||||
| 1.Appropriationofsurplusreserve | 63,892,252.27 | -63,892,252.27 | |||||||||
| 2.Appropriationofprofittoowners | -348,363,541.68 | -348,363,541.68 | |||||||||
| 3.Others | |||||||||||
| (IV)Internalcarry-overwithinequity | |||||||||||
| 1.Transferofcapitalreservetocapital | |||||||||||
| 2.Transferofsurplusreservetocapital | |||||||||||
| 3.Surplusreservetocoverlosses | |||||||||||
| 4.Changesindefinedbenefitplancarriedovertoretainedearnings | |||||||||||
| 5.Othercomprehensiveincomecarriedovertoretainedearnings | |||||||||||
| 6.Others | |||||||||||
| (V)Specialreserve | |||||||||||
| 1.Currentperiodappropriation | |||||||||||
| 2.Currentperioduse | |||||||||||
| (VI)Others | |||||||||||
| IV.Balanceattheendofcurrentperiod | 3,179,506,670.00 | 266,914,714.33 | 15,324,662,735.39 | 94,132,795.17 | -4,630,000.00 | 344,796,630.77 | 786,431,614.32 | 19,803,549,569.64 |
Infore Environment Technology Group Co.,Ltd. Parent company statement of changes in equity for the year ended December 31, 2023 (continued) (Expressed in Renminbi Yuan)
| Precedingperiodcomparative | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Items | Otherequityinstruments | Other | |||||||||
| Sharecapital | Preferredshares | Perpetualbonds | Others | Capitalreserve | Less:Treasuryshares | comprehensiveincome | Specialreserve | Surplusreserve | Undistributedprofit | Totalequity | |
| I.Balanceattheendofprioryear | 3,175,734,760.00 | 266,929,289.24 | 15,433,256,911.67 | 455,303,777.91 | -4,280,000.00 | 262,534,494.14 | 706,488,302.65 | 19,385,359,979.79 | |||
| Add:Cumulativechangesofaccountingpolicies | |||||||||||
| Errorcorrectionofpriorperiod | |||||||||||
| Others | |||||||||||
| II.Balanceatthebeginningofcurrentyear | 3,175,734,760.00 | 266,929,289.24 | 15,433,256,911.67 | 455,303,777.91 | -4,280,000.00 | 262,534,494.14 | 706,488,302.65 | 19,385,359,979.79 | |||
| III.Currentperiodincrease(orless:decrease) | 3,770,799.00 | -12,947.44 | -108,602,849.88 | -361,170,982.74 | -350,000.00 | 18,369,884.36 | -146,723,417.12 | 127,622,451.66 | |||
| (I)Totalcomprehensiveincome | -350,000.00 | 183,698,843.64 | 183,348,843.64 | ||||||||
| (II)Capitalcontributedorwithdrawnbyowners | 3,770,799.00 | -12,947.44 | -108,602,849.88 | -361,170,982.74 | 256,325,984.42 | ||||||
| 1.Ordinarysharescontributedbyowners | 3,761,991.00 | -112,538,093.97 | -361,170,982.74 | 252,394,879.77 | |||||||
| 2.Capitalcontributedbyholdersofotherequityinstruments | 8,808.00 | -12,947.44 | 66,691.53 | 62,552.09 | |||||||
| 3.Amountofshare-basedpaymentincludedinequity | 3,868,552.56 | 3,868,552.56 | |||||||||
| 4.Others | |||||||||||
| (III)Profitdistribution | 18,369,884.36 | -330,422,260.76 | -312,052,376.40 | ||||||||
| 1.Appropriationofsurplusreserve | 18,369,884.36 | -18,369,884.36 | |||||||||
| 2.Appropriationofprofittoowners | -312,052,376.40 | -312,052,376.40 | |||||||||
| 3.Others | |||||||||||
| (IV)Internalcarry-overwithinequity | |||||||||||
| 1.Transferofcapitalreservetocapital | |||||||||||
| 2.Transferofsurplusreservetocapital | |||||||||||
| 3.Surplusreservetocoverlosses | |||||||||||
| 4.Changesindefinedbenefitplancarriedovertoretainedearnings | |||||||||||
| 5.Othercomprehensiveincomecarriedovertoretainedearnings | |||||||||||
| 6.Others | |||||||||||
| (V)Specialreserve | |||||||||||
| 1.Currentperiodappropriation | |||||||||||
| 2.Currentperioduse | |||||||||||
| (VI)Others | |||||||||||
| IV.Balanceattheendofcurrentperiod | 3,179,505,559.00 | 266,916,341.80 | 15,324,654,061.79 | 94,132,795.17 | -4,630,000.00 | 280,904,378.50 | 559,764,885.53 | 19,512,982,431.45 |
Infore Environment Technology Group Co., Ltd. Notes to FinancialStatements
For the year ended December 31, 2023
Monetary unit: RMB Yuan
I. Company profile
Infore Environment Technology Group Co., Ltd. (the "Company"), formerly known as Zhejiang Shangfeng Industrial Co., Ltd., was registered at Zhejiang Administration for Industry and Commerce on November 18, 1993. Under the approval of Zhejiang Share System Pilot WorkCoordination Group with document of approval numbered Zhe Gu [1993] 51,the Company was established by Zhejiang Fan Air Cooling Equipment Co., Ltd., the main initiator, and Shangyu Fan Factory and Shaoxing Fluid Engineering Research Institute, the joint initiators, through targeted fundraising. Headquartered in Shaoxing City, Zhejiang Province, the Company currently holds a business license with unified social credit code of 913300006096799222. As of December 31, 2023, it has registered capital of 3,179,505,559.00 yuan, and total share capitalof 3,179,506,670.00 yuan. The difference between the registered capital and share capital is because the change related to new share capital has not been registered at the administration for market regulation. According to the records in China Securities Depository and Clearing Corporation Limited, as of December 31, 2023, the Company has restricted outstanding shares of 1,472,469 shares, and unrestricted outstanding shares of 3,178,034,201 shares, totaling 3,179,506,670.00 shares. The Company's shares were listed on the Shenzhen Stock Exchange on March 30, 2000.
The Company belongs to the ecological protection and environmental management industry. The main business activities include R&D, maintenance and operation services of environmental monitoring instruments and environmental protection equipment, environmental treatment technology development, consulting and services, operation services of environmental treatment facilities, environmental engineering, environmental protection engineering, urban engineering, sale of ventilators, air-cooling, water-cooling and air-conditioning equipment, etc. Its revenue ismainly from sales of environmentaland sanitation machinery, ventilation equipment,and sanitation operation service.
The financial statements were approved and authorized for issue by the sixth meeting of the tenth session of the Board of Directors dated April 26, 2024.
The Company has brought 278 subsidiaries including Changsha Zoomlion Environmental Industry Co., Ltd. (the "Zoomlion Environmental Company"), Zhejiang Shangfeng Special Blower Industrial Co., Ltd. (the "Shangfeng Industrial Company"), Guangdong Infore Technology Co., Ltd. (the "Infore Technology Company") and Shenzhen Green Oriental Environmental Protection Co., Ltd. (the "Green Oriental Company") into the consolidation scope. Please referto section VII of notes to the financial statements for details.
II. Preparation basis of the financial statements
(I) Preparation basis
The financial statements have been prepared on the basis of going concern.
(II) Assessment of the ability to continue as a going concern
The Company has no events orconditions that may cast significant doubts upon the Company's ability to continue as a going concern within the 12 months after the balance sheet date.
III. Significant accounting policies and estimates
Important note: The Company has set up accounting policies and estimates on transactions or events such as impairment of financial instruments, depreciation of fixed assets, depreciation of right-of-use assets, amortization of intangible assets, revenue recognition, etc., based on the Company's actual production and operation features.
(I) Statement of compliance
The financial statements have been prepared in accordance with the requirements of China Accounting Standards for Business Enterprises (CASBEs), and present truly and completely the financial position, financial performance and cash flows of the Company.
(II) Accounting period
The accounting year of the Company runs from January 1 to December 31 under the Gregorian calendar.
(III) Operating cycle
The Company has a relatively short operating cycle for its business, an asset or a liability is classified as current if it is expected to be realized or due within 12 months.(IV) Functional currency
The Company's functional currency is Renminbi (RMB) Yuan.
(V) Determination method and basis for selection of materiality
The Company prepares and discloses financial statements in compliance with the principle of materiality. The items disclosed in notes to the financial statements involving materiality judgements, determination method and basis for selection of materiality are as follows:
| Discloseditemsinvolvingmaterialityjudgements | NoteNo. | Determinationmethodandbasisforselectionofmateriality |
|---|---|---|
| Significantaccountsreceivablewithprovisionforbaddebtsmadeonanindividualbasis | V(I)3(2)2) | Accountsreceivablewithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantaccountsreceivable. |
| Significantaccountsreceivablewrittenoff | V(I)3(4)2) | Accountsreceivablewrittenoffwithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantaccountsreceivablewrittenoff. |
| Significantadvancespaidwithageoveroneyear | V(I)5(1)2) | Advancespaidwithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantadvancespaid. |
| Significantotherreceivableswithprovisionforbaddebtsmadeonanindividualbasis | V(I)6(3)2) | Otherreceivableswithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantotherreceivables. |
| Significantotherreceivableswrittenoff | V(I)6(5)2) | Otherreceivableswrittenoffwithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantotherreceivableswrittenoff. |
| Significantconstructioninprogress | V(I)16(2) | Constructioninprogresswithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantconstructioninprogress. |
| Significantaccountspayablewithageoveroneyear | V(I)27(1)2) | Accountspayablewithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantaccountspayable. |
| Significantcontractliabilitieswithageoveroneyear | V(I)28(2) | Contractliabilitieswithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantcontractliabilities. |
| Significantotherpayableswithageoveroneyear | V(I)31(2) | Otherpayableswithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantotherpayables. |
| Significantcashflowsfrominvestingactivities | V(III)1 | Cashflowsfrominvestingactivitieswithsingleamountinexcessof10%oftotalassetsareidentifiedassignificantcashflowsfrominvestingactivities. |
| SignificantcapitalizedR&DprojectsandoutsourcedR&Dprojects | VI(II)2 | CapitalizedR&DprojectsandoutsourcedR&Dprojectswithsingleamountinexcessof0.3%oftotalassetsareidentifiedassignificantcapitalizedR&DprojectsandoutsourcedR&Dprojects. |
| Significantsubsidiaries,notwholly-ownedsubsidiaries | VII(I)2 | Subsidiarieswithtotalassetsinexcessof15%ofthegroup'stotalassetsareidentifiedassignificantsubsidiariesorsignificantnotwholly-ownedsubsidiaries. |
| Significantjointventures,associatesandjointoperations | VII(V) | Jointventuresandassociateswiththeamountofsinglelong-termequityinvestmentinexcessof0.5%ofthetotalassetsareidentifiedassignificantjointventures,associatesorjointoperations. |
(VI) Accounting treatments ofbusiness combination under and not under common control
- Accounting treatment of business combination under common control
Assets and liabilities arising from business combination are measured at carrying amount of the combined party included in the consolidated financial statements of the ultimate controlling party at the combination date. Difference between carrying amount of the equity of the combined party included in the consolidated financial statements of the ultimate controlling party and that of the combination consideration or total par value of shares issued is adjusted to capital reserve, if the balance of capital reserve is insufficient to offset, any excess is adjusted to retained earnings.
- Accounting treatment of business combination not under common control
When combination cost is in excess of the fair value of identifiable net assets obtained from the acquiree at the acquisition date, the excess is recognized as goodwill; otherwise, the fair value of identifiable assets, liabilities and contingent liabilities, and the measurement of the combination cost are reviewed, then the difference is recognized in profit or loss.
(VII) Judgement criteria for control and compilation method of consolidated financial statements
- Judgement of control
An investor controls an investee if and only if the investor has all the following: (1) power over the investee; (2) exposure, or rights, to variable returns from its involvement with the investee; and (3) the ability to use its power over the investee to affect the amount of the investor's returns.
- Compilation method of consolidated financial statements
The parent company brings allits controlled subsidiaries into the consolidation scope. The consolidated financial statements are compiled by the parent company according to "CASBE 33 – Consolidated Financial Statements", based on relevant information and the financial statements of the parent company and its subsidiaries.
(VIII) Classification of joint arrangements and accounting treatment of joint operations
-
Joint arrangements include joint operations and joint ventures.
-
When the Company is a joint operator of a joint operation, it recognizes the following items in relation to its interest in a joint operation:
(1) its assets, including its share of any assets held jointly;
(2) its liabilities, including its share of any liabilities incurred jointly;
(3) its revenue from the sale of its share of the output arising from the joint operation;
(4) its share of the revenue from the sale of the assets by the joint operation; and
(5) its expenses, including its share of any expenses incurred jointly.
(IX) Recognition criteria of cash and cash equivalents
Cash as presented in cash flow statement refers to cash on hand and deposit on demand for payment. Cash equivalents refer to short-term,highly liquid investments that can be readily converted to cash and that are subject to an insignificant risk of changes in value.
(X) Foreign currency translation
- Translation of transactions denominated in foreign currency
Transactions denominated in foreign currency are translated into RMB yuan at the spotexchange rate atthe transaction date at initial recognition. At the balance sheet date, monetary items denominated in foreign currency are translated at the spot exchange rate at the balance sheet date with difference, except for those arising from the principal and interest of exclusive borrowings eligible for capitalization, included in profit or loss; non-cash items carried at historical costs are translated at the spot exchange rate at the transaction date, with the RMB amounts
unchanged; non-cash items carried at fair value in foreign currency are translated at the spot exchange rate at the date when the fair value was determined, with difference included in profit or loss orother comprehensive income.
2. Translation of financial statements measured in foreign currency
The assets and liabilities in the balance sheet are translated into RMB at the spot exchange rate at the balance sheet date; the equity items, other than undistributed profit, are translated at the spot exchange rate at the transaction date; the revenues and expenses in the income statement are translated into RMB at the spot exchange rate atthe transaction date. The difference arising from the aforementioned foreign currency translation is included in other comprehensive income.
(XI) Financial instruments
1. Classification of financial assets and financial liabilities
Financial assets are classified into the following three categories when initially recognized: (1) financial assets at amortized cost; (2) financial assets at fair value through other comprehensive income; (3) financial assets at fair value through profit or loss.
Financial liabilities are classified into the following four categories when initially recognized: (1) financial liabilities at fair value through profit or loss; (2) financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuing involvement approach applies; (3) financial guarantee contracts not fall within the above categories (1) and (2), and commitments to provide a loan ata below-market interest rate, which do not fall within the above category (1); (4)financial liabilities at amortized cost.
- Recognition criteria, measurement method and derecognition of financial assets and financial liabilities
(1) Recognition criteria and measurement method of financial assets and financial liabilities
When the Company becomes a party to a financial instrument, it is recognized as a financial asset or financial liability. The financial assets and financial liabilities initially recognized by the Company are measured at fair value; for the financial assets and liabilities at fair value through profit or loss, the transaction expenses thereof are directly included in profit or loss; for other categories of financial assets and financial liabilities, the transaction expenses thereof are included into the initially recognized amount. However, at initial recognition, for accounts receivable that do not contain a significant financing component or in circumstances where the Company doesnot consider the financing components in contracts within one year, they are measured at the transaction price in accordance with "CASBE 14 – Revenues".(2) Subsequent measurement of financial assets
- Financial assets measured at amortized cost
The Company measures its financial assets at the amortized costs using effective interest method. Gains or losses on financial assets that are measured at amortized cost and are not part of hedging relationships shall be included into profit or loss when the financial assets are derecognized, reclassified, amortized using effective interest method or recognized with impairment loss.
2) Debt instrument investments at fair value through other comprehensive income
The Company measures its debtinstrument investments at fair value. Interests, impairment gains or losses, and
gains and losses on foreign exchange that calculated using effective interest method shall be included into profit or loss, while other gains or losses are included into other comprehensive income. Accumulated gains or losses that initially recognized as other comprehensive income should be transferred out into profit or loss when the financial assets are derecognized.
- Equity instrument investments at fair value through other comprehensive income
The Company measures its equity instrument investments at fair value. Dividends obtained (other than those aspart of investment cost recovery) shall be included into profit or loss, while other gains orlosses are included into other comprehensive income.Accumulated gains or losses that initially recognized as other comprehensive income should be transferred out into retained earnings when the financial assets are derecognized.
4) Financial assets at fair value through profit or loss
The Company measures its financial assets at fair value. Gains or losses arising from changes in fair value (including interests and dividends) shall be included into profit or loss, except for financial assets that are part of hedging relationships.
(3) Subsequent measurement of financial liabilities
1) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss include held-for-trading financial liabilities (including derivatives that are liabilities) and financial liabilities designated as at fair value through profit or loss. The Company measures such kind of liabilities at fair value. The amount of changes in the fair value of the financial liabilities thatare attributable to changes in the Company's own credit risk shall be included into other comprehensive income,unless such treatmentwould create or enlarge accounting mismatches in profit or loss. Other gains or losses on those financial liabilities (including interests, changes in fair value that are attributable to reasons other than changes in the Company's own credit risk) shall be included into profit or loss, except for financial liabilities that are part of hedging relationships. Accumulated gains or losses that originally recognized as other comprehensive income should be transferred out into retained earnings when the financial liabilities are derecognized.
- Financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuing involvement approach applies
The Company measures its financial liabilities in accordance with "CASBE 23 – Transfer of Financial Assets".
- Financial guarantee contracts not fall within the above categories 1) and 2), and commitments to provide a loan at a below-market interest rate, which do not fall within the above category 1)
The Company measures its financial liabilities at the higher of: a. the amount of loss allowances in accordance with impairment requirements of financial instruments; b. the amount initially recognized lessthe amount of accumulated amortization recognized in accordance with "CASBE 14 –Revenues".
4) Financial liabilities at amortized cost
The Company measures its financial liabilities at amortized cost using effective interest method. Gains orlosses on financial liabilities that are measured at amortized cost and are not part of hedging relationships shall be included
into profit or loss when the financial liabilities are derecognized and amortized using effective interest method.
(4) Derecognition of financial assets and financial liabilities
- Financial assets are derecognized when:
a. the contractual rights to the cash flows from the financial assets expire; or
b. the financial assets have been transferred and the transfer qualifies for derecognition in accordance with "CASBE 23 – Transfer of Financial Assets".
- Only when the underlying present obligations of a financial liability are relieved totally or partly may the financial liability be derecognized accordingly.
3. Recognition criteria and measurement method of financial assets transfer
Where the Company has transferred substantially all of the risks and rewards related to the ownership of the financial asset, it derecognizes the financial asset, and any right or liability arising from such transfer is recognized independently as an asset or a liability. If it retained substantially all of the risks and rewards related to the ownership of the financial asset, it continues recognizing the financial asset. Where the Company doesnot transfer or retain substantially all of the risks and rewards related to the ownership of a financial asset, it is dealt with according to the circumstances as follows respectively: (1) if the Company does not retain its control over the financial asset, it derecognizes the financial asset, and any right or liability arising from such transfer is recognized independently as an asset or a liability; (2) if the Company retains its control over the financial asset, according to the extent of its continuing involvement in the transferred financial asset, it recognizes the related financial asset and recognizes the relevant liability accordingly.
If the transfer of an entire financial asset satisfies the conditions for derecognition, the difference between the amounts ofthe following two items is included in profit or loss: (1) the carrying amount of the transferred financial asset as ofthe date of derecognition; (2) the sum of consideration received from the transfer of the financial asset, and the accumulative amount of the changes of the fair value originally included in other comprehensive income proportionate to the transferred financial asset (financial assets transferred refer to debt instrument investments at fair value through other comprehensive income). If the transfer of financial asset partially satisfies the conditions for derecognition, the entire carrying amount of the transferred financial asset is, between the portion which is derecognized and the portion which is not, apportioned according to their respective relative fair value, and the difference between the amounts of the following two items is included into profit or loss: (1) the carrying amount of the portion which is derecognized; (2) the sum of consideration of the portion which is derecognized, and the portion of the accumulative amount of the changes in the fair value originally included in other comprehensive income which is corresponding to the portion which is derecognized (financial assets transferred refer to debt instrument investments at fair value through other comprehensive income).
4. Fair value determination method of financial assets and liabilities
The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data and information are available to measure fair value. The inputs to valuation techniques used to measure fair value are arranged in the following hierarchy and used accordingly:
(1) Level 1 inputs are unadjusted quoted prices in active markets for identical assets orliabilities that the Company can access at the measurement date;
(2) Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include: quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability, for example, interest rates and yield curves observable at commonly quoted intervals; market-corroborated inputs;
(3) Level 3 inputs are unobservable inputs for the asset or liability. Level 3 inputs include interest rate that is not observable and cannot be corroborated by observable market data at commonly quoted intervals, historical volatility, future cash flows to be paid to fulfill the disposal obligation assumed in business combination, financial forecast developed using the Company's own data, etc.
5. Impairment of financial instruments
The Company, on the basis ofexpected credit loss, recognizes loss allowances offinancial assets at amortized cost, debt instrument investments at fair value through other comprehensive income, contract assets, leases receivable, loan commitments other than financial liabilities at fair value through profit or loss, financial guarantee contracts not belong to financial liabilities at fair value through profit or loss or financial liabilities that arise when a transfer of a financial asset does not qualify for derecognition or when the continuing involvement approach applies.
Expected credit losses refer to the weighted average of credit losses with the respective risks of a default occurring as the weights.Credit loss refers to the difference between all contractual cash flows thatare due to the Company in accordance with the contract and all the cash flows that the Company expects to receive (i.e., all cash shortfalls), discounted at the original effective interest rate. Among which, purchased or originated credit-impaired financial assets are discounted at the credit-adjusted effective interestrate.
At the balance sheet date, the Company shall only recognize the cumulative changes in the lifetime expected credit losses since initial recognition as a loss allowance for purchased or originated credit-impaired financial assets.
For leases receivable, and accounts receivable and contract assets resulting from transactions regulated in "CASBE 14 – Revenues", the Company chooses simplified approach to measure the loss allowance at an amount equal to lifetime expected credit losses.
For financial assets other than the above, on each balance sheet date, the Company shall assess whether the credit risk on the financial instrument has increased significantly since initial recognition. The Company shall measure the loss allowance for the financial instrument at an amount equal to the lifetime expected credit losses if the credit risk on that financial instrument has increased significantly since initial recognition; otherwise, the Company shall measure the loss allowance for thatfinancial instrument at an amount equal to 12-month expected credit loss.
Considering reasonable and supportable forward-looking information, the Company compares the risk of a default occurring on the financial instrument as at the balance sheet date with the risk of a default occurring on the financial instrument as at the date of initial recognition, so as to assess whether the credit risk on the financial
instrument has increased significantly since initial recognition.
The Company may assume that the credit risk on a financial instrument has not increased significantly since initial recognition if the financial instrument is determined to have relatively low credit risk at the balance sheet date.
The Company shall estimate expected credit risk and measure expected credit losses on an individual or a collective basis. When the Company adopts the collective basis, financial instruments are grouped with similarcredit risk features.
The Company shall remeasure expected credit loss on each balance sheet date, and increased or reversed amounts of loss allowance arising therefrom shall be included into profit or loss as impairment losses or gains. For a financial asset measured at amortized cost, the loss allowance reduces the carrying amount of such financial asset presented in the balance sheet; for a debt investment measured at fair value through other comprehensive income, the loss allowance shall be recognized in other comprehensive income and shall not reduce the carrying amount of such financial asset.
- Offsetting financial assets and financial liabilities
Financial assets and financial liabilities are presented separately in the balance sheet and are not offset. However, the Company offsets a financial asset and a financial liability and presents the net amount in the balance sheet when, and only when,the Company: (1) currently has a legally enforceable right to set off the recognized amounts; and (2) intends either to settle on a net basis, or to realize the asset and settle the liability simultaneously.
For a transfer of a financial asset that does not qualify for derecognition, the Company does not offset the transferred asset and the associated liability.
(XII) Recognition criteria and accrual method for expected credit losses ofreceivables and contract assets
- Receivables and contract assets with expected credit losses measured on a collective basis using similarcredit risk features
| Categories | Basisfordeterminationofportfolio | Methodformeasuringexpectedcreditloss |
|---|---|---|
| Bankacceptancereceivable | Typeofnotes | Basedonhistoricalcreditlossexperience,thecurrentsituationandtheforecastoffutureeconomicconditions,theCompanycalculates |
| Tradeacceptancereceivable | expectedcreditlossthroughexposureatdefaultandlifetimeexpectedcreditlossrate. | |
| Accountsreceivable–Portfoliogroupedwithbalancesduefromrelatedpartieswithintheconsolidationscope | Balancesduefromrelatedpartieswithintheconsolidationscope | Basedonhistoricalcreditlossexperience,thecurrentsituationandtheforecastoffutureeconomicconditions,theCompanycalculatesexpectedcreditlossthroughexposureatdefaultandlifetimeexpectedcreditlossrate. |
| Accountsreceivable–Portfoliogroupedwithages | Ages | Basedonhistoricalcreditlossexperience,thecurrentsituationandtheforecastoffutureeconomicconditions,theCompanypreparesthecomparisontableofagesandlifetimeexpectedcreditlossrateofaccountsreceivable,soastocalculateexpectedcreditloss. |
| Accountsreceivable–Portfolio | Natureofreceivables | Basedonhistoricalcreditlossexperience,the |
| Categories | Basisfordeterminationofportfolio | Methodformeasuringexpectedcreditloss | |
|---|---|---|---|
| groupedwithgovernmentsubsidiesfornewenergyvehicles | currentsituationandtheforecastoffutureeconomicconditions,theCompanycalculatesexpectedcreditlossthroughexposureatdefaultandlifetimeexpectedcreditlossrate. | ||
| Otherreceivables–Portfoliogroupedwithbalancesduefromrelatedpartieswithintheconsolidationscope | Balancesduefromrelatedpartieswithintheconsolidationscope | Basedonhistoricalcreditlossexperience,thecurrentsituationandtheforecastoffuture | |
| Otherreceivables–Portfoliogroupedwithperformancecompensations | Natureofreceivables | economicconditions,theCompanycalculatesexpectedcreditlossthroughexposureatdefaultand12-monthorlifetimeexpectedcreditlossrate. | |
| Otherreceivables–Portfoliogroupedwithbuyer'scredit | Natureofreceivables | ||
| Otherreceivables–Portfoliogroupedwithages | Ages | Basedonhistoricalcreditlossexperience,thecurrentsituationandtheforecastoffutureeconomicconditions,theCompanypreparesthecomparisontableofagesandexpectedcreditlossrateofotherreceivables,soastocalculateexpectedcreditloss. | |
| Long-termreceivables–Portfoliogroupedwithfinanceleasepayment/Long-termreceivables–Portfoliogroupedwithreceivablesfinancingfactoringpayment/Accountsreceivable–Portfoliogroupedwithcommercialfactoringpayment | Natureofreceivables | Expectedcreditlossratesarecalculatedbasedonfive-levelclassificationofcreditassetsofnon-bankfinancialinstitutions:1.5%forpasscategory,3%forspecial-mentioncategory,30%forsubstandardcategory,60%fordoubtfulcategory,and100%forlosscategory | |
| Long-termreceivables–Portfoliogroupedwithages | Natureofreceivables | Forlong-termreceivableswithinthecreditperiodthathasnotreachedthecontractualpaymentdeadline,provisionforbaddebtsisaccruedat5%ofthebalance.Forlong-termreceivablesthathaveexceededthecontractualpaymentdeadlineandhavenotyetbeenpaid,provisionforbaddebtsisaccruedbasedontheageofthebalance. | |
| Contractassets–Portfoliogroupedwithwarrantyreserve | Natureofthebalance | Basedonhistoricalcreditlossexperience,thecurrentsituationandtheforecastoffutureeconomicconditions,theCompanycalculatesexpectedcreditlossthroughexposureatdefaultandlifetimeexpectedcreditlossrate. |
| Expectedcredit | Expectedcreditlossrate | Expectedcredit | Expectedcreditlossrate | |
|---|---|---|---|---|
| lossrateof | ofaccountsreceivableof | lossrateof | ofotherreceivablesof | |
| accounts | ventilationequipment | other | ventilationequipment | |
| Ages | receivableof | manufacturingindustry | receivablesof | manufacturingindustry |
| parentcompany | andenvironmental | parentcompany | andenvironmental | |
| (%) | integratedindustry(%) | (%) | integratedindustry(%) | |
| 1-180days(inclusive,thesamehereinafter) | 0 | 5 | 0 | 5 |
| 180days-1year | 2 | 5 | 2 | 5 |
| 1-2years | 10 | 10 | 10 | 10 |
| 2-3years | 30 | 30 | 30 | 30 |
| 3-5years | 50 | 50 | 50 | 50 |
| Over5years | 80 | 100 | 80 | 100 |
| agesandexpectedcreditlossrateofportfoliogroupedwithages |
|---|
| ------------------------------------------------------------------------------------------------- |
Ages ofaccounts receivable, other receivables and long-term receivables arecalculated from the month when such receivables are accrued.
- Recognition criteria for receivables and contract assets with expected credit losses measured on an individual basis
For receivables and contract assets whose credit risk is significantly different from that of portfolios, the Company accrues expected credit losses on an individualbasis.
(XIII) Inventories
- Classification of inventories
Inventories include finished goods or goods held for sale in the ordinary course of business, work in process in the process of production, materials, supplies, etc. to be consumed in the production process or in the rendering of services.
- Accounting method for dispatched inventories
Inventories dispatched from storage are accounted for with weighted average method.
- Inventory system
Perpetual inventory method is adopted.
-
- Amortization method of low-value consumables and packages
- (1) Low-value consumables
- Low-value consumables are amortized with one-offmethod.
- (2) Packages
Packages are amortized with one-off method.
- Provision for inventory write-down
Recognition criteria and accrual method of provision for inventory write-down
At the balance sheet date, inventories are measured at the lower of cost and net realizable value; provisions for inventory write-down are made on the excess of its cost over the net realizable value. The net realizable value of inventories held for sale is determined based on the amount of the estimated selling price less the estimated selling expenses and relevant taxes and surcharges in the ordinary course of business; the net realizable value of inventories to be processed is determined based on the amount of the estimated selling price less the estimated costs of completion, selling expenses and relevant taxes and surcharges in the ordinary course of business; at the balance sheet date, when only part of the same item of inventories have agreed price, their net realizable value are determined separately and are compared with their costs to set the provision for inventory write-down to be made or reversed.
(XIV) Non-current assets ordisposal groups held for sale, discontinued operations
- Classification of non-current assets or disposal groups held for sale
Non-current assets or disposal groups are accounted for as held for sale when the following conditions are all met: (1) the asset must be available for immediate sale in its present condition subject to terms that are usual and customary for sales of such assets or disposal groups; (2) its sales must be highly probable, i.e., the Company has made a decision on the sale plan and has obtained a firm purchase commitment, and the sale isexpected to be completed within one year.
When the Company acquires a non-current asset or disposal group with a view to resale, it shall classify the non-current asset or disposal group as held for sale at the acquisition date only if the requirement of "expected to be completed within one year" ismet at that date and it is highly probable that other criteria for held for sale will be met within a short period (usually within three months).
An asset or a disposal group is still accounted for as held for sale when the Company remains committed to its plan to sell the asset or disposal group in the circumstance that non-related party transactions fail to be completed within one year due to one of the following reasons: (1) a buyer or others unexpectedly set conditions that will extend the sale period, while the Company has taken timely actions to respond to the conditions and expects a favorable resolution of the delaying factors within one year since the setting; (2) a non-current asset or disposal group classified as held for sale fails to be sold within one yeardue to rare cases, and the Company has taken action necessary to respond to the circumstances during the initial one-year period and the criteria for held for sale are met.
- Accounting treatments of non-current assets ordisposal groups held for sale
(1) Initial measurement and subsequent measurement
For initial measurement and subsequent measurement as at the balance sheet date of a non-current asset or disposal group held for sale, where the carrying amount is higher than the fair value less costs to sell, the carrying amount is written down to the fair value less costs to sell, and the write-down is recognized in profit or loss as assets impairment loss, meanwhile, provision for impairment of assets held for sale shall be made.
For a non-current asset or disposal group classified as held for sale at the acquisition date, the asset or disposal group is measured on initial recognition at the lower of its initial measurement amount had it not been so classified and fair value less costs to sell. Apart from the non-current asset or disposal group acquired through business
combination, the difference arising from the initial recognition of a non-current asset or disposal group at the fair value less costs to sell shall be included into profitor loss.
The assets impairment loss recognized for a disposal group held for sale shall reduce the carrying amount of goodwill in the disposal group first, and then reduce its carrying amount based on the proportion of each non current asset's carrying amount in the disposal group.
No provision for depreciation or amortization shall be made on non-current assets held for sale or non-current assets in disposal groups held for sale, while interest and other expenses attributable to the liabilities of a disposal group held for sale shall continue to be recognized.
(2) Reversal of assets impairment loss
When there is a subsequent increase in fair value less costs to sell of a non-current asset held for sale at the balance sheet date, the write-down shall be recovered, and shall be reversed not in excess of the impairment loss that has been recognized after the non-current asset was classified as held for sale. The reversal shall be included into profit or loss. Assets impairment loss that has been recognized before the classification is not reversed.
When there isa subsequent increase in fair value less costs to sell of a disposal group held for sale at the balance sheet date, the write-down shall be recovered, and shall be reversed not in excess of the non-current assets impairment loss that has been recognized after the disposal group was classified as held for sale. The reversal shall be included into profit or loss. The reduced carrying amount of goodwill and non-current assets impairment loss that has been recognized before the classification is not reversed.
For the subsequent reversal of the impairment loss that has been recognized in a disposal group held for sale, the carrying amount is increased based on the proportion of carrying amount of each non-current asset (excluding goodwill) in the disposal group.
(3) Non-current asset or disposal group that is no longer classified as held for sale and derecognized
A non-current asset or disposal group that does not meet criteria for held for sale and no longer classified as held for sale, or a non-current asset that removed from a disposal group held for sale shall be measured at the lower of: 1) its carrying amount before it was classified as held for sale, adjusted for any depreciation, amortization or impairment that would have been recognized had it not been classified as held for sale; and 2) its recoverable amount.
When a non-current asset or disposal group classified as held for sale is derecognized, unrecognized gains orlosses shall be included into profit or loss.
3. Recognition criteria of discontinued operations
A component of the Company that has been disposed of, or is classified as held for sale and can be clearly distinguished is recognized as a discontinued operation when it fulfills any of the following conditions:
(1) it represents a separate major line of business ora separate geographical area of operations;
(2) it is part of a related plan to dispose of a separate major line of business or a separate geographical area of
operations; or
(3) it is a subsidiary acquired exclusively with a review to resale.
4. Presentation method of discontinued operations
The Company presents gains or losses from continuing operations and gains orlosses from discontinued operations separately in the income statement. Operating gains or losses including impairment loss of discontinued operations and its reversal amount, and gains or losses on disposal are presented as gains or losses from discontinued operations. For discontinued operations presented in the current period, the information previously presented as gains or losses from continuing operations is reclassified as gains or losses from discontinued operations for the comparative period in the currentfinancial statements. For discontinued operations that no longer meet criteria for held for sale, the information previously presented as gains orlosses from discontinued operations is reclassified as gains or losses from continuing operations for the comparative period in the current financial statements.
(XV) Long-term equity investments
1. Judgment of joint control and significant influence
Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control of these policies.2. Determination of investment cost
(1) For business combination under common control, if the consideration of the combining party is that it makes payment in cash, transfers non-cash assets, assumes its liabilities or issues equity securities, on the date of combination, it regards the share of the carrying amount of the equity of the combined party included in the consolidated financial statements of the ultimate controlling party as the initial cost of the investment. The difference between the initial cost of the long-term equity investments and the carrying amount of the combination consideration paid or the par value of shares issued offsets capital reserve; if the balance of capital reserve is insufficient to offset, any excess is adjusted to retained earnings.
When long-term equity investments are obtained through business combination under common control achieved in stages, the Company determines whether it is a "bundled transaction". If it is a "bundled transaction", stages as a whole are considered as one transaction in accounting treatment. If it is not a "bundled transaction", on the date of combination, investment cost is initially recognized at the share of the carrying amount of net assets of the combined party included the consolidated financial statements of the ultimate controlling party. The difference between the initial investment cost of long-term equity investments at the acquisition date and the carrying amount of the previously held long-term equity investments plus the carrying amount of the consideration paid for the newly acquired equity is adjusted to capital reserve; if the balance of capital reserve isinsufficient to offset, any excess is adjusted to retained earnings.
(2) For business combination not under common control, investment cost is initially recognized at the acquisition date fair value of considerations paid.
When long-term equity investments are obtained through business combination not under common control achieved in stages, the Company determined whether they are stand-alone financial statements or consolidated financial statements in accounting treatment:
-
In the case of stand-alone financial statements, investment cost is initially recognized at the carrying amount of the previously held long-term equity investments plus the carrying amount of the consideration paid for the newly acquired equity.
-
In the case of consolidated financial statements, the Company determines whether it is a "bundled transaction". If it is a "bundled transaction", stages as a whole are considered as one transaction in accounting treatment. If it is not a "bundled transaction", the carrying amount of the acquirer's previously held equity interest in the acquiree is remeasured at the acquisition-date fair value, and the difference between the fair value and the carrying amount is recognized in investment income; when the acquirer's previously held equity interest in the acquiree involves other comprehensive income under equity method, the related other comprehensive income is reclassified as income for the acquisition period, excluding other comprehensive income arising from changes in net liabilities or assets from remeasurement of defined benefit plan of the acquiree.
(3) Long-term equity investments obtained through ways other than business combination: the initial cost of a longterm equity investment obtained by making payment in cash is the purchase cost which is actually paid; that obtained on the basis of issuing equity securities is the fair value of the equity securities issued; that obtained through debt restructuring is determined according to "CASBE 12 –Debt Restructuring"; and that obtained through non-cash assets exchange is determined according to "CASBE 7 – Non-cash Assets Exchange".
- Subsequent measurement and recognition method of profit or loss
For a long-term equity investment with control relationship, it is accounted for with cost method; for a long-term equity investment with joint control or significant influence relationship, it is accounted for with equity method.
- Disposal of a subsidiary in stages resulting in the Company's loss ofcontrol
(1) Judgement principles of"bundled transaction"
For disposal of a subsidiary in stages resulting in the Company's loss ofcontrol, the Company determines whether it is a "bundled transaction" based on the agreement terms for each stage, disposal consideration obtained separately, object of the equity sold, disposal method, disposal time point, etc. If the terms, conditions and economic effect of each transaction meet one or more of the following conditions,these transactions are usually considered as a "bundled transaction":
-
these transactions are entered into at the same time or in contemplation of each other;
-
these transactions form a single transaction designed to achieve an overall commercial effect;
-
the occurrence of one transaction is dependent on the occurrence of at least one other transaction; and
-
one transaction considered on its own is not economically justified, but it is economically justified when considered together with other transactions.
(2) Accounting treatments ofnon-bundled transactions
1) Stand-alone financial statements
The difference between the carrying amount of the disposed equity and the consideration obtained thereof is recognized in profit or loss. If the disposal does not result in the Company's loss of significant influence or joint control, the remained equity is accounted for with equity method; however, if the disposal results in the Company's loss ofcontrol, joint control, or significant influence, the remained equity is accounted for according to "CASBE 22 – Financial Instruments: Recognition and Measurement".
2) Consolidated financial statements
Before the Company's loss ofcontrol, the difference between the disposal consideration and the proportionate share of net assets in the disposed subsidiary from acquisition date or combination date to the disposal date isadjusted to capital reserve (capital premium), if the balance of capital reserve is insufficient to offset, any excess is adjusted to retained earnings.
When the Company loses control, the remained equity is remeasured at the loss-of-control-date fair value. The aggregated value of disposal consideration and the fairvalue of the remained equity, less the share of net assets in the disposed subsidiary held before the disposal from the acquisition date or combination date to the disposal date is recognized in investment income in the period when the Company loses control over such subsidiary,and meanwhile goodwill is offset correspondingly. Other comprehensive income related to equity investments in former subsidiary is reclassified as investment income upon the Company's loss of control.
- (3) Accounting treatment of bundled transaction
-
- Stand-alone financial statements
Stages as a whole are considered as one transaction resulting in loss of control in accounting treatment. However, before the Company loses control over a subsidiary, the difference between the disposal consideration at each stage and the carrying amount of long-term equity investments corresponding to the disposed investments is recognized as other comprehensive income at the stand-alone financial statements and reclassified as profit or loss in the period when the Company loses control over such subsidiary.
2) Consolidated financial statements
Stages as a whole are considered as one transaction resulting in loss of control in accounting treatment. However, before the Company loses control over a subsidiary, the difference between the disposal consideration at each stage and the proportionate share of net assets in the disposed subsidiary is recognized as other comprehensive income at the consolidated financial statements and reclassified as profit or loss in the period when the Company loses control over such subsidiary.
(XVI) Investment property
-
Investment property includes land use right of leased-out property and of property held for capital appreciation and buildings that have been leased out.
-
The initial measurement of investment property is based on its cost,and subsequent measurement is made using the cost model, the depreciation or amortization method is the same as that of fixed assets and intangible assets.
(XVII) Fixed assets
1. Recognition principles offixed assets
Fixed assets are tangible assets held for use in the production of goods or rendering of services, for rental to others, or for administrative purposes, and expected to be used during more than one accounting year. Fixed assets are recognized if, and only if, itis probable that future economic benefits associated with the assets will flow to the Company and the cost of the assets can be measured reliably.
| Categories | Depreciationmethod | Usefullife(years) | Residualvalueproportion(%) | Annualdepreciationrate(%) |
|---|---|---|---|---|
| Buildingsandstructures | Straight-linemethod | 3-50 | 3.00-5.00 | 2.71-32.33 |
| Generalequipment | Straight-linemethod | 3-5 | 3.00-5.00 | 19.00-32.33 |
| Specialequipment | Straight-linemethod | 2-15 | 0.00-5.00 | 6.33-50.00 |
| Transportfacilities | Straight-linemethod | 3-15 | 3.00-5.00 | 6.33-32.33 |
| Otherequipment | Straight-linemethod | 3-10 | 5.00 | 9.50-31.67 |
2. Depreciation method of different categories offixed assets
(XVIII) Construction in progress
-
Construction in progress is recognized if, and only if, it is probable that future economic benefits associated with the item will flow to the Company, and the cost of the item can be measured reliably. Construction in progress is measured at the actual cost incurred to reach its designed usable conditions.
-
Construction in progress is transferred into fixed assets at its actual cost when it reaches the designed usable conditions. When the auditing of the construction in progress is not finished while reaching the designed usable conditions, it is transferred to fixed assets using estimated value first, and then adjusted accordingly when the actual cost is settled, but the accumulated depreciation is not to be adjusted retrospectively.
| Categories | Standardsandtimepointoftransferringconstructioninprogresstofixedassets | |
|---|---|---|
| Machinery | Whenthedesignrequirementsoracceptancecriteriaforuseasspecifiedinthecontractaremetafterinstallationandcommissioning | |
| Engineeringconstruction | Whenthecompletionacceptanceisfinishedandreachingthedesignedusableconditions |
(XIX) Borrowing costs
- Recognition principle of borrowing costs capitalization
Where the borrowing costs incurred to the Company can be directly attributable to the acquisition and construction or production of assets eligible for capitalization, it is capitalized and included in the costs of relevant assets; other borrowing costs are recognized as expenses on the basis ofthe actual amount incurred, and are included in profit or loss.
2. Borrowing costs capitalization period
(1) The borrowing costs are not capitalized unless the following requirements are all met: 1) the asset disbursements have already incurred; 2) the borrowing costs have already incurred; and 3) the acquisition and construction or production activities which are necessary to prepare the asset for its intended use or sale have already started.
(2) Suspension of capitalization: where the acquisition and construction or production of a qualified asset is interrupted abnormally and the interruption period lastsfor more than 3 months, the capitalization of the borrowing costs is suspended; the borrowing costs incurred during such period are recognized as expenses, and are included in profit or loss, till the acquisition and construction or production of the asset restarts.
(3) Ceasing of capitalization: when the qualified asset under acquisition and construction or production is ready for the intended use or sale,the capitalization of the borrowing costs is ceased.
- Capitalization rate and capitalized amount of borrowing costs
For borrowings exclusively for the acquisition and construction or production of assets eligible for capitalization, the to-be-capitalized amount of interests is determined in light of the actual interest expenses incurred (including amortization of premium or discount based on effective interest method) of the specialborrowings in the current period less the interest income on the unused borrowings as a deposit in the bank or as a temporary investment; where a general borrowing is used for the acquisition and construction or production of assets eligible for capitalization, the Company calculates and determines the to-be-capitalized amount of interests on the general borrowing by multiplying the weighted average asset disbursement of the excess of the accumulative capital disbursements over the special borrowings by the capitalization rate of the generalborrowing used.
(XX) Intangible assets
-
Intangible assets include land use right, patent right, non-patented technology, etc. The initial measurement of intangible assets is based on its cost.
-
For intangible assets with finite useful lives, their amortization amounts are amortized within their useful lives systematically and reasonably, if it is unable to determine the expected realization pattern reliably, intangible assets are amortized by the straight-line method with details as follows:
| Items | Usefullifeanddeterminationbasis | Amortizationmethod |
|---|---|---|
| Franchise | Contractualterm | Straight-linemethod |
| Landuseright | 35-50years;usefulliferegisteredonthelandusecertificate | Straight-linemethod |
| Patentedtechnology | 5-10years;economiclifecycle | Straight-linemethod |
| Software | 3-10years;estimatedeconomiclife | Straight-linemethod |
| Others | 5years;economiclifecycle | Straight-linemethod |
3. Permitted scope of R&D costs
(1) Personnel costs
Personnel costs include wages and salaries, basic endowment insurance premiums, basic medical insurance premiums, unemployment insurance premiums, occupational injuries premiums, maternity premiums and housing provident funds for the Company's R&D personnel, as well as labor costs for external R&D personnel.
If R&D personnel serve for multiple R&D projects at the same time, personnel costs are recognized based on their
working hour records provided by the Company's administrative department, and proportionately allocated among different R&D projects.
If personnel directly engaged in R&D activities and external R&D personnel are engaged in non-R&D activities at the same time, the Company, based on their working hour records at different positions, allocates personnel costs actually incurred between R&D expenses and production and operating expenses using reasonable methods such as the ratio of actual working hours.
(2) Direct input costs
Direct input costs refer to relevant expenses actually incurred by the Company for R&D activities, which include: 1) materials, fuel and power costs directly consumed by R&D activities; 2) development and manufacturing costs of molds and craft equipment used for intermediate tests and trial production, acquisition costs of samples, prototypes and general testing methods that do not constitute fixed assets, and inspection costs of trial production; and 3) operation and maintenance, adjustment, inspection, testing and repairing costs of instruments and equipment used for R&D activities.
(3) Depreciation and long-term prepayments
Depreciation refers to the depreciation of instruments, equipment and in-use buildings used for R&D activities.
For instruments, equipment and in-use buildings both used for R&D activities and non-R&D activities, necessary records shall be kept on their usage, and depreciation actually incurred is allocated between R&D expenses and production and operating expenses in a reasonable manner based on the actual working hours, the usable area, etc.
Long-term prepayments refer to those incurred during renovation, modification, decoration and repairing of R&D facilities, which are collected based on actual amount and amortized evenly over a specified period.
(4) Amortization of intangible assets
Amortization of intangible assets refer to the amortization of software, intellectual property, and non-patented technology (proprietary technology, licenses, design and calculation methods, etc.) used for R&D activities.
(5) Design expenses
Design expenses refer to expenses incurred for the conception, development and manufacturing of new products and techniques, design of processes, technical specifications, process specification formulation, operational characteristics, etc., including expenses incurred for creative design activities to obtain innovative, creative and breakthrough products.
(6) Equipment commissioning and testing expenses
Equipment commissioning expenses refer to expenses incurred for R&D activities during tooling preparation, including expenses incurred for activities such as development of special and specialized production machines, changes in production and quality control procedures, development of new methods and standards, etc.
Expenses incurred for routine tooling preparation and industrial engineering for the purpose of large-scale/mass and commercial production are not included in the permitted scope.
Testing expenses include clinical trial fees for new drug development, on-site testing feesfor exploration and production technologies, field testing fees, etc.
(7) R&D outsourcing expenses
R&D outsourcing expenses refer to expenses incurred for R&D activities outsourced to other domestic or foreign organizations or individuals (outcomes of R&D activities are owned by the Company and closely related to the Company's main business operations).
(8) Other expenses
Other expenses refer to expenses other than those mentioned above that are directly related to R&D activities, including technical books and materials fees, data translation fees, expert consultation fees, high-tech R&D insurance premiums, R&D outcomes search, demonstration, evaluation, appraisal and acceptance fees, intellectual property application, registration and agency fees, conference fees, business travelling fees, communication fees, etc.
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Expenditures on the research phase of an internal project are recognized as profit or loss when they are incurred. An intangible asset arising from the development phase of an internal project is recognized if the Company can demonstrate all of the followings: (1) the technical feasibility of completing the intangible asset so that it will be available for use or sale; (2) its intention to complete the intangible asset and use or sell it; (3) how the intangible asset will generate probable future economic benefits, among other things, the Company can demonstrate the existence of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally, the usefulness of the intangible asset; (4) the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and (5) its ability to measure reliably the expenditure attributable to the intangible asset during its development.
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Criteria for distinguishing the research phase from the development phase of an internal project to create an intangible asset:
The planned investigation phase for acquiring new technology and knowledge should be defined as the research phase, which has the characteristics ofplanning and exploratory nature; before commercial production or use, when the research results or other knowledge are applied to a certain plan or design with the intention to produce new or substantially improved materials, devices, products, etc., such stage should be determined as the development phase, which has the characteristics of pertinence and greaterpossibility of forming results. The Company divides the research and development phases by forming the prototype drawing and starting the prototype trial production. Expenditures in the research phase of internal research and development projects are included in profit or loss when they incur. When the Company enters the development phase, project expenditures are first calculated by projects under "development expenditure", and if the capitalization conditions are met, they are presented as development expenditures in the financial statements. The project will be transferred to intangible assets when the project has the conditions for sale or mass production.
(XXI) Impairment of part of long-term assets
For long-term assets suchas long-term equity investments, investment property at cost model, fixed assets,
construction in progress, right-of-use assets, intangible assets with finite useful lives, etc., if atthe balance sheet date there is indication of impairment, the recoverable amount is to be estimated. For goodwill recognized in business combination and intangible assets with indefinite useful lives, no matter whether there is indication of impairment, impairment test is performed annually. Impairment test on goodwill is performed on related asset group or asset group portfolio.
When the recoverable amount of such long-term assets is lower than their carrying amount, the difference is recognized as provision for assets impairment through profit or loss.
(XXII) Long-term prepayments
Long-term prepayments are expenses that have been recognized but with amortization period over one year (excluding one year). They are recorded with actual cost, and evenly amortized within the beneficiary period or stipulated period. If items of long-term prepayments fail to be beneficial to the following accounting periods, residual values ofsuch items are included in profit or loss.
(XXIII) Employee benefits
- Employee benefits include short-term employee benefits, post-employment benefits, termination benefits and other long-term employee benefits.2. Short-term employee benefits
The Company recognizes, in the accounting period in which an employee provides service, short-term employee benefits actually incurred as liabilities, with a corresponding charge to profit or loss or the cost of a relevant asset.
3. Post-employment benefits
The Company classifies post-employment benefit plans as either defined contribution plans ordefined benefit plans.
(1) The Company recognizes in the accounting period in which an employee provides service the contribution payable to a defined contribution plan as a liability,with a corresponding charge to profit or loss or the cost of a relevant asset.
(2) Accounting treatment by the Company for defined benefit plan usually involves the following steps:
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In accordance with the projected unit credit method, using unbiased and mutually compatible actuarial assumptions to estimate related demographic variables and financial variables, measure the obligations under the defined benefit plan, and determine the periods to which the obligations are attributed. Meanwhile, the Company discounts obligations under the defined benefit plan to determine the present value of the defined benefit plan obligations and the current service cost;
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When a defined benefit plan has assets,the Company recognizes the deficit or surplus by deducting the fair value of defined benefit plan assets from the present value ofthe defined benefit plan obligation as a net defined benefit plan liability or net defined benefit plan asset. When a defined benefit plan has a surplus, the Company measures the net defined benefit plan asset at the lower of the surplus in the defined benefit plan and the asset ceiling;
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At the end of the period, the Company recognizes the following components of employee benefits cost arising from defined benefit plan: a.service cost; b. net interest on the net defined benefit plan liability (asset); and c. changes as a result of remeasurement of the net defined benefit liability (asset). Item a and item bare recognized in profit or loss or the cost of a relevant asset. Item c is recognized in other comprehensive income and is not to be reclassified subsequently to profit or loss. However, the Company may transfer those amounts recognized in other comprehensive income within equity.
4. Termination benefits
Termination benefits provided to employees are recognized as an employee benefit liability for termination benefits, with a corresponding charge to profit or loss at the earlier of the following dates: (1) when the Company cannot unilaterally withdraw the offer of termination benefits because of an employment termination plan ora curtailment proposal; or (2) when the Company recognizes cost or expenses related to a restructuring that involves the payment of termination benefits.
5. Other long-term employee benefits
When other long-term employee benefits provided to the employees satisfied the conditions for classifying as a defined contribution plan, those benefits are accounted for in accordance with the requirements relating to defined contribution plan, while other benefits are accounted for in accordance with the requirements relating to defined benefit plan. The Company recognizes the cost of employee benefits arising from other long-term employee benefits as the followings: (1) service cost; (2) net interest on the net liability or net assets of other long-term employee benefits; and (3) changes as a result of remeasurement of the net liability or net assets of other long-term employee benefits.As a practical expedient, the net total of the aforesaid amounts is recognized in profit or loss or included in the cost of a relevant asset.
(XXIV) Provisions
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Provisions are recognized when fulfilling the present obligations arising from contingencies such as providing guarantee for other parties, litigation, products quality guarantee, onerous contract, etc., may cause the outflow of the economic benefit and such obligations can be reliably measured.
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The initial measurement of provisions is based on the best estimated expenditures required in fulfilling the present obligations, and its carrying amount is reviewed at the balance sheet date.
(XXV) Share-based payment
- Types of share-based payment
Share-based payment consists ofequity-settled share-based payment and cash-settled share-based payment.
2. Accounting treatment for settlements, modifications and cancellations of share-based payment plans
(1) Equity-settled share-based payment
For equity-settled share-based payment transaction with employees, if the equity instruments granted vest immediately, the fair value of those equity instruments is measured at grant date and recognized as transaction cost or expense, with a corresponding adjustment in capital reserve; if the equity instruments granted do not vest until the counterparty completes a specified period of service or fulfills certain performance conditions, at the balance
sheet date within the vesting period, the fair value of those equity instruments measured at grant date based on the best estimate of the number of equity instruments expected to vest is recognized as transaction cost orexpense, with a corresponding adjustment in capital reserve.
For equity-settled share-based payment transaction with parties other than employees, if the fair value of the services received can be measured reliably, the fair value ismeasured at the date the Company receives the service; if the fair value of the services received cannot be measured reliably, but that of equity instruments can be measured reliably, the fair value of the equity instruments granted measured at the date the Company receives the service is referred to, and recognized as transaction cost or expense, with a corresponding increase in equity.
(2) Cash-settled share-based payment
For cash-settled share-based payment transactions with employees, if share appreciation rights vest immediately, the fair value of the liability incurred as the acquisition of services is measured at grant date and recognized as transaction cost or expense, with a corresponding increase in liabilities; if share appreciation rights do not vest until the employees have completed a specified period of service or fulfills certain performance conditions, the liability is measured, at each balance sheet date until settled, at the fair value of the share appreciation rights measured at grant date based on the best estimate of the number of share appreciation right expected to vest.
(3) Modifications and cancellations ofshare-based payment plan
If the modification increases the fair value of the equity instruments granted, the Company includes the incremental fair value granted in the measurement of the amount recognized for services received as consideration for the equity instruments granted; similarly, if the modification increases the number of equity instruments granted, the Company includes the fair value of the additional equity instruments granted, in the measurement of the amount recognized for services received as consideration for the equity instruments granted; if the Company modifies the vesting conditions in a manner that is beneficial to the employee, the Company takes the modified vesting conditions into account.
If the modification reduces the fair value of the equity instruments granted, the Company doesnot take into account that decrease in fair value and continue to measure the amount recognized for services received as consideration for the equity instruments based on the grant date fair value of the equity instruments granted; if the modification reduces the number of equity instruments granted to an employee, that reduction is accounted for as a cancellation of that portion of the grant; if the Company modifies the vesting conditions in a manner that is not beneficial to the employee, the Company does not take the modified vesting conditions into account.
If the Company cancels or settles a grant of equity instruments during the vesting period (other than that cancelled when the vesting conditions are not satisfied), the Company accounts for the cancellation or settlement as an acceleration of vesting, and therefore recognizes immediately the amount that otherwise would have been recognized for services received over the remainder of the vesting period.
(XXVI) Other financial instruments such as preferred shares and perpetual bonds
Pursuant to CASBEs on financial instruments and "Regulations on Accounting Treatments of Perpetual Bonds" (Cai Kuai [2019] No. 2) issued by the Ministry of Finance, for financial instruments such as convertible bonds etc.,
the Company classifies a financial instrument or its components at initial recognition as a financial asset or liability or equity instrument, based on contract terms and economic essence it reveals instead of its legal form, combining with the definitions offinancial asset, liability and equity instrument.
At the balance sheet date, for a financial instrument classified as an equity instrument, its interest expenditure or dividend distribution is treated as profit distribution, and share repurchase and cancelation are treated as changes in equity; for a financial instrument classified as a financial liability, its interest expenditure or dividend distribution is treated as borrowing expense, and gain or loss on repurchase or redemption is included in profit or loss.
(XXVII) Revenue
- Revenue recognition principles
At contract inception, the Company shall assess the contracts and shall identify each performance obligation in the contracts, and determine whether the performance obligation should be satisfied over time or ata point in time.
The Company satisfies a performance obligation over time if one of the following criteria ismet, otherwise, the performance obligation is satisfied at a pointin time: (1) the customer simultaneously receives and consumes the economic benefits provided by the Company's performance as the Company performs; (2) the customer can control goods as they are created by the Company's performance; (3) goods created during the Company's performance have irreplaceable uses and the Company has an enforceable right to the payments for performance completed to date during the whole contract period.
For each performance obligation satisfied over time, the Company shall recognize revenue overtime by measuring the progress towards complete satisfaction of that performance obligation. In the circumstance that the progress cannot be measured reasonably, but the costs incurred in satisfying the performance obligation are expected to be recovered, the Company shall recognize revenue only to the extent of the costs incurred until it can reasonably measure the progress. For each performance obligation satisfied at a pointin time, the Company shall recognize revenue at the time point that the customer obtains control of relevant goods or services. To determine whether the customer has obtained control of goods, the Company shall consider the following indications: (1) the Company has a present right to payments for the goods, i.e., the customer is presently obliged to pay for the goods; (2) the Company has transferred the legal title of the goods to the customer, i.e., the customer has legal title to the goods; (3) the Company has transferred physical possession of the goods to the customer, i.e., the customer has physically possessed the goods; (4) the Company has transferred significant risks and rewards of ownership of the goods to the customer, i.e., the customer has obtained significant risks and rewards of ownership of the goods; (5) the customer has accepted the goods; (6) other evidence indicating the customer has obtained control over the goods.
2. Revenue measurement principle
(1) Revenue is measured at the amount of the transaction price that is allocated to each performance obligation. The transaction price is the amount of consideration to which the Company expects to be entitled in exchange for transferring goods or services to a customer, excluding amounts collected on behalf of third parties and those expected to be refunded to the customer.
(2) If the consideration promised in a contract includes a variable amount,the Company shall confirm the best
estimate of variable consideration at expected value or the most likely amount. However, the transaction price that includes the amount of variable consideration only to the extentthat it is high probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is subsequently resolved.
(3) In the circumstance that the contract contains a significant financing component, the Company shall determine the transaction price based on the price that a customer would have paid for if the customer had paid cash for obtaining control over those goods or services. The difference between the transaction price and the amount of promised consideration is amortized under effective interest method over contractual period. The effects of a significant financing component shall not be considered if the Company expects, at the contract inception, that the period between when the customer obtains control over goods or services and when the customer pays consideration will be one year or less.
(4) For contracts containing two or more performance obligations, the Company shall determine the stand-alone selling price at contract inception of the distinct good underlying each performance obligation and allocate the transaction price to each performance obligation on a relative stand-alone selling price basis.3. Revenue recognition method
The Company mainly sellsenvironmental and sanitation machinery, ventilation equipment, etc., and engages in sanitation operation service.
(1) Sale of ventilation equipment is a performance obligation satisfied at a pointin time. Revenue from domestic sales of products that do not require installation is recognized when the Company has delivered goods to the designated address as agreed by contract and such delivered goods have been verified for acceptance by customers, and the Company has obtained delivery receipts, and has collected the payments or has obtained the right to the payments, and related economic benefits are highly probable to flow to the Company. For products that need to be installed, revenue is recognized when the products are delivered and qualified for installation, commissioning and acceptance. Revenue from overseas sales is recognized when the Company has declared goods to the customs based on contractual agreements and has obtained a bill of lading, and the Company has collected the payments or has obtained the right to the payments, and related economic benefits are highly probable to flow to the Company.
(2) Sales of environmental and sanitation machinery products is a performance obligation satisfied at a point in time, and revenue is recognized when customers receive and consume the products, and the Company has collected the payments or has obtained the right to the payments, and related economic benefits are highly probable to flow to the Company.
(3) Comprehensive environmental and sanitation management engineering is a performance obligation satisfied over time. Revenue isrecognized based on the performance progress according to the projectprogress confirmed by the supervisor.
(4) Sanitation operation service is a performance obligation satisfied over time. Revenue is recognized based on the service assessment statement confirmed by the labor receiving party, etc.
(5) For revenue recognition method of PPP business with BOT model, etc., please refer to section III (XXXV) 1 of notes to the financial statements for details.
(XXVIII) Costs of obtaining a contractand costs to fulfill a contract
The Company recognizes as an asset the incremental costs of obtaining a contractif those costs are expected to be recovered. The costs of obtaining a contract shall be included into profit or loss when incurred if the amortization period of the asset is one year or less.
If the costs incurred in fulfilling a contractare not within the scope of standards related to inventories, fixed assets or intangible assets, etc., the Company shall recognize the costs to fulfill a contract as an asset ifall the following criteria are satisfied:
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The costs relate directly to a contract or to an anticipated contract, including direct labor, direct materials, manufacturing overhead cost (or similar cost), cost that are explicitly chargeable to the customer under the contract, and other costs that are only related to the contract;
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The costs enhance resources of the Company that will be used in satisfying performance obligations in the future; and
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The costs are expected to be recovered.
An asset related to contract costs shall be amortized on a systematic basis that is consistent with related goods or services, with amortization included into profit or loss.
The Company shall make provision for impairment and recognize an impairment loss to the extent that the carrying amount of an asset related to contract costs exceeds the remaining amount of consideration that the Company expects to receive in exchange for the goods or services to which the asset relates less the costs expected to be incurred. The Company shall recognize a reversal of an impairment loss previously recognized in profit or loss when the impairment conditions no longer exist or have improved. The carrying amount of the asset after the reversal shall not exceed the amount that would have been determined on the reversal date if no provision for impairment had been made previously.
(XXIX) Contract assets, contract liabilities
The Company presents contract assets or contract liabilities in the balance sheet based on the relationship between its performance obligations and customers' payments. Contract assets and contract liabilities under the same contract shall offset each other and be presented on a net basis.
The Company presents an unconditional right to consideration (i.e., only the passage of time isrequired before the consideration is due) as a receivable, and presents a right to consideration in exchange for goods that it has transferred to a customer (which is conditional on something other than the passage of time) as a contract asset.
The Company presents an obligation to transfer goods to a customer for which the Company has received consideration (or the amount is due) from the customer as a contract liability.
(XXX) Government grants
- Government grants shallbe recognized if, and only if, the following conditions are all met: (1) the Company will comply with the conditions attaching to the grants; (2) the grants will be received. Monetary government grants are measured at the amount received or receivable. Non-monetary government grants are measured at fair value, and can be measured at nominal amount in the circumstance that fair value cannot be assessed.
2. Government grants related to assets
Government grants related to assets are government grants with which the Company purchases, constructs or otherwise acquires long-term assets under requirements of government. In the circumstances that there is no specific government requirement, the Company shall determine based on the primary condition to acquire the grants, and government grants related to assets are government grants whose primary condition is to construct or otherwise acquire long-term assets. They offset carrying amount of relevant assets, or they are recognized as deferred income. If recognized as deferred income, they are included in profit or loss on a systematic basis over the useful lives of the relevant assets. Those measured at notional amount are directly included into profit or loss. For assets sold, transferred, disposed or damaged within the useful lives, balance of unamortized deferred income is transferred into profitor loss ofthe period in which the disposal occurred.
3. Government grants related to income
Government grants related to income are government grants other than those related to assets. For government grants that contain both parts related to assets and parts related to income, in which those two parts are blurred, they are thus collectively classified as government grants related to income.For government grants related to income used for compensating the related future cost, expenses or losses, they are recognized as deferred income and included in profit or loss or used to offset relevant cost during the period in which the relevant cost, expenses or losses are recognized; for government grants related to income used for compensating the related cost, expenses or losses incurred to the Company, they are directly included in profit or loss or used to offset relevant cost.
- Government grants related to the ordinary course of business shall be included into other income or used to offset relevant cost based on business nature, while those not related to the ordinary course of business shall be included into non-operating revenue or expenditures.
(XXXI) Deferred tax assets/Deferred tax liabilities
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Deferred tax assets or deferred tax liabilities are calculated and recognized based on the difference between the carrying amount and tax base of assets and liabilities (and the difference of the carrying amount and tax base of items not recognized as assets and liabilities but with their tax base being able to be determined according to tax laws) and in accordance with the tax rate applicable to the period during which the assets are expected to be recovered or the liabilities are expected to be settled.
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A deferred tax asset is recognized to the extent of the amount of the taxable income, which is most likely to obtain and which can be deducted from the deductible temporary difference. At the balance sheet date, if there is any exact evidence indicating that it is probable that future taxable income will be available against which deductible temporary differences can be utilized, the deferred tax assets unrecognized in prior periods are recognized.
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At the balance sheet date, the carrying amount of deferred tax assets is reviewed. The carrying amount of a deferred tax asset is reduced to the extent that it is no longer probable that sufficient taxable income will be available to allow the benefit of the deferred tax asset to be utilized. Such reduction is subsequently reversed to the extent that it becomes probable that sufficient taxable income will be available.
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The income tax and deferred tax for the period are treated as income tax expenses or income through profit or loss, excluding those arising from the following circumstances: (1) business combination; and (2) the transactions or items directly recognized in equity.
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Deferred tax assets and deferred tax liabilities shall offset each other and be presented on a net basis when the following conditions are all met: (1) the Company has the legal right to settle off current tax assets against current tax liabilities;(2) the deferred tax assets and the deferred tax liabilities relate to income taxes levied by the same tax authority on either:1) the same taxable entity; or 2) different taxable entities which intend either to settle current tax liabilities and assets on a net basis,or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts ofdeferred tax assets orliabilities are expected to be recovered or settled.
(XXXII) Leases
1. The Company as lessee
At the commencement date, the Company recognizes a lease that has a lease term of 12 months or less as a shortterm lease, which shall not contain a purchase option;the Company recognizes a lease as a lease of a low-value asset if the underlying asset is of low value when it isnew. If the Company subleases an asset, or expects to sublease an asset, the head lease does not qualify as a lease of a low-value asset.
For all short-term leases and leases of low-value assets, lease payments are recognized as cost or profit or loss with straight-line method over the lease term.
Apart from the above-mentioned short-term leases and leases of low-value assets with simplified approach, the Company recognizes right-of-use assets and lease liabilities at the commencement date.
(1) Right-of-use assets
The right-of-use asset is measured at cost and the cost shall comprise: 1) the amount of the initial measurement of the lease liabilities; 2) any lease payments made at or before the commencement date, less any lease incentives received; 3) any initial direct costs incurred by the lessee; and 4) an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the terms and conditions of the lease.
The Company depreciates the right-of-use asset using the straight-line method. If it is reasonable to be certain that the ownership of the underlying asset can be acquired by the end of the lease term, the Company depreciates the right-of-use asset from the commencement date to the end of the useful life of the underlying asset. Otherwise, the Company depreciates the right-of-use asset from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term.
(2) Lease liabilities
At the commencement date, the Company measures the lease liability at the present value of the lease payments that are not paid at that date, discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, the Company's incremental borrowing rate shall be used. Unrecognized financing expenses, calculated at the difference between the lease payment and its present value, are recognized as interest expenses over the lease term using the discount rate which has been used to determine the present value of lease payment and included in profit or loss. Variable lease payments not included in the measurement of lease liabilities are included in profit or loss in the periods in which they are incurred.
After the commencement date, if there isa change in the following items: 1) actual fixed payments; 2) amounts expected to be payable under residual value guarantees; 3) an index or a rate used to determine lease payments; 4) assessment result or exercise of purchase option, extension option or termination option, the Company remeasures the lease liability based on the present value of lease payments after changes, and adjusts the carrying amount of the right-of-use asset accordingly. If the carrying amount of the right-of-use asset is reduced to zero but there shall be a further reduction in the lease liability,the remaining amount shall be recognized into profit or loss.
2. The Company as lessor
At the commencement date, the Company classifies a lease as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset. Otherwise, it is classified as an operating lease.
(1) Operating lease
Lease receipts are recognized as lease income with straight-line method over the lease term. Initial direct costs incurred shall be capitalized, amortized on the same basis as the recognition of lease income, and included into profit or loss by installments. Variable lease payments related to operating lease which are not included in the lease payment are charged as profit or loss in the periods in which they are incurred.
(2) Finance lease
At the commencement date, the Company recognizes the finance lease payment receivable based on the net investment in the lease (sum of the present value of unguaranteed residual value and lease receipts that are not received at the commencement date, discounted by the interest rate implicit in the lease), and derecognizes assets held under the finance lease. The Company calculates and recognizes interest income using the interestrate implicit in the lease overthe lease term.
Variable lease payments not included in the measurement of the net investment in the lease are charged as profit or loss in the periods in which they are incurred.
3. Sale and leaseback
(1) The Company as the lessee
In accordance with the "CASBE 14 –Revenues", the Company would assess and determine whether the transfer of an asset in the sale and leaseback transaction is accounted for as a sale of that asset.
If the transfer of an asset is accounted for as a sale of the asset, the Company measures the right-of-use asset arising from the leaseback at the proportion of the original carrying amount of the asset that relates to the right of use retained by the Company. Accordingly, the Company recognizes only the amount of any gain or loss that relates to
the rights transferred to the lessor.
Otherwise, the Company continues the recognition of the transferred assets, and recognizes a financial liability equal to the amount of transfer income in accordance with the "CASBE 22 – Financial Instruments: Recognition and Measurement" at the same time.
(2) The Company as the lessor
In accordance with the "CASBE 14 –Revenues", the Company would assess and determine whether the transfer of an asset in the sale and leaseback transaction is accounted for as a sale of that asset.
If the transfer of an asset is accounted for as a sale of the asset, the Company accounts for the purchase of assets in accordance with other applicable standards, and accounts for the lease of assets in accordance with the "CASBE 21 – Leases".
Otherwise, the Company does not recognize the transferred asset, but recognizes a financial asset equal to the amount of transfer income in accordance with the "CASBE 22 – Financial Instruments: Recognition and Measurement".
(XXXIII) Work safety fund
The Company appropriates work safety fund in accordance with the "Circular on Management Measures on the Appropriation and Use of Work Safety Fund" (Cai Zi [2022] No. 136) issued by the Ministry of Finance and the Ministry of Emergency Management. Standard work safety fund is included in the cost or profit or loss, meanwhile accounted for under "special reserve". When work safety fund is used as an expense, it is to offset special reserve directly. When work safety fund is qualified to be included in the cost of fixed assets, it is accounted for under "construction in progress" and transferred to fixed assets when related safety projects reach the designed useful conditions; meanwhile, the cost included in fixed assets is to offset "special reserve", and accumulated depreciation shall be recognized at the same amount. Such fixed assets shallnot be depreciated in future periods.
(XXXIV) Segment reporting
Operating segments are determined based on the structure of the Company's internal organization, management requirements and internal reporting system. An operating segment is a component of the Company:
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that engages in business activities from which it may earn revenues and incur expenses;
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whose financial performance is regularly reviewed by the Management to make decisions about resource to be allocated to the segment and to assess its performance; and
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for which accounting information regarding financial position, financial performance and cash flows is available through analysis.
(XXXV) Other significant accounting policies and estimates
1. PPP business
The Company adopts the build-operate-transfer approach (PPP projects, mainly using BOT, TOT, etc.) to participate in the public infrastructure business. The projectcompany obtains the franchise of public infrastructure
projects from government departments and participates in the construction and operation of the project. After the franchise expires,the project company needs to hand over relevant infrastructure to the government or the department designated by the government.
For the PPP project contract under which the Company provides multiple services (such as the rendering of construction services of PPP projects as well as post-completion operation services and maintenance services), the Company identifies each performance obligation in the contracts in accordance with the provisions of"CASBE 14 – Revenues", and allocates the transaction price to each performance obligation on the basis of the relative stand alone selling prices. If the stand-alone selling price cannot be directly observed, or if there isa lack of similar market prices, the Company will take into account market conditions, specific factors of the Company and information related to customers and other relevant information, and make a reasonable estimate of the stand-alone selling price using methods such as market adjustment method, cost-plus method, residual value method,etc. Construction services are performance obligations satisfied over time.Revenue from construction services is recognized by the percentage of completion of the performance obligations, which is determined based on the proportion of the incurred costs to the estimated total costs. In the circumstance that the percentage of completion cannot be measured reasonably, but the incurred costs are expected to be recovered, the Company recognizes revenue only to the extentof the incurred costs untilit can reasonably measure the percentage of completion.
The Company has the right to charge users of public goods and services during the operation of the projectin accordance with the PPP project contracts. However, if the amount of the fees is uncertain, such right does not constitute an unconditional right to receive cash, and the consideration or construction revenue of the relevant PPP project assets is recognized as intangible assets when the PPP project assets reach the designed useful conditions, which shall be accounted for in accordance with "CASBE 6 – Intangible Assets".
If the Company is qualified to have the right to receive a determinable amount of cash (or other financial assets) during the operation of the projectin accordance with the PPP project contracts, such amount is recognized as accounts receivable when the Company has the right to such consideration (the right depends only on the factor of the passage of time) and is accounted for in accordance with "CASBE 22 – Financial Instruments: Recognition and Measurement". The Company recognizes the difference between the consideration or construction revenue of the relevant PPP project assets and the determinable amount of cash (or other financial assets) as intangible assets when the PPP project assets reach the designed useful conditions.
For the portion of the consideration or construction revenue recognized as intangible assets, the contract assets recognized during the relevant construction period are presented under "intangible assets" in the balance sheet; for other contract assets recognized during the construction period, they are presented under "contract assets", or "other non-current assets" in the balance sheet if they are expected to be realized within twelve months of the balance sheet date.
After the PPP project assets reach the designed useful conditions, the Company recognizes revenue related to operating services in accordance with "CASBE 14 – Revenues".2. Accounting treatment related to share repurchase
When the Company repurchases its shares for the purpose of reducing its registered capital or rewarding its employees, if the purchased shares are to be kept as treasury shares, the treasury shares are recorded at the cash distributed to existing shareholders for repurchase; if the purchased shares are to be retired, the difference between the total book value of shares retired and the cash distributed to existing shareholders for repurchase is to reduce capital reserve, or retained earnings when the capital reserve isnot enough to reduce. If the Company repurchases vested equity instruments in equity-settled share-based payment transactions with employees, cost of treasury shares granted to employees and capital reserve (other capital reserve) accumulated within the vesting period are to be written off on the payment made to employees, with a corresponding adjustment in capital reserve (share premium).
(XXXV) Significant changes in accounting policies
Changes in accounting policies arising from changes in CASBEs
The Company has adopted the regulations about accounting for deferred tax related to assets and liabilities arising from a single transaction to which the initialrecognition exemption doesnot apply in the "Interpretation of China Accounting Standards for Business Enterprises No. 16" issued by the Ministry of Finance since January 1, 2023, and makes adjustments on such single transactions occurring between the beginning of the earliest comparative period and the first adoption date accordingly. For taxable and deductible temporary differences associated with lease liabilities and right-of-use assets, provisions associated with decommissioning obligations and corresponding assets arising from such single transactions and presented at the beginning of the earliest comparative period, the cumulative effect of initially applying such regulations and "CASBE 18 –Enterprise Income Tax" shall be adjusted into retained earnings or other related items at the beginning of the earliest comparative period presented. Such change in accounting policies has no impact on the Company's financial statements.
IV. Taxes
(I) Main taxes and tax rates
| TaxesTaxbases | Taxrates | |
|---|---|---|
| Value-addedtax(VAT) | Theoutputtaxcalculatedbasedontherevenuefromsalesofgoodsorrenderingofservicesinaccordancewiththetaxlaw,netoftheinputtaxthatisallowedtobedeductedinthecurrentperiod | 3%,6%,9%,13%.Exportedgoodsaresubjectto"exemption,credit,refund"policies,withrefundrateof13%. |
| Housingpropertytax | Forhousingpropertyleviedonthebasisofprice,housingpropertytaxisleviedattherateof1.2%ofthebalanceafterdeducting30%ofthecost;forhousingpropertyleviedonthebasisofrent,housingpropertytaxisleviedattherateof12%ofleaseincome. | 1.2%,12% |
| Urbanmaintenanceandconstructiontax | Turnovertaxactuallypaid | 7%,5% |
| Educationsurcharge | Turnovertaxactuallypaid | 3% |
| Localeducationsurcharge | Turnovertaxactuallypaid | 2%,1% |
| EnterpriseincometaxTaxableincome | 15%,20%,25% |
Different enterprise income tax ratesapplicable to different taxpayers:
| Taxpayers | Incometaxrate |
|---|---|
| InforeTechnologyCompany | 15% |
| GuangdongInforeIntelligentSanitationTechnologyCo.,Ltd. | 15% |
| ShangfengIndustrialCompany | 15% |
| ZoomlionEnvironmentalCompany | 15% |
| FengyunIoTTechnologyCo.,Ltd. | 15% |
| HuaianChenjieEnvironmentalEngineeringCo.,Ltd. | 15% |
| ZhejiangYolshElectricDriveTechnologyCo.,Ltd.(the"YolshCompany") | 15% |
| XiantaoGreenOrientalEnvironmentalPowerGenerationCo.,Ltd.(the"XiantaoCompany") | 15% |
| FoshanShundeHuaqingyuanEnvironmentalProtectionCo.,Ltd.(the"HuaqingyuanCompany") | 15% |
| FoshanShundeDistrictHuayingEnvironmentalWaterCo.,Ltd. | 15% |
| LianjiangGreenOrientalNewEnergyCo.,Ltd.(the"LianjiangCompany") | 15% |
| Taxpayersotherthantheabove-mentioned | 25%,20%forsmallenterpriseswithmeagerprofit |
(II) Tax preferential policies
1. Enterprise income tax
| No. | Entities | Preferentialpolicies |
|---|---|---|
| 1 | ZoomlionEnvironmentalCompany,FengyunIoTTechnologyCo.,Ltd.,HuaianChenjieEnvironmentalEngineeringCo.,Ltd.,YolshCompany,XiantaoCompany,FoshanShundeDistrictHuayingEnvironmentalWaterCo.,Ltd. | Pursuanttothepreferentialincometaxpolicyforhigh-techenterprises,enterpriseincometaxrateisreducedto15%from2023to2025. |
| 2 | ShangfengIndustrialCompany,InforeTechnologyCompany,HuaqingyuanCompany,GuangdongInforeIntelligentSanitationTechnologyCo.,Ltd.,LianjiangCompany | Pursuanttothepreferentialincometaxpolicyforhigh-techenterprises,enterpriseincometaxrateisreducedto15%from2022to2024. |
| 3 | HuaqingyuanCompany,FoshanShundeDistrictHuayingEnvironmentalWaterCo.,Ltd.,FoshanShundeDistrictYuanrunWaterEnvironmentalProtectionCo.,Ltd.,FoshanShundeHuaboEnvironmentalWaterCo.,Ltd. | Revenuefromtheproductionofnon-restrictedandnon-prohibitedproductsthatmeettherelevantnationalandindustrystandardsusingresourcesspecifiedinthe"ResourcesComprehensiveUtilizationofEnterpriseIncomeTaxPreferentialCatalog(2008Edition)"asthemainrawmaterialwillbereducedto90%astaxableincomeforenterpriseincometaxinthecurrentperiod. |
| 4 | Subsidiariesandsub-subsidiariesincludingShenzhenInforeCityServiceIntelligentTechnologyCo.,Ltd.,FoshanShundeHuaboEnvironmentalWaterCo.,Ltd.,FoshanShundeYuanyiWaterEnvironmentalProtectionCo.,Ltd.,DingnanZoomlionEnvironmentalIndustryCo.,Ltd.,etc. | Pursuanttothe"AnnouncementofMinistryofFinance(MOF)andStateTaxationAdministration(STA)ontheFurtherImplementationoftheEnterpriseIncomeTaxPreferentialPoliciesforSmallEnterpriseswithMeagerProfitandIndividually-ownedBusinesses"(AnnouncementofMOFandSTA[2022]No.13),"AnnouncementofMOFandSTAontheEnterprisesIncomeTaxPreferentialPoliciesforSmallEnterpriseswithMeagerProfitandIndividually-ownedBusinesses"(AnnouncementofMOFandSTA[2023]No.6),andthe"AnnouncementofMOFandSTAonFurtherImplementationoftheEnterprisesIncomeTaxPreferentialPoliciesforSmallEnterpriseswithMeagerProfitandIndividually-OwnedBusinesses"(Announcement[2023]No.12),fromJanuary1,2023toDecember31,2027,theenterpriseincometaxfortheportionofthetaxableincomewithin3millionyuanisleviedat20%basedon25%ofthatportionofincome. |
| 5 | Subsidiariesandsub-subsidiariesincludingPingdingshanYingheEnvironmentalSanitationManagementCo.,Ltd.,HeyangYingheUrbanEnvironmentalServiceCo., | Pursuanttothe"LawofthePeople'sRepublicofChinaonEnterpriseIncomeTax"anditsimplementationregulations,the"NoticeofMOF,STAandNationalDevelopmentandReformCommission(NDRC)onPublishingtheCatalogofEnterpriseIncomeTaxPreferencesfor |
| No. | Entities | Preferentialpolicies |
|---|---|---|
| Ltd.,ZhangjiajieYinglianEnvironmentalManagementCo.,Ltd.,LilingZhaoyangEnvironmentalProtectionCo.,Ltd.,etc. | EnvironmentalProtection,EnergySaving,andWaterSavingProjects(Trial)"(CaiShui[2009]No.166)(the"2009Catalog"),theprojectcompaniesareentitledtoenjoythepreferentialpolicyofthree-yearexemptionfromthefirstprofit-makingyear,followedbythreeyearsof50%reductionofenterpriseincometax.Pursuanttothe"AnnouncementNo.36,2021ofMOF,STA,NDRC,andMinistryofEcologyandEnvironment"issuedbyfourdepartmentsincludingtheMOFdatedDecember16,2021,theentities'businesscomplywiththe"2021Catalog",andrelevantprojectscanstillenjoytheabovepreferentialpolicy. | |
| 6 | RuiliYinglianEnvironmentalIndustryCo.,Ltd. | PursuanttothedocumentnumberedGuoBanHan[2012]103bytheStateCouncil,newlyestablishedenterprisesthatsettleintheRuiliPilotZoneareentitledtoenjoythefive-year-exemptionandfive-year-halfreductionpolicyfortheenterpriseincometaxsharedbythelocalauthorityoftheregion(40%oftotalenterpriseincometax),i.e.,theyenjoyenterpriseincometaxexemptionfrom2021to2025,andenjoya50%reductioninincomefrom2026to2030,whilefortheenterpriseincometaxsharedbycentralgovernment(60%),theyenjoythepreferentialpolicyassmallenterpriseswithmeagerprofit. |
2. VAT
(1) Pursuant to the "Notice of MOF and STA on VAT Policies for Software Products" (Cai Shui [2011] No. 100), general VAT taxpayerswho sell software products developed and produced by themselves are subject to VAT refund upon collection for the amount exceeding 3% oftheir actual VAT burdens. In 2023, the subsidiaries Zoomlion Environmental Company and Infore Technology Company are entitled to enjoy the VAT refund upon collection policy for sale of their self-developed and self-produced software products.
(2) Pursuant to the "Announcement of MOF and STA on Clarifying Policies on VAT Reduction and Exemption, etc. for Small-scale Taxpayers" (Announcement of MOF and STA [2023] No. 1), eligible taxpayers engaged in the life services as met the provisions of the "Announcement of MOF and STA on Clarifying Extra VAT Deduction and Exemption Policy for Life Service Industry" (Announcement of MOF and STA [2019] No. 87) are entitled to enjoy an extra 10% VAT credit. In 2023, the subsidiaries Zoomlion Environmental Company and its certain subsidiaries, Foshan Shunde Yuanyi Water Environmental Protection Co., Ltd. and Infore Zoomlion City Environmental Service Co., Ltd. are entitled to enjoy such preferential policy.
(3) Pursuant to the "Notice of MOF and STA on Extra VAT Deduction Policy for Advanced Manufacturing Enterprises" (Announcement of MOF and STA [2023] No. 43), from January 1, 2023 to December 31, 2027, advanced manufacturing enterprises are eligible to enjoy an extra 5% VAT credit. In 2023, the subsidiaries Zoomlion Environmental Company, Infore Technology Company, Shangfeng Industrial Company and Yolsh Company are entitled to enjoy such preferential policy.
(4) Pursuant to Article 5 of the "Announcement of MOF and STA on Improving VAT Policy for Improving Comprehensive Utilization of Resources" (Announcement of MOF and STA [2021] No. 40), since March 1, 2022, enterprises rendering sewage treatment services are entitled to enjoy 70% VAT refund upon collection. In 2023, the subsidiaries Huaqingyuan Company, Foshan Shunde District Huaying Environmental Water Co., Ltd., Foshan Shunde District Yuanrun Water Environmental Protection Co., Ltd. are entitled to enjoy such preferential policy.
Pursuant to Article 4 ofthe "Notice of MOF and STA on Printing and Distributing the Announcement on VAT
Policy for Improving Comprehensive Utilization of Resources" (Announcement of MOF and STA [2021] No. 40), since March 1, 2022, enterprises rendering sewage treatment services are entitled to enjoy VAT refund upon collection policy or VAT exemption policy. In 2023, the subsidiaries Huaqingyuan Company, Foshan Shunde District Huaying Environmental Water Co., Ltd., Foshan Shunde District Yuanrun Water Environmental Protection Co., Ltd. and Foshan Shunde Huabo Environmental Water Co., Ltd. have adopted VAT exemption policy.
(5) Pursuant to Article 2 of the "Announcement of MOF and STA on Improving VAT Policy for Improving Comprehensive Utilization of Resources" (Announcement of MOF and STA [2021] No. 40), enterprises producing electricity and heat products with fuel from garbage and biogas resources produced by garbage fermentation are entitled to enjoy 100% VAT refund upon collection. Pursuant to Article 5, enterprises rendering garbage treatment and sewage treatment services are entitled to enjoy 70% VAT refund upon collection. The subsidiaries Lianjiang Company, Shouxian Green Oriental New Energy Co., Ltd. (the "Shouxian Company") and Funan Green Oriental Environmental Energy Co., Ltd. (the "Funan Company") are entitled to enjoy such preferential policy.
(6) Pursuant to the "Measures for the Implementation of the Pilot Implementation of VAT Reform forthe Transportation Industry and Certain Modern Service Industries" (Cai Shui [2011] No. 111), revenue from technology transfer, technology development, and related technical consulting, and technical service businesses is exempt from VAT. In 2023, the subsidiary Shenzhen Dingzhu Environmental Technology Co., Ltd. meets the condition and is exempt from VAT.
(7) Pursuant to the "Announcement of MOF, STA and Ministry of Veterans Affairs (MVA) on Tax Policies for Further Supporting the Business Startup by and the Employment of Veterans Seeking Independent Employment" (Announcement of MOF, STA and MVA [2023] No. 14), from January 1, 2023 to December 31, 2027, if an enterprise enters into an employment contract with veteran seeking independent employment for a term of one year or more and payssocial insurance premiums in accordance with the law, it may enjoy a credit within the standard quota against, in sequential order, VAT, urban maintenance and construction tax, educational surcharge, local education surcharges and enterprise income tax according to the number of persons actually employed for three years from the month when the employment contract is signed and the social premiums are paid. In 2023, the subsidiary Zoomlion Environmental Company and its certain subsidiaries were entitled to enjoy such tax reduction and exemption policy.
(8) Pursuant to the "Announcement of the MOF, SAT, Ministry of Hunman Resources and Social Security (MHR), Ministry of Agriculture and Rural Affairs (MAR) on Tax Policies for Further Supporting the Business Startup by and the Employment of Key Populations" (Announcement [2023] No. 15), from January 1, 2023 to December 31,2027, if an enterprise enters into an employment contract with people who have been lifted out of poverty, as well as people who have been registered as unemployed for more than six months at the public employment service agency of MHR with an "Entrepreneurship Certificate" or "Unemployment Registration Certificate" (Indicated "Enterprise Tax Absorption Policy"), for a term of one year or more and pays social insurance premiums in accordance with the law, it may enjoy a credit within the standard quota against, in sequential order, VAT, urban maintenance and construction tax, educational surcharge, local education surcharges and enterprise income tax according to the number of persons actually employed for three years from the month when the employment
contract is signed and the social premiums are paid. In 2023, the subsidiary Zoomlion Environmental Company and its certain subsidiaries were entitled to enjoy such tax reduction and exemption policy.
- Reduction and exemption policy on six local taxes and two rates
Pursuant to the "Announcement of the MOF and SAT on Tax Policies for Further Supporting the Development of Small Enterprises with Meager Profit and Individually-Owned Businesses" (Announcement of MOF and STA [2023] No. 12), from January 1, 2023 to December 31, 2027, for VAT small-scale taxpayers, small enterprises with meager profit and individually-owned businesses,resource tax (excluding water resources tax), urban maintenance and construction tax, housing property tax, urban land use tax, stamp duty (excluding securities transaction stamp duty) cultivated land occupation tax and education surcharge, local education surcharge will be halved. In 2023, some subsidiaries of Zoomlion Environmental Company, Foshan Shunhe Environmental Protection Co., Ltd., Foshan Shunde Huabo Environmental Water Co., Ltd. and Foshan Shunde Yuanyi Water Environmental Protection Co., Ltd. were eligible to enjoy such tax preferential policy.
V. Notes to items ofconsolidated financial statements
(I) Notes to items ofthe consolidated balance sheet
-
- Cash and bank balances
- (1) Details
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Cashonhand | 310,688.91 | 84,414.54 |
| Cashinbank | 4,150,666,527.57 | 4,590,418,271.45 |
| Othercashandbankbalances | 260,399,367.30 | 137,700,844.47 |
| Total | 4,411,376,583.78 | 4,728,203,530.46 |
| Including:Depositedoverseas | 1,519,215.68 | 3,949,867.33 |
(2) Other remarks
-
Closing balance of cash in bank included funds frozen due to lawsuits of 5,100,869.89 yuan, engineering escrow accounts not available for separate use of 154,141.05 yuan, frozen security deposits of 290,200.17 yuan and certificates ofdeposit of 230,340,333.33 yuan, which was with use restrictions.
-
Closing balance of other cash and bank balances included deposits for notes of 179,001,533.41 yuan, deposits for letters of guarantee of 77,546,493.49 yuan, engineering deposits of929,734.93 yuan, ETC deposits of 3,000.00 yuan, deposits for buyer's credit of 861,924.65 yuan and deposits for land reclamation of 1,003,098.32 yuan, which was with use restrictions.
2. Notes receivable
(1) Details
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Bankacceptance | 4,597,270.24 | 6,474,284.28 |
| Tradeacceptance | 349,861.59 | 7,091,421.94 |
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| Total | 4,947,131.83 | 13,565,706.22 |
(2) Provision for bad debts
1) Details on categories
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionfor | |||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | |||
| Receivableswithprovisionforbaddebtsmadeonacollectivebasis | 5,005,019.28 | 100.00 | 57,887.45 | 1.16 | 4,947,131.83 | ||
| Including:Bankacceptance | 4,597,270.24 | 91.85 | 4,597,270.24 | ||||
| Tradeacceptance | 407,749.04 | 8.15 | 57,887.45 | 14.20 | 349,861.59 | ||
| Total | 5,005,019.28 | 100.00 | 57,887.45 | 1.16 | 4,947,131.83 | ||
(Continued)
| Openingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionfor | |||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | |||
| Receivableswithprovisionforbaddebtsmadeonacollectivebasis | 15,111,625.30 | 100.00 | 1,545,919.08 | 10.23 | 13,565,706.22 | ||
| Including:Bankacceptance | 6,474,284.28 | 42.84 | 6,474,284.28 | ||||
| Tradeacceptance | 8,637,341.02 | 57.16 | 1,545,919.08 | 17.90 | 7,091,421.94 | ||
| Total | 15,111,625.30 | 100.00 | 1,545,919.08 | 10.23 | 13,565,706.22 |
2) Notes receivable with provision for bad debts made on a collective basis
| Items | Closingbalance | ||||||
|---|---|---|---|---|---|---|---|
| Bookbalance | Provisionforbaddebts | Provisionproportion(%) | |||||
| Bankacceptanceportfolio | 4,597,270.24 | ||||||
| Tradeacceptanceportfolio | 407,749.04 | 57,887.45 | 14.20 | ||||
| Subtotal | 5,005,019.28 | 57,887.45 | 1.16 |
(3) Changes in provision for bad debts
| Opening | Increase | Decrease | Closing | ||||
|---|---|---|---|---|---|---|---|
| Items | balance | Accrual | RecoveryorReversal | Write-off | Others | balance | |
| Receivableswithprovisionforbaddebtsmadeonacollectivebasis | 1,545,919.08 | -1,488,031.63 | 57,887.45 | ||||
| Total | 1,545,919.08 | -1,488,031.63 | 57,887.45 |
(4) No pledged notes at the balance sheet date.
(5) Endorsed or discounted but undue notes at the balance sheet date
| Items | Closingbalancederecognized | Closingbalancenotyetderecognized |
|---|---|---|
| Bankacceptance | 4,472,210.78 | |
| Tradeacceptance | 407,749.04 | |
| Subtotal | 4,879,959.82 |
(6) Notes receivable transferred to accounts receivable due to non-performance of issuer
| Items | Amounttransferred |
|---|---|
| Tradeacceptance | 9,618,317.80 |
| Subtotal | 9,618,317.80 |
3. Accounts receivable
(1) Age analysis
| Ages | Closingbookbalance | Openingbookbalance |
|---|---|---|
| Within1year | 4,798,113,288.74 | 4,708,241,417.53 |
| 1-2years | 930,689,479.95 | 892,266,330.70 |
| 2-3years | 552,003,141.94 | 336,117,089.17 |
| 3-5years | 277,106,854.66 | 199,203,953.15 |
| Over5years | 89,167,772.76 | 74,219,972.77 |
| Total | 6,647,080,538.05 | 6,210,048,763.32 |
(2) Provision for bad debts
- Details on categories
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Categories | Book | balance | Provisionforbaddebts | ||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | |||
| Receivableswithprovisionmadeonanindividualbasis | 261,607,248.18 | 3.94 | 108,069,720.23 | 41.31 | 153,537,527.95 | ||
| Receivableswithprovisionmadeonacollectivebasis | 6,385,473,289.87 | 96.06 | 671,341,340.96 | 10.51 | 5,714,131,948.91 | ||
| Total | 6,647,080,538.05 | 100.00 | 779,411,061.19 | 11.73 | 5,867,669,476.86 | ||
| (Continued) |
| Openingbalance | |||
|---|---|---|---|
| Categories | Bookbalance | Provisionforbaddebts | Carryingamount |
| Amount | %tototal | Amount | Provisionproportion(%) | ||
|---|---|---|---|---|---|
| Receivableswithprovisionmadeonanindividualbasis | 26,702,254.77 | 0.43 | 16,482,074.94 | 61.73 | 10,220,179.83 |
| Receivableswithprovisionmadeonacollectivebasis | 6,183,346,508.55 | 99.57 | 567,774,216.01 | 9.18 | 5,615,572,292.54 |
| Total | 6,210,048,763.32 | 100.00 | 584,256,290.95 | 9.41 | 5,625,792,472.37 |
- Significant accounts receivable with provision made on an individual basis
| Openingbalance | Closingbalance | |||||||
|---|---|---|---|---|---|---|---|---|
| Debtors | Bookbalance | Provisionforbaddebts | Bookbalance | Provisionforbaddebts | Provisionproportion(%) | Basisforprovisionmade | ||
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | 189,921,071.39 | 56,976,321.42 | 30.00 | Expectedcreditlosses | ||||
| Subtotal | 189,921,071.39 | 56,976,321.42 | 30.00 |
- Accounts receivable with provision for bad debts made on a collective basis
| Closingbalance | |||||
|---|---|---|---|---|---|
| Items | BookbalanceProvisionforbaddebts | Provisionproportion(%) | |||
| Portfoliogroupedwithages | 6,050,614,468.43 | 659,820,086.32 | 10.91 | ||
| Portfoliogroupedwithcommercialfactoringreceivable | 294,408,028.59 | 11,521,254.64 | 3.91 | ||
| Portfoliogroupedwithgovernmentgrantsreceivablefornewenergyvehicles | 40,450,792.85 | ||||
| Subtotal | 6,385,473,289.87 | 671,341,340.96 | 10.51 |
- Accounts receivable with provision made on a collective basis using age analysis method
| Closingbalance | ||||||
|---|---|---|---|---|---|---|
| Ages | BookbalanceProvisionforbaddebts | Provisionproportion(%) | ||||
| Within1year | 4,404,011,770.14 | 220,200,588.57 | 5.00 | |||
| 1-2years | 824,904,402.24 | 82,490,440.22 | 10.00 | |||
| 2-3years | 476,520,031.86 | 142,956,009.56 | 30.00 | |||
| 3-5years | 262,010,432.44 | 131,005,216.22 | 50.00 | |||
| Over5years | 83,167,831.75 | 83,167,831.75 | 100.00 | |||
| Subtotal | 6,050,614,468.43 | 659,820,086.32 | 10.91 |
- Commercial factoring portfolio grouped by five-level classification
| Five-level | Closingbalance | ||||
|---|---|---|---|---|---|
| classification | Bookbalance | Unrealizedfinancingincome | Provisionforbaddebts | Provisionproportion(%) | |
| Pass | 249,939,526.65 | 3,749,092.90 | 1.50 |
| Five-level | Closingbalance | ||||
|---|---|---|---|---|---|
| classification | Bookbalance | Unrealizedfinancingincome | Provisionforbaddebts | Provisionproportion(%) | |
| Special-mention | 20,623,662.36 | 618,709.87 | 3.00 | ||
| Substandard | 23,844,839.58 | 7,153,451.87 | 30.00 | ||
| Subtotal | 294,408,028.59 | 11,521,254.64 | 3.91 |
(3) Changes in provision for bad debts
1) Details
| Increase/Decrease | Closing | |||||
|---|---|---|---|---|---|---|
| ItemsOpening | balance | Accrual | RecoveryorReversal | Write-off | Others | balance |
| Receivableswithprovisionmadeonanindividualbasis | 16,482,074.94 | 100,712,885.29 | 484,240.00 | 8,641,000.00 | 108,069,720.23 | |
| Receivableswithprovisionmadeonacollectivebasis | 567,774,216.01 | 151,514,611.64 | 835,452.64 | 47,112,034.05 | 671,341,340.96 | |
| Total | 584,256,290.95 | 252,227,496.93 | 1,319,692.64 | 55,753,034.05 | 779,411,061.19 |
- No significant provisions collected or reversed in the current period.
(4) Accounts receivable actually written off in the currentperiod
- Accounts receivable written off
| Items | Amountwrittenoff |
|---|---|
| Accountsreceivableactuallywrittenoff | 55,753,034.05 |
- No significant accounts receivable written off in the currentperiod.
(5) Details ofthe top 5 debtors with largest balances ofaccounts receivable and contract assets
| Closingbookbalance | Proportiontothetotal | Provisionforbad | |||
|---|---|---|---|---|---|
| Debtors | Accountsreceivable | Contractassets(includingcontractsassetspresentedunderothernon-currentassets) | Subtotal | balanceofaccountsreceivableandcontractassets(includingcontractsassetspresentedunderothernon-currentassets)(%) | debtsofaccountsreceivableandprovisionforimpairmentofcontractassets |
| No.1 | 189,921,071.39 | 189,921,071.39 | 2.75 | 56,976,321.42 | |
| No.2 | 100,039,699.41 | 100,039,699.41 | 1.45 | 17,825,857.13 | |
| No.3 | 74,592,738.95 | 74,592,738.95 | 1.08 | 5,958,563.47 | |
| No.4 | 70,454,956.26 | 5,935,440.93 | 76,390,397.19 | 1.11 | 7,895,525.34 |
| No.5 | 64,715,567.52 | 64,715,567.52 | 0.94 | 3,235,778.38 | |
| Subtotal | 499,724,033.53 | 5,935,440.93 | 505,659,474.46 | 7.33 | 91,892,045.74 |
4. Receivables financing
(1) Details
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| ------- | -------------------- | -------------------- | -- |
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| Bankacceptance | 146,814,501.64 | 107,316,593.41 | |
| Total | 146,814,501.64 | 107,316,593.41 |
(2) Pledged receivables financing at the balance sheet date
| Items | Closingbalanceofpledgednotes | ||
|---|---|---|---|
| Bankacceptance | 55,280,364.20 | ||
| Subtotal | 55,280,364.20 |
(3) Endorsed or discounted but undue receivables financing at the balance sheet date
| Items | Closingbalancederecognized126,601,525.47 | |
|---|---|---|
| Bankacceptance | ||
| Subtotal | 126,601,525.47 |
Due to the fact that the acceptor of bank acceptance iscommercial bank, which is of high credit level, there is very little possibility of failure in recoverability when it isdue. Based on this fact, the Company derecognized the endorsed or discounted bank acceptance. However, if any bank acceptance is not recoverable when it is due, the Company still holds joint liability on such acceptance, according to the China Commercial Instrument Law.
5. Advances paid
(1) Age analysis
1) Details
| Ages | Closingbalance | |||||
|---|---|---|---|---|---|---|
| Bookbalance | %tototal | Provisionforimpairment | Carryingamount | |||
| Within1year | 131,172,209.02 | 93.53 | 131,172,209.02 | |||
| 1-2years | 8,100,756.68 | 5.78 | 8,100,756.68 | |||
| 2-3years | 327,684.83 | 0.23 | 327,684.83 | |||
| Over3years | 640,396.13 | 0.46 | 640,396.13 | |||
| Total | 140,241,046.66 | 100.00 | 140,241,046.66 | |||
| (Continued) |
| Openingbalance | ||||||
|---|---|---|---|---|---|---|
| Ages | Bookbalance | %tototal | Provisionforimpairment | Carryingamount | ||
| Within1year | 186,619,989.22 | 97.02 | 186,619,989.22 | |||
| 1-2years | 4,515,793.00 | 2.35 | 4,515,793.00 | |||
| 2-3years | 1,175,026.94 | 0.61 | 1,175,026.94 | |||
| Over3years | 49,733.08 | 0.02 | 49,733.08 | |||
| Total | 192,360,542.24 | 100.00 | 192,360,542.24 |
- No material balance with age overone year.
(2) Details ofthe top 5 debtors with largest balances
| Debtors | Bookbalance | Proportiontothetotalbalanceofadvancespaid(%) | |
|---|---|---|---|
| No.1 | 7,896,200.00 | 5.63 | |
| No.2 | 3,636,283.20 | 2.59 | |
| No.3 | 2,387,925.65 | 1.70 | |
| No.4 | 1,988,886.43 | 1.42 | |
| No.5 | 1,980,000.00 | 1.41 | |
| Subtotal | 17,889,295.28 | 12.75 |
- Other receivables
(1) Other receivables categorized by nature
| Natureofreceivables | Closingbookbalance | Openingbookbalance |
|---|---|---|
| Temporaryadvancepaymentreceivableandpettycash | 163,429,454.84 | 189,730,555.74 |
| Securitydeposits | 82,240,734.41 | 115,535,012.45 |
| Performancecompensation | 113,460,620.00 | 113,460,620.00 |
| Others | 4,598,968.70 | 6,649,505.96 |
| Total | 363,729,777.95 | 425,375,694.15 |
(2) Age analysis
| Ages | Closingbookbalance | Openingbookbalance |
|---|---|---|
| Within1year | 117,612,450.57 | 195,949,031.83 |
| 1-2years | 65,555,129.46 | 171,544,892.21 |
| 2-3years | 149,623,905.77 | 27,310,051.83 |
| 3-4years | 10,558,177.00 | 22,981,433.06 |
| 4-5years | 14,053,059.51 | 3,490,125.62 |
| Over5years | 6,327,055.64 | 4,100,159.60 |
| Total | 363,729,777.95 | 425,375,694.15 |
(3) Provision for bad debts
- Details on categories
| Closingbalance | ||||||
|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionforbaddebts | ||||
| Amount | %tototal | ProvisionAmountproportion(%) | Carryingamount | |||
| Receivableswithprovisionmadeonanindividualbasis | ||||||
| Receivableswithprovisionmadeonacollectivebasis | 363,729,777.95 | 100.00 | 47,068,704.69 | 12.94 | 316,661,073.26 |
| Categories | Closingbalance | |||||
|---|---|---|---|---|---|---|
| Bookbalance | Provisionforbaddebts | |||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | ||
| Total | 363,729,777.95 | 100.00 | 47,068,704.69 | 12.94 | 316,661,073.26 |
(Continued)
| Openingbalance | ||||||
|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionforbaddebts | ||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | ||
| Receivableswithprovisionmadeonanindividualbasis | ||||||
| Receivableswithprovisionmadeonacollectivebasis | 425,375,694.15 | 100.00 | 39,753,423.15 | 9.35 | 385,622,271.00 | |
| Total | 425,375,694.15 | 100.00 | 39,753,423.15 | 9.35 | 385,622,271.00 |
- Other receivables with provision made on a collective basis
a. Other receivables with provision made on a collective basis – parent company
| Closingbalance | ||||||
|---|---|---|---|---|---|---|
| Ages | Bookbalance | Provisionforbaddebts | Provisionproportion(%) | |||
| Portfoliogroupedwithperformancecompensation | 113,460,620.00 | 2,179,342.69 | 1.92 | |||
| Portfoliogroupedwithbuyer'scredit | 24,127,705.88 | 4,857,450.12 | 20.13 | |||
| Portfoliogroupedwithages | 4,995,936.39 | 1,713,840.08 | 34.30 | |||
| Including:1-180days | 258,669.54 | |||||
| 180days-1year | 1,019,113.00 | 20,382.26 | 2.00 | |||
| 1-2years | 315,690.79 | 31,569.08 | 10.00 | |||
| 2-3years | 329,381.49 | 98,814.45 | 30.00 | |||
| 3-5years | 2,984,636.57 | 1,492,318.29 | 50.00 | |||
| Over5years | 88,445.00 | 70,756.00 | 80.00 | |||
| Subtotal | 142,584,262.27 | 8,750,632.89 | 6.14 |
Notes: For the portfolio grouped with performance compensation, expected credit losses are measured based on the remaining balance afterthe mandatory enforcement after the balance sheet date. Please refer to section XIV (III) 1 of notes to the financial statements for details.
b. Ventilation equipment manufacturing industry and environmental integrated industry
| Portfolios | Closingbalance | ||||
|---|---|---|---|---|---|
| Bookbalance | Provisionforbaddebts | Provisionproportion(%) |
| Closingbalance | ||||||
|---|---|---|---|---|---|---|
| Portfolios | Bookbalance | Provisionforbaddebts | Provisionproportion(%) | |||
| Portfoliogroupedwithages | 221,145,515.68 | 38,318,071.80 | 17.33 | |||
| Including:Within1year | 104,576,885.16 | 5,229,038.34 | 5.00 | |||
| 1-2years | 52,869,515.66 | 5,286,951.57 | 10.00 | |||
| 2-3years | 35,833,904.28 | 10,750,171.28 | 30.00 | |||
| 3-5years | 21,626,599.94 | 10,813,299.97 | 50.00 | |||
| Over5years | 6,238,610.64 | 6,238,610.64 | 100.00 | |||
| Subtotal | 221,145,515.68 | 38,318,071.80 | 17.33 |
(4) Changes in provision for bad debts
| Stage1 | Stage2 | Stage3 | ||
|---|---|---|---|---|
| Items | 12‑monthexpectedcreditlosses | Lifetimeexpectedcreditlosses(creditnotimpaired) | Lifetimeexpectedcreditlosses(creditimpaired) | Subtotal |
| Openingbalance | 8,420,041.44 | 5,808,427.22 | 25,524,954.49 | 39,753,423.15 |
| Openingbalanceinthecurrentperiod | ||||
| --Transferredtostage2 | -2,649,887.72 | 2,649,887.72 | ||
| --Transferredtostage3 | -3,616,328.58 | 3,616,328.58 | ||
| --Reversedtostage2 | ||||
| --Reversedtostage1 | ||||
| Provisionmadeinthecurrentperiod | -479,707.78 | 1,972,005.47 | 7,298,991.30 | 8,791,288.99 |
| Provisionrecoveredorreversedinthecurrentperiod | 18,583.43 | 305,040.36 | 1,129,941.75 | 1,453,565.54 |
| Provisionwrittenoffinthecurrentperiod | ||||
| Otherchanges[Note] | -22,441.91 | -22,441.91 | ||
| Closingbalance | 5,249,420.60 | 6,508,951.47 | 35,310,332.62 | 47,068,704.69 |
| Provisionproportion(%) | 4.96 | 9.93 | 19.56 | 12.94 |
Note: Other changes refer to balances transferred out due to the disposal of subsidiaries in the currentperiod.
Division basis for each stages: ages ofother receivables.
| (5) | Detailsofthetop5debtorswithlargestbalances |
|---|---|
| Debtors | Natureofreceivables | Closingbookbalance | Ages | Proportiontothetotalbalanceofotherreceivables(%) | Provisionforbaddebtsatthebalancesheetdate |
|---|---|---|---|---|---|
| No.1 | Performancecompensationandtemporaryadvancepaymentreceivable | 113,792,911.19 | [Note] | 31.29 | 2,362,244.28 |
| No.2 | Temporaryadvancepaymentreceivable | 9,707,040.68 | 1-2years | 2.67 | 2,912,112.20 |
| No.3 | Temporaryadvancepaymentreceivable | 8,550,000.00 | 180days-1year | 2.35 | 855,000.00 |
| Debtors | Natureofreceivables | Closingbookbalance | Ages | Proportiontothetotalbalanceofotherreceivables(%) | Provisionforbaddebtsatthebalancesheetdate |
|---|---|---|---|---|---|
| No.4 | Securitydeposits | 6,068,877.68 | 2-3years | 1.67 | 1,820,663.30 |
| No.5 | Securitydeposits | 5,325,411.20 | 4-5years | 1.46 | 2,662,705.60 |
| Subtotal | 143,444,240.75 | 39.44 | 10,612,725.38 |
Note: It includes 113,460,620.00 yuan as performance compensation with age of 2 to 3 years, 298,779.19 yuan as temporary advance payment receivable with age of 3 to 5 years, and 33,512.00 yuan as temporary advance payment receivable with age over 5 years.
- Inventories
(1) Details
| Closingbalance | Openingbalance | |||||
|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforwrite-down | Carryingamount | Bookbalance | Provisionforwrite-down | Carryingamount |
| Rawmaterials | 124,680,011.55 | 17,707,425.98 | 106,972,585.57 | 179,291,553.12 | 10,856,535.28 | 168,435,017.84 |
| Workinprocess | 185,705,546.49 | 5,117,048.20 | 180,588,498.29 | 177,447,500.50 | 2,633,928.18 | 174,813,572.32 |
| Goodsonhand | 671,255,477.27 | 10,858,073.14 | 660,397,404.13 | 543,123,849.45 | 16,365,369.64 | 526,758,479.81 |
| Materialsonconsignmentforfurtherprocessing | 135,587.95 | 135,587.95 | 710,664.71 | 710,664.71 | ||
| Coststofulfillacontract | 23,135,561.21 | 23,135,561.21 | 10,320,302.27 | 10,320,302.27 | ||
| Total | 1,004,912,184.47 | 33,682,547.32 | 971,229,637.15 | 910,893,870.05 | 29,855,833.10 | 881,038,036.95 |
(2) Provision for inventory write-down
- Details
| Opening | Increase | Decrease | |||||
|---|---|---|---|---|---|---|---|
| Items | balance | Accrual | Others | Reversalorwrite-off | Others | Closingbalance | |
| Rawmaterials | 10,856,535.28 | 9,203,927.63 | 2,353,036.93 | 17,707,425.98 | |||
| Workinprocess | 2,633,928.18 | 2,675,381.31 | 192,261.29 | 5,117,048.20 | |||
| Goodsonhand | 16,365,369.64 | 3,963,683.30 | 9,470,979.80 | 10,858,073.14 | |||
| Total | 29,855,833.10 | 15,842,992.24 | 12,016,278.02 | 33,682,547.32 |
- Determination basis of net realizable value and reasons for the reversal or write-off of provision for inventory write-down
| write-down | |
|---|---|
| ------------ | -- |
| Items | Determinationbasisofnetrealizablevalue | Reasonsforwrite-offofprovisionforinventorywrite-down |
|---|---|---|
| Rawmaterials,workinprocess | Estimatedsellingpriceofrelevantfinishedgoodslesscosttobeincurreduponcompletion,estimatedsellingexpenses,andrelevanttaxesandsurcharges | Inventorieswithprovisionforinventorywrite-downmadeatthebeginningoftheperiodwereusedorsoldinthecurrentperiod. |
| Goodsonhand | Estimatedsellingpriceofrelevantfinishedgoodslessestimatedselling | Inventorieswithprovisionforinventorywrite-downmadeatthe |
| Determinationbasisofnetrealizable | Reasonsforwrite-offofprovisionfor | |||
|---|---|---|---|---|
| Items | value | inventorywrite-down | ||
| expenses,andrelevanttaxesand | beginningoftheperiodweresoldin | |||
| surcharges | thecurrentperiod. |
(3) Costs to fulfill a contract
| Items | Openingbalance | Increase | Carriedforward | Closingbalance |
|---|---|---|---|---|
| TownshipsewagedeliveryprojectphaseIIofHanshouCounty | 908,488.95 | 7,208,417.24 | 908,488.95 | 7,208,417.24 |
| KitchenprojectofShangraoGuangfengDistrict | 4,533,540.92 | 4,533,540.92 | ||
| Well-pointequipmentsalesofLeiyangCity | 1,815,112.42 | 1,815,112.42 | ||
| PretreatmentequipmentprocurementprojectofDuyunproject | 1,681,363.40 | 1,681,363.40 | ||
| LeachatedeliveryprojectofXi'anChanbaTransferStation | 1,117,852.48 | 1,117,852.48 | ||
| EquipmentsalesofYongshunCounty,XiangxiTujiaandMiaoAutonomousPrefecture-townshipsewage(Wanping) | 1,450,156.90 | 1,450,156.90 | ||
| LeachatedeliveryprojectofFuzhouQingliangshanTransferStation | 2,059,176.45 | 500,917.40 | 2,560,093.85 | |
| Others | 2,969,515.07 | 9,001,530.72 | 5,191,771.04 | 6,779,274.75 |
| Subtotal | 10,320,302.27 | 22,925,769.68 | 10,110,510.74 | 23,135,561.21 |
8. Contract assets
(1) Details
| Closingbalance | ||||||
|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | |||
| Qualityguaranteedepositsreceivable | 84,519,179.04 | 9,715,689.56 | 74,803,489.48 | |||
| Total | 84,519,179.04 | 9,715,689.56 | 74,803,489.48 | |||
(Continued)
| Openingbalance | |||||
|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | ||
| Qualityguaranteedepositsreceivable | 116,355,489.32 | 15,331,634.99 | 101,023,854.33 | ||
| Total | 116,355,489.32 | 15,331,634.99 | 101,023,854.33 |
(2) Details on provision for impairment
1) Details on categories
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionforimpairment | Carrying | ||||
| Amount | %tototal | Amount | Provisionproportion(%) | amount | |||
| Receivableswithprovisionmadeonacollectivebasis | 84,519,179.04 | 100.00 | 9,715,689.56 | 11.50 | 74,803,489.48 | ||
| Total | 84,519,179.04 | 100.00 | 9,715,689.56 | 11.50 | 74,803,489.48 | ||
| (Continued) |
| Openingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionforimpairment | Carrying | ||||
| Amount | %tototal | Amount | Provisionproportion(%) | amount | |||
| Receivableswithprovisionmadeonacollectivebasis | 116,355,489.32 | 100.00 | 15,331,634.99 | 13.18 | 101,023,854.33 | ||
| Total | 116,355,489.32 | 100.00 | 15,331,634.99 | 13.18 | 101,023,854.33 |
2) Contract assets with provision for impairment made on a collective basis
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Items | BookbalanceProvisionforimpairment | Provisionproportion(%) | |||||
| Portfoliogroupedwithqualityguaranteedeposits | 84,519,179.04 | 9,715,689.56 | 11.50 | ||||
| Subtotal | 84,519,179.04 | 9,715,689.56 | 11.50 |
(3) Changes in provision for impairment
| Openingbalance | Closing | |||||
|---|---|---|---|---|---|---|
| Items | Accrual | Recoveryorreversal | Write-off | Others | balance | |
| Receivableswithprovisionforimpairmentmadeonacollectivebasis | 15,331,634.99 | -5,615,945.43 | 9,715,689.56 | |||
| Total | 15,331,634.99 | -5,615,945.43 | 9,715,689.56 |
9. Non-current assets due within one year
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Unrecognizedfinanceincome | Provisionforbaddebts | Carryingamount | Discountraterange(%) | ||
| Salesofgoodsininstallments | 328,993,341.47 | 6,469,240.60 | 15,965,200.41 | 306,558,900.46 | 4.20-4.30 | ||
| Paymentsforfinancelease | 46,826,104.16 | 2,749,700.41 | 1,354,452.95 | 42,721,950.80 | 4.20-4.30 | ||
| Factoringofreceivablesfinancing | 215,722,449.48 | 9,685,000.00 | 3,235,836.74 | 202,801,612.74 | 4.20-4.30 | ||
| Total | 591,541,895.11 | 18,903,941.01 | 20,555,490.10 | 552,082,464.00 |
| Openingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Unrecognizedfinanceincome | Provisionforbaddebts | Carryingamount | Discountraterange(%) | ||
| Salesofgoodsininstallments | 433,440,778.60 | 8,785,866.67 | 21,166,538.93 | 403,488,373.00 | 4.30-4.65 | ||
| Paymentsforfinancelease | 58,791,768.45 | 2,263,633.33 | 895,847.05 | 55,632,288.07 | 4.30-4.65 | ||
| Factoringofreceivablesfinancing | 17,823,638.14 | 171,119.36 | 267,354.57 | 17,385,164.21 | 4.30-4.65 | ||
| Total | 510,056,185.19 | 11,220,619.36 | 22,329,740.55 | 476,505,825.28 |
(Continued)
10. Other current assets
(1) Details
| Closingbalance | Openingbalance | |||||
|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | Bookbalance | Provisionforimpairment | Carryingamount |
| InputVATtobecredited,excessinputVATcreditsandprepaidtaxes | 513,175,804.36 | 513,175,804.36 | 482,764,023.99 | 482,764,023.99 | ||
| Coststoobtainacontract | 10,704,601.44 | 10,704,601.44 | 9,306,113.04 | 9,306,113.04 | ||
| Listingexpensesofsubsidiaryspunoff | 5,380,660.39 | 5,380,660.39 | ||||
| Total | 523,880,405.80 | 523,880,405.80 | 497,450,797.42 | 497,450,797.42 |
(2) Costs to obtain a contract
| Items | Openingbalance | Increase | Amortization | Provisionforimpairment | Closingbalance |
|---|---|---|---|---|---|
| Coststoobtainacontract | 9,306,113.04 | 35,876,372.11 | 34,477,883.71 | 10,704,601.44 | |
| Subtotal | 9,306,113.04 | 35,876,372.11 | 34,477,883.71 | 10,704,601.44 |
11. Long-term receivables
(1) Details
| Closingbalance | ||||||||
|---|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Unrealizedfinanceincome | Provisionforbaddebts | Carryingamount | Discountraterange(%) | |||
| Salesofgoodsininstallments | 474,463,111.30 | 28,883,881.35 | 69,637,094.56 | 375,942,135.39 | 4.20-4.30 | |||
| GuaranteedcollectionamountforBOTprojects | 32,146,788.99 | 3,759,737.26 | 1,607,339.45 | 26,779,712.28 | 4.30-4.65 | |||
| Paymentsforfinancelease | 21,422,534.54 | 1,929,467.83 | 486,521.79 | 19,006,544.92 | 4.20-4.30 | |||
| Factoringofreceivablesfinancing | 1,391,000.00 | 20,865.00 | 1,370,135.00 | 4.20-4.30 | ||||
| Total | 529,423,434.83 | 34,573,086.44 | 71,751,820.80 | 423,098,527.59 |
| Openingbalance | ||||||||
|---|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Unrealizedfinanceincome | Provisionforbaddebts | Carryingamount | Discountraterange(%) | |||
| Salesofgoodsininstallments | 607,626,695.18 | 28,919,805.27 | 101,644,682.13 | 477,062,207.78 | 4.30-4.65 | |||
| GuaranteedcollectionamountforBOTprojects | 32,146,788.99 | 3,759,737.26 | 1,607,339.45 | 26,779,712.28 | 4.30-4.65 | |||
| Paymentsforfinancelease | 40,885,220.88 | 2,877,273.01 | 682,107.05 | 37,325,840.82 | 4.30-4.65 | |||
| Factoringofreceivablesfinancing | 421,616,855.59 | 24,329,491.82 | 6,324,252.83 | 390,963,110.94 | 4.30-4.65 | |||
| Total | 1,102,275,560.64 | 59,886,307.36 | 110,258,381.46 | 932,130,871.82 |
(Continued)
(2) Changes in provision for bad debts
1) Details on categories
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Categories | Book | balance | Provisionforimpairment | ||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | |||
| Receivableswithprovisionforimpairmentmadeonanindividualbasis | 1,711,994.50 | 0.35 | 1,711,994.50 | 100.00 | |||
| Receivableswithprovisionforimpairmentmadeonanindividualbasis | 493,138,353.89 | 99.65 | 70,039,826.30 | 14.20 | 423,098,527.59 | ||
| Total | 494,850,348.39 | 100.00 | 71,751,820.80 | 14.50 | 423,098,527.59 |
(Continued)
| Openingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionforimpairment | |||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | |||
| Receivableswithprovisionmadeonacollectivebasis | 1,042,389,253.28 | 100.00 | 110,258,381.46 | 10.58 | 932,130,871.82 | ||
| Total | 1,042,389,253.28 | 100.00 | 110,258,381.46 | 10.58 | 932,130,871.82 |
-
No significant long-term receivables with provision for bad debts made on an individual basis.
-
Long-term receivables with provision for bad debts made on a collective basis using age analysis method
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Ages | Bookbalance | Provisionforbaddebts | Provisionproportion(%) | ||||
| Paymentsundue | 106,097,455.52 | 5,304,872.78 | 5.00 | ||||
| Paymentsdue | 398,800,450.27 | 64,227,566.73 | 16.11 | ||||
| Subtotal | 504,897,905.79 | 69,532,439.51 | 13.77 |
4) Long-term receivables with provision for bad debts using the five-level classification
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforbaddebts | Provisionproportion(%) | ||||
| Portfoliogroupedwithfinanceleasepayment | 21,422,534.54 | 486,521.79 | 2.27 | ||||
| Portfoliogroupedwithreceivablesfinancingfactoringpayment | 1,391,000.00 | 20,865.00 | 1.50 | ||||
| Subtotal | 22,813,534.54 | 507,386.79 | 2.22 |
(3) Changes in provision for bad debts
| Items | Openingbalance | Increase/Decrease | ||||
|---|---|---|---|---|---|---|
| Accrual | Recoveryorreversal | Write-off | Others | Closingbalance | ||
| Receivableswithprovisionforimpairmentmadeonanindividualbasis | 1,711,994.50 | 1,711,994.50 | ||||
| Receivableswithprovisionforimpairmentmadeonacollectivebasis | 110,258,381.46 | -40,218,555.16 | 70,039,826.30 | |||
| Total | 110,258,381.46 | -38,506,560.66 | 71,751,820.80 |
12. Long-term equity investments
(1) Categories
| Closingbalance | Openingbalance | ||||||
|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | Bookbalance | ProvisionforCarryingimpairmentamount | ||
| Investments681,629,084.69inassociates | 681,629,084.69 | 676,829,959.84 | 676,829,959.84 | ||||
| Total | 681,629,084.69 | 681,629,084.69 | 676,829,959.84 | 676,829,959.84 |
(2) Details
| Increase/Decrease | ||||||
|---|---|---|---|---|---|---|
| Investees | Openingbalance | Investmentsincreased | Investmentsdecreased | Investmentincomerecognizedunderequitymethod | Adjustmentinothercomprehensiveincome | |
| Associates | ||||||
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | 29,631,523.07 | -1,821,854.32 | ||||
| GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | 218,036,312.90 | 30,240,907.09 | ||||
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd.[Note1] | ||||||
| ShantouZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 21,960,846.16 | 2,546,071.11 | ||||
| ShantouChaoyangDistrictZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 31,419,699.92 | 647,839.13 | ||||
| ChangshaCowaZoomlionIntelligentTechnologyCo.,Ltd. | 4,893,582.51 | -222,073.44 | ||||
| GuangdongLiangkeEnvironmentalEngineeringCo.,Ltd. | 32,695,599.98 | 203,520.80 |
| Increase/Decrease | ||||||
|---|---|---|---|---|---|---|
| Investees | Openingbalance | Investmentsincreased | Investmentsdecreased | Investmentincomerecognizedunderequitymethod | Adjustmentinothercomprehensiveincome | |
| GuangxiZoomlionGuilvUrbanEnvironmentalServiceCo.,Ltd. | 2,361,751.84 | 260,465.40 | ||||
| ShenzhenYingmeiCityHousekeeperCo.,Ltd. | 28,165.29 | 41.05 | ||||
| FoshanYingtongElectricalMaterialsCo.,Ltd. | 228,933,254.09 | -26,979,326.27 | ||||
| ChinaUrbanInstitute(Beijing)EnvironmentalTechnologyCo.,Ltd. | 97,387,146.22 | 3,801,154.35 | ||||
| BeijingXingyunZhixingTechnologyCo., | Ltd.9,482,077.86 | -816,487.88 | ||||
| GuangdongYinglingTestingTechnologyServiceCo.,Ltd.[Note2] | ||||||
| TaizhouJinzhongEnvironmentalIndustryCo.,Ltd. | 4,900,000.00 | -2,899,564.23 | ||||
| Total | 676,829,959.84 | 4,900,000.00 | 4,960,692.79 |
(Continued)
| Increase/Decrease | Closing | balance | ||||
|---|---|---|---|---|---|---|
| Investees | Changesinotherequity | Cashdividend/Profitdeclaredfordistribution | Provisionforimpairment | Others | Carryingamount | Provisionforimpairment |
| Associates | ||||||
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | 27,809,668.75 | |||||
| GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | 5,061,567.94 | 243,215,652.05 | ||||
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd.[Note1] | ||||||
| ShantouZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 24,506,917.27 | |||||
| ShantouChaoyangDistrictZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 32,067,539.05 | |||||
| ChangshaCowaZoomlionIntelligentTechnologyCo.,Ltd. | 4,671,509.07 | |||||
| GuangdongLiangkeEnvironmentalEngineeringCo.,Ltd. | 32,899,120.78 | |||||
| GuangxiZoomlionGuilvUrbanEnvironmentalServiceCo.,Ltd. | 2,622,217.24 | |||||
| ShenzhenYingmeiCityHousekeeperCo.,Ltd. | 28,206.34 | |||||
| FoshanYingtongElectricalMaterialsCo.,Ltd. | 201,953,927.82 | |||||
| ChinaUrbanInstitute(Beijing)EnvironmentalTechnologyCo.,Ltd. | 101,188,300.57 | |||||
| BeijingXingyunZhixingTechnologyCo.,Ltd. | 8,665,589.98 | |||||
| GuangdongYinglingTestingTechnologyServiceCo.,Ltd.[Note2] | ||||||
| TaizhouJinzhongEnvironmentalIndustryCo.,Ltd. | 2,000,435.77 | |||||
| Total | 5,061,567.94 | 681,629,084.69 |
Note 1: Long-term equity investments of 0.00 yuan in Guangdong Tianshu New Energy Technology Co., Ltd. was due to its long-term loss. The carrying amount of such long-term equity investment was adjusted to 0.00 yuan by the Company under the equity method.
Note 2: Long-term equity investments of 0.00 yuan in Guangdong Yingling Testing Technology Service Co., Ltd. was due to its long-term loss. The carrying amount of such long-term equity investment was adjusted to 0.00 yuan by the Company under the equity method.
- Other equity instrument investments
| Increase/Decrease | |||||||
|---|---|---|---|---|---|---|---|
| Items | Openingbalance | Investmentsincreased | Investmentsdecreased | Gainsorlossesincludedintoothercomprehensiveincomeinthecurrentperiod | Others | ||
| ZhejiangShangyuRuralCommercialBankCo.,Ltd. | 800,000.00 | ||||||
| ShenzhenInforeEnvironmentalProtectionIndustryFundManagementCo.,Ltd. | 270,000.00 | ||||||
| ShenzhenInforeEnvironmentalProtectionIndustryM&AFund[Note] | 14,282,971.01 | ||||||
| Total | 15,352,971.01 | ||||||
| (Continued) |
| Items | Closingbalance | Dividendincomerecognizedinthecurrentperiod | Accumulatedgainsorlossesincludedintoothercomprehensiveincomeattheendoftheperiod | |
|---|---|---|---|---|
| ZhejiangShangyuRuralCommercial | 800,000.00 | 408,044.00 | ||
| BankCo.,Ltd. | ||||
| ShenzhenInforeEnvironmental | ||||
| ProtectionIndustryFundManagement | 270,000.00 | |||
| Co.,Ltd. | ||||
| ShenzhenInforeEnvironmentalProtectionIndustryM&AFund[Note] | 14,282,971.01 | |||
| Total | 15,352,971.01 | 408,044.00 |
Note: As of December 31, 2023, Shenzhen Infore Environmental Protection Industry M&A Fund is still in liquidation.
- Investment property
(1) Details
| Items | Buildingsandstructures | Total |
|---|---|---|
| Cost | ||
| Openingbalance | 29,071,100.66 | 29,071,100.66 |
| Items | Buildingsandstructures | Total | |
|---|---|---|---|
| Increase | |||
| Decrease | 27,266,145.23 | 27,266,145.23 | |
| 1)Disposal | 360,965.00 | 360,965.00 | |
| 2)Transferredoutintofixedassets | 26,905,180.23 | 26,905,180.23 | |
| Closingbalance | 1,804,955.43 | 1,804,955.43 | |
| Accumulateddepreciationandamortization | |||
| Openingbalance | 1,965,665.63 | 1,965,665.63 | |
| Increase | 88,593.04 | 88,593.04 | |
| 1)Accrualoramortization | 88,593.04 | 88,593.04 | |
| Decrease | 1,388,171.84 | 1,388,171.84 | |
| 1)Disposal | 117,929.48 | 117,929.48 | |
| 2)Transferredoutintofixedassets | 1,270,242.36 | 1,270,242.36 | |
| Closingbalance | 666,086.83 | 666,086.83 | |
| Closingcarryingamount | 1,138,868.60 | 1,138,868.60 | |
| Openingcarryingamount | 27,105,435.03 | 27,105,435.03 |
(2) Investment property with certificate of titles being unsettled
| Items | Carryingamount | Reasonsforunsettlement | ||
|---|---|---|---|---|
| ShangyuWandarealestate | 1,138,868.60 | Inprocessing | ||
| Subtotal | 1,138,868.60 |
15. Fixed assets
(1) Details
| Items | Buildingsandstructures | Generalequipment | Specialequipment | Transportfacilities | Otherequipment | Total |
|---|---|---|---|---|---|---|
| Cost | ||||||
| Openingbalance | 1,549,398,837.99 | 164,152,084.63 | 1,174,010,394.82 | 66,315,220.43 | 37,872,401.73 | 2,991,748,939.60 |
| Increase | 52,284,572.68 | 15,914,123.88 | 298,543,607.90 | 1,856,706.52 | 1,470,994.40 | 370,070,005.38 |
| 1)Acquisition | 3,474,388.92 | 10,351,560.25 | 251,273,170.38 | 1,856,706.52 | 1,470,994.40 | 268,426,820.47 |
| 2)Transferredinfromconstructioninprogress | 21,905,003.53 | 5,411,810.98 | 37,441,177.36 | 64,757,991.87 | ||
| 3)Businesscombination | 150,752.65 | 127,198.00 | 277,950.65 | |||
| 4)Transferredinfrominventories | 9,702,062.16 | 9,702,062.16 | ||||
| 5)Transferredinfrominvestmentproperty | 26,905,180.23 | 26,905,180.23 | ||||
| Decrease | 14,500.00 | 4,184,733.91 | 36,311,332.14 | 8,206,633.02 | 1,883,665.88 | 50,600,864.95 |
| 1)Disposal/Scrapping | 4,131,399.40 | 35,268,132.12 | 8,206,633.02 | 1,776,065.88 | 49,382,230.42 | |
| 2)Disposalofsubsidiaries | 14,500.00 | 53,334.51 | 1,043,200.02 | 107,600.00 | 1,218,634.53 | |
| Closingbalance | 1,601,668,910.67 | 175,881,474.60 | 1,436,242,670.58 | 59,965,293.93 | 37,459,730.25 | 3,311,218,080.03 |
| Accumulateddepreciation |
| Items | Buildingsandstructures | Generalequipment | Specialequipment | Transportfacilities | Otherequipment | Total |
|---|---|---|---|---|---|---|
| Openingbalance | 211,955,077.34 | 65,300,299.82 | 409,748,290.58 | 18,602,556.14 | 17,855,513.71 | 723,461,737.59 |
| Increase | 64,097,222.86 | 21,457,613.17 | 186,749,488.79 | 5,965,787.96 | 1,360,261.65 | 279,630,374.43 |
| 1)Accrual | 62,826,980.50 | 21,314,398.19 | 186,697,080.47 | 5,965,787.96 | 1,360,261.65 | 278,164,508.77 |
| 2)Businesscombination | 143,214.98 | 52,408.32 | 195,623.30 | |||
| 3)Transferredinfrominvestmentproperty | 1,270,242.36 | 1,270,242.36 | ||||
| Decrease | 14,065.00 | 3,673,714.78 | 19,965,831.24 | 4,791,734.14 | 1,744,810.97 | 30,190,156.13 |
| 1)Disposal/Scrapping | 3,643,672.74 | 19,142,825.69 | 4,791,734.14 | 1,653,857.30 | 29,232,089.87 | |
| 2)Disposalofsubsidiaries | 14,065.00 | 30,042.04 | 823,005.55 | 90,953.67 | 958,066.26 | |
| Closingbalance | 276,038,235.20 | 83,084,198.21 | 576,531,948.13 | 19,776,609.96 | 17,470,964.39 | 972,901,955.89 |
| Carryingamount | ||||||
| Closingbalance | 1,325,630,675.47 | 92,797,276.39 | 859,710,722.45 | 40,188,683.97 | 19,988,765.86 | 2,338,316,124.14 |
| Openingbalance | 1,337,443,760.65 | 98,851,784.81 | 764,262,104.24 | 47,712,664.29 | 20,016,888.02 | 2,268,287,202.01 |
(2) No fixed assets temporarily idle at the balance sheet date.
(3) Fixed assets leased out under operating leases
| Items | Carryingamount | ||
|---|---|---|---|
| Buildingsandstructures | 22,736,364.29 | ||
| Subtotal | 22,736,364.29 |
(4) Fixed assets with certificate of titles being unsettled
| Items | Carryingamount | Reasonsforunsettlement |
|---|---|---|
| Integrationprojectplant | 302,783,876.40 | Inprocessing |
| EmployeedormitoryinLueryuan | 135,358,752.00 | Inprocessing |
| BottomrenovationworkshopinLueryuan | 21,125,640.93 | Inprocessing |
| LueryuanExhibitionCenter | 15,696,091.03 | Inprocessing |
| StaffcanteeninLueryuan | 22,984,574.86 | Inprocessing |
| Subtotal | 497,948,935.22 |
16. Construction in progress
(1) Details
| Closingbalance | Openingbalance | ||||||
|---|---|---|---|---|---|---|---|
| Projects | Bookbalance | Provisionforimpairment | Carryingamount | Bookbalance | Provisionforimpairment | Carryingamount | |
| InforeEnvironmentShundeEnvironmentalProtectionTechnologyIndustrialPark(PhaseII)Project | 256,519,519.36 | 256,519,519.36 | |||||
| Equipmenttobeinstalled | 19,134,556.95 | 19,134,556.95 | 16,211,018.08 | 16,211,018.08 | |||
| Piecemealprojects | 12,402,942.58 | 12,402,942.58 | 24,862,249.60 | 24,862,249.60 | |||
| Total | 288,057,018.89 | 288,057,018.89 | 41,073,267.68 | 41,073,267.68 |
(2) Changes in significant projects
| Projects | Budgets | Openingbalance | Increase | Transferredtofixedassets | Transferredtointangibleassets | Otherdecreases | Closingbalance |
|---|---|---|---|---|---|---|---|
| InforeEnvironmentShundeEnvironmentalProtectionTechnologyIndustrialPark(PhaseII)Project | 483,333,200.00 | 256,519,519.36 | 256,519,519.36 | ||||
| Equipmenttobeinstalled | 16,211,018.08 | 21,439,852.20 | 7,036,652.70 | 11,479,660.63 | 19,134,556.95 | ||
| Piecemealprojects | 24,862,249.60 | 45,469,636.25 | 57,721,339.17 | 207,604.10 | 12,402,942.58 | ||
| Total | 41,073,267.68 | 323,429,007.81 | 64,757,991.87 | 11,687,264.73 | 288,057,018.89 | ||
| (Continued) |
| Projects | Accumulatedinputtobudget(%) | Completionpercentage(%) | Accumulatedamountofborrowingcostcapitalization | Amountofborrowingcostcapitalizationinthecurrentperiod | Annualcapitalizationrate(%) | Fundsource |
|---|---|---|---|---|---|---|
| InforeEnvironmentShundeEnvironmentalProtectionTechnologyIndustrialPark(PhaseII)Project | 54.95 | 54.95 | 2,716,000.00 | 2,716,000.00 | 0.73 | Self-raised,long-termborrowings |
| Equipmenttobeinstalled | Self-raised | |||||
| Piecemealprojects | Self-raised | |||||
| Total | 2,716,000.00 | 2,716,000.00 |
17. Right-of-use assets
| Items | Buildingsandstructures | Total | |
|---|---|---|---|
| Cost | |||
| Openingbalance | 46,849,639.86 | 46,849,639.86 | |
| Increase | 2,440,036.08 | 2,440,036.08 | |
| 1)Leasedin | 2,440,036.08 | 2,440,036.08 | |
| Decrease | 9,387,245.15 | 9,387,245.15 | |
| 1)Disposal | 9,387,245.15 | 9,387,245.15 | |
| Closingbalance | 39,902,430.79 | 39,902,430.79 | |
| Accumulateddepreciation | |||
| Openingbalance | 14,990,185.62 | 14,990,185.62 | |
| Increase | 8,706,270.90 | 8,706,270.90 | |
| 1)Accrual | 8,706,270.90 | 8,706,270.90 | |
| Decrease | 8,919,697.68 | 8,919,697.68 | |
| 1)Disposal | 8,919,697.68 | 8,919,697.68 | |
| Closingbalance | 14,776,758.84 | 14,776,758.84 | |
| Carryingamount | |||
| Closingbalance | 25,125,671.95 | 25,125,671.95 | |
| Openingbalance | 31,859,454.24 | 31,859,454.24 |
18. Intangible assets
(1) Details
| CostOpeningbalance657,565,927.3770,369,281.836,775,246,738.14459,379,594.21Increase7,152,320.0014,940,796.49659,915,003.7432,917,511.291)Acquisition7,152,320.003,253,531.76659,915,003.742)Transferredinfromconstructionin11,687,264.7311,687,264.73process3)IndependentR&D32,917,511.2932,917,511.29Decrease362,058,343.473,536,938.021)Disposal24,255,438.093,536,938.0227,792,376.112)Transferredoutintoothernon-current337,802,905.38assetsClosingbalance664,718,247.3785,310,078.327,073,103,398.41488,760,167.48AccumulatedamortizationOpeningbalance85,065,544.6323,500,971.701,486,964,648.90271,140,604.91Increase13,707,737.358,023,452.35488,433,164.5437,144,253.061)Accrual13,707,737.358,023,452.35488,433,164.5437,144,253.06Decrease130,675,779.15634,634.141)Disposal20,113,600.89634,634.1420,748,235.032)Transferredoutintoothernon-current110,562,178.26assetsClosingbalance98,773,281.9831,524,424.051,844,722,034.29307,650,223.83ProvisionforimpairmentOpeningbalance24,687,522.8523,087,884.0747,775,406.92IncreaseDecrease2,902,303.881)Disposal2,902,303.88Closingbalance24,687,522.8520,185,580.1944,873,103.04CarryingamountClosingbalance565,944,965.3953,785,654.275,203,693,841.27160,924,363.46 | Items | Landuseright | Software | Franchise | Patentedtechnology | Total |
|---|---|---|---|---|---|---|
| 7,962,561,541.55 | ||||||
| 714,925,631.52 | ||||||
| 670,320,855.50 | ||||||
| 365,595,281.49 | ||||||
| 337,802,905.38 | ||||||
| 8,311,891,891.58 | ||||||
| 1,866,671,770.14 | ||||||
| 547,308,607.30 | ||||||
| 547,308,607.30 | ||||||
| 131,310,413.29 | ||||||
| 110,562,178.26 | ||||||
| 2,282,669,964.15 | ||||||
| 2,902,303.88 | ||||||
| 2,902,303.88 | ||||||
| 5,984,348,824.39 | ||||||
| Openingbalance | 572,500,382.74 | 46,868,310.13 | 5,263,594,566.39 | 165,151,105.23 | 6,048,114,364.49 |
(2) No land use right with certificate of titles being unsettled at the balance sheet date.
19. Development expenditures
(1) Details
| Closingbalance | Openingbalance | ||||||
|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | CarryingBookbalanceamount | Provisionforimpairment | Carryingamount | ||
| Developmentexpenditures | 9,063,080.60 | 9,063,080.60 | 33,160,925.44 | 2,822,707.36 | 30,338,218.08 | ||
| Total | 9,063,080.60 | 9,063,080.60 | 33,160,925.44 | 2,822,707.36 | 30,338,218.08 |
(2) Other remarks
Please referto section VI of notes to the financial statements for details on development expenditures.
20. Goodwill
(1) Details
| Investeesorevents | Closingbalance | Openingbalance | ||||
|---|---|---|---|---|---|---|
| resultingingoodwill | Bookbalance | Provisionforimpairment | Carryingamount | Bookbalance | Provisionforimpairment | Carryingamount |
| ZoomlionEnvironmentalCompany | 5,714,428,315.99 | 618,097,980.83 | 5,096,330,335.16 | 5,714,428,315.99 | 528,229,356.55 | 5,186,198,959.44 |
| GreenOrientalCompany | 65,456,185.12 | 65,456,185.12 | 78,074,688.12 | 78,074,688.12 | ||
| FoshanShunheEnvironmentalProtectionCo.,Ltd.[Note] | 329,083,984.91 | 3,152,463.61 | 325,931,521.30 | 316,465,481.91 | 316,465,481.91 | |
| ShangfengIndustrialCompany | 100,455,813.40 | 100,455,813.40 | 100,455,813.40 | 100,455,813.40 | ||
| YolshCompany | 13,389,232.61 | 13,389,232.61 | 13,389,232.61 | 13,389,232.61 | ||
| LianjiangCompany | 46,032,017.84 | 2,229,729.76 | 43,802,288.08 | 46,032,017.84 | 1,013,513.53 | 45,018,504.31 |
| Total | 6,268,845,549.87 | 623,480,174.20 | 5,645,365,375.67 | 6,268,845,549.87 | 529,242,870.08 | 5,739,602,679.79 |
Note: On December 25,2023, the Company's subsidiary Foshan Infore Environmental Water Treatment Co., Ltd. changed its name to Foshan Shunhe Environmental Protection Co., Ltd.
(2) Cost
| Investeesoreventsresultingingoodwill | Openingbalance | Increase[Note] | Decrease[Note] | Closingbalance |
|---|---|---|---|---|
| ZoomlionEnvironmentalCompany | 5,714,428,315.99 | 5,714,428,315.99 | ||
| GreenOrientalCompany | 78,074,688.12 | 12,618,503.00 | 65,456,185.12 | |
| FoshanShunheEnvironmentalProtectionCo.,Ltd. | 316,465,481.91 | 12,618,503.00 | 329,083,984.91 | |
| ShangfengIndustrialCompany | 100,455,813.40 | 100,455,813.40 | ||
| YolshCompany | 13,389,232.61 | 13,389,232.61 | ||
| LianjiangCompany | 46,032,017.84 | 46,032,017.84 | ||
| Total | 6,268,845,549.87 | 12,618,503.00 | 12,618,503.00 | 6,268,845,549.87 |
Note: Pursuant to the "Equity Transfer Agreement" entered into in December 2023, Green Oriental Company transferred 100% of equity of Funan Company to Foshan Shunhe Environmental Protection Co., Ltd., with goodwill of 12,618,503.00 yuan transferred out accordingly, which is a portion of the goodwill of 78,074,688.12
yuan formerly formed in the Company's acquisition of Green Oriental Company.
| Investeesoreventsresultingingoodwill | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| ZoomlionEnvironmentalCompany[Note1] | 528,229,356.55 | 89,868,624.28 | 618,097,980.83 | |
| LianjiangCompany[Note2] | 1,013,513.53 | 1,216,216.23 | 2,229,729.76 | |
| FoshanShunheEnvironmentalProtectionCo.,Ltd.[Note3] | 3,152,463.61 | 3,152,463.61 | ||
| Total | 529,242,870.08 | 94,237,304.12 | 623,480,174.20 |
(3) Provision for impairment
Note 1: For impairment loss of goodwill of Zoomlion Environmental Company, as the goodwill of 92,031,026.04 yuan was recognized at the time of the acquisition of Zoomlion Environmental Company through deferred tax liabilities due to appraisal appreciation at the date of business combination not under common control, provision for impairment of 3,857,982.20 yuan was made along with changes in deferred tax liabilities in the currentperiod. The accumulated provision for impairment of goodwill arising from this factor totaled 56,757,490.15 yuan. Impairment loss of 86,010,642.08 yuan was recognized at the difference between the recoverable amount and the carrying amount of equipment asset group portfolio of Zoomlion Environmental Company, and the accumulated provision for impairment of goodwill arising from this factor totaled 561,340,490.68 yuan.
Note 2: For impairment loss of goodwill of Lianjiang Company, as the goodwill of 30,000,000.00 yuan was recognized at the time of the acquisition of Lianjiang Company through deferred tax liabilities due to appraisal appreciation at the date of business combination not under common control, provision for impairment of 1,216,216.23 yuan was made along with changes in deferred tax liabilities in the currentperiod. The accumulated provision for impairment of goodwill arising from this factor totaled 2,229,729.76 yuan.
Note 3: Impairment loss of 2,161,796.44 yuan was recognized at the difference between the recoverable amount and the carrying amount of water governance operation asset group, and the accumulated provision for impairment of goodwill arising from this factor totaled 2,161,796.44 yuan. Impairment loss of990,667.17 yuan was recognized based on the difference between recoverable amount and carrying amount of Funan Company in the urban-rural sanitation integrated operation asset group portfolio. The accumulated provision for impairment of goodwill arising from this factor totaled 990,667.17 yuan.
- (4) Related information of asset groups orasset group portfolios which include goodwill
-
- Related information of asset groups or asset group portfolios
| Assetgroupsorassetgroupportfolios | Compositionofassetgroupsorassetgroupportfoliosanditsbasis | Operatingsegmentanditsbasis | Whetherassetgroupsorassetgroupportfoliosareconsistentwiththoseatacquisitiondate/atgoodwillimpairmenttestingdateinpreviousyears |
|---|---|---|---|
| Sanitationvehiclesandequipmentmanufacturingandsalesassetgroup | Operatinglong-termassetsofZoomlionEnvironmentalCompany(manufacturingandsalesofsanitationvehiclesandequipment),andChangshaZhongbiaoEnvironmentalIndustryCo., | ZoomlionEnvironmentalCompany(manufacturingandsalesofsanitationvehiclesandequipment)andChangshaZhongbiaoEnvironmentalIndustryCo.,Ltd. | Yes |
| Assetgroupsorassetgroupportfolios | Compositionofassetgroupsorassetgroupportfoliosanditsbasis | Operatingsegmentanditsbasis | Whetherassetgroupsorassetgroupportfoliosareconsistentwiththoseatacquisitiondate/atgoodwillimpairmenttestingdateinpreviousyears |
|---|---|---|---|
| Ltd. | |||
| Urban-ruralsanitationintegratedoperationassetgroupportfolio | Operatinglong-termassetsofZoomlionEnvironmentalCompany(sanitationintegratedoperation),GreenOrientalCompany,FunanCompany,HuaianChenjieEnvironmentalEngineeringCo.,Ltd.,BiyangCountyFengheNewEnergyPowerCo.,Ltd.,andLianjiangCompany | ZoomlionEnvironmentalCompany(sanitationintegratedoperation),GreenOrientalCompany,FunanCompany,HuaianChenjieEnvironmentalEngineeringCo.,Ltd.,BiyangCountyFengheNewEnergyPowerCo.,Ltd.,LianjiangCompany | Yes[Note] |
| Watergovernanceoperationassetgroup | Operatinglong-termassetsofFoshanShunheEnvironmentalProtectionCo.,Ltd.(watertreatmentbusiness) | FoshanShunheEnvironmentalProtectionCo.,Ltd.(watertreatmentbusiness) | Yes |
| Ventilationequipmentmanufacturingandsalesassetgroup | Operatinglong-termassetsofShangfengIndustrialCompany | ShangfengIndustrialCompany | Yes |
| Electricalequipmentmanufacturingandsalesassetgroup | Operatinglong-termassetsofYolshCompany | YolshCompany | Yes |
Note: In December 2018, Zoomlion Environmental Company, which was acquired under business combination under common control by the Company, had two asset groups, i.e., sanitation vehicles and equipment manufacturing and sales asset group and urban-rural sanitation integrated operation asset group (including waste transfer, landfill and treatment).Data of original goodwill at the formation of Zoomlion Environmental Company was based on the fairvalue of the identifiable net assets as atthe end of June 2017 under asset-based method in the appraisal report numbered Zhong Rui Ping Bao Zi [2017] 110731042, without considering the synergy between the urban-rural sanitation integrated operation asset group of Zoomlion Environmental Company and the waste incineration power generation operation asset group of former Green Oriental Company. After the business combination of Zoomlion Environmental Company, as its urban-rural sanitation integrated operation asset group and the waste incineration power generation operation asset group of Green Oriental Company were similar in terms of business acquisition, production and operation activities, and cash return realization methods, and the Management had started to carry out integrated management, these two asset groups were identified as the urbanrural sanitation integrated operation asset group portfolio.
The Company acquired Lianjiang Company through business combination not under common control in February 2022. After the business combination of Lianjiang Company, as its assetgroup and urban-rural sanitation integrated operation asset group and the waste incineration power generation operation asset group of the Company were similar in terms of business acquisition, production and operation activities, and cash return realization methods, and the Management had carried out integrated management, the asset group of Lianjiang Company was identified as the urban-rural sanitation integrated operation asset group portfolio.
(5) Specific method for determining recoverable amount
| Items | Carryingamountofassetgroupsorassetgroupportfolioswhichincludegoodwill | Recoverableamount | Provisionforimpairment |
|---|---|---|---|
| Urban-ruralsanitationintegratedoperationassetgroupportfolio | 198,587,216.61 | 197,596,549.44 | 990,667.17 |
| Watergovernanceoperationassetgroup | 433,349,512.21 | 431,187,715.77 | 2,161,796.44 |
| Subtotal | 631,936,728.82 | 628,784,265.21 | 3,152,463.61 |
| (Continued) |
- Recoverable amount determined based on the fair value less costs ofdisposal
| Items | Determinationmethodoffairvalueandcostsofdisposal | Keyparametersanddeterminationbasis |
|---|---|---|
| Urban-ruralsanitation | Equitydisposalprice,disposalexpenses | |
| integratedoperationasset | Determinedbasedonthe | incurredafterthebalancesheetdate,non- |
| groupportfolio | subsequentdisposalpriceof | operatingassets,liabilities,workingcapital, |
| Watergovernance | theassetgroup | etc.asstipulatedinthe"EquityTransfer |
| operationassetgroup | Agreement"signedbytheCompany |
- Recoverable amount determined based on the presentvalue of estimated future cash flows
| Items | Carryingamountofassetgroupsorassetgroupportfolioswhichincludegoodwill[Note1] | Recoverableamount[Note2] | Provisionforimpairment |
|---|---|---|---|
| Sanitationvehiclesand | |||
| equipmentmanufacturingandsalesassetgroup | 11,619,748,317.81 | 11,451,100,000.00 | 86,010,642.08 |
| Urban-ruralsanitationintegratedoperationassetgroupportfolio[Note3] | 4,600,796,416.27 | 4,969,530,000.00 | |
| Ventilationequipmentmanufacturingandsalesassetgroup | 302,264,770.42 | 447,883,111.44 | |
| Electricalequipmentmanufacturingandsalesassetgroup | 44,643,222.78 | 53,492,386.65 | |
| Subtotal | 16,567,452,727.28 | 16,922.005,498.09 | 86,010,642.08 |
Note 1: The goodwill of the asset group portfolio has included the portion attributable to non-controlling shareholders. Cost of original goodwill of Zoomlion Environmental Company of 5.714 billion yuan was reallocated to the sanitation vehicles and equipment manufacturing and sales asset group and urban-rural sanitation integrated operation asset group portfolio based on the percentages of gross profit contributed by the two businesses, with 5.636 billion yuan and 78 million yuan reallocated, respectively.
Note 2: The presentvalue of estimated future cash flows (recoverable amount) of sanitation vehicles and equipment manufacturing and sales asset group was based on the appraisal report numbered Zhong Rui Ping Bao Zi [2024] 300596 issued by Chungrui Worldunion Assets Appraisal Group Co., Ltd.
The present value of estimated future cash flows (recoverable amount) of urban-rural sanitation integrated operation asset group portfolio was based on the appraisal report numbered Zhong Rui Ping Bao Zi [2024] 300557 issued by Chungrui Worldunion Assets Appraisal Group Co., Ltd. and the appraisal report numbered Jun Rui Ping
Bao Zi [2024] 065 issued by Shenzhen Junrui Assets Appraisals LLP.
Note 3: It does not include the portion of urban-rural sanitation integrated operation asset group, which has been transferred out under equity transfer agreement after the balance sheet date.
(Continued)
| Items | Forecastperiod(years) | Parametersincludingrevenuegrowthrateandgrossmarginforforecastperiodandtheirdeterminationbasis | Parametersincludingrevenuegrowthrateandgrossmarginforstableperiodandtheirdeterminationbasis | Discountrateanditsdeterminationbasis[Note4] |
|---|---|---|---|---|
| Sanitationvehiclesandequipmentmanufacturingand | 5 | [Note1] | Therevenuegrowthrateis0 | 10.71% |
| salesassetgroup | ||||
| Urban-ruralsanitationintegratedoperationassetgroupportfolio | [Note1] | [Note1] | [Note1] | 8.95%-8.97% |
| Ventilationequipmentmanufacturingandsalesassetgroup | 5 | [Note2] | Therevenuegrowthrateis0 | 11.01% |
| Electricalequipmentmanufacturingandsalesassetgroup | 5 | [Note3] | Therevenuegrowthrateis0 | 12.93% |
Note 1: The recoverable amount of asset groups and asset group portfolios is estimated based on the business characteristics of different asset groups or asset group portfolios according to the budget approved by the Management. The revenue growth rate of the product production and sales asset group in 2024 is based on the existing orders, historical data and operating budget, while the expense rate is based on the average expense rate of the previous three years, in combination with the reasonable income growth, capital depreciation and labor cost growth in the future; for operation asset groups orasset group portfolios, due to the large difference in income and gross profit margin between the investment period and period of maturity of PPP operating projects, the expected growth rate, stable period growth rate and profit rate of the asset groups and asset group portfolios show an irregular distribution when multiple projects are run in parallel, and the income, costs and expenses are estimated based on the time to mature operation and design capacity of each specific project.
Note 2: The revenue growth rate of ventilation equipment manufacturing and sales asset group during the forecast period from 2024 to 2028 is 13.40%, 4.00%, 3.00%, 2.00% and 1.00%, respectively, which are determined based on the Company's historical annual operating performance, growth rates, existing orders, and the Management's expectations for market development.
Note 3: The revenue growth rate of electrical equipment manufacturing and sales asset group during the forecast period from 2024 to 2028 is 105.08%, 25.00%, 30.00%, 35.00% and 40.00%, respectively, which are determined based on the Company's historical annual operating performance, growth rates, existing orders, and the Management's expectations for market development.
Note 4: Discount rate: determined based on weighted average cost of capital (WACC), cost of equity capital and cost of liabilities.
21. Long-term prepayments
| Items | Openingbalance | Increase | Amortization | Otherdecreases | Closingbalance |
|---|---|---|---|---|---|
| Expendituresonimprovementofleased-infixedassets | 25,781,580.05 | 6,548,947.45 | 8,722,846.35 | 23,607,681.15 | |
| Others | 4,429,355.86 | 7,108,859.69 | 4,015,099.21 | 7,523,116.34 | |
| Total | 30,210,935.91 | 13,657,807.14 | 12,737,945.56 | 31,130,797.49 |
22. Deferred tax assets and deferred tax liabilities
(1) Deferred tax assets before offset
| Closingbalance | Openingbalance | |||
|---|---|---|---|---|
| Items | Deductibletemporarydifference | Deferredtaxassets | Deductibletemporarydifference | Deferredtaxassets |
| Provisionforimpairmentofassets | 697,808,362.88 | 107,271,372.72 | 668,318,234.13 | 102,350,161.93 |
| Unrealizedprofitfrominternaltransactions | 20,475,833.05 | 3,071,374.96 | 22,214,585.93 | 3,332,187.89 |
| Deductiblelosses | 47,114,527.25 | 8,894,435.03 | 47,115,916.60 | 8,894,782.37 |
| Leaseliabilities | 26,136,462.82 | 4,103,472.14 | ||
| Total | 791,535,186.00 | 123,340,654.85 | 737,648,736.66 | 114,577,132.19 |
(2) Deferred tax liabilities before offset
| Closingbalance | Openingbalance | ||||
|---|---|---|---|---|---|
| Items | Taxabletemporarydifference | Deferredtaxliabilities | Taxabletemporarydifference | Deferredtaxliabilities | |
| Accelerateddepreciationoffixedassets | 26,637,066.56 | 4,698,936.18 | 24,481,935.20 | 3,672,290.28 | |
| Assetsappraisalappreciationduetobusinesscombinationnotundercommoncontrol | 267,111,526.85 | 45,461,139.37 | 448,250,679.76 | 50,535,337.80 | |
| Right-of-useassets | 25,125,671.95 | 3,951,853.51 | |||
| Total | 318,874,265.36 | 54,111,929.06 | 472,732,614.96 | 54,207,628.08 |
| Closingbalance | Openingbalance | |||
|---|---|---|---|---|
| Items | Deferredtaxassetsoffsetbydeferredtaxliabilities | Deferredtaxassets/liabilitiesafteroffset | Deferredtaxassetsoffsetbydeferredtaxliabilities | Deferredtaxassets/liabilitiesafteroffset |
| Deferredtaxassets | 6,892,349.21 | 116,448,305.64 | 114,577,132.19 | |
| Deferredtaxliabilities | 6,892,349.21 | 47,219,579.85 | 54,207,628.08 |
(3) Deferred tax assets orliabilities after offset
(4) Details ofunrecognized deferred tax assets
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Deductibletemporarydifference | 825,763,726.98 | 510,065,399.73 |
| Deductiblelosses | 749,514,337.17 | 596,581,457.35 |
| Unrealizedprofitfrominternaltransactions | 364,794,037.67 | 343,937,402.32 |
| Total | 1,940,072,101.82 | 1,450,584,259.40 |
(5) Maturity years ofdeductible losses ofunrecognized deferred tax assets
| Maturityyears | Closingbalance | Openingbalance | Remarks |
|---|---|---|---|
| Year2023 | 24,742,029.97 | ||
| Year2024 | 86,322,391.77 | 82,954,604.70 | |
| Year2025 | 187,721,684.90 | 206,033,354.21 | |
| Year2026 | 94,150,648.91 | 97,279,157.08 | |
| Year2027 | 175,149,966.49 | 185,572,311.39 | |
| Year2028 | 206,169,645.10 | ||
| Total | 749,514,337.17 | 596,581,457.35 |
23. Other non-current assets
(1) Details
| Closingbalance | |||||
|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | ||
| Assetstobedisposalof | 227,240,727.12 | 227,240,727.12 | |||
| Contractassets–Qualityguaranteedepositreceivable | 164,081,168.47 | 21,618,229.88 | 142,462,938.59 | ||
| Advancesforlong-termassets | 55,114,043.37 | 55,114,043.37 | |||
| Coststoobtainacontract | 63,666,470.76 | 63,666,470.76 | |||
| Receivablesforagentconstruction | 8,518,174.25 | 8,518,174.25 | |||
| Total | 518,620,583.97 | 30,136,404.13 | 488,484,179.84 |
(Continued)
| Openingbalance | ||||||||
|---|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | |||||
| Contractassets–Qualityguaranteedepositreceivable | 154,548,259.36 | 17,968,552.02 | 136,579,707.34 | |||||
| Advancesforlong-termassets | 93,266,692.04 | 93,266,692.04 | ||||||
| Coststoobtainacontract | 68,565,164.58 | 68,565,164.58 | ||||||
| Receivablesforagentconstruction | 8,518,174.25 | 8,518,174.25 | ||||||
| Total | 324,898,290.23 | 17,968,552.02 | 306,929,738.21 |
(2) Contract assets
1) Details
| Closingbalance | ||||||||
|---|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | |||||
| Contractassets–Qualityguaranteedepositreceivable | 164,081,168.47 | 21,618,229.88 | 142,462,938.59 | |||||
| Total | 164,081,168.47 | 21,618,229.88 | 142,462,938.59 |
(Continued)
| Openingbalance | |||||||
|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | ||||
| Contractassets–Qualityguaranteedepositreceivable | 154,548,259.36 | 17,968,552.02 | 136,579,707.34 | ||||
| Total | 154,548,259.36 | 17,968,552.02 | 136,579,707.34 |
2) Details on provision for impairment
a. Details on categories
| Closingbalance | ||||||||
|---|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionforimpairment | ||||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | ||||
| Receivableswithprovisionmadeonacollectivebasis | 164,081,168.47 | 100.00 | 21,618,229.88 | 13.18 | 142,462,938.59 | |||
| Total | 164,081,168.47 | 100.00 | 21,618,229.88 | 13.18 | 142,462,938.59 |
(Continued)
| Openingbalance | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionforimpairment | |||||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | |||||
| Receivableswithprovisionmadeonacollectivebasis | 154,548,259.36 | 100.00 | 17,968,552.02 | 11.63 | 136,579,707.34 | ||||
| Total | 154,548,259.36 | 100.00 | 17,968,552.02 | 11.63 | 136,579,707.34 |
b. Contract assets with provision for impairment made on a collective basis
| Closingbalance | ||||||||
|---|---|---|---|---|---|---|---|---|
| Portfolios | BookbalanceProvisionforimpairment | Provisionproportion(%) | ||||||
| Portfoliogroupedwithqualityguaranteedeposits | 164,081,168.47 | 21,618,229.88 | 13.18 | |||||
| Subtotal | 164,081,168.47 | 21,618,229.88 | 13.18 |
3) Changes in provision for impairment
a. Details
| Increase/Decrease | ||||||
|---|---|---|---|---|---|---|
| Items | Openingbalance | Accrual | Recoveryorreversal | Write-off | Others | Closingbalance |
| Receivableswithprovisionforimpairmentmadeonacollectivebasis | 17,968,552.02 | 4,018,806.01 | 369,128.15 | 21,618,229.88 | ||
| Total | 17,968,552.02 | 4,018,806.01 | 369,128.15 | 21,618,229.88 |
b. No significant provisions collected or reversed in the current period.
(3) Costs to obtain a contract
| Items | Openingbalance | Increase | Amortization | Provisionforimpairment | Closingbalance |
|---|---|---|---|---|---|
| Coststoobtainacontract | 68,565,164.58 | 25,071,451.76 | 29,970,145.58 | 63,666,470.76 | |
| Subtotal | 68,565,164.58 | 25,071,451.76 | 29,970,145.58 | 63,666,470.76 |
24. Assets with title or use right restrictions
(1) Details
1) Details on assets with restrictions at the balance sheet date
| Items | Closingbookbalance | Closingcarrying | Typeofrestrictions | Reasonsforrestrictions |
|---|---|---|---|---|
| Cashandbankbalances | 495,231,329.24 | amount495,231,329.24 | Guaranteed,frozen, | Deposits,escrowaccount,etc.frozenduetolitigationpreservation |
| Notesreceivable–Bankacceptance | 4,472,210.78 | 4,472,210.78 | Endorsedordiscounted | Endorsedordiscountedbutundue |
| Notesreceivable–Tradeacceptance | 407,749.04 | 349,861.59 | Endorsedordiscounted | Endorsedordiscountedbutundue |
| Accountsreceivable | 357,237,223.82 | 338,232,491.18 | Pledged | Pledged |
| Receivablesfinancing | 55,280,364.20 | 55,280,364.20 | Pledged | Pledged |
| Long-termreceivablesandnon-currentassetsduewithinoneyear | 66,695,425.00 | 61,841,516.63 | Recoursefactoring,pledged | Recoursefactoring,pledged |
| Fixedassets | 72,439,458.40 | 27,881,359.42 | Mortgaged | Mortgaged |
| Intangibleassets | 84,779,751.51 | 77,778,795.88 | Mortgaged | Mortgaged |
| 100%ofequityofBiyangCountyFengheNewEnergyPowerCo.,Ltd. | 105,047,950.25 | 105,047,950.25 | Pledged | Pledged[Note] |
| Items | Closingbookbalance | Closingcarryingamount | Typeofrestrictions | Reasonsforrestrictions |
|---|---|---|---|---|
| 100%ofequityofFunanCompany | 78,720,044.41 | 78,720,044.41 | Pledged | |
| 100%ofequityofPoyangGreenOrientalRenewableEnergyCo.,Ltd. | 76,768,690.77 | 76,768,690.77 | Pledged | |
| 75%ofequityofLianjiangCompany | 112,692,107.66 | 112,692,107.66 | Pledged | |
| 25%ofequityofLianjiangCompany | 37,564,035.89 | 37,564,035.89 | Frozen | Frozenduetolitigationpreservation |
| Total | 1,547,336,340.97 | 1,471,860,757.90 |
Note: The pledged amount refers to the Company's proportionate share of net assets in these entities.
| beginningofcurrentperiod | the | at | restrictions | with | assets | on | Details | 2) | |
|---|---|---|---|---|---|---|---|---|---|
| ---------------------------------- | ----- | ---- | -- | -------------- | ------ | -------- | ---- | --------- | ---- |
| Items | Openingbookbalance | Openingcarryingamount | Typeofrestrictions | Reasonsforrestrictions | |
|---|---|---|---|---|---|
| Cashandbankbalances | 147,538,284.47 | 147,538,284.47 | Guaranteed,frozen,etc. | Securitydeposits,escrowaccount,frozenduetolitigationpreservation | |
| Notesreceivable–Bankacceptance | 2,732,733.00 | 2,732,733.00 | Endorsedordiscounted | Endorsedordiscountedbutundue | |
| Notesreceivable–Tradeacceptance | 5,422,499.62 | 4,836,352.06 | Endorsedordiscounted | Endorsedordiscountedbutundue | |
| Accountsreceivable | 276,390,131.13 | 273,691,152.48 | Pledged | Pledged | |
| Receivablesfinancing | 42,293,141.00 | 42,293,141.00 | Pledged | Pledged | |
| Long-termreceivablesandnon-currentassetsduewithinoneyear | 66,716,222.75 | 60,356,875.95 | Recoursefactoring | Recoursefactoring | |
| Fixedassets | 561,518,592.09 | 477,655,980.05 | Mortgaged | Mortgaged | |
| Intangibleassets | 56,073,651.51 | 47,082,404.81 | Mortgaged | Mortgaged | |
| 100%ofequityofFunanCompany | 69,631,957.01 | 69,631,957.01 | Pledged | ||
| 100%ofequityofPoyangGreenOrientalRenewableEnergyCo.,Ltd. | 80,733,192.59 | 80,733,192.59 | Pledged | ||
| 50%ofequityofLianjiangCompany | 68,922,363.62 | 68,922,363.62 | Pledged | Pledged[Note] | |
| 100%ofequityofBiyangCountyFengheNewEnergyPowerCo.,Ltd. | 105,525,597.14 | 105,525,597.14 | Pledged | ||
| 25%ofequityofLianjiangCompany | 34,461,181.81 | 34,461,181.81 | Frozen | Frozenduetolitigationpreservation | |
| Total | 1,517,959,547.74 | 1,415,461,215.99 |
Note: The pledged amount refers to the Company's proportionate share of net assets in these entities.
25. Short-term borrowings
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Guaranteedborrowings | 66,077,658.34 | 281,942,622.11 |
| Pledgedborrowings | 29,830,000.00 | |
| Mortgagedborrowings | 18,018,500.00 | 18,020,900.00 |
| Creditborrowings | 8,006,821.92 | 140,139,583.33 |
| Pledgedandguaranteedborrowings | 5,006,875.00 | |
| Total | 126,939,855.26 | 440,103,105.44 |
- Notes payable
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Tradeacceptance | 58,782,211.43 | 222,877,645.46 |
| Bankacceptance | 2,235,494,340.03 | 2,292,351,647.71 |
| Total | 2,294,276,551.46 | 2,515,229,293.17 |
27. Accounts payable
(1) Details
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Paymentsforgoods | 2,580,677,947.96 | 2,547,048,086.70 |
| Paymentsforengineeringandequipment | 240,704,266.86 | 164,908,990.42 |
| Others | 97,161,489.64 | 60,004,194.54 |
| Total | 2,918,543,704.46 | 2,771,961,271.66 |
(2) No material closing balance with age over one year.
28. Contract liabilities
(1) Details
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Paymentsforgoodsreceivedinadvance | 290,854,742.72 | 247,747,809.30 |
| Rebateforcustomers | 15,922,430.85 | 26,542,168.95 |
| Total | 306,777,173.57 | 274,289,978.25 |
(2) No material closing balance with age over one year.
- Employee benefits payable
(1) Details
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Short-termemployeebenefits | 405,398,080.74 | 2,467,413,107.42 | 2,385,539,192.67 | 487,271,995.49 |
| Post-employmentbenefits-definedcontributionplan | 1,991,692.81 | 119,076,238.47 | 118,435,010.78 | 2,632,920.50 |
| Terminationbenefits | 2,184,245.17 | 19,327,584.57 | 20,515,905.75 | 995,923.99 |
| Total | 409,574,018.72 | 2,605,816,930.46 | 2,524,490,109.20 | 490,900,839.98 |
(2) Details ofshort-term employee benefits
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Wage,bonus,allowanceandsubsidy | 389,433,590.07 | 2,301,824,431.43 | 2,219,899,492.88 | 471,358,528.62 |
| Employeewelfarefund | 767,326.06 | 60,407,067.82 | 59,534,554.49 | 1,639,839.39 |
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Socialinsurancepremium | 833,759.70 | 61,992,305.12 | 61,878,494.51 | 947,570.31 |
| Including:Medicarepremium | 768,080.23 | 55,857,687.14 | 55,764,342.50 | 861,424.87 |
| Occupationalinjuriespremium | 65,679.47 | 6,134,617.98 | 6,114,152.01 | 86,145.44 |
| Housingprovidentfund | 1,806,925.39 | 36,374,491.24 | 36,548,481.56 | 1,632,935.07 |
| Tradeunionfundandemployeeeducationfund | 12,556,479.52 | 6,814,811.81 | 7,678,169.23 | 11,693,122.10 |
| Subtotal | 405,398,080.74 | 2,467,413,107.42 | 2,385,539,192.67 | 487,271,995.49 |
(3) Details ofdefined contribution plan
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Basicendowmentinsurancepremium | 1,595,528.10 | 115,104,704.80 | 114,149,325.50 | 2,550,907.40 |
| Unemploymentinsurancepremium | 396,164.71 | 3,971,533.67 | 4,285,685.28 | 82,013.10 |
| Subtotal | 1,991,692.81 | 119,076,238.47 | 118,435,010.78 | 2,632,920.50 |
30. Taxes and ratespayable
| Items | Closingbalance | Openingbalance |
|---|---|---|
| VAT | 86,581,679.18 | 66,918,012.44 |
| Enterpriseincometax | 27,900,731.55 | 36,440,528.78 |
| Individualincometaxwithheldfortaxauthorities | 4,803,397.21 | 3,778,293.58 |
| Urbanmaintenanceandconstructiontax | 506,023.66 | 1,991,056.41 |
| Housingpropertytax | 1,191,074.92 | 2,606,954.11 |
| Landusetax | 1,168,188.55 | 157,193.04 |
| Stampduty | 1,433,178.29 | 1,661,333.48 |
| Educationsurcharge | 252,330.39 | 845,859.65 |
| Localeducationsurcharge | 135,999.15 | 562,045.06 |
| Others | 59,328.23 | 6,950.33 |
| Total | 124,031,931.13 | 114,968,226.88 |
31. Other payables
(1) Details
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Recoursefactoringofaccountsreceivable[Note] | 22,660,825.00 | 66,789,887.39 |
| Temporaryreceiptspayable | 354,511,622.56 | 297,006,996.69 |
| Securitydeposits | 165,161,284.82 | 129,748,015.42 |
| Others | 167,608,092.39 | 163,577,388.03 |
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Total | 709,941,824.77 | 657,122,287.53 |
Note: The balance refers to the recourse factoring of accounts receivable made by Zoomlion Environmental Company to the non-bank financial institutions. However, as non-bank financial institutions have the right to request Zoomlion Environmental Company to repurchase the accounts receivable if they are overdue, the accounts receivable shall not be derecognized, and the receipts offactoring shall be recognized as other payables.
(2) No material closing balance with age over one year.
32. Non-current liabilities due within one year
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Long-termborrowingsduewithinoneyear | 387,310,047.45 | 555,746,357.94 |
| Leaseliabilitiesduewithinoneyear | 8,613,396.84 | 4,673,226.74 |
| Long-termpayablesduewithinoneyear | 9,104,000.00 | 599,514.91 |
| Total | 405,027,444.29 | 561,019,099.59 |
33. Other current liabilities
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| OutputVATtoberecognized | 36,931,126.97 | 31,616,947.24 | |
| Total | 36,931,126.97 | 31,616,947.24 |
34. Long-term borrowings
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| Pledgedborrowings | 200,179,577.30 | 454,467,547.52 | |
| Mortgagedborrowings | 154,000,000.00 | ||
| Guaranteedborrowings | 47,300,000.00 | 70,029,166.64 | |
| Creditborrowings | 90,650,000.00 | 18,800,000.00 | |
| Mortgagedandguaranteedborrowings | 150,000,000.00 | ||
| Pledgedandguaranteedborrowings | 1,392,227,274.43 | 1,229,009,512.16 | |
| Total | 1,884,356,851.73 | 1,922,306,226.32 |
35. Bonds payable
(1) Details
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| Convertiblecorporatebonds | 1,360,603,802.12 | 1,308,690,556.32 | |
| Total | 1,360,603,802.12 | 1,308,690,556.32 |
(2) Current period movements (not including other financial instruments such as preferred shares/perpetual bonds
| Bonds | Parvalue | Couponrate | (%)Issuingdate | Maturity | Amount | outstanding | Whetherdefault | |
|---|---|---|---|---|---|---|---|---|
| Inforebonds | convertible | 100.00 | [Note] | 11/4/2020 | 6years | 1,476,189,600.00 | No | |
| Subtotal | 100.00 | 1,476,189,600.00 | ||||||
| (Continued) | ||||||||
| Bonds | Openingbalance | Currentperiodissuance | Parvalueinterest | Premium/Discountamortization | Currentperiodrepayment | Convertedtoshares | Fundsreturnedduetoconversionofbondsintoshares | Closingbalance |
| Inforeconvertiblebonds | 1,308,690,556.32 | 13,440,998.27 | 50,289,412.70 | 11,808,996.02 | 8,157.13 | 12.02 | 1,360,603,802.12 | |
| Subtotal | 1,308,690,556.32 | 13,440,998.27 | 50,289,412.70 | 11,808,996.02 | 8,157.13 | 12.02 | 1,360,603,802.12 |
classified as financial liabilities)
Note: The coupon rate is0.20% in the first year, 0.50% in the second year, 0.80% in the third year, 1.50% in the fourth year, 1.80% in the fifth year and 2.00% in the sixth year.
(3) Converting conditions and time of convertible bonds
Under the "Approval of the Public Offering of Convertible Bonds by Infore Environment Technology Group Co., Ltd." issued by China Securities Regulatory Commission (Zheng Jian Xu Ke [2020] 2219) dated September 10, 2020, on November 4, 2020, the Company issued publicly convertible bonds of 1,476,189,600 yuan, with a total issuance of 14,761,896 pieces, and a term of 6 years. The coupon rate of the convertible bonds issued this time is 0.20% in the first year, 0.50% in the second year, 0.80% in the third year, 1.50% in the fourth year, 1.80% in the fifth year, and 2.00% in the sixth year. Interest of the convertible corporate bonds is paid once a year, and principal and the last year's interest are paid atmaturity. The Company will redeem all convertible bonds not converted by investors at the 110% of the par value (including the last year's interest) within 5 trading daysupon maturity of the convertible bonds issued this time.
The duration of the convertible bonds issued this time is 6 years from the date of issuance, that is, from November 4, 2020 to November 3, 2026. The initial conversion price of the convertible bonds issued this time is 8.31 yuan/share; the conversion period of the convertible bonds issued this time starts from the first trading day (May 10, 2021) after the expiration of six months from the end date ofthe issuance on November 10,2020 to the maturity date of the convertible bonds (November 3, 2026).
As ofDecember 31,2023, a total of 1,389 Infore convertible bonds had been converted to the Company's ordinary A shares, with a total of 16,944 shares converted. In the currentperiod, capital reserve (share premium) of 8,673.60 yuan was recognized at the difference between the carrying amount of the convertible bonds actually converted and other equity instruments and share capital increased due to actual conversion of bonds into shares.
- Lease liabilities
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| ------- | -------------------- | -------------------- | -- |
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| Unpaidleasepayments | 17,036,813.59 | 24,948,023.12 | |
| Less:Unrecognizedfinancingexpenses | 866,022.83 | 1,692,398.82 | |
| Total | 16,170,790.76 | 23,255,624.30 |
37. Long-term payables
(1) Details
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Long-termpayables | 15,173,333.32 | |
| Specialpayables | 287,776,139.63 | 315,735,814.91 |
| Total | 302,949,472.95 | 315,735,814.91 |
(2) Long-term payables
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Factoringfundspayable | 15,173,333.32 | |
| Subtotal | 15,173,333.32 |
(3) Special payables
| Items | Openingbalance | Increase | Decrease | Closingbalance | Reasonsforbalance |
|---|---|---|---|---|---|
| Specialfundsfortreasurybondprojects | 3,000,000.00 | 3,000,000.00 | Fundsfromconversionoftreasurybondsintoloans. | ||
| SpecialfundsforJiayuSewageTreatmentProject | 176,015,774.58 | 9,475,977.00 | 27,203,971.75 | 158,287,779.83 | SpecialgovernmentfundsforPPPprojects. |
| SpecialfundsforTongshanSewageTreatmentProject | 136,720,040.33 | 3,144,000.00 | 13,375,680.53 | 126,488,359.80 | SpecialgovernmentfundsforPPPprojects. |
| Subtotal | 315,735,814.91 | 12,619,977.00 | 40,579,652.28 | 287,776,139.63 |
38. Provisions
| Items | Closingbalance | Openingbalance | Reasonsforbalance |
|---|---|---|---|
| Creditguarantees | 1,994,511.41 | 4,575,049.22 | Guaranteeforbuyer'scredit |
| Total | 1,994,511.41 | 4,575,049.22 |
39. Deferred income
(1) Details
| Items | Openingbalance | Increase | Decrease | Closingbalance | Reasonsforbalance |
|---|---|---|---|---|---|
| Governmentgrants | 120,890,710.04 | 3,994,300.00 | 9,544,515.62 | 115,340,494.42 | Governmentgrantsrelatedtoassets |
| Total | 120,890,710.04 | 3,994,300.00 | 9,544,515.62 | 115,340,494.42 |
(2) Other remarks
Please refer to section VIII (II) of notes to the financial statements for details on government grants included into profit or loss.
40. Other non-current liabilities
| Items | Closingbalance | Openingbalance | |
|---|---|---|---|
| Centralspecialconstructionfunds | 8,148,148.14 | 8,333,333.33 | |
| Total | 8,148,148.14 | 8,333,333.33 |
41. Share capital
(1) Details
| Items | Openingbalance | Issueofnewshares | Bonusshares | Conversionofreservetoshares | Others | Subtotal | Closingbalance |
|---|---|---|---|---|---|---|---|
| Totalshares | 3,179,505,559.00 | 1,111.00 | 1,111.00 | 3,179,506,670.00 |
(2) Other remarks
The Company converted convertible corporate bonds with par value of 9,000 yuan into the Company's ordinary A shares of 1,111 shares, with capital premium (share premium) recognized at 8,673.60 yuan.
42. Other equity instruments
(1) Please refer to section V (I) 35 of notesto financial statements for basic information of convertible corporate bonds outstanding at the balance sheet date.
(2) Current period movements of financial instruments such as preferred shares or perpetual bonds outstanding at the balance sheet date
| Openingbalance | Increase | Decrease | Closingbalance | |||||
|---|---|---|---|---|---|---|---|---|
| Items | Quantity | Carryingamount | Quantity | Carryingamount | Quantity | Carryingamount | Quantity | Carryingamount |
| Convertiblecorporatebonds | 14,760,597 | 266,916,341.80 | 90 | 1,627.47 | 14,760,507 | 266,914,714.33 | ||
| Total | 14,760,597 | 266,916,341.80 | 90 | 1,627.47 | 14,760,507 | 266,914,714.33 |
Note: As of December 31,2023, convertible corporate bonds with par value of 9,000 yuan had been converted into ordinary A shares, with otherequity instruments decreased by 1,627.47 yuan accordingly.
43. Capital reserve
(1) Details
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Capitalpremium(sharepremium) | 9,604,610,324.24 | 164,826.05 | 1,277,359.26 | 9,603,497,791.03 |
| Othercapitalreserve | 57,900,930.24 | 57,900,930.24 |
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Total | 9,662,511,254.48 | 164,826.05 | 1,277,359.26 | 9,661,398,721.27 |
(2) Other remarks
- Current increase of capital premium (share premium) was mainly due to:
a. the conversion of convertible corporate bonds with par value of 9,000 yuan into the Company's ordinary A shares of 1,111 shares, with capital premium (share premium) recognized at 8,673.60 yuan;
b. the difference of 156,152.45 yuan between the reduced registered capital of 38,423,985.00 yuan of the subsidiary Xiantao Yinghe Environmental Protection Co., Ltd. based on the resolution of its shareholders' meeting in December 2023 and the proportionate share in net assets continuously calculated from the acquisition date or combination date.
- Current decrease of capital premium (share premium) was mainly due to the difference of 1,277,359.26 yuan between the consideration for acquisition of 4% of equity of the subsidiary Huaian Chenjie Environmental Engineering Co., Ltd. in June 2023 and the proportionate share in net assets continuously calculated from the acquisition date or combination date.
44. Treasury shares
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Treasuryshares | 94,132,795.17 | 94,132,795.17 | ||
| Total | 94,132,795.17 | 94,132,795.17 |
45. Other comprehensive income (OCI)
| Current | periodcumulative | |||||||
|---|---|---|---|---|---|---|---|---|
| Net | OCIaftertax | Less:OCIpreviouslyrecognizedbut | ||||||
| Items | Openingbalance | Currentperiodcumulativebeforeincometax | Less:OCIpreviouslyrecognizedbuttransferredtoprofitorlossinthecurrentperiod | Less:Incometaxexpenses | Attributabletoparentcompany | Attributabletonon-controllingshareholders | transferredtoretainedearningsinthecurrentperiod(attributabletoparentcompanyaftertax) | Closingbalance |
| Itemsnottobereclassifiedsubsequentlytoprofitorloss | -4,630,000.00 | -4,630,000.00 | ||||||
| Including:Changesinfairvalueofotherequityinstrumentinvestments | -4,630,000.00 | -4,630,000.00 | ||||||
| Total | -4,630,000.00 | -4,630,000.00 |
46. Special reserve
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Worksafetyfund | 8,608,843.62 | 8,608,843.62 | ||
| Total | 8,608,843.62 | 8,608,843.62 |
47. Surplus reserve
(1) Details
| Items | Openingbalance | Increase | Decrease | Closingbalance |
|---|---|---|---|---|
| Statutorysurplusreserve | 315,124,767.92 | 63,892,252.27 | 379,017,020.19 | |
| Total | 315,124,767.92 | 63,892,252.27 | 379,017,020.19 |
(2) Other remarks
Current increase of 63,892,252.27 yuan was due to the appropriation of statutory surplus reserve at 10% of net profit generated by the parentcompany in the currentperiod.
48. Undistributed profit
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Openingbalance | 3,963,306,890.06 | 3,874,934,971.69 |
| Add:Netprofitattributabletoownersoftheparentcompany | 498,383,730.00 | 418,794,179.13 |
| Less:Appropriationofstatutorysurplusreserve | 63,892,252.27 | 18,369,884.36 |
| Dividendpayableonordinaryshares | 348,363,541.68 | 312,052,376.40 |
| Closingbalance | 4,049,434,826.11 | 3,963,306,890.06 |
(II) Notes to items of the consolidated income statement
1. Operating revenue/Operating cost
(1) Details
| Currentperiod | cumulative | Precedingperiodcomparative | |||
|---|---|---|---|---|---|
| Items | Revenue | Cost | Revenue | Cost | |
| Mainoperations | 12,593,195,441.07 | 9,725,483,452.68 | 12,206,399,059.56 | 9,429,679,886.47 | |
| Otheroperations | 37,855,526.27 | 19,998,635.24 | 49,593,878.86 | 39,830,944.80 | |
| Total | 12,631,050,967.34 | 9,745,482,087.92 | 12,255,992,938.42 | 9,469,510,831.27 | |
| Including:Revenuefromcontractswithcustomers | 12,627,471,564.83 | 9,743,083,609.80 | 12,253,033,163.91 | 9,467,213,554.61 |
(2) Breakdown of revenue
1) Breakdown of revenue from contracts with customers by goods orservices
| Currentperiod | cumulative | Precedingperiodcomparative | |||
|---|---|---|---|---|---|
| Items | Revenue | Cost | Revenue | Cost | |
| Intelligentsanitation | 10,715,122,532.51 | 8,366,738,029.63 | 10,242,746,845.76 | 8,023,297,059.91 | |
| Otherbusinesses | 1,912,349,032.32 | 1,376,345,580.17 | 2,010,286,318.15 | 1,443,916,494.70 | |
| Subtotal | 12,627,471,564.83 | 9,743,083,609.80 | 12,253,033,163.91 | 9,467,213,554.61 |
| Items | Currentperiod | cumulative | Precedingperiodcomparative | ||
|---|---|---|---|---|---|
| Revenue | Cost | Revenue | Cost | ||
| Domestic | 12,580,574,554.53 | 9,709,744,510.62 | 12,234,221,595.20 | 9,451,301,571.85 | |
| Overseas | 46,897,010.30 | 33,339,099.18 | 18,811,568.71 | 15,911,982.76 | |
| Subtotal | 12,627,471,564.83 | 9,743,083,609.80 | 12,253,033,163.91 | 9,467,213,554.61 |
2) Breakdown of revenue from contracts with customers by operating regions
- Breakdown of revenue from contracts with customers by time oftransferring goods or rendering services
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Recognizedatapointintime | 5,853,953,110.98 | 6,705,692,980.49 |
| Recognizedovertime | 6,773,518,453.85 | 5,547,340,183.42 |
| Subtotal | 12,627,471,564.83 | 12,253,033,163.91 |
2. Taxes and surcharges
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Urbanmaintenanceandconstructiontax | 19,347,236.29 | 27,686,507.84 |
| Educationsurcharge | 9,237,216.76 | 12,075,573.31 |
| Housingpropertytax | 16,056,747.97 | 9,759,719.80 |
| Landusetax | 9,274,170.36 | 8,282,959.61 |
| Localeducationsurcharge | 4,897,252.61 | 7,807,835.47 |
| Stampduty | 9,430,645.45 | 7,540,686.80 |
| Vehicleandvesselusetax | 1,791,754.71 | 1,481,678.21 |
| Environmentalprotectiontax | 22,817.10 | 50,061.01 |
| Others | 33,747.82 | |
| Total | 70,091,589.07 | 74,685,022.05 |
3. Selling expenses
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Employeebenefits | 335,609,966.84 | 340,290,000.65 |
| Marketingexpensesandagencyfees | 265,269,393.83 | 221,534,865.64 |
| Businessentertainmentexpenses | 48,124,800.71 | 47,320,675.86 |
| Officeexpenses | 44,084,358.46 | 39,159,155.49 |
| Expensesfortenderingandbidding | 23,714,813.45 | 33,479,432.56 |
| Vehicleusagefees | 26,437,459.78 | 27,886,649.81 |
| Businesstravellingexpenses | 24,235,527.24 | 22,889,790.05 |
| Depreciationandamortization | 2,564,157.65 | 8,871,711.08 |
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| After-salesserviceexpenses | 9,468,198.50 | 8,427,436.37 |
| Share-basedpayments | 789,290.58 | |
| Others | 14,826,275.56 | 12,321,839.86 |
| Total | 794,334,952.02 | 762,970,847.95 |
4. Administrative expenses
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Employeebenefits | 405,851,793.11 | 325,720,014.09 |
| Depreciationandamortization | 96,124,324.58 | 92,377,339.97 |
| Officeexpenses | 55,346,741.42 | 49,435,534.41 |
| Businessentertainmentexpenses | 57,420,506.69 | 47,088,220.88 |
| Agencyconsultingfees | 49,770,146.66 | 38,554,467.66 |
| Vehicleusagefees | 11,285,144.00 | 15,346,887.97 |
| Businesstravellingexpenses | 12,998,629.92 | 9,732,527.31 |
| Repairfees | 3,476,335.42 | 2,863,363.74 |
| Share-basedpayments | 1,905,828.75 | |
| Others | 33,885,615.65 | 26,577,495.45 |
| Total | 726,159,237.45 | 609,601,680.23 |
5. R&D expenses
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Employeebenefits | 246,795,666.58 | 248,961,357.20 |
| Directinputs | 34,669,099.04 | 40,506,455.35 |
| Otherexpenses | 62,565,473.71 | 50,336,437.55 |
| Share-basedpayments | 971,457.24 | |
| Total | 344,030,239.33 | 340,775,707.34 |
6. Financial expenses
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Interestexpenses | 156,635,777.38 | 170,568,834.86 |
| Interestincome | -99,626,077.56 | -86,389,951.68 |
| Gainsandlossesonforeignexchange | -1,587,128.38 | -3,056,908.33 |
| Others | 19,898,513.43 | 20,717,449.06 |
| Total | 75,321,084.87 | 101,839,423.91 |
7. Other income
| Items | Currentperiodcumulative | Precedingperiodcomparative | Amountincludedinnon-recurringprofitorloss |
|---|---|---|---|
| Governmentgrantsrelatedtoassets | 9,544,515.62 | 8,085,032.61 | 2,128,328.14 |
| Governmentgrantsrelatedtoincome | 69,450,144.75 | 93,590,019.49 | 50,838,222.61 |
| Refundofhandlingfeesforwithholdingindividualincometax | 424,735.51 | 429,102.26 | |
| VATextradeductions | 40,567,420.41 | 17,460,524.12 | |
| Total | 119,986,816.29 | 119,564,678.48 | 52,966,550.75 |
8. Investment income
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Investmentincomefromlongtermequityinvestmentsunderequitymethod | 4,960,692.79 | 8,548,481.77 |
| Gainsfromfairvalueremeasurementatthetimeofobtainingcontrol | 51,896,314.25 | |
| Investmentincomefromfinancialproducts | 12,111,406.99 | 19,091,108.25 |
| Performancecompensation | -50,000,000.00 | |
| Lossesfromdebtrestructuring | -3,130,560.92 | -5,380,200.00 |
| Gainsfromnon-recursefactoringofaccountsreceivable | -64,671,667.09 | -65,918,373.23 |
| Others | -867,077.69 | 296,543.34 |
| Total | -51,597,205.92 | -41,466,125.62 |
9. Credit impairment loss
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Baddebts | -218,933,128.92 | -103,391,907.05 |
| Creditguaranteeloss | 2,580,537.81 | -1,445,255.37 |
| Total | -216,352,591.11 | -104,837,162.42 |
10. Assets impairment loss
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Inventorywrite-downloss | -15,842,992.24 | -15,053,708.82 |
| Impairmentlossofgoodwill | -94,237,304.12 | -296,010,591.93 |
| Impairmentlossofothernon-currentassets | -12,686,044.85 | 2,080,536.79 |
| Impairmentlossofcontract | 5,615,945.43 | -1,192,023.34 |
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| assets | ||
| Impairmentlossofdevelopmentexpenditures | -6,240,373.24 | -2,822,707.36 |
| Total | -123,390,769.02 | -312,998,494.66 |
11. Gains on asset disposal
| Items | Currentperiodcumulative | Precedingperiodcomparative | Amountincludedinnon-recurringprofitorloss |
|---|---|---|---|
| Gainsondisposaloffixedassets | -661,936.68 | 301,250.20 | -661,936.68 |
| Gainsondisposalofintangibleassets | -529,889.14 | 10,073.29 | -529,889.14 |
| Gainsondisposalofright-of-useassets | 221,473.23 | ||
| Total | -1,191,825.82 | 532,796.72 | -1,191,825.82 |
12. Non-operating revenue
| Items | Currentperiodcumulative | Precedingperiodcomparative | Amountincludedinnon-recurringprofitorloss |
|---|---|---|---|
| Gainsondamageorretirementofnon-currentassets | 428,721.52 | 8,797.04 | 428,721.52 |
| Penaltyandconfiscatoryincome | 14,363,825.53 | 9,298,430.37 | 14,363,825.53 |
| Others | 5,054,158.55 | 3,491,008.49 | 5,054,158.55 |
| Total | 19,846,705.60 | 12,798,235.90 | 19,846,705.60 |
13. Non-operating expenditures
| Items | Currentperiodcumulative | Precedingperiodcomparative | Amountincludedinnon-recurringprofitorloss |
|---|---|---|---|
| Donationexpenditures | 1,837,168.20 | 2,302,553.92 | 1,837,168.20 |
| Lossesondamageorretirementofnon-currentassets | 2,654,891.96 | 2,913,020.22 | 2,654,891.96 |
| Specialfundsforlocalwaterconservancyconstruction | 490,964.79 | 409,764.78 | |
| Penaltyandconfiscatoryexpenses | 6,546,510.22 | 6,695,894.28 | 6,546,510.22 |
| Others | 1,501,531.02 | 1,626,755.62 | 1,501,531.02 |
| Total | 13,031,066.19 | 13,947,988.82 | 12,540,101.40 |
- Income tax expenses
(1) Details
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Currentperiodincometaxexpenses | 106,216,873.13 | 110,132,217.76 |
| Deferredincometaxexpenses | -8,859,221.68 | -13,168,974.08 |
| Total | 97,357,651.45 | 96,963,243.68 |
(2) Reconciliation of accounting profit to income tax expenses
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Profitbeforetax | 609,901,840.51 | 556,255,365.25 |
| Incometaxexpensesbasedontaxrateapplicabletotheparentcompany | 152,475,460.13 | 139,063,841.31 |
| Effectofdifferenttaxrateapplicabletosubsidiaries | -108,201,596.08 | -14,174,894.59 |
| Effectofpriorincometaxreconciliation | 10,458,266.74 | 2,488,907.40 |
| Effectofnon-taxableincome | -1,995,800.61 | -10,408,754.85 |
| Effectofnon-deductiblecosts,expensesandlosses | 17,657,279.37 | 10,640,861.01 |
| Effectofutilizationofdeductiblelossesnotpreviouslyrecognizedasdeferredtaxassets | -13,171,099.82 | -3,001,651.62 |
| Effectofdeducibletemporarydifferencesordeductiblelossesnotrecognizedasdeferredtaxassetsinthecurrentperiod | 86,948,728.47 | 20,910,057.40 |
| Effectofextradeduction | -46,798,282.51 | -49,866,353.99 |
| Differencebetweendeferredandcurrentincometaxrates | -15,304.24 | 1,311,231.61 |
| Incometaxexpenses | 97,357,651.45 | 96,963,243.68 |
- Other comprehensive income, net of income tax
Please referto section V (I) 45 of notes to the financial statements for details.
(III) Notes to items ofthe consolidated cash flow statement
- Other cash receipts orpayments related to operating activities, investing activities and financing activities
(1) Other cash receipts related to operating activities
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Receiptsofdepositsfornotes,lettersofcreditandlettersofguarantee | 167,737,972.76 | 385,183,093.29 |
| Receiptsofgovernmentgrants | 58,010,336.36 | 112,106,818.35 |
| Receiptsofsecuritydeposits | 111,742,962.57 | 109,630,599.89 |
| Recoveryofpettycashandtemporaryadvancepaymentreceivable | 99,329,855.08 | 76,785,785.58 |
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Temporaryreceiptspayable | 180,665,554.52 | 152,028,816.71 |
| Receiptsofinterestincome | 76,788,792.42 | 48,011,644.19 |
| Receiptsoffactoringpaymentandprincipaloffinancelease | 1,066,072,685.44 | 1,128,899,220.36 |
| Receiptofprincipalandinterestoftimedeposits | 67,760,782.25 | |
| Others | 20,325,575.31 | 16,659,857.72 |
| Total | 1,780,673,734.46 | 2,097,066,618.34 |
(2) Other cash payments related to operating activities
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Paymentsfordepositsfornotes,lettersofcreditandlettersofguarantee | 285,090,684.20 | 130,498,826.74 |
| Operatingperiodexpenses | 731,115,039.63 | 807,025,083.75 |
| Paymentsforsecuritydeposits | 63,056,515.55 | 64,966,788.26 |
| Paymentsforpettycashandtemporaryadvancepaymentreceivable | 60,967,713.23 | 120,806,495.16 |
| Paymentsforfactoringandprincipaloffinancelease | 719,746,793.47 | 1,181,778,621.41 |
| Timedeposits | 230,000,000.00 | |
| Temporaryreceiptspayable | 94,331,472.76 | 80,648,317.53 |
| Others | 14,644,423.90 | 10,338,831.68 |
| Total | 2,198,952,642.74 | 2,396,062,964.53 |
(3) Other cash receipts related to investing activities
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Redemptionoffinancialproducts | 1,638,150,000.00 | 5,398,900,000.00 |
| Receiptsofspecialpayables | 12,619,977.00 | |
| Receiptsofprincipalandinterestofcallloans | 2,961,000.00 | |
| Total | 1,650,769,977.00 | 5,401,861,000.00 |
(4) Other cash payments related to investing activities
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Purchaseoffinancialproducts | 1,638,150,000.00 | 5,398,900,000.00 |
| Recoveryofspecialpayables | 3,000,000.00 | |
| Cashoutflowsfromdisposalofsubsidiaries | 1,785,617.97 | |
| Total | 1,642,935,617.97 | 5,398,900,000.00 |
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Receiptsofcallloans | 48,692,000.00 | 44,250,000.00 |
| Receiptsofpaymentsforemployeestockownershipplan | 228,995,320.75 | |
| Recoursefactoringofaccountsreceivable | 17,309,890.84 | |
| Total | 48,692,000.00 | 290,555,211.59 |
(5) Other cash receipts related to financing activities
(6) Other cash payments related to financing activities
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Returnofcallloans | 32,418,130.98 | 57,303,692.00 |
| Paymentsforrents | 10,331,775.89 | 6,227,752.76 |
| Purchaseofnon-controllinginterest | 2,000,000.00 | |
| Paymentsforfactoringservicefeesandhandlingfees | 14,049,209.58 | |
| Paymentsforemployeestockownershipplan | 180,112,670.02 | |
| PrepaidIPOlistingexpenses | 5,703,500.00 | |
| Total | 44,749,906.87 | 263,396,824.36 |
2. Supplementary information to the cash flow statement
| Supplementaryinformation | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Reconciliationofnetprofittocashflowsfrom(1)operatingactivities: | ||
| Netprofit | 512,544,189.06 | 459,292,121.57 |
| Add:Provisionforassetsimpairment | 339,743,360.13 | 417,835,657.08 |
| Depreciationoffixedassets,oilandgasassets,productivebiologicalassets | 278,253,101.81 | 217,634,741.39 |
| Depreciationofright-of-useassets | 8,706,270.90 | 7,064,171.89 |
| Amortizationofintangibleassets | 508,294,636.17 | 458,736,681.20 |
| Amortizationoflong-termprepayments | 12,737,945.56 | 8,520,526.60 |
| Lossesondisposaloffixedassets,intangibleassetsandotherlong-termassets(Less:gains) | 1,104,586.11 | -614,542.02 |
| Fixedassetsretirementloss(Less:gains) | 2,226,170.44 | 2,904,223.18 |
| Lossesonchangesinfairvalue(Less:gains) | ||
| Financialexpenses(Less:gains) | 156,286,924.35 | 177,688,052.22 |
| Investmentlosses(Less:gains) | -17,097,464.58 | -24,239,932.54 |
| Decreaseofdeferredtaxassets(Less:increase) | -1,871,173.45 | -4,814,568.19 |
| Increaseofdeferredtaxliabilities(Less:decrease) | -6,988,048.23 | -8,354,405.89 |
| Supplementaryinformation | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Decreaseofinventories(Less:increase) | -115,741,461.68 | 226,633,956.56 |
| Decreaseofoperatingreceivables(Less:increase) | -217,119,189.86 | -409,725,335.43 |
| Increaseofoperatingpayables(Less:decrease) | -75,523,337.24 | 129,881,870.69 |
| Others | 4,039,069.40 | |
| Netcashflowsfromoperatingactivities | 1,385,556,509.49 | 1,662,482,287.71 |
| (2)Significantinvestingandfinancingactivitiesnotrelatedtocashreceiptsandpayments: | ||
| Conversionofdebtintocapital | ||
| Convertiblebondsduewithinoneyear | ||
| Fixedassetsleasedinunderfinanceleases | ||
| (3)Netchangesincashandcashequivalents: | ||
| Cashattheendoftheperiod | 3,916,145,254.54 | 4,580,665,245.99 |
| Less:Cashatthebeginningoftheperiod | 4,580,665,245.99 | 4,118,746,885.72 |
| Add:Cashequivalentsattheendoftheperiod | ||
| Less:Cashequivalentsatthebeginningoftheperiod | ||
| Netincreaseofcashandcashequivalents | -664,519,991.45 | 461,918,360.27 |
- Composition of cash and cash equivalents
(1) Details
| Items | Closingbalance | Openingbalance |
|---|---|---|
| 1)Cash | 3,916,145,254.54 | 4,580,665,245.99 |
| Including:Cashonhand | 310,688.91 | 84,414.54 |
| Cashinbankondemandforpayment | 3,914,780,983.13 | 4,580,210,453.03 |
| Othercashandbankbalancesondemandforpayment | 1,053,582.50 | 370,378.42 |
| Centralbankdepositondemandforpayment | ||
| Depositinotherbanks | ||
| Loanstootherbanks | ||
| 2)Cashequivalents | ||
| Including:Bondinvestmentsmaturingwithinthreemonths | ||
| 3)Cashandcashequivalentsattheendoftheperiod | 3,916,145,254.54 | 4,580,665,245.99 |
| Including:Cashandcashequivalentsofparentcompanyorsubsidiarieswithuserestrictions |
(2) Cash and cash equivalents with use restrictions
|--|--|
| Items | Closingbalance | Openingbalance | Reasonsforuserestrictionsandforconsideredascashandcashequivalents |
|---|---|---|---|
| Raisedfunds | 77,431,277.37 | 115,338,436.21 | Raisedfunds |
| Businessfundsspecificallyusedforprojectpayments | 22,851,951.00 | Specialfunds | |
| Subtotal | 100,283,228.37 | 115,338,436.21 |
(3) Cash and bank balances not considered as cash and cash equivalents
| Items | Closingbalance | Openingbalance | Reasonsfornotconsideredascashandcashequivalents |
|---|---|---|---|
| Depositsforbankacceptance | 179,001,533.41 | 46,878,240.34 | Unabletobewithdrawnondemand |
| Depositsforlettersofguarantee | 77,546,493.49 | 87,619,095.60 | Unabletobewithdrawnondemand |
| Engineeringdeposits | 929,734.93 | 927,865.56 | Unabletobewithdrawnondemand |
| ETCdeposits | 3,000.00 | 3,000.00 | Unabletobewithdrawnondemand |
| Depositsforlandreclamation | 1,003,098.32 | 1,000,832.05 | Unabletobewithdrawnondemand |
| Depositsforbuyer'scredit | 861,924.65 | 901,432.50 | Unabletobewithdrawnondemand |
| Engineeringescrowaccountsthatarenotavailableforseparateuse | 154,141.05 | 9,107,818.42 | Unabletobewithdrawnondemand |
| Frozenbankdepositsduetolawsuits | 5,100,869.89 | 1,100,000.00 | Unabletobewithdrawnondemand |
| Timedepositsandinterests | 230,340,333.33 | Unabletobewithdrawnondemand | |
| Others | 290,200.17 | Unabletobewithdrawnondemand | |
| Subtotal | 495,231,329.24 | 147,538,284.47 |
- Changes in liabilities related to financing activities
| Increase | Decrease | |||||
|---|---|---|---|---|---|---|
| Items | Openingbalance | Changesincash | Changesinnon-cash | Changesincash | Changesinnon-cash | Closingbalance |
| Short-termborrowings | 440,103,105.44 | 599,206,768.24 | 9,696,553.27 | 922,066,571.69 | 126,939,855.26 | |
| Dividendpayable | 355,986,223.08 | 355,986,223.08 | ||||
| Otherpayables | 29,093,805.32 | 21,380,000.00 | 2,040,387.09 | 28,714,555.94 | 23,799,636.47 | |
| Long-termborrowings(includinglongtermborrowingsduewithinoneyear) | 2,474,887,976.24 | 831,248,989.56 | 93,048,642.05 | 1,127,518,708.67 | 2,271,666,899.18 | |
| Bondspayable(includingbondspayableduewithinoneyear) | 1,308,690,556.32 | 63,722,253.84 | 11,809,008.04 | 1,360,603,802.12 |
| Increase | Decrease | |||||
|---|---|---|---|---|---|---|
| Items | Openingbalance | Changesincash | Changesinnon-cash | Changesincash | Changesinnon-cash | Closingbalance |
| Leaseliabilities(includingleaseliabilitiesduewithinoneyear) | 31,093,459.07 | 4,126,126.53 | 10,248,232.04 | 187,165.96 | 24,784,187.60 | |
| Long-termpayables(includinglong-termpayablesduewithinoneyear) | 27,312,000.00 | 2,703,662.62 | 4,175,192.30 | 1,563,137.00 | 24,277,333.32 | |
| Subtotal | 4,283,868,902.39 | 1,479,147,757.80 | 531,323,848.48 | 2,460,518,491.76 | 1,750,302.96 | 3,832,071,713.95 |
- Significant activities not involving cash receipts and payments
Please referto section V (III) 4 of notes to the financial statements for details on significant investing and financing activities not involving cash receipts and payments.
(IV) Others
1. Monetary items in foreign currencies
| Items | Closingbalanceinforeigncurrencies | Exchangerate | RMBequivalentattheendoftheperiod |
|---|---|---|---|
| Cashandbankbalances | 38,281,796.98 | ||
| Including:USD | 1,299,398.42 | 7.0827 | 9,203,249.19 |
| EUR | 3,577,091.77 | 7.8592 | 28,113,079.64 |
| HKD | 1,065,402.95 | 0.9062 | 965,468.15 |
| Accountsreceivable | 17,855,293.19 | ||
| Including:USD | 164.00 | 7.0827 | 1,161.56 |
| EUR | 2,271,749.24 | 7.8592 | 17,854,131.63 |
2. Leases
(1) The Company as lessee
-
Please refer to section V (I) 17 of notes to the financial statements for details on right-of-use assets.
-
Please refer to section III (XXXII) of notes to the financial statements for details on the Company's accounting policies on short-term leases and leases for which the underlying asset is of low value. The amounts of short-term leases and low-value asset leases included into profit or loss are asfollows:
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Expenserelatingtoshort-termleases | 19,527,703.71 | 10,884,849.01 |
| Expenserelatingtoleasesoflow-valueassets(excludingshort-termleases) | ||
| Total | 19,527,703.71 | 10,884,849.01 |
- Profit or loss and cash flows related to leases
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Interestexpensesonleaseliabilities | 1,190,325.15 | 1,337,799.45 |
| Variableleasepaymentsincludedinprofitorlossbutnotincludedinthemeasurementoflease | ||
| liabilities | ||
| Incomefromsubleasingright-of-useassets | ||
| Totalcashoutflowsrelatedtoleases | 29,859,479.60 | 17,112,601.77 |
| Gainsorlossesarisingfromsale |
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| andleasebacktransactions |
- Please refer to section IX (II) of notes to the financial statements for details on maturity analysis of lease liabilities and related liquidity risk management.
(2) The Company as lessor
- Operating lease
a. Lease income
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Leaseincome | 3,249,127.28 | 1,855,150.51 |
| Including:Incomerelatingto | ||
| variableleasepaymentsnot | ||
| includedinthemeasurementof | ||
| theleaseliabilities |
b. Assets leased out under operating leases
| Items | Closingbalance | December31,2022 | ||
|---|---|---|---|---|
| Buildingsandstructures | 23,875,232.89 | 27,105,435.03 | ||
| Subtotal | 23,875,232.89 | 27,105,435.03 |
Please refer to section V (I) 15 of notes to the financial statements for details on fixed assets leased out under operating leases.
c. Undiscounted lease payments to be received arising from non-cancellable leases based on the lease contract signed with lessee
| Remainingyears | Closingbalance | December31,2022 |
|---|---|---|
| Within1year | 104,738.00 | 157,112.00 |
| 1-2years | 104,738.00 | 157,112.00 |
| 2-3years | 104,738.00 | 157,112.00 |
| 3-4years | 104,738.00 | 157,112.00 |
| 4-5years | 104,738.00 | 157,112.00 |
| Over5years | 157,112.00 | |
| Total | 523,690.00 | 942,672.00 |
- Finance lease
a. Profit or loss related to finance lease
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Financeincomeonthenetinvestmentinthelease | 2,245,842.84 | 5,464,955.41 |
| Incomerelatingtovariablelease | |
|---|---|
| paymentsnotincludedinthe | |
| measurementofthenet | |
| investmentinthelease |
b. Reconciliation of undiscounted lease payments to net investment in the lease
| Items | Closingbalance | December31,2022 |
|---|---|---|
| Undiscountedleasepayments | 68,248,638.70 | 99,676,989.33 |
| Less:Unrealizedfinanceincomerelatingtoleasepayments | 4,679,168.24 | 5,140,906.34 |
| Add:Presentvalueofunguaranteedresidualvalue | ||
| Netinvestmentinthelease | 63,569,470.46 | 94,536,082.99 |
c. Undiscounted lease payments to be received arising from non-cancellable leases based on the lease contract signed with lessee
| Remainingyears | Closingbalance | December31,2022 |
|---|---|---|
| Within1year | 46,826,104.16 | 58,791,768.45 |
| 1-2years | 19,550,334.54 | 32,869,315.86 |
| 2-3years | 1,497,760.00 | 6,143,705.02 |
| 3-4years | 374,440.00 | 1,497,760.00 |
| 4-5years | 374,440.00 | |
| Total | 68,248,638.70 | 99,676,989.33 |
VI. R&D costs
(I) R&D costs
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Employeebenefits | 252,327,439.92 | 266,224,944.76 |
| Directinputs | 37,083,931.61 | 44,582,928.01 |
| Otherexpenses | 63,438,534.25 | 52,458,233.21 |
| Share-basedpayment | 971,457.24 | |
| Total | 352,849,905.78 | 364,237,563.22 |
| Including:R&Dcoststobeexpensed | 344,030,239.33 | 340,775,707.34 |
| R&Dcoststobecapitalized | 8,819,666.45 | 23,461,855.88 |
(II) Development expenditures
- Changes in development expenditures
| Increase | Decrease | |||||||
|---|---|---|---|---|---|---|---|---|
| Items | Openingbalance | Internaldevelopmentexpenditures | Others | Recognizedasintangibleassets | Transferredoutintoprofitorloss | Others | Closingbalance |
| Increase | |||||||
|---|---|---|---|---|---|---|---|
| Itemsbalance | Opening | Internaldevelopmentexpenditures | Others | Recognizedasintangibleassets | Transferredoutintoprofitorloss | Others | Closingbalance |
| R&Dofindoorself-drivingoperatingsystem | 765,552.19 | 765,552.19 | |||||
| Intelligentbarreledgarbagetransfermachine | 662,327.79 | 662,327.79 | |||||
| Indoorsweepingrobot | 870,662.83 | 870,662.83 | |||||
| Deepcleaningmachine | 524,164.55 | 524,164.55 | |||||
| Researchonwirecontroltechnologyforsmallself-madechassis | 4,115,027.48 | 120,653.35 | 4,235,680.83 | ||||
| R&Dofoutdoorself-drivingoperatingsystem(Stage2) | 5,758,682.29 | 826,253.18 | 6,584,935.47 | ||||
| Researchonaerodynamicnoisecontrolandpneumaticconveyingenergy-savingtechnology | 2,351,791.55 | 85,060.50 | 2,436,852.05 | ||||
| Pureelectricroadsweeper | 1,565,839.40 | 1,565,839.40 | |||||
| SanitationrobotIoTplatform | 3,351,117.77 | 248,957.47 | 3,600,075.24 | ||||
| Economicalgarbagetransfertruck | 225,467.15 | 225,467.15 | |||||
| Developmentofcleaningrobotbasedonautonomousunmannedsystem | 1,325,659.13 | 734,617.23 | 2,060,276.36 | ||||
| SpecialfundsforS2000seriestop-sellingproducts | 2,442,440.66 | 1,997,898.12 | 4,440,338.78 | ||||
| SpecialfundsforS18seriestop-sellingproductproject | 4,283,010.42 | 3,193,424.27 | 7,476,434.69 | ||||
| Brandnewfirstgenerationeconomicalversionofrollingsweeper | 470,115.54 | 1,612,802.33 | 2,082,917.87 | ||||
| Indoorfloorwashingrobot | 1,763,287.72 | 1,763,287.72 | |||||
| Pureelectricsmallgarbagecleaningmachine | 1,024,782.18 | 1,024,782.18 | |||||
| Pureelectricsidewalksweeper | 1,592,468.75 | 1,592,468.75 | |||||
| Pureelectricgarbagecollector | 68,528.04 | 68,528.04 | |||||
| Total | 33,160,925.44 | 8,819,666.45 | 32,917,511.29 | 9,063,080.60 |
2. Impairment of development expenditures
(1) Changes in provision for impairment
| Items | Opening | Increase | Decrease | |||
|---|---|---|---|---|---|---|
| balance | Accrual | Others | Disposal/Scrapping | Others | Closingbalance | |
| R&Dofindoorself-drivingoperatingsystem | 765,552.19 | 765,552.19 | ||||
| Intelligentbarreledgarbagetransfermachine | 662,327.79 | 662,327.79 | ||||
| Indoorsweepingrobot | 870,662.83 | 870,662.83 | ||||
| Deepcleaningmachine | 524,164.55 | 524,164.55 |
| Items | Opening | Increase | Decrease | Closingbalance | ||
|---|---|---|---|---|---|---|
| balance | Accrual | Others | Disposal/Scrapping | Others | ||
| Pureelectricroadsweeper | 1,565,839.40 | 1,565,839.40 | ||||
| Economicalgarbagetransfertruck | 225,467.15 | 225,467.15 | ||||
| Indoorfloorwashingrobot | 1,763,287.72 | 1,763,287.72 | ||||
| Pureelectricsmallgarbagecleaningmachine | 1,024,782.18 | 1,024,782.18 | ||||
| Pureelectricsidewalksweeper | 1,592,468.75 | 1,592,468.75 | ||||
| Pureelectricgarbagecollector | 68,528.04 | 68,528.04 | ||||
| Subtotal | 2,822,707.36 | 6,240,373.24 | 9,063,080.60 |
(2) Impairment test on development expenditures
| Items | Carryingamount | Recoverableamount | Provisionforimpairment | |
|---|---|---|---|---|
| R&Dofindoorself-drivingoperatingsystem | ||||
| Intelligentbarreledgarbagetransfermachine | ||||
| Indoorsweepingrobot | ||||
| Deepcleaningmachine | ||||
| Pureelectricroadsweeper | 1,565,839.40 | 1,565,839.40 | ||
| Economicalgarbagetransfertruck | 225,467.15 | 225,467.15 | ||
| Indoorfloorwashingrobot | 1,763,287.72 | 1,763,287.72 | ||
| Pureelectricsmallgarbagecleaningmachine | 1,024,782.18 | 1,024,782.18 | ||
| Pureelectricsidewalksweeper | 1,592,468.75 | 1,592,468.75 | ||
| Pureelectricgarbagecollector | 68,528.04 | 68,528.04 | ||
| Subtotal | 6,240,373.24 | 6,240,373.24 |
(Continued)
| Items | Determinationmethodoffairvalueandcostsofdisposal |
|---|---|
| R&Dofindoorself-drivingoperatingsystem | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Intelligentbarreledgarbagetransfermachine | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Indoorsweepingrobot | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Deepcleaningmachine | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Pureelectricroadsweeper | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Items | Determinationmethodoffairvalueandcostsofdisposal |
|---|---|
| Economicalgarbagetransfertruck | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Indoorfloorwashingrobot | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Pureelectricsmallgarbagecleaningmachine | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Pureelectricsidewalksweeper | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Pureelectricgarbagecollector | FullprovisionforimpairmentismadeastheCompanyterminatesR&DoftheprojectduetoitsR&Dresourcedirectionadjustmentandchangesofmarketdemand. |
| Subtotal |
VII. Interest in other entities
(I) Composition of the consolidation scope
- The Company has brought 278 subsidiaries including Zoomlion Environmental Company, Shangfeng Industrial Company, Infore Technology Company, and Green Oriental Company into the consolidation scope.
| informationofsignificantsubsidiaries | |
|---|---|
| -------------------------------------------------- | -- |
| Mainoperating | Holdingproportion(%) | ||||||
|---|---|---|---|---|---|---|---|
| Subsidiaries | Registeredcapital | placeandplaceofregistration | Businessnature | Direct | Indirect | Acquisitionmethod | |
| ShangfengIndustrialCompany | 109.21millionyuan | Shaoxing,Zhejiang | Fanequipmentmanufacturingandothers | 60.20 | Businesscombinationnotundercommoncontrol | ||
| GreenOrientalCompany | 150millionyuan | Shenzheng,Guangdong | Environmentalmonitoringandsolidwastedisposal | 70.00 | Businesscombinationnotundercommoncontrol | ||
| FunanCompany | 87.50millionyuan | Funan,Anhui | Environmentalmonitoringandsolidwastedisposal | 70.00 | Businesscombinationnotundercommoncontrol | ||
| XiantaoCompany | 125millionyuan | Xiantao,Hubei | Environmentalmonitoringandsolidwastedisposal | 70.00 | Businesscombinationnotundercommoncontrol | ||
| ShouxianCompany | 87.50millionyuan | Shouxian,Anhui | Environmentalmonitoringandsolidwastedisposal | 70.00 | Businesscombinationnotundercommoncontrol | ||
| XiantaoYingheEnvironmentalProtectionCo.,Ltd. | 100.14millionyuan | Xiantao,Hubei | Environmentalmonitoringandsolidwastedisposal | 70.32 | 5.35 | Setup | |
| InforeTechnologyCompany | 110millionyuan | Foshan,Guangdong | Environmentalmonitoringandsolidwastedisposal | 100.00 | Setup | ||
| FoshanShunheEnvironmentalProtectionCo.,Ltd. | 300millionyuan | Foshan,Guangdong | Environmentalmonitoringandsolidwaste | 100.00 | Businesscombinationnotundercommoncontrol |
| Subsidiaries | Registeredcapital | Mainoperatingplaceandplace | Businessnature | Holding | proportion(%) | Acquisitionmethod |
|---|---|---|---|---|---|---|
| ofregistration | Direct | Indirect | ||||
| disposal | ||||||
| HuaqingyuanCompany | 12millionyuan | Foshan,Guangdong | Environmentalmonitoringandsolidwastedisposal | 100.00 | Businesscombinationnotundercommoncontrol | |
| FoshanShundeDistrictHuayingEnvironmentalWaterCo.,Ltd. | 3millionyuan | Foshan,Guangdong | Environmentalmonitoringandsolidwastedisposal | 100.00 | Businesscombinationnotundercommoncontrol | |
| FoshanShundeDistrictYuanrunWaterEnvironmentalProtectionCo.,Ltd. | 12millionyuan | Foshan,Guangdong | Environmentalmonitoringandsolidwastedisposal | 100.00 | Businesscombinationnotundercommoncontrol | |
| FoshanShundeHuaboEnvironmentalWaterCo.,Ltd. | 1millionyuan | Foshan,Guangdong | Environmentalmonitoringandsolidwastedisposal | 100.00 | Businesscombinationnotundercommoncontrol | |
| ZoomlionEnvironmentalCompany | 2,351.53millionyuan | Changsha,Hunan | Smartcityservices | 100.00 | Businesscombinationundercommoncontrol | |
| ChangshaZoomlionChanggaoEnvironmentalIndustryCo.,Ltd. | 30millionyuan | Changsha,Hunan | Smartcityservices | 100.00 | Setup | |
| FujianNan'anYinglianUrbanEnvironmentalServiceCo.,Ltd. | 30millionyuan | Nan'an,Fujian | Smartcityservices | 80.00 | Setup | |
| ZhangjiajieYinglianEnvironmentalManagementCo., | 8millionyuanLtd. | Zhangjiajie,Hunan | Smartcityservices | 90.00 | Setup | |
| CiliCountyZoomlionHuabaoEnvironmentalIndustryCo.,Ltd. | 6millionyuan | Cili,Hunan | Smartcityservices | 60.00 | Setup | |
| HanshouZoomlionEnvironmentalIndustryCo.,Ltd. | 13millionyuan | Hanshou,Hunan | Smartcityservices | 90.00 | Setup | |
| LonghuiCountyZoomlionEnvironmentalIndustryCo.,Ltd. | 1millionyuan | Longhui,Hunan | Smartcityservices | 100.00 | Setup | |
| ShimenZoomlionEnvironmentalIndustryCo.,Ltd. | 15millionyuan | Shimen,Hunan | Smartcityservices | 90.00 | Setup | |
| NingboInforeFinanceLeaseCo.,Ltd. | USD72.60million | Ningbo,Zhejiang | Financelease | 99.31 | 0.69 | Setup |
(II) Business combination not under common control
- Business combination not under common control in the currentperiod
| Acquirees | Equityacquisitiondate | Equityacquisitioncost | Proportionofequityacquired(%) | Equityacquisitionmethod | Acquisitiondate |
|---|---|---|---|---|---|
| HubeiYinglingTestingTechnologyServiceCo.,Ltd. | May18,2023 | 156,438.75 | 100.00 | Acquisition | May18,2023 |
| (Continued) |
| Acquirees | Acquiree'sAcquiree'snetAcquiree'scashflowsfromacquisitiondateto | ||||||
|---|---|---|---|---|---|---|---|
| Determinationbasisforacquisitiondate | incomefrom | profitfrom | periodend | ||||
| acquisitiondate | acquisitiondate | Netinflows | Netinflows | ||||
| toperiodend | toperiodend | Netinflows |
| fromoperatingactivities | frominvestingactivities | fromfinancingactivities | ||||
|---|---|---|---|---|---|---|
| HubeiYinglingTestingTechnologyServiceCo.,Ltd. | Transferofcontrol | 86,770.44 | -812,968.37 | -87,733.23 |
2. Combination costs and goodwill
| Items | HubeiYinglingTestingTechnologyServiceCo.,Ltd. |
|---|---|
| Combinationcosts | |
| Cash | 156,438.75 |
| Totalcombinationcosts | 156,438.75 |
| Less:Shareoffairvalueofnetidentifiableassetsacquired | 156,438.75 |
| Goodwill/Balanceoffairvalueofnetidentifiedassetsacquiredafterdeductingcombinationcosts |
3. Acquisition-date identifiable assets and liabilities ofacquirees
(1) Details
| HubeiYinglingTestingTechnologyServiceCo.,Ltd. | ||||||||
|---|---|---|---|---|---|---|---|---|
| Items | Acquisition-datefairvalue | Acquisition-datecarryingamount | ||||||
| Assets | 410,344.64 | 410,344.64 | ||||||
| Cashandbankbalances | 112,965.79 | 112,965.79 | ||||||
| Accountsreceivable | 97,680.00 | 97,680.00 | ||||||
| Advancespaid | 16,000.00 | 16,000.00 | ||||||
| Otherreceivables | 43,871.50 | 43,871.50 | ||||||
| Fixedassets | 82,327.35 | 82,327.35 | ||||||
| Long-termprepayments | 57,500.00 | 57,500.00 | ||||||
| Liabilities | 253,905.89 | 253,905.89 | ||||||
| Accountspayable | 104,920.44 | 104,920.44 | ||||||
| Employeebenefitspayable | 29,996.37 | 29,996.37 | ||||||
| Taxpayable | 1,006.22 | 1,006.22 | ||||||
| Otherpayables | 117,982.86 | 117,982.86 | ||||||
| Netassets | 156,438.75 | 156,438.75 | ||||||
| Netassetsacquired | 156,438.75 | 156,438.75 |
(2) Fair value determination method on identifiable assets and liabilities
The carrying amount of assets and liabilities on the acquisition date of Hubei Yingling Testing Technology Service Co., Ltd. is taken as the fair value of identifiable assets and liabilities.
(II) Disposal of subsidiaries
One-time disposal leading to loss ofcontrol over a subsidiary
Details
| Subsidiaries | Equitydisposalconsideration | Equitydisposalproportion(%) | Equitydisposalmethod | Lossofcontroldate | Determinationbasisforlossofcontroldate | DifferencebetweendisposalconsiderationandnetassetsattributabletotheCompanyattheconsolidatedfinancialstatementslevel | ||||
|---|---|---|---|---|---|---|---|---|---|---|
| GuchengYinglianUrbanEnvironmentalServiceCo.,Ltd. | 500,000.00 | 100.00 | Transfer | 8/24/2023 | control | Substantialtransfer | -381,328.08 | |||
| ZaozhuangYinglianUrbanEnvironmentalServiceCo.,Ltd. | 500,000.00 | 100.00 | Transfer | 3/1/2023 | control | Substantialtransfer | -7,097.77 | |||
| YichunYinglianUrbanEnvironmentalServiceCo.,Ltd. | 500,000.00 | 100.00 | Transfer | 8/8/2023control | Substantialtransfer | -235,810.55 | ||||
| ChongqingYinglianCitySanitationServiceCo.,Ltd. | 500,000.00 | 100.00 | Transfer | 12/6/2023control | Substantialtransfer | 24,004.26 | ||||
| HuaibeiZhongfengUrbanEnvironmentalServiceCo.,Ltd. | 1.00 | 100.00 | Transfer | 9/13/2023 | Substantialcontroltransfer | -215,560.78 | ||||
| (Continued) | ||||||||||
| Subsidiaries | Proportionofremainingequityatthelossofcontroldate(%) | Carryingamountofremainingequityattheofcontroldate | lossloss | Fairvalueremainingequitydate | ofGains/Lossesfairattheremeasurementofcontrolofequity | onvalueremaining | Determinationmethodandassumptionvalueofequityatthecontrol | majoronfairremaininglossofdate | Changesinothercomprehensiveincome/equityrelatedtoformersubsidiary'sequityinvestmenttransferredtoinvestmentincome | |
| GuchengYinglianUrbanEnvironmentalServiceCo.,Ltd. | ||||||||||
| ZaozhuangYinglianUrbanEnvironmentalServiceCo.,Ltd. | ||||||||||
| YichunYinglianUrbanEnvironmentalServiceCo.,Ltd. |
(III) Changes in the consolidation scope due to other reasons
- Entities brought into the consolidation scope
Chongqing Yinglian City Sanitation
Huaibei Zhongfeng Urban Environmental Service Co., Ltd.
Service Co., Ltd.
| Entities | Equityacquisitionmethod | Equityacquisitiondate | Capitalcontribution | Holdingproportion(%) |
|---|---|---|---|---|
| LiaochengChipingDistrictYingshengEnvironmentalSanitationServiceCo.,Ltd. | Setup | 1/4/2023 | 100,000.00 | 100.00 |
| JiangmenLvyingUrbanEnvironmentalServiceCo.,Ltd. | Setup | 2/3/2023 | [Note] | 100.00 |
| FuzhouChangleDistrictYingshengUrban | Setup | 2/8/2023 | [Note] | 100.00 |
| Entities | Equityacquisitionmethod | Equityacquisitiondate | Capitalcontribution | Holdingproportion(%) |
|---|---|---|---|---|
| EnvironmentalServiceCo.,Ltd. | ||||
| ChongqingBananDistrictYingheUrbanEnvironmentalServiceCo.,Ltd. | Setup | 2/17/2023 | 300,000.00 | 100.00 |
| GuangzhouYingtaiUrbanManagementServiceCo.,Ltd. | Setup | 2/22/2023 | [Note] | 100.00 |
| FoshanShundeDistrictYingchuangUrbanEnvironmentalServiceCo.,Ltd. | Setup | 3/1/2023 | 2,300,000.00 | 100.00 |
| PuningHonglianEnvironmentalServiceCo.,Ltd. | Setup | 3/7/2023 | [Note] | 100.00 |
| HefeiYingshengUrbanEnvironmentalServiceCo.,Ltd. | Setup | 3/15/2023 | 200,000.00 | 100.00 |
| FengyangYingheEnvironmentalSanitationManagementCo.,Ltd. | Setup | 3/21/2023 | 500,000.00 | 100.00 |
| SanyaLianyingUrbanEnvironmentalServiceCo.,Ltd. | Setup | 3/22/2023 | 100,000.00 | 100.00 |
| FuzhouYingheEnvironmentalDevelopmentCo.,Ltd. | Setup | 4/11/2023 | [Note] | 60.00 |
| ChuzhouTongyingEnvironmentalSanitationManagementCo.,Ltd. | Setup | 4/11/2023 | 500,000.00 | 100.00 |
| YongxinYingheEnvironmentalSanitationManagementCo.,Ltd. | Setup | 4/17/2023 | 500,000.00 | 100.00 |
| LianjiangLianyingUrbanEnvironmentalServiceCo.,Ltd. | Setup | 4/21/2023 | 2,100,000.00 | 100.00 |
| GuangzhouYingzhiUrbanEnvironmentalSanitationServiceCo.,Ltd. | Setup | 5/5/2023 | [Note] | 100.00 |
| ShenzhenLonggangYinglianEnvironmentalServiceCo.,Ltd. | Setup | 6/2/2023 | [Note] | 100.00 |
| ShenzhenYinglianAfforestEngineeringCo.,Ltd. | Setup | 6/5/2023 | [Note] | 100.00 |
| YangjiangYingheUrbanEnvironmentalServiceCo.,Ltd. | Setup | 6/8/2023 | 10,000,000.00 | 100.00 |
| RenshouYingheUrbanandRuralSanitationServiceCo.,Ltd. | Setup | 6/13/2023 | 2,000,000.00 | 100.00 |
| ChibiLianyingEnvironmentalSanitationManagementCo.,Ltd. | Setup | 6/27/2023 | 14,662,100.00 | 100.00 |
| ShenZhenLonggangDistrictYingjiCityServiceCo.,Ltd. | Setup | 7/5/2023 | [Note] | 100.00 |
| WuyiYingheEnvironmentalSanitationManagementCo.,Ltd. | Setup | 7/18/2023 | [Note] | 100.00 |
| XuchangJian'anDistrictTongyingEnvironmentalSanitationManagementCo.,Ltd. | Setup | 7/18/2023 | 100,000.00 | 100.00 |
| Entities | Equityacquisitionmethod | Equityacquisitiondate | Capitalcontribution | Holdingproportion(%) |
|---|---|---|---|---|
| FoshanShundeDistrictLianyingUrbanEnvironmentalServiceCo.,Ltd. | Setup | 7/20/2023 | 1,770,000.00 | 59.00 |
| TaizhouYingheEnvironmentalSanitationManagementCo.,Ltd. | Setup | 7/24/2023 | [Note] | 100.00 |
| ChangshaYingheEnvironmentalSanitationManagementCo.,Ltd. | Setup | 7/24/2023 | 500,000.00 | 100.00 |
| HuichangYingmaoEnvironmentalManagementCo.,Ltd. | Setup | 7/25/2023 | 6,500,000.00 | 65.00 |
| TangshanYinglianEnvironmentalManagementCo.,Ltd. | Setup | 7/26/2023 | [Note] | 100.00 |
| YongfengYingheEnvironmentalSanitationManagementCo.,Ltd. | Setup | 7/27/2023 | 500,000.00 | 100.00 |
| NanjingYinglianEnvironmentalTechnologyCo.,Ltd. | Setup | 8/1/2023 | 1,000,000.00 | 100.00 |
| SuzhouWujiangYingheEnvironmentalSanitationManagementCo.,Ltd. | Setup | 8/4/2023 | 200,000.00 | 100.00 |
| XiajiangYingheEnvironmentalSanitationManagementCo.,Ltd. | Setup | 8/14/2023 | 500,000.00 | 100.00 |
| LongquanTongyingEnvironmentalSanitationServiceCo.,Ltd. | Setup | 8/22/2023 | 100,000.00 | 100.00 |
| XinhuaYinglianModernEnvironmentalServiceCo.,Ltd. | Setup | 8/28/2023 | 10,879,960.00 | 80.00 |
| GuangxiLuochengYingxinUrbanEnvironmentalServiceCo.,Ltd. | Setup | 9/25/2023 | [Note] | 51.00 |
| SuzhouYingfenEnvironmentalIndustryCo.,Ltd. | Setup | 10/30/2023 | 2,100,000.00 | 70.00 |
| RenshouZhongyingSanitationServiceCo.,Ltd. | Setup | 11/3/2023 | 2,000,000.00 | 70.00 |
| NantongLianyingEnvironmentalServiceCo.,Ltd. | Setup | 11/17/2023 | 100,000.00 | 100.00 |
| HuazhouLianshengUrbanEnvironmentalServiceCo.,Ltd. | Setup | 12/11/2023 | 8,000,000.00 | 100.00 |
| HeyuanZijinLianshengUrbanEnvironmentalServiceCo.,Ltd. | Setup | 12/27/2023 | [Note] | 100.00 |
| TangshanYingxingSanitationEquipmentManufacturingCo.,Ltd. | Setup | 12/28/2023 | [Note] | 68.00 |
| QuanzhouYingxinUrbanEnvironmentalServiceCo.,Ltd. | Setup | 12/29/2023 | [Note] | 100.00 |
| ZhejiangYolshIntelligentEmergencyEquipmentCo.,Ltd. | Setup | 12/13/2023 | 100,000,000.00 | 70.00 |
| HeyangYingheUrban | Setup | 4/26/2023 | 5,000,000.00 | 100.00 |
| Entities | Equityacquisitionmethod | Equityacquisitiondate | Capitalcontribution | Holdingproportion(%) |
|---|---|---|---|---|
| EnvironmentalServiceCo.,Ltd. | ||||
| XuzhouTongyingSanitationServiceCo.,Ltd. | Setup | 12/5/2023 | 100,000.00 | 100.00 |
Note: As ofDecember 31,2023, the Company has not paid contribution to these entities.
2. Entities excluded from the consolidation scope
| Entities | Equitydisposalmethod | Equitydisposaldate | Disposal-datenetassets | Netprofitfromtheperiodbeginningtothedisposaldate |
|---|---|---|---|---|
| MeishanPengshan | ||||
| ZhongfengEnvironmental | Cancellation | 10/10/2023 | -287,156.36 | |
| IndustryCo.,Ltd. | ||||
| ChengduYinglian | ||||
| Environmental | Cancellation | 6/1/2023 | -4,011.80 | |
| ManagementCo.,Ltd. | ||||
| GuangxiGuipingYinghe | ||||
| EnvironmentalSanitation | Cancellation | 8/18/2023 | -43,942.03 | |
| ManagementCo.,Ltd. | ||||
| ShengzhouYinghe | ||||
| EnvironmentalSanitation | Cancellation | 7/12/2023 | -65,689.18 | |
| ManagementCo.,Ltd. | ||||
| ChongyangYinglian | ||||
| EnvironmentalProtection | Cancellation | 2/28/2023 | 0.04 | |
| Co.,Ltd. | ||||
| YiyangYinglian | ||||
| EnvironmentalSanitation | Cancellation | 4/19/2023 | 25.21 | |
| ManagementCo.,Ltd. | ||||
| WanningYinglian | ||||
| EnvironmentalIndustry | Cancellation | 4/4/2023 | 296,440.93 | |
| Co.,Ltd. | ||||
| ShenzhenLonghua | ||||
| DistrictYinglianUrban | Cancellation | 10/14/2023 | -203.21 | |
| ServiceCo.,Ltd. | ||||
| GuangdongInforeSmart | Cancellation | 1/6/2023 | ||
| TechnologyCo.,Ltd. | ||||
| AnhuaYingsheng | ||||
| EnvironmentalSanitation | Cancellation | 9/20/2023 | -10,713.04 | |
| ServiceCo.,Ltd. |
(IV) Transactions resulting in changes in subsidiaries' equity but without losing control
- Changes in subsidiaries' equity
| Subsidiaries | Dateofchange | Holdingproportionbeforechange | Holdingproportionafterchange |
|---|---|---|---|
| HuaianChenjieEnvironmentalEngineeringCo.,Ltd. | 6/1/2023 | 96.00% | 100.00% |
| XiantaoYingheEnvironmentalProtectionCo.,Ltd. | 12/25/2023 | 80.58% | 75.67% |
| 2. | Effectoftransactionson | non-controllinginterest | andequityattributable | toparentcompany | |
|---|---|---|---|---|---|
| HuaianChenjieEnvironmental | XiantaoYingheEnvironmental | |
|---|---|---|
| Items | EngineeringCo.,Ltd. | ProtectionCo.,Ltd. |
| Acquisitioncosts/Disposal | ||
| considerations | ||
| Cash | 2,000,000.00 | 35,872,650.00 |
| Totalacquisitioncosts/ | ||
| disposalconsiderations | 2,000,000.00 | 35,872,650.00 |
| Less:Shareinsubsidiaries' | ||
| netassetsbasedonacquired/ | 722,640.74 | 35,716,497.55 |
| disposednetassetsproportion | ||
| Balance | 1,277,359.26 | 156,152.45 |
| Including:Capitalreserve | ||
| adjusted | 1,277,359.26 | 156,152.45 |
(V) Interest in joint ventures orassociates
- Significant joint ventures orassociates
| Associates | Mainoperatingplace | Placeofregistration | Businessnature | HoldingDirect | proportion(%)Indirect | Accountingtreatmentoninvestmentsinjointventuresorassociates |
|---|---|---|---|---|---|---|
| FoshanYingtongElectricalMaterialsCo.,Ltd. | Foshan | Foshan | Manufacturing | 49.00 | Equitymethod |
- Main financial information of significant associates
| Closingbalance/Currentperiod | Openingbalance/Preceding | |
|---|---|---|
| Items | cumulative | periodcomparative |
| FoshanYingtongElectrical | FoshanYingtongElectrical | |
| MaterialsCo.,Ltd. | MaterialsCo.,Ltd. | |
| Currentassets | 1,111,710,931.09 | 1,089,506,862.74 |
| Non-currentassets | 164,920,906.11 | 201,274,064.95 |
| Totalassets | 1,276,631,837.20 | 1,290,780,927.69 |
| Currentliabilities | 672,193,265.67 | 691,609,958.01 |
| Non-currentliabilities | 55,400,000.00 | 520,544.08 |
| Totalliabilities | 727,593,265.67 | 692,130,502.09 |
| Non-controllinginterest | 66,338,530.17 | 68,425,663.17 |
| Equityattributabletoownersofparentcompany | 482,700,041.36 | 530,224,762.44 |
| Proportionateshareinnetassets | 236,523,020.27 | 259,810,133.60 |
| Adjustments | ||
| Others | -34,569,092.45 | -30,876,879.51 |
| Carryingamountofinvestmentsinassociates | 201,953,927.82 | 228,933,254.09 |
| Operatingrevenue | 1,773,954,226.95 | 2,238,921,694.12 |
| Netprofit | -49,874,177.08 | -44,464,542.43 |
| Items | Closingbalance/Currentperiodcumulative | Openingbalance/Precedingperiodcomparative |
|---|---|---|
| Associates | ||
| Totalcarryingamountofinvestments | 479,675,156.87 | 447,896,705.75 |
| Proportionatesharesinthefollowingitems | ||
| Netprofit | 31,940,019.06 | 31,671,037.49 |
| Othercomprehensiveincome | ||
| Totalcomprehensiveincome | 31,940,019.06 | 31,671,037.49 |
- Aggregated financial information of insignificant joint ventures and associates
VIII. Government grants
(I) Government grants increased in the currentperiod
| Items | Amount |
|---|---|
| Governmentgrantsrelatedtoassets | 3,994,300.00 |
| Including:Includedintodeferredincome | 3,994,300.00 |
| Governmentgrantsrelatedtoincome | 69,450,144.75 |
| Including:Includedintootherincome | 69,450,144.75 |
| Total | 73,444,444.75 |
(II) Liabilities related to government grants
| Items | Openingbalance | Increase | Amountincludedintootherincome | Amountincludedintonon-operatingrevenue |
|---|---|---|---|---|
| Deferredincome | 120,890,710.04 | 3,994,300.00 | 9,544,515.62 | |
| Subtotal | 120,890,710.04 | 3,994,300.00 | 9,544,515.62 |
(Continued)
| Items | Amountoffsettingcosts | Amountoffsettingassets | Otherchanges | Closingbalance | Relatedtoassets/Relatedtoincome |
|---|---|---|---|---|---|
| Deferredincome | 115,340,494.42 | Relatedtoassets | |||
| Subtotal | 115,340,494.42 |
(III) Government grants included into profitor loss
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Governmentgrantsincludedintootherincome | 78,994,660.37 | 101,675,052.10 |
| Total | 78,994,660.37 | 101,675,052.10 |
| Items | Amountsreturned | Reasonforreturn | |
|---|---|---|---|
| Specialfundforpromotinghigh-qualitydevelopmentofforeigninvestmentinFoshanof2021 | 893,100.00 | GuangdongInforeIntelligentSanitationTechnologyCo.,Ltd.failedtomeettherequirementsofgovernmentgrantsasitwastransformedfromaforeign-investedenterprisetoadomestic-fundedone,andreturnedthegovernmentgrantsof2021. | |
| Total | 893,100.00 |
(IV) Government grants returned in the currentperiod
IX. Risks related tofinancial instruments
In risk management, the Company aims to seek the appropriate balance between the risks and benefits from its use of financial instruments and to mitigate the adverse effects that the risks of financial instruments have on the Company's financial performance, so as to maximize the profits of shareholders and other equity investors. Based on such risk management objectives, the Company's risk management policies are established to identify and analyze the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits on a timely and reliable basis.
The Company has exposure to the following risks from its use of financial instruments, which mainly include: credit risk, liquidity risk, and market risk. The Management has deliberated and approved policies concerning such risks, and details are:
(I) Credit risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to discharge an obligation.
- Credit risk management practice
(1) Evaluation method of credit risk
At each balance sheet date, the Company assesses whether the credit risk on a financial instrument has increased significantly since initial recognition. When assessing whether the credit risk has increased significantly since initial recognition, the Company takes into account reasonable and supportable information, which is available without undue cost or effort, including qualitative and quantitative analysis based on historical data, external credit risk rating, and forward-looking information. The Company determines the changes in default risk of financial instruments during the estimated lifetime through comparison of the defaultrisk at the balance sheet date and the initial recognition date, on an individualbasis or a collective basis.
The Company considers the credit risk on a financial instrument has increased significantly when one or more of the following qualitative and quantitative standards are met:
-
Quantitative standard mainly relates to the scenario in which, at the balance sheet date, the probability of default in the remaining lifetime has risen by more than a certain percentage compared with the initial recognition;
-
Qualitative standard mainly relates to significant adverse changes in the debtor's operation or financial position, present or expected changes in technology, market, economy or legal environment that will have significant adverse
impact on the debtor's repayment ability;
(2) Definition of default and credit-impaired assets
A financial instrument is defined as defaulted when one or more following events have occurred, of which the standard is consistent with that forcredit-impairment:
-
significant financial difficulty of the debtor;
-
a breach of binding clause of contract;
-
it is very likely that the debtor will enter bankruptcy or other financial reorganization;
-
the creditor of the debtor, for economic or contractual reasons relating to the debtor's financial difficulty, having granted to the debtor a concession(s) that the creditor would not otherwise consider.
- Measurement of expected credit losses
The key factors in the measurement of expected credit loss include the probability of default, loss given default, and exposure to default risk. The Company develops a model of the probability of default, loss given default, and exposure to default risk on the basis of quantitative analysis of historical data (e.g., counterparty rating, guarantee measures and collateral type, payment method, etc.) and forward-looking information.
-
Please refer to section V (I) 2, 3, 4, 6, 8, 11 and 23 of notes to the financial statements for details on the reconciliation table of opening balance and closing balance of loss allowances offinancial instrument.
-
Exposure to credit risk and concentration of credit risk
The Company's credit risk is primarily attributable to cash and bank balances and receivables. In order to control such risks, the Company has taken the following measures:
(1) Cash and bank balances
The Company deposits its bank balances and other cash and bank balances in financial institutions with relatively high credit levels, hence, its credit risk is relatively low.
(2) Receivables and contract assets
The Company performs credit assessment on customers using credit settlement on a regular basis. The Company selects credible and well-reputed customers based on credit assessment result, and conducts ongoing monitoring on balance of receivables, to avoid significant risks in bad debts.
As the Company's credit risks fall into several business partners and customers, as of December 31,2023, 7.33% (December 31, 2022: 9.38%) of the total accounts receivable and contract assets was due from the five largest customers ofthe Company. The Company has no significant central credit risk.
The maximum amount of exposure to credit risk of the Company is the carrying amount of each financial asset at the balance sheet.
(II) Liquidity risk
Liquidity risk is the risk that the Company may encounter deficiency of funds in meeting obligations associated
with cash or other financial assets settlement, which is possibly attributable to failure in selling financial assets at fair value on a timely basis, or failure in collecting liabilities from counterparties of contracts, or early redemption
of debts, or failure in achieving estimated cash flows.In order to control such risk, the Company comprehensively utilizes financing tools such as notes settlement, bank borrowings, etc. and adopts long-term and short-term financing methods to optimize financing structures, and finally maintains a balance between financing sustainability and flexibility. The Company has obtained credit limit from several commercial banks to meet working capital requirements and expenditures.
| Closingbalance | |||||||
|---|---|---|---|---|---|---|---|
| ItemsCarryingamount | Within1year | 1-3years | Over3years | ||||
| Bankborrowings | 2,398,606,754.44 | yetdiscounted2,785,244,392.01 | 598,015,270.38 | 611,768,269.63 | 1,575,460,852.00 | ||
| Notespayable | 2,294,276,551.46 | 2,294,276,551.46 | 2,294,276,551.46 | ||||
| Accountspayable | 2,918,543,704.46 | 2,918,543,704.46 | 2,918,543,704.46 | ||||
| Otherpayables | 709,941,824.77 | 709,941,824.77 | 709,941,824.77 | ||||
| Leaseliabilities | 24,784,187.60 | 26,511,358.34 | 9,474,544.70 | 17,036,813.64 | |||
| Long-termpayables | 312,053,472.95 | 312,053,472.95 | 9,104,000.00 | 15,173,333.32 | 287,776,139.63 | ||
| Bondspayable | 1,360,603,802.12 | 1,566,237,165.60 | 11,809,516.80 | 22,142,844.00 | 1,532,284,804.80 | ||
| Subtotal | 10,018,810,297.80 | 10,612,808,469.59 | 6,551,165,412.57 | 666,121,260.59 | 3,395,521,796.43 |
Financial liabilities classified based on remaining time period till maturity
(Continued)
| December31,2022 | ||||||
|---|---|---|---|---|---|---|
| Items | Carryingamount | Contractamountnotyetdiscounted | Within1year | Over3years | ||
| Bankborrowings | 2,918,155,689.70 | 3,064,480,800.96 | 795,179,666.92 | 725,728,644.01 | 1,543,572,490.03 | |
| Notespayable | 2,515,229,293.17 | 2,515,229,293.17 | 2,515,229,293.17 | |||
| Accountspayable | 2,771,961,271.66 | 2,771,961,271.66 | 2,771,961,271.66 | |||
| Otherpayables | 657,122,287.53 | 657,122,287.53 | 657,122,287.53 | |||
| Leaseliabilities | 31,093,459.06 | 33,953,751.30 | 9,005,728.14 | 16,755,133.25 | 8,192,889.91 | |
| Long-termpayables | 316,335,329.82 | 316,335,329.82 | 599,514.91 | 315,735,814.91 | ||
| Bondspayable | 1,308,690,556.32 | 1,573,618,113.60 | 7,380,948.00 | 11,809,516.80 | 1,554,427,648.80 | |
| Subtotal | 10,518,587,887.26 | 10,932,700,848.04 | 6,756,478,710.33 | 754,293,294.06 | 3,421,928,843.65 |
(III) Market risk
Market risk is the risk that the Company may encounter fluctuation in fair value or future cash flows of financial instruments due to changes in market price. Market risk mainly includes interest risk and foreign currency risk.
1. Interest risk
Interest risk is the risk that an enterprise may encounter fluctuation in fair value or future cash flows of financial instruments due to changes in market interest rates. The Company's fair value interest risks arise from fixed-rate financial instruments, while the cash flow interest risks arise from floating-rate financial instruments. The Company determines the proportion of fixed-rate financial instruments and floating-rate financial instruments based on the marketenvironment, and maintains a proper financial instruments portfolio through regularreview and monitoring. The Company's interest risk in cash flows relates mainly to bank borrowings with floating interest rate.
As of December 31, 2023, balance of borrowings with interest accrued at floating interest rate totaled 1,811,617,334.60 yuan (December 31, 2022: 1,755,696,317.89 yuan). If interest rates had been 50 basis points higher/lower and all other variables were held constant, the Company's gross profit and equity will not be significantly affected.
2. Foreign currency risk
Foreign currency risk is the risk arising from changes in fair value or future cash flows of financial instrument resulted from changes in exchange rate. The Company is mainly operated in mainland China, whose main activities are denominated in RMB, hence, the Company bears insignificant market risk arising from foreign exchange changes.
Please refer to section V (IV) 1 of notes to the financial statements for details on foreign currency financial assets and liabilities at the end of the period.
X. Fair value disclosure
(I) Details offair value of assets and liabilities at fair value at the balance sheet date
| Fairvalueasatthebalancesheetdate | |||||
|---|---|---|---|---|---|
| Items | Level1fairvalue | Level2fairvalue | Level3fairvalue | Total | |
| measurement | measurement | measurement | |||
| Recurringfairvaluemeasurement | |||||
| 1.Receivablesfinancing | 146,814,501.64 | 146,814,501.64 | |||
| 2.Otherequityinstrumentinvestments | 15,352,971.01 | 15,352,971.01 | |||
| Totalassetsatrecurringfairvaluemeasurement | 162,167,472.65 | 162,167,472.65 |
(II) Qualitative and quantitative information of valuation technique(s) and key input(s) for level 3 fair value at recurring and non-recurring fair value measurement
-
For receivables financing, the Company uses specific valuation techniques to determine its fair value based on its par value.
-
For other equity instrument investments, the Company usesspecific valuation techniques to determine its fair value.
XI. Related party relationships and transactions
(I) Related party relationships
- Parent company
(1) Details
| Parentcompany | Placeofregistration | Businessnature | Registeredcapital | HoldingproportionovertheCompany(%) | VotingrightproportionovertheCompany(%) |
|---|---|---|---|---|---|
| InforeGroupCo., | Foshan,Ltd.Guangdong | Industrialinvestment | 4.45billion | 43.33[Note] | 43.33 |
Note: Infore Group Co., Ltd. (the "Infore Group") directly holds 11.31% of equity of the Company, and indirectly holds 32.02% of equity of the Company through its wholly-owned subsidiary Ningbo Infore Asset Management Co., Ltd.
(2) The Company's ultimate controlling party is He Jianfeng, who directly holds 2.00% of equity of the Company, and indirectly holds 43.33% of equity of the Company through Infore Group.
-
Please refer to section VII of notes to the financial statements for details on the Company's subsidiaries.
-
Joint ventures and associates ofthe Company
Please refer to section VII ofnotes to the financial statements for details on the Company's significant joint ventures and associates. Details ofother joint ventures or associates carrying out related party transactions with the Company in the current period or in preceding period but with balance in the current period are as follows:
| Jointventuresorassociates | RelationshipswiththeCompany | |
|---|---|---|
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | AssociateoftheCompany | |
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | AssociateoftheCompany | |
| GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | AssociateoftheCompany | |
| ChangshaCowaZoomlionIntelligentTechnology | AssociateoftheCompany'ssubsidiaryZoomlion | |
| Co.,Ltd. | EnvironmentalCompany | |
| GuangxiZoomlionGuilvUrbanEnvironmental | AssociateoftheCompany'ssubsidiaryZoomlion | |
| ServiceCo.,Ltd. | EnvironmentalCompany | |
| ShantouChaoyangDistrictZoomlionRuikang | AssociateoftheCompany'ssubsidiaryZoomlion | |
| EnvironmentalSanitationServiceCo.,Ltd. | EnvironmentalCompany | |
| ShantouZoomlionRuikangEnvironmental | AssociateoftheCompany'ssubsidiaryZoomlion | |
| SanitationServiceCo.,Ltd. | EnvironmentalCompany | |
| TaizhouJinzhongEnvironmentalIndustryCo.,Ltd. | AssociateoftheCompany'ssubsidiaryZoomlionEnvironmentalCompany | |
| GuangdongLiangkeEnvironmentalEngineering | AssociateoftheCompany'ssubsidiaryGuangdong | |
| Co.,Ltd. | InforeEnvironmentalInvestmentCo.,Ltd. | |
| FoshanYingtongElectricalMaterialsCo.,Ltd. | AssociateoftheCompany'ssubsidiaryGuangdongInforeEnvironmentalInvestmentCo.,Ltd. | |
| BeijingXingyunZhixingTechnologyCo.,Ltd. | AssociateoftheCompany'ssubsidiaryGuangdongInforeEnvironmentalInvestmentCo.,Ltd. |
- Other related parties of the Company
| Relatedparties | RelationshipswiththeCompany |
|---|---|
| ZoomlionHeavyIndustryCo.,Ltd.(the"ZoomlionHeavyIndustryCompany") | Shareholderholdingmorethan5%oftheCompany'sshares |
| ShenzhenInforeSmartTechnologyCo.,Ltd. | Undercontroloftheactualcontroller |
| FoshanShundeDistrictYinghaiInvestmentCo.,Ltd. | Undercontroloftheactualcontroller |
| Relatedparties | RelationshipswiththeCompany |
|---|---|
| GuangzhouHuayiInternationalAutionCo.,Ltd. | Undercontroloftheactualcontroller |
| FoshanShundeDistrictMideaHotelManagementCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| NingboMideaPropertyManagementCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| GuangdongBomeiPropertyServiceCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| GuangdongMideaHVACEquipmentCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| GuangdongWellingMotorManufacturingCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| GuangdongMideaElectricCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| GuangdongMideaRefrigerationEquipmentCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| GuangdongMideaBuildingTechnologiesCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| ChongqingMideaGeneralRefrigerationEquipmentCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| AnhuiMeizhiRefrigerationEquipmentCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| MideaGroupCo.,Ltd. | Undercontrolofimmediatefamilyoftheactualcontroller |
| GuangdongFerriesNewEnergyTechnologyCo.,Ltd. | UndercontroloftheCompany'sassociateFoshanYingtongElectricalMaterialsCo.,Ltd. |
| GuangdongWeiqiElectricalMaterialsCo.,Ltd. | UndercontroloftheCompany'sassociateFoshanYingtongElectricalMaterialsCo.,Ltd. |
| LiaoningDonggangMagnetWireCo.,Ltd. | UndercontroloftheCompany'sassociateFoshanYingtongElectricalMaterialsCo.,Ltd. |
| AnhuiWeiqiElectricalMaterialsCo.,Ltd. | UndercontroloftheCompany'sassociateFoshanYingtongElectricalMaterialsCo.,Ltd. |
| ZoomlionHengtongMachineryCo.,Ltd. | AssociateoftheCompany'sshareholderZoomlionHeavyIndustryCompany |
| GreenOrientalInvestmentHoldingsCo.,Ltd.(the"HongKongInvestmentCompany") | Non-controllingshareholderofthesubsidiary |
| GuchengYinglianUrbanEnvironmentalServiceCo.,Ltd.[Note] | TheformersubsidiaryoftheCompany'ssubsidiaryZoomlionEnvironmentalCompany |
| YichunYinglianUrbanEnvironmentalServiceCo.,Ltd.[Note] | TheformersubsidiaryoftheCompany'ssubsidiaryZoomlionEnvironmentalCompany |
Note: The Company disposed of all the equity of Gucheng Yinglian Urban Environmental Service Co., Ltd. and Yichun Yinglian Urban Environmental Service Co., Ltd., the former subsidiaries of Zoomlion Environmental Company, in August 2023, which continued to be disclosed as related parties within one year after disposal, and the current disclosure period of related party transactions was from September 2023 to December 2023.
(II) Related party transactions
- Purchase and sale of goods, rendering and receiving of services
(1) Purchase of goods and receiving of services
| Relatedparties | Contentoftransactions | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|---|
| GuangdongTianshuNewEnergy | Materials | 8,393,506.88 | 7,638,710.54 |
| Relatedparties | Contentoftransactions | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|---|
| TechnologyCo.,Ltd. | |||
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | Materials | 3,572,705.19 | 9,239,400.36 |
| GuangdongFerriesNewEnergyTechnologyCo.,Ltd. | Materials | 518,435.64 | |
| ChangshaCowaZoomlionIntelligentTechnologyCo.,Ltd. | Materials | 150.98 | 10,847,784.36 |
| GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | Laborservices | 10,692,550.78 | 9,909,911.14 |
| ZoomlionHeavyIndustryCompany | Materials | 77,364,306.08 | 105,493,871.91 |
| ShenzhenInforeSmartTechnologyCo.,Ltd. | Informationsystemsandrelatedimplementationservices | 4,253,139.63 | |
| GuangdongLiangkeEnvironmentalEngineeringCo.,Ltd. | Laborservices | 1,500,000.00 | 1,415,094.34 |
| FoshanShundeDistrictMideaHotelManagementCo.,Ltd. | Laborservices | 116,702.94 | 180,887.93 |
| NingboMideaPropertyManagementCo.,Ltd. | Laborservices | 516,713.84 | |
| GuangzhouHuayiInternationalAutionCo.,Ltd. | Laborservices | 801,033.29 | |
| GuangdongBomeiPropertyServiceCo.,Ltd. | Laborservices | 1,191,467.15 | |
| Subtotal | 108,403,998.56 | 145,242,374.42 |
(2) Sale of goods and rendering of services
| Relatedparties | Contentoftransactions | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|---|
| GuangdongLiangkeEnvironmentalEngineeringCo.,Ltd. | Goodsandfactoring | 1,706,918.19 | 781,333.30 |
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | Goodsandfactoring | 4,572,082.14 | 90,942,152.84 |
| GuangdongWeiqiElectricalMaterialsCo.,Ltd. | Factoring | 5,100,534.46 | 1,873,184.56 |
| LiaoningDonggangMagnetWireCo.,Ltd. | Factoring | 2,843,034.34 | 124,354.60 |
| AnhuiWeiqiElectricalMaterialsCo.,Ltd. | Goodsandfactoring | 2,323,149.35 | 416,492.94 |
| FoshanYingtongElectricalMaterialsCo.,Ltd. | Factoring | 549,056.60 | 233,830.19 |
| GuangdongFerriesNewEnergyTechnologyCo.,Ltd. | Goods | 32,674,315.93 | |
| GuangdongMideaHVACEquipmentCo.,Ltd. | Goods | 28,141.59 | 543,008.85 |
| GuangdongWellingMotorManufacturingCo.,Ltd. | Goodsandlaborservices | 233,895.50 | |
| BeijingXingyunZhixingTechnologyCo.,Ltd. | Goods | 943.40 | |
| TaizhouJinzhongEnvironmentalIndustryCo.,Ltd. | Laborservices | 22,021,147.55 | |
| GuangdongBomeiPropertyServiceCo., | Goodsandlabor | 4,719,857.33 | 3,118,410.25 |
| Relatedparties | Contentoftransactions | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|---|
| Ltd. | services | ||
| GuangxiZoomlionGuilvUrbanEnvironmentalServiceCo.,Ltd. | Goods | -141,215.31 | 6,862,177.99 |
| ZoomlionHeavyIndustryCompany | Goods | 3,780,395.53 | 1,995,580.83 |
| ShantouChaoyangDistrictZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | Goods | 94,726.56 | 589,792.61 |
| ShantouZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | Goods | 118,489.02 | 65,565.12 |
| Subtotal | 80,625,472.18 | 107,545,884.08 |
2. Related party leases
(1) The Company as the lessor
| Lessees | Typesofassetsleased | Leaseincomeforthecurrentperiod | Leaseincomefortheprecedingperiod |
|---|---|---|---|
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | Plantandcomprehensivebuilding | 2,304,088.08 | 988,266.74 |
| GuangdongLiangkeEnvironmentalEngineeringCo.,Ltd. | Office | 15,600.00 |
(2) The Company as the lessee
| Currentperiodcumulative | |||||||
|---|---|---|---|---|---|---|---|
| Expensesforshort-termleasesand | Leaseofright-of-useassetsrecognized | ||||||
| Lessors | Typesofassetsleased | leasesoflow-valueassetswithsimplifiedapproachandvariableleasepaymentsnotincludedinthemeasurementofleaseliabilities | Leaseexpensespaid(excludingvariableleasepaymentsnotincludedinthemeasurementofleaseliabilities) | Increasedprincipalofleaseliabilities | Interestexpensesrecognized | ||
| FoshanShundeDistrictYinghaiInvestmentCo.,Ltd. | Officebuilding,parkingspace | 20,952.38 | 1,258,782.48 | 84,848.59 | |||
| ShenzhenInforeSmartTechnologyCo.,Ltd. | Officebuilding | 695,812.82 |
(Continued)
| Precedingperiodcomparative | |||||
|---|---|---|---|---|---|
| Leaseofright-of-use | assetsrecognized | ||||
| Lessors | Typesofassetsleased | Expensesforshort-termleasesandleasesoflow-valueassetswithsimplifiedapproachandvariableleasepaymentsnotincludedinthemeasurementofleaseliabilities | Leaseexpensespaid(excludingvariableleasepaymentsnotincludedinthemeasurementofleaseliabilities) | Increasedprincipalofleaseliabilities | Interestexpensesrecognized |
| FoshanShundeDistrictYinghaiInvestmentCo.,Ltd. | Officebuilding,parkingspace | 1,256,323.04 | 63,604.54 | ||
| ShenzhenInforeSmartTechnologyCo.,Ltd. | Officebuilding | 840,509.43 |
- Related party guarantees
(1) The Company and its subsidiaries did not act as guarantors in the currentperiod.
(2) The Company and its subsidiaries did not act as guaranteed parties in the current period.
- Temporary call loans between related parties
In 2023, Infore Group lent temporary funds to the Company and its subsidiaries, totaling 800 million yuan, which were usually returned within one working day. Therefore, the two parties have not settled the interest on the funds occupied.
- Key management's emoluments
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Keymanagement'semoluments | 7,022,866.00 | 6,500,407.42 |
- Special agreement on continued implementation of sales contract signed in the name of Zoomlion Heavy Industry Company
Since June 1, 2017, the sanitation business of Zoomlion Heavy Industry Company was merged into Zoomlion Environmental Company. In order to continue the implementation of the sales contract originally signed in the name of Zoomlion Heavy Industry Company, Zoomlion Environmental Company invoiced Zoomlion Heavy Industry Company, which will then issue the invoice of the same amount to end customers. The tax-excluded amount of income from such transactions in 2023 is -1,489,633.01 yuan. Zoomlion Environmental Company related such transactions directly to end customers.
7. Other related party transactions
In 2023, the subsidiary Zoomlion Environmental Company carried out financing factoring business through Zoomlion Heavy Industry Company and paid the financing factoring service fees of 19.5 thousand yuan.
(III) Balances due to orfrom related parties
- Balances due from related parties
| Closingbalance | Openingbalance | ||||
|---|---|---|---|---|---|
| Items | Relatedparties | Bookbalance | Provisionforbaddebts | Bookbalance | Provisionforbaddebts |
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | 189,921,071.39 | 56,976,321.42 | 200,788,348.94 | 8,569,313.68 | |
| GuangdongWeiqiElectricalMaterialsCo.,Ltd. | 43,161,070.83 | 647,416.06 | 112,174,999.99 | 1,682,625.00 | |
| LiaoningDonggangMagnetWireCo.,Ltd. | 40,963,666.44 | 614,455.00 | 31,300,000.00 | 469,500.00 | |
| Accountsreceivable | GuangdongFerriesNewEnergyTechnologyCo.,Ltd. | 36,921,977.00 | 1,846,098.85 | ||
| AnhuiWeiqiElectricalMaterialsCo.,Ltd. | 21,157,622.95 | 317,364.34 | 30,586,839.62 | 458,802.59 | |
| TaizhouJinzhongEnvironmentalIndustryCo.,Ltd. | 5,934,700.00 | 296,735.00 |
| Closingbalance | Openingbalance | ||||
|---|---|---|---|---|---|
| Items | Relatedparties | Bookbalance | Provisionforbaddebts | Bookbalance | Provisionforbaddebts |
| GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | 4,108,567.88 | 1,696,739.48 | 4,158,567.88 | 890,025.90 | |
| ShantouChaoyangDistrictZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 4,048,556.31 | 1,185,488.39 | 4,017,898.31 | 401,789.83 | |
| GuchengYinglianUrbanEnvironmentalServiceCo.,Ltd. | 2,045,755.42 | 102,287.77 | |||
| GuangxiZoomlionGuilvUrbanEnvironmentalServiceCo.,Ltd. | 1,889,210.92 | 188,921.09 | 3,762,921.52 | 188,146.08 | |
| ZoomlionHeavyIndustryCompany | 1,150,774.01 | 237,645.17 | 665,051.93 | 126,337.58 | |
| GuangdongBomeiPropertyServiceCo.,Ltd. | 876,777.77 | 43,838.89 | 903,500.08 | 45,175.00 | |
| GuangdongWellingMotorManufacturingCo.,Ltd. | 85,215.05 | 4,260.75 | |||
| ShantouZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 77,715.00 | 3,885.75 | 10,711.00 | 535.55 | |
| GuangdongMideaHVACEquipmentCo.,Ltd. | 31,910.00 | 1,595.50 | 233,371.88 | 51,798.38 | |
| GuangdongMideaElectricCo.,Ltd. | 54,018.62 | 54,018.62 | |||
| GuangdongMideaRefrigerationEquipmentCo.,Ltd. | 42,819.11 | 42,819.11 | |||
| GuangdongMideaBuildingTechnologiesCo.,Ltd. | 33,413.42 | 33,413.42 | |||
| GuangdongLiangkeEnvironmentalEngineeringCo.,Ltd. | 30,000,000.00 | 450,000.00 | |||
| FoshanYingtongElectricalMaterialsCo.,Ltd. | 20,486,000.00 | 307,290.00 | |||
| Subtotal | 352,374,590.97 | 64,163,053.46 | 439,218,462.30 | 13,771,590.74 | |
| Receivables | GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | 3,776,800.00 | |||
| financing | ZoomlionHeavyIndustryCompany | 600,000.00 | 200,000.00 | ||
| Subtotal | 4,376,800.00 | 200,000.00 | |||
| GuchengYinglianUrbanEnvironmentalServiceCo.,Ltd. | 500,000.00 | ||||
| ZoomlionHeavyIndustryCompany | 155,660.67 | 85,768.19 | |||
| Advancespaid | GuangzhouHuayiInternationalAutionCo.,Ltd. | 40,800.00 | |||
| ChongqingMideaGeneralRefrigerationEquipmentCo.,Ltd. | 31,500.00 | ||||
| Subtotal | 696,460.67 | 117,268.19 | |||
| Other | GuchengYinglianUrbanEnvironmentalServiceCo.,Ltd. | 2,739,525.00 | 136,976.25 | ||
| receivables | GuangdongShunkongEnvironmentalInvestment | 1,730,000.00 | 1,730,000.00 | 1,730,000.00 | 865,000.00 |
| Closing | balance | Openingbalance | ||||
|---|---|---|---|---|---|---|
| Items | Relatedparties | Bookbalance | Provisionforbaddebts | Bookbalance | Provisionforbaddebts | |
| Co.,Ltd. | ||||||
| ShantouChaoyangDistrictZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 838,613.91 | 41,930.70 | ||||
| GuangzhouHuayiInternationalAutionCo.,Ltd. | 327,600.00 | 16,380.00 | ||||
| FoshanShundeDistrictYinghaiInvestmentCo.,Ltd. | 205,228.40 | 102,614.20 | 205,228.40 | 102,614.20 | ||
| AnhuiMeizhiRefrigerationEquipmentCo.,Ltd. | 5,000.00 | 250.00 | ||||
| ZoomlionHeavyIndustryCompany | 7,190,173.17 | 359,508.66 | ||||
| GuangdongMideaHVACEquipmentCo.,Ltd. | 10,000.00 | 500.00 | ||||
| ShenzhenInforeSmartTechnologyCo.,Ltd. | 304,020.00 | 15,308.44 | ||||
| GuangdongWeiqiElectricalMaterialsCo.,Ltd. | 337,565.30 | 168,782.65 | ||||
| Subtotal | 5,845,967.31 | 2,028,151.15 | 9,776,986.87 | 1,511,713.95 | ||
| Contractassets | GuangdongMideaHVACEquipmentCo.,Ltd. | 31,800.00 | 3,180.00 | |||
| othernon-currentassets | ZoomlionHeavyIndustryCompany | 22,500.00 | 1,125.00 | 162,550.00 | 8,127.50 | |
| Subtotal | 54,300.00 | 4,305.00 | 162,550.00 | 8,127.50 | ||
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | 5,037,500.00 | 1,511,250.00 | 5,137,500.01 | 77,062.50 | ||
| Long-termreceivablesandnon-current | ShantouZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 3,456,000.00 | 1,342,250.00 | 3,456,000.00 | 651,050.00 | |
| assetsduewithinoneyear | ShantouChaoyangDistrictZoomlionRuikangEnvironmentalSanitationServiceCo.,Ltd. | 7,369,548.45 | 1,995,153.96 | 7,531,548.45 | 983,685.27 | |
| Subtotal | 15,863,048.45 | 4,848,653.96 | 16,125,048.46 | 1,711,797.77 |
2. Balances due to related parties
| Items | Relatedparties | Closingbalance | Openingbalance |
|---|---|---|---|
| ZoomlionHeavyIndustryCompany | 33,784,532.87 | 55,248,477.35 | |
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | 3,737,470.40 | 6,037,232.82 | |
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | 2,963,838.75 | 6,033,821.63 | |
| MideaGroupCo.,Ltd. | 587,507.93 | 587,507.93 | |
| Accountspayable | GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | 585,700.00 | 993,522.02 |
| GuangdongFerriesNewEnergyTechnologyCo.,Ltd. | 519,697.82 | ||
| GuangzhouHuayiInternationalAutionCo.,Ltd. | 327,600.00 | ||
| ChangshaCowaZoomlionIntelligentTechnologyCo.,Ltd. | 26,733.52 | 7,253,459.78 | |
| FoshanShundeDistrictMideaHotelManagementCo.,Ltd. | 22,848.91 | 80,789.37 |
| Items | Relatedparties | Closingbalance | Openingbalance |
|---|---|---|---|
| GuangdongLiangkeEnvironmentalEngineeringCo.,Ltd. | 875,000.00 | ||
| Subtotal | 42,555,930.20 | 77,109,810.90 | |
| ZoomlionHeavyIndustryCompany | 51,685,972.00 | 59,153,632.35 | |
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | 3,002,040.00 | ||
| Notespayable | ChangshaCowaZoomlionIntelligentTechnologyCo.,Ltd. | 471,035.00 | |
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | 252,000.00 | 520,000.00 | |
| Subtotal | 52,409,007.00 | 62,675,672.35 | |
| ZoomlionHeavyIndustryCompany | 101,061.95 | 6,145,050.10 | |
| GuangdongLiangkeEnvironmentalEngineeringCo.,Ltd. | 987,079.70 | 987,079.67 | |
| Contractliabilities | GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | 13,296.46 | 1,681.42 |
| GuangxiZoomlionGuilvUrbanEnvironmentalServiceCo.,Ltd. | 78,180.53 | ||
| Subtotal | 1,101,438.11 | 7,211,991.72 | |
| HongKongInvestmentCompany | 32,958,498.54 | 21,875,000.00 | |
| GuchengYinglianUrbanEnvironmentalServiceCo.,Ltd. | 3,480,000.00 | ||
| TaizhouJinzhongEnvironmentalIndustryCo.,Ltd. | 1,545,898.65 | ||
| GuangxiZoomlionGuilvUrbanEnvironmentalServiceCo.,Ltd. | 1,525,315.33 | 403,654.00 | |
| ZoomlionHeavyIndustryCompany | 68,259.20 | 363,559.20 | |
| Otherpayables | YichunYinglianUrbanEnvironmentalServiceCo.,Ltd. | 63,965.82 | |
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | 50,000.00 | ||
| GuangdongBomeiPropertyServiceCo.,Ltd. | 5,000.00 | 5,000.00 | |
| ZoomlionHengtongMachineryCo.,Ltd. | 4,300.00 | 4,300.00 | |
| GuangdongTianshuNewEnergyTechnologyCo.,Ltd. | 2,700.00 | 2,700.00 | |
| Subtotal | 39,703,937.54 | 22,654,213.20 | |
| Leaseliabilitiesandnon-currentliabilitiesduewithinoneyear | FoshanShundeDistrictYinghaiInvestmentCo.,Ltd. | 1,845,892.92 | |
| Subtotal | 1,845,892.92 |
XII. Share-based payment
(I) Overall information
- Details
| Quantityandamountofequityinstruments | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Objects | Grantedinthecurrentperiod | Vestedinthecurrentperiod | Unlockedinthecurrentperiod | Expiredinthecurrentperiod | |||||
| Quantity | Amount | Quantity | Amount | Quantity | Amount | Quantity | Amount | ||
| Managementpersonnel | 10,420,000.00 | 7,312,289.83 |
| R&Dpersonnel | 5,048,000.00 | 3,542,460.56 | |||
|---|---|---|---|---|---|
| Salespersonnel | 4,380,000.00 | 3,073,688.05 | |||
| Productionpersonnel | 2,116,000.00 | 1,484,914.13 | |||
| Total | 21,964,000.00 | 15,413,352.57 |
2. Other remarks
The decision-making procedures and approval status of the Company's phase III stock option incentive plan
According to the "Proposal on the 'Phase III Stock Option Incentive Plan (Draft)' and Its Summary" approved by the Company's third extraordinary shareholders' meeting of 2019 dated November 12,2019, and the "Proposal on Adjusting the List of Incentive Targets and the Number of Granted Stock Options for Phase III Stock Option Incentive Plan" deliberated and approved by 32 nd meeting of the eighth session of the Board of Directors dated November 26, 2019, the Company intends to implement stock option incentive plans for some of the Company's middle and senior managers and core backbones (technology, marketing, production, etc.). The total number of stock options granted to incentive targets is 65.09 million, accounting for approximately 2.06% of the Company's total share capital of 3,163.0621 million shares when the incentive plan is signed. If each stock option meets the exercise conditions after 12 months from the grant date, the incentive targets exercise the option by three installments at 30%, 30%, and 40% at the exercise price of 6.45 yuan per share within the next 36 months.
According to the "Proposal on Adjusting the Incentive Targets and the Number of Options Exercised in Phase II and Phase III Stock Option Incentive Plans" deliberated and approved by the fourth meeting of the ninth session of the Board of Directors and the third meeting of the ninth session of the Board of Supervisors dated April 23, 2020, 5 employees who resigned due to personal reasons were identified by the Company's Board of Directors as no longer eligible for incentives. According to the provisions of the "Phase III Stock Option Incentive Plan (Draft)", their first, second, and third installments of stock options, a total of 1.28 million, were cancelled. After the adjustments, the incentive targets of phase III stock option incentive plan have been adjusted from the original 249 to 244, and the number of locked stock options granted has been adjusted from 65.09 million to 63.81 million.
The "Proposal on the Company's Phase III Stock Option Incentive Plan's Failure to Meet the Exercising Conditions for the First Exercise Period and Cancellation of Part of the Stock Options" was deliberated and approved by the fourth meeting of the ninth session of the Board of Directors and the third meeting of the ninth session of the Board of Supervisors. Given that the Company's performance did notreach the exercising conditions of the first exercise period of the phase III stock option incentive plan, the 19.143 million stock options granted but not yet exercised in the first exercise period cannot be exercised. According to the relevant provisions of the "Phase III Stock Option Incentive Plan (Draft)", the Company's Board of Directors agreed to cancel the 19.143 million stock options granted but not yet exercised in the first exercise period.
The Company has disclosed the "Announcement on the Implementation of the AnnualEquity Distribution of 2019" on July 4, 2020, based on the Company's current total share capital after excluding the repurchased shares (0 share), i.e., 3,163,062,146 shares, cash dividend of 1.10 yuan (tax inclusive) for every 10 shares is to be distributed to all shareholders. The equity registration date for this equity distribution is July 9, 2020, and the ex-rights and exdividend date is July 10, 2020. Given that the Company's equity distribution of 2019 has been implemented on July 10, 2020, according to provisions on the adjustment of the exercise price of the phase II and phase III stock option incentive plan drafts, if the Company has conversion of capital reserve into share capital, distribution of share bonus, or share split, share reduction, dividend distribution, and share allotments, the exercise price of stock options will be adjusted accordingly. After the implementation of this equity distribution, the exercise price of phase III stock option incentive plan will be adjusted from 6.45 yuan per share to 6.34 yuan per share.
Pursuant to the "Proposal on Revising the Performance Appraisal Indicators of Phase III Stock Option Incentive Plan" deliberated and approved by the sixth meeting of the ninth session of the Board of Directors dated August 20, 2020, it is agreed to revise the performance appraisal indicators ofphase III stock option incentive plan.
Pursuant to the "Proposal on Adjusting the Incentive Targets and the Number of Options Exercised and Cancellation of Part of the Stock Options in Phase II and Phase III Stock Option Incentive Plans" deliberated and approved by the 13 th meeting of the ninth session of the Board of Directors and the 12 th meeting of the ninth session of the Board of Supervisors dated April 22, 2021, 13 incentive targets who resigned from the Company or the Company's controlled subsidiaries due to personal reasons were identified by the Company's Board of Directors as no longer eligible for incentives. According to the provisions of the "Phase III Stock Option Incentive Plan (Revised Draft)", their second and third installments ofstock options, a total of 3.101 million, were cancelled. After the adjustments, the incentive targets of phase III stock option incentive plan have been adjusted from the original 244 to 231, and the number of locked stock options granted has been adjusted from 44.667 million to 41.566 million.
According to the "Proposal on Matters Related to the Second Exercise Period of Phase III Stock Option Incentive Plan" deliberated and approved by the 13 th meeting of the ninth session of the Board of Directors and the 12 th meeting of the ninth session of the Board of Supervisors, given that the conditions for the second exercise period of the Company's phase III stock option incentive plan have been fulfilled, the phase III stock option incentive plan has determined and passed the assessment for a total of 231 incentive targets, and a total of 17.814 million shares can be exercised in the second exercise period.
Pursuant to the "Profit Distribution of 2020" deliberated and approved by the shareholders' meeting of 2020 dated May 14, 2021, based on the Company's current total share capitalof 3,163,086,005 shares after excluding the repurchased shares of 58,976,234 share, i.e., 3,104,109,771 shares, cash dividend of 1.20 yuan (tax inclusive) for every 10 shares is to be distributed to all shareholders, with 0 bonus share (tax inclusive) and no conversion of capital reserve into share capital. The equity registration date for this equity distribution is July 7, 2021, and the exrights and ex-dividend date is July 8, 2021.
The "Proposal on Adjusting the Exercise Price of Stock Options in Phase II and Phase III Stock Option Incentive Plans" was deliberated and approved by the 14 th meeting of the ninth session of the Board of Directors and the 13 th meeting of the ninth session of the Board of Supervisors on August 19, 2021. Given that the Company's equity distribution of 2020 has been implemented on July 8, 2021, according to provisions on the adjustment of the exercise price of the phase III stock option incentive plan draft, if the Company has conversion of capitalreserve
into share capital, distribution of share bonus, or share split, share reduction, dividend distribution, and share allotments, the exercise price of stock options will be adjusted accordingly. After the adjustment, the exercise price of phase III stock option incentive plan will be adjusted from 6.34 yuan per share to 6.22 yuan per share.
Pursuant to the "Profit Distribution of 2021" deliberated and approved by the shareholders' meeting of 2021 dated May 24, 2022, based on the Company's current total share capitalof 3,179,499,998 shares after excluding the repurchased shares of 58,976,234 share, i.e., 3,120,523,764 shares, cash dividend of 1.00 yuan (tax inclusive) for every 10 shares is to be distributed to all shareholders, with 0 bonus share (tax inclusive) and no conversion of capital reserve into share capital. The equity registration date for this equity distribution is July 19, 2022, and the ex-rights and ex-dividend date is July 20, 2022.
The "Proposal on Adjusting the Exercise Price of Stock Options in Phase III Stock Option Incentive Plan" was deliberated and approved by the 19 th meeting of the ninth session of the Board of Directors and the 18 th meeting of the ninth session of the Board of Supervisors on August 24,2022. Given that the Company's equity distribution of 2021 has been implemented on July 20, 2022, after the adjustment, the exercise price of phase III stock option incentive plan will be adjusted from 6.22 yuan per share to 6.12 yuan per share.
According to the "Proposal on Adjusting the Incentive Targets and the Number of Options Exercised and Cancellation of Part of the Stock Options in Phase III Stock Option Incentive Plan" deliberated and approved by the 21 st meeting of the ninth session of the Board of Directors and the 19 th meeting of the ninth session of the Board of Supervisors dated October 26,2022, 22 incentive targets who resigned from the Company were identified by the Company's Board of Directors as no longer eligible for incentives. According to the provisions of the "Phase III Stock Option Incentive Plan (Revised Draft)", their third installments of stock options, a total of 1.788 million, were cancelled. After the adjustments, the incentive targets of phase III stock option incentive plan have been adjusted from the original 231 to 209, and the number of locked stock options granted has been adjusted from 23.752 million to 21.964 million.
The "Proposal on Cancellation of Expired but Unexercised Stock Options for the Third Exercise Period of the Phase III Stock Option Incentive Plan" was deliberated and approved by the fifth extraordinary meeting of the tenth session of the Board of Directors dated January 8, 2024. As ofNovember 25, 2023, the third exercise period of the Company's phase III stock option incentive plan has expired, and 21.964 million stock options held by 209 incentive objects for the third exercise period of the phase III stock option incentive plan have not been exercised. According to the regulations of the phase III stock option incentive plan, incentive objects must exercise their options within the valid exercise period. If the exercise conditions are not met, the currentstock options shall not be exercised and shall be canceled by the Company; if the exercise conditions are met, but the stock options are not exercised within the valid exercise period, the stock options shall be canceled by the Company. Therefore, the Company will cancel a total of 21.964 million stock options that have been granted to but notyet exercised by the aforementioned 209 incentive objects during the third exercise period. After the completion of this cancellation, the Company's phase III stock option incentive plan has been fully implemented.
(II) Equity-settled share-based payment
| Determinationmethodandkeyparametersofgrant-datefairvalueofequityinstruments | Stockoptions:Grant-datefairvalueofthestockoptionswasdeterminedaccordingtotheBlack-Scholesoptionpricingmodel |
|---|---|
| Determinationmethodforthenumberofequityinstrumentsexpectedtovest | ItisexpectedthatallincentivetargetsstillholdpositionswiththeCompanybythenwillfullyexercisetheirrights |
| Reasonsforsignificantdifferencebetweentheestimatesinthecurrentperiodandprecedingperiod | None |
| Capitalreserveaccumulatedduetoequity-settledshare-basedpayment | 63,871,094.05 |
1. Details
XIII. Commitments and contingencies
(I) Significant commitments
As ofDecember 31, 2023, the Company has no significant commitments to be disclosed.
(II) Contingencies
- Contingent liabilities incurred by pending lawsuit/arbitration and the financial effect
On November 19, 2018, Hong Kong Investment Company, the former shareholder of the Company's 70% controlled subsidiary Green Oriental Company, filed a civil complaint with the People's Court of Qianhai Cooperation Zone, Shenzhen City, Guangdong Province, requesting the Company and its subsidiary Shenzhen Green Ark Investment Co., Ltd. to pay 21.875 million yuan and interest thereof for the 25% equity acquisition of Lianjiang Company in 2016, and therefore applied for freezing 25% ofequity of Lianjiang Company. According to the Civil Judgment numbered [2018] Yue 0391 Min Chu 4117 issued by the People's Court of Qianhai Cooperation Zone, Shenzhen City, Guangdong Province on June 18, 2019, the subsidiary Shenzhen Green Ark Investment Co., Ltd. shall pay 21.875 million yuan and interest thereof for the 25% equity acquisition of Lianjiang Company in 2016 to Hong Kong Investment Company. On July 12, 2019, Shenzhen Green Ark Investment Co., Ltd. filed a civil appeal petition to Shenzhen Intermediate People's Court, requesting to revoke the Civil Judgment numbered [2018] Yue 0391 Min Chu 4117 in accordance with the law, and to dismiss all the claims made by Hong Kong Investment Company.
On May 20, 2021, the Shenzhen Intermediate People's Court made the final judgement numbered (2019) Yue 03 Min Zhong 24451. The court believed that although the Company and Shenzhen Green Ark Investment Co., Ltd. were related parties, they were independent of each other as corporations, thus did not support the Shenzhen Green Ark Investment Co., Ltd.'s unsafe right of defense against Hong Kong Investment Company based on the "Cooperation Framework Agreement"; meanwhile, as Green Oriental Company and Shenzhen Green Ark Investment Co., Ltd. were also independent corporations, the court did not support Shenzhen Green Ark Investment Co., Ltd.'s claim for a set-off based on the reason that Green Oriental Company had the creditor's rights to Hong Kong Investment Company. The civil judgment numbered (2019) Yue 03 Min Zhong 24451 upheld the firstinstance judgment. On January 8, 2021, Shenzhen Yongsheng Electric Power Equipment Co., Ltd. claimed that it had acquired the creditor's rights as confirmed by the civil judgment numbered (2019) Yue 03 Min Zhong 24451, and applied to the People's Court of Qianhai Cooperation Zone, Shenzhen City, Guangdong Province for
compulsory enforcement.
Later, Shenzhen Green Ark Investment Co., Ltd. raised an enforcement objection, which had been accepted by the court with the case number of (2021) Yue 0391 Zhi Yi 240. According to the civil judgment numbered [2021] Yue 0391 Min Chu 5890 issued by the People's Court of Qianhai Cooperation Zone, Shenzhen City, Guangdong Province on July 31, 2022, the court ruled to revoke the defendant Hong Kong Investment Company's transfer of its creditor's rightincluding equity transfer funds of21,875,000 yuan and interest thereof, litigation fees of 172,535 yuan and preservation fees of5,000 yuan to the defendant Shenzhen Yongsheng Electric Power Equipment Co., Ltd. On August 10,2022, Hong Kong Investment Company and Shenzhen Yongsheng Electric Power Equipment Co., Ltd. filed an appeal to the Shenzhen Intermediate People's Court.
As of December 31, 2023, the Company has accrued other payables of 32,958,498.54 yuan due to Hong Kong Investment Company.
- Contingent liabilities incurred by providing debt guarantees for other entities and the financial effect
(1) Please referto section XI of notes to the financial statements for details on guarantees provided by the Company to related parties.
(2) Guarantees provided by the Company and its subsidiaries to non-related parties
-
Certain customers of the Company use working capital loans provided by banks to finance their purchase. According to the arrangement of the agreement, the Company provides guarantees for such transactions. Meanwhile, the actual controller of the borrower provides a joint and several liability guarantee for the full amount of loans. As ofDecember 31, 2023, the Company's maximum exposure to these guarantees is 121,356,312.99 yuan.
-
Certain customers of the Company use finance lease services provided by third-party finance lease companies to finance their purchase from the Company. According to the arrangement of the agreement, the Company provides guarantees for third-party finance lease companies. If customers default, the Company will be required to compensate the third-party finance lease companies for the lease payment owed by customers.Meanwhile, the Company has the right to take back and sell the machinery that is the subject of the lease, and keep any sales income exceeding the balance of the guarantee payment to the lease company. As of December 31, 2023, the Company's maximum exposure to these guarantees is 78,094,828.01 yuan.
XIV. Events after the balance sheet date
(I) Significant non-adjusting events
The Company has no significant non-adjusting events after the balance sheet date.
(II) Profit distribution after the balance sheet date
According to the "ProfitDistribution Plan of 2023" deliberated and approved by the sixth meeting of the tenth session of the Board of Directors on April 26, 2024, the Company intends to distribute cash dividends of 1.25 yuan (tax inclusive) per 10 shares based on the currenttotal share capital of 3,166,941,288 shares (net of shares in the Company's special account for repurchase), with cash dividends distributed totaling 395,867,661.00 yuan.
(III) Other remarks
- Recognition of performance compensation and indemnity
Pursuant to the "Proposal on Signing the Equity Transfer Agreement and Cooperation Framework Agreement" deliberated and approved by the 13 th interim meeting of the seventh session of the Board of Directors of the Company dated October 14, 2015, the Company signed the "Signing of Equity Transfer Agreement" and the "Cooperation Framework Agreement of Shenzhen Green Oriental Environmental Protection Co., Ltd." (the "Cooperation Framework Agreement"), which stipulated that the Company will acquire 51.00% of equity of Green Oriental Company held by Shenzhen Feima Investment Co., Ltd. and Shenzhen Qianhai Chima Environmental Protection Investment Co., Ltd. at the consideration of 100,548,976.00 yuan, of which, 96,605,878.90 yuan is the consideration for the 49.00% of equity of Green Oriental Company held by Shenzhen Feima Investment Co., Ltd., and 3,943,097.10 yuan is the consideration for the 2.00% of equity of Green Oriental Company held by Shenzhen Qianhai Chima Environmental Protection Investment Co., Ltd.
According to the Cooperation Framework Agreement, Hong Kong Investment Company and Zheng Weixian made commitments on the business performance of Green Oriental Company in the next four years as follows: (1) from January 1, 2016 to December 31, 2019, the total net profit realized by the fourproject companies including Lianjiang Company, Xiantao Company, Funan Company and Shouxian Company (collectively, the "four project companies") shall not be less than 120 million yuan. Otherwise, Hong Kong Investment Company and Zheng Weixian shall compensate the Company based on the difference between the accumulated committed net profit and the accumulated realized net profit multiplied by 60%, which should be paid in cash. If the cash compensation is insufficient, they will compensate the Company with the equity of Green Oriental Company held by Hong Kong Investment Company; (2) within 24 months after the completion of registration of capital increase at the administration for market regulation, Hong Kong Investment Company shall transfer its LuyiProject and Puyang Project to Green Oriental Company, and smoothly start the construction as scheduled according to the law. If the projects cannot be transferred or partially transferred, unable to be transferred, or are withdrawn and cancelled by the government within the above period, Hong Kong Investment Company and Zheng Weixian will pay the lump sum indemnity of not less than 5.00 million yuan for each project to the Company; (3) before December 31,2018, the Poyang Project and the Yangxin Project must officially start construction and obtain approval procedures. If the construction cannot be started or the projects are withdrawn by the government, Hong Kong Investment Company and Zheng Weixian will pay the indemnity of not less than 10.00 million yuan for each project to the Company; (4) before December 31,2020, Jiujiang Green Oriental Renewable Energy Co., Ltd. must start construction and obtain approval procedures. If the construction cannot be started or itis withdrawn by the government, Hong Kong Investment Company and Zheng Weixian will pay the indemnity of not less than 5.00 million yuan for each project to the Company; (5) from January 1, 2016 to December 31,2019, for the new waste incineration power generation BOT agreement (subject to the signed franchise agreement) signed by Green Oriental Company, the total daily processing capacity shall be not less than 6,500 tons (the daily processing capacity of a single projectis not less than 500 tons, at least one of which must be more than 2,000 tons). If the above conditions are not met, Hong Kong Investment Company and Zheng Weixian will compensate Green Oriental Company 5 million yuan for every 500 tons less than the daily processing capacity.
In addition, in 2015, the Company and Hong Kong Investment Company entered into the equity pledge contract, stipulating that Hong Kong Investment Company would pledge 49% of equity of Green Oriental Company for the debt portfolio worth 340 million yuan as agreed in the Cooperation Framework Agreement. The equity pledge was processed by both parties in the same year.
As of October 31, 2015, the Company has paid all the equity transfer payments, and Green Oriental Company has been brought into the consolidation scope since the end of October 2015. In April 2016, the Company continued to acquire 19.00% of equity of Green Oriental Company through capital increase of 86.67 million yuan and finally held 70% of equity of Green Oriental Company. On April 23, 2020, Pan-China Certified Public Accountants LLP issued an assurance report numbered PCCPAAR [2020] 3439, which stated that: the audited net profits of the four project companies for the year ended December 31,2016, 2017, 2018 and 2019 (the lower of net profits before and after deducting non-recurring profit or loss) amounted to 2.16 million yuan, -24.42 million yuan, -19.19 million yuan and -0.63 million yuan, respectively; the accumulated net profit amounted to -42.09 million yuan, which was 162.09 million yuan less than the amount of performance commitment, and the committed net profits from 2016 to 2019 were not achieved.
In order to promote the implementation of performance compensation and indemnity, the Company filed a lawsuit with the Intermediate People's Court of Foshan City, Guangdong Province, requiring Hong Kong Investment Company and Zheng Weixian to pay indemnity and compensation to the Company in accordance with the Cooperation Framework Agreement.
On January 13, 2021, the Intermediate People's Court of Foshan City, Guangdong Province made a first-instance judgment, requesting Hong Kong Investment Company and Zheng Weixian to pay the indemnity of 113.46 million yuan for the unfulfilled performance commitment, i.e., [120 million yuan - (-42.09 million yuan)] *70%; pay the compensation of 50.00 million yuan for the unfinished daily processing volume; at the same time, the court supported the Company to enjoy the priority of compensation within 200 million yuan for the 30% of equity of Green Oriental Company held by Hong Kong Investment Company.
On January 29, 2021, Hong Kong Investment Company and Zheng Weixian appealed to the Higher People's Court of Guangdong Province.
On November 2, 2021, the Higher People's Court of Guangdong Province held a public hearing of the secondinstance case.
On July 18, 2022, the Higher People's Court of Guangdong Province made the final judgement of the second instance, ruling that Hong Kong Investment Company and Zheng Weixian shall pay the Company 113.46 million yuan for the unfulfilled performance commitment and supported the Company to enjoy the priority of compensation within 200 million yuan for the 30% of equity of Green Oriental Company held by Hong Kong Investment Company.
The Company has applied to the Intermediate People's Court of Foshan City, Guangdong Province for compulsory enforcement, and received the notice of acceptance of the enforcement case numbered (2022) Yue 06 Zhi 1500 on
August 4, 2022.
On January 26, 2024, the Intermediate People's Court of Foshan City, Guangdong Province, conducted a judicial auction of 30% equity of Green Oriental Company, which was won by the Company with a bid of 73,059,000 yuan. On February 18, 2024, the Intermediate People's Court of Foshan City, Guangdong Province transferred the enforcement payment of 72,403,790.58 yuan to the Company.
2. Transfer of subsidiaries' equity
Pursuant to the "Proposal on Transfer of Subsidiaries' Equity" deliberated and approved by the fifth extraordinary meeting of the tenth session of the Board of Directors dated January 8, 2024, it was agreed to transfer 100% of equity of Foshan Shunhe Environmental Protection Co., Ltd. to Guangdong Shunkong Development Co., Ltd. at the consideration of 259.63 million yuan.
XV. Other significant events
(I) Segment information
1. Identification basis for reportable segments
Reportable segments are identified according to the structure of the Company's internal organization, management requirements and internal reporting system, and based on product segments. The Company evaluates the operating performance of smart city services and other businesses respectively. Assets and liabilities shared by different segments are allocated among segments proportionate to their respective sizes.
2. Financial information of reportable segments
| Products | segment | |
|---|---|---|
| ---------- | --------- | -- |
| Items | Smartcityservices | Otherbusinesses | Inter-segmentoffsetting | Total |
|---|---|---|---|---|
| Operatingrevenue | 10,721,886,759.01 | 1,946,638,680.05 | 37,474,471.72 | 12,631,050,967.34 |
| Operatingcost | 8,370,900,180.28 | 1,411,862,859.52 | 37,280,951.88 | 9,745,482,087.92 |
| Totalassets | 17,145,309,940.35 | 30,726,217,660.18 | 18,823,326,040.17 | 29,048,201,560.36 |
| Totalliabilities | 8,699,585,283.86 | 9,662,247,870.89 | 7,211,679,051.48 | 11,150,154,103.27 |
(II) PPP contracts
Details on the Company's top five PPP contracts are listed as follows:
| No. | Projects | Summaryofcontracts | Significantcontractualtermsthatmayaffecttheamount,timingandriskoffuturecashflows | RelatedrightsenjoyedandobligationsassumedbytheCompany | Changesincontracts | Classificationofcontracts |
|---|---|---|---|---|---|---|
| 1 | FunanCountyDomesticWasteIncinerationPowerPlantProject | TheprojectisawasteincinerationpowergenerationprojectinvestedbytheCompanyandtheFunanCountyUrbanManagementandLawEnforcementBureauintheformofBOT.ItisplannedtobelocatedinFunan,Anhui,andismainlyusedforincinerationofdomesticwasteinFunan.Theplannedtotalinvestmentisabout1.24billionyuan,andthedesigneddailydomesticwastetreatmentscaleis500tonsinthefirstphaseand1,000tonsinthefinalphase.Theconcessionperiodoftheprojectis30years(calculatedfromthedateofcommercialoperation).Theprojecthasstartedcommercialoperationin2020. | Annualguaranteedwastesupply:thefirstphaseisnolessthan180,000tons/year,andthesecondphasehasnotyetbeenagreed;thewastetreatmentpriceis52yuan/ton,whichwillbeadjustedeverythreeyears;iftheannualwastesupplyoftheFunanCountyUrbanManagementandLawEnforcementBureauismorethan0.36milliontons,thetwopartiescanbuildanotherfactory,whiletheCompanyhastheprioritytoinvestandconstructunderthesameconditions;theCompany'sremainingelectricityisconnectedtothegridaccordingtorelevantprocedures,andtheon-gridelectricitypriceisdeterminedaccordingtothe"PowerPurchaseandSaleContract". | FunanCountyUrbanManagementandLawEnforcementBureaugrantedtheprojectcompanytheexclusiverighttoinvestandfinance,design,construct,operateandmaintaindomesticwastepowergenerationprojects;duringtheconcessionperiod,theprojectcompanyshallbearthecosts,responsibilitiesandrisksbyitself,beresponsiblefortheinvestmentandfinancing,design,construction,operationandmaintenanceoftheprojectfacilities,andhandovertheprojectfacilitiestotheFunanCountyUrbanManagementandLawEnforcementBureauoritsdesignatedinstitutionfreeofchargewhentheconcessionperiodexpires. | No | BOT;mixedmodel |
| 2 | PPPProjectofResourceRecoveryofLilingUrbanandRuralDomesticWaste | TheprojectisawastetreatmentprojectinvestedbytheCompanyandLilingUrbanManagementandLawEnforcementBureauintheformofDBOTandROT.ItismainlyusedtoincineratedomesticwasteinLilingCity.Theplannedtotalinvestmentisabout717millionyuan,including3sub-projects:LilingUrbanandRuralDomesticWasteCollectionandTransportationSystemConstructionProject(DBOT),LilingUrbanandRuralDomesticWastePretreatmentandIncinerationPowerGenerationProject(DBOT)andLilingDomesticWasteHarmlessTreatmentPlant(ROT).Thedesignedwastecollectionandtransportationscaleis600tons/day,thescaleofpretreatmentandincinerationpowergenerationprojectsis600tons/dayintheneartermand900tons/dayinthelongterm.Theprojectcooperationperiodis25yearsfromNovember2018. | Sincethecommencementofoperation,theannualguaranteedminimumsupplyis146,000tons.Ifthevolumeofwastedeliveredislessthansuchguaranteedminimumvolume,thewastetreatmentfeewillbepaidaccordingtotheguaranteedminimumvolume.Theunitpriceofwastecollectionandtransportationserviceis198yuan/ton(thetreatmentcapacityiswithin600tons/day);theunitpriceofwastepretreatmentandincinerationpowergenerationserviceis84yuan/ton(thetreatmentcapacityiswithin600tons/day),andtheunitpriceoflandfillserviceis56.71yuan/ton(calculatedwiththetreatmentcapacityof300tons/day)or37.53yuan/ton(calculatedwiththetreatmentcapacityof600tons/day);asubsidyfeewillbepaidaccordingtotheagreementforthedisposalofwastethatexceedsthedesigncapacity.TheCompany'sremainingelectricityisconnectedtothegridaccordingtorelevantprocedures,and | Duringthecooperationperiod,theprojectcompanyhastheexclusiverighttoinvest,construct,operate,maintainandmanagetheprojectinLilingCity.TheprojectcompanyprovideswastetreatmentservicestotheLilingUrbanManagementandLawEnforcementBureau,andchargestheLilingUrbanManagementandLawEnforcementBureauthereon;meanwhile,itsellsthesurpluselectricitygeneratedbywasteincinerationandwasteheattothepowercompanyandcollectselectricityfees,andsellsrecyclablemetalsandrefusederivedfuelsandcollectsfees.Theprojectcompanyshallbearthecosts,responsibilitiesandrisksbyitselfduringthecooperationperiod,beresponsiblefortheinvestmentandfinancing,design,construction,operationandmaintenanceoftheprojectfacilities,andshallhandoverallthenecessaryassetsfor | No | DBOT&ROT;mixedmodel |
| No. | Projects | Summaryofcontracts | Significantcontractualtermsthatmayaffecttheamount,timingandriskoffuturecashflows | Changesincontracts | Classificationofcontracts | |
|---|---|---|---|---|---|---|
| theon-gridelectricitypriceisdeterminedaccordingtothe"PowerPurchaseandSaleContract".(Subsequentpriceswillbeadjustedbasedonactualconditions.) | theprojecttoaninstitutiondesignatedbytheLilingMunicipalPeople'sGovernmentfreeofchargewhenthecooperationperiodexpiresorterminatesaccordingtothecontract. | |||||
| 3 | Xin'an,FuyongandFuhaiStreetsSanitationIntegrationPPPProject | Theprojectisaintegrationprojectincludingroadcleaning,publicareaandurbanvillagewastesorting,collectionandmanagement(includingthefacilityconfiguration,maintenanceandmanagement),otherwastecollection,transportationandtransfer,operationandmaintenancemanagementofwastetransferstations,operationandmaintenancemanagementofpublictoilets,constructionandoperationandmaintenanceofsanitationparkinglots,greeningmanagement,constructionandoperationandmaintenanceofsmartsanitationplatforms,sanitationemergencysupport,etc.intheadministrativeareaofXin'an,FuyongandFuhaistreetsinBao'anDistrict,whichisinvestedbytheCompanyandShenzhenBao'anDistrictUrbanManagementandLawEnforcementBureauintheformofBOT.Theinitialinvestmentoftheprojectis520millionyuan,andtheoperationperiodis15years(includingconstructionandequipmentconfigurationperiodof1year)fromJune1,2020toMay31,2035. | Theamountpaidforthisprojectisequaltothetotalmonthlyoperatingservicefeeminusthedailyassessmentdeductionsoftheproject.Monthlyoperationservicefee=monthlycomprehensiveroadcleaningandfee+monthlywastecollection,transportationandtransferfee+monthlypublictoiletmanagementfee+monthlygreeningmaintenancefee+monthlysanitationparkinglotservicefee+monthlysmartsanitationplatformoperationandmanagementfee.Fromthestartoftheoperationperiod,every3extensionyearsisapriceadjustmentperiod. | Duringtheoperationperiod,theprojectcompanyshallundertaketheresponsibilitiesofinvestmentandfinancingoftheproject,purchasingofvehiclesandequipment,designandconstruction,operation,maintenanceandhandoveroftheparkinglots.Aftertheexpiryoftheoperationperiod,theprojectassets,projectfacilitiesandprojectsiteshallbehandedovertotheimplementingagency(exceptfortheparkinglotsbuiltbytheCompanyitself,butifthelandusedfortheparkinglotisprovidedbythegovernment,thesiteinvolvedintheseparkinglotsshallbehandedovertotheimplementingagency),andtheprojectcompanyshallcollectfeesfromthesub-districtofficeduringtheoperationperiodaccordingtothecontract. | No | BOT;intangibleassetsmodel |
| 4 | LianjiangDomesticWasteIncinerationPowerGenerationProject | TheprojectisawasteincinerationpowergenerationprojectinvestedbytheCompanyandtheLianjiangMunicipalBureauofUrbanUtilitiesandLandscapingintheformofBOT.ItisplannedtobelocatedinLianjiang,Guangdong,andismainlyusedforincinerationofdomesticwasteinLianjiang.Theplannedtotalinvestmentisabout493millionyuan,andthedesigneddailydomesticwastetreatmentscaleis500tonsinthefirstphaseand1,100tonsinthefinalphase.The | Sincethecommencementofoperation,thedailyguaranteedminimumvolumeofwastedeliveredorconsignedunderthefirstphaseis500tons.Iftheactualvolumeislessthansuchguaranteedminimumvolume,thewastetreatmentfeewillbepaidaccordingtotheguaranteedminimumvolume.Thepriceofwastetreatment:inthefirststage:fromDecember1,2019totheoperationofthesecondphase("72+24hours"trialoperationisconductedandacompliancecommissioningreportisissued),thewaste | LianjiangMunicipalBureauofUrbanUtilitiesandLandscapinggrantedtheprojectcompanytheexclusiverighttoinvestandfinance,design,construct,operateandmaintaindomesticwastepowergenerationprojects;duringtheconcessionperiod,theprojectcompanyshallbearthecosts,responsibilitiesandrisksbyitself,beresponsiblefortheinvestmentandfinancing,design,construction,operationandmaintenanceoftheprojectfacilities,and | No | BOT;intangibleassetsmodel |
| No. | Projects | Summaryofcontracts | Significantcontractualtermsthatmayaffecttheamount,timingandriskoffuturecashflows | RelatedrightsenjoyedandobligationsassumedbytheCompany | Changesincontracts | Classificationofcontracts |
|---|---|---|---|---|---|---|
| concessionperiodoftheprojectis30years(calculatedfromthedateofcommercialoperation).Thefirstphasehasstartedcommercialoperationin2016. | treatmentfeeisadjustedfrom40yuan/tonto65yuan/ton;inthesecondstage:aftertheoperationofthesecondphase("72+24hours"trialoperationisconductedandacompliancecommissioningreportisissued),thewastetreatmentfeeisadjustedfrom65yuan/tonto78yuan/ton;theCompany'sremainingelectricityisconnectedtothegridaccordingtorelevantprocedures,andtheon-gridelectricitypriceisdeterminedaccordingtothe"PowerPurchaseandSaleContract". | handovertheprojectfacilitiestotheLianjiangMunicipalBureauofUrbanUtilitiesandLandscapingoritsdesignatedinstitutionfreeofchargewhentheconcessionperiodexpires. | ||||
| 5 | XiantaoCircularEconomyIndustrialParkPPPProject | TheprojectisacirculareconomyindustrialparkprojectinvestedbytheCompanyandXiantaoUrbanManagementandLawEnforcementBureauintheformofBOT.ItislocatedinXiantaoCity,HubeiProvince.Theindustrialparkprojectincludes8sub-projects:therecyclingofkitchenwaste,theharmlesstreatmentofsludge,theresourcerecoveryofconstructionwaste,theleachatetreatmentstation(PhaseII),theleachatetreatmentstation(PhaseI),andthedomesticwastetransfersystem(thecooperationperiodoftheabove6sub-projectscovers30yearsfromthecommencementdateofeachsub-project,whichincludestheconstructionperiodof1yearandtheoperationperiodof29years),theXiantaoEnvironmentalProtectionScienceandTechnologyMuseum(thecooperationperiodcovers11yearsfromthecommencementdate,whichincludestheconstructionperiodof1yearandtheoperationperiodof10years),thedomesticwastesanitarylandfill(thecooperationperiodcovers10yearsand3monthsfromthecommencementdate,whichincludestheconstructionperiodof3monthsandtheoperationperiodof10years).Theprojectinvestmentisabout462millionyuan.Pursuanttothesupplementaryagreementon | Thereturnonthesub-projectsincludingresourceutilizationofkitchenwaste,harmlesstreatmentofsludge,resourcerecoveryofconstructionwaste,leachatetreatmentstation(PhaseI),domesticwastetransfersystem,domesticwastesanitarylandfillisgovernmentfeasibilitygapsubsidy,whichismadeupoftheunitpriceofwastetreatmentmultipliedbythehigherofbasicsupply,actualtreatmentcapacityanddesigntreatmentcapacity,withtheunitpriceadjustedeverythreeyears.TheCompanygeneratesproductsincludingbutnotlimitedtoelectricityandbuildingmaterialsthroughwastetreatmentandcomprehensiveutilization.TheownershipandrevenueoftheproductsbelongtotheCompany. | Inaccordancewithrelevantlawsandregulations,XiantaoUrbanManagementandLawEnforcementBureaugrantedXiantaoYingheEnvironmentalProtectionCo.,Ltd.,withinthescopeoftheprojectserviceandcooperationperiod,anexclusiverightto:(1)investin,build,operateandmaintain5sub-projectsincludingtheresourcerecoveryofkitchenwaste,sludgeharmlesstreatment,constructionwasterecycling,leachatetreatmentstation(PhaseII),andXiantaoEnvironmentalScienceandTechnologyMuseum(2)invest,reconstruct,operateandmaintain3sub-projectsincludingtheleachatetreatmentstation(PhaseI),domesticwastetransfersystemanddomesticwastesanitarylandfill.XiantaoYingheEnvironmentalProtectionCo.,Ltd.shallbearthecosts,responsibilitiesandrisksbyitselfduringthecooperationperiod,beresponsiblefortheinvestment,construction,operationandmaintenanceoftheprojectfacilities,andhandovertheprojectfacilitiesingoodconditionandfreeofchargetotheXiantaoUrbanManagementandLawEnforcementBureauoritsdesignatedinstitutionwhenthecooperationperiodexpires,andguaranteethenormaloperationoftheprojectfacilities.Duringthecooperationperiod,Xiantao | No | BOT;intangibleassetsmodel |
| No. | Projects | Summaryofcontracts | Significantcontractualtermsthatmayaffecttheamount,timingandriskoffuturecashflows | RelatedrightsenjoyedandobligationsassumedbytheCompany | Changesincontracts | Classificationofcontracts |
|---|---|---|---|---|---|---|
| thePPPprojectcontractenteredintobetween | YingheEnvironmentalProtectionCo.,Ltd. | |||||
| theCompanyandXiantaoUrban | provideskitchenwasterecycling,sludge | |||||
| ManagementandLawEnforcementBureauin | harmlesstreatment,constructionwaste | |||||
| August2023,theimplementationplanofthe | recycling,leachatetreatment,servicesof | |||||
| PPPprojecthasbeenadjusted,andthethree | environmentalprotectionscienceand | |||||
| sub-subjectsincludingtheleachatetreatment | technologymuseum,domesticwastetransfer, | |||||
| station(PhaseII),thedomesticwastesanitary | domesticwasteemergencylandfill,flyash | |||||
| landfillandtheXiantaoCityEnvironmental | landfillandotherservices,andenjoysthe | |||||
| ProtectionScienceandTechnologyMuseum | righttochargeservicefeesandrelated | |||||
| havebeenmovedoutofthePPPscope. | income. | |||||
| Thedomesticwastetransfersystemhasbeen | ||||||
| putintousesuccessivelyfrom2019to2020, | ||||||
| andtheremainingprojectsarestillunder | ||||||
| construction. |
(III) Other significant transactions and matters which are influential to investors on their decision-making As of December 31, 2023, the Company's controlling shareholder, actual controller and persons acting in concert held a total of 1,441,121,828 shares of the Company, accounting for 45.33% of the Company's totalshare capital, of which, 710,798,429 shares were pledged,accounting for 49.32% of its holdings of the Company, and 22.36% of the Company's total share capital. Details are as follows:
| Shareholder | Holderofthepledge | Numberofsharespledged | Initialtransactiondate | Repurchasedate | Remarks |
|---|---|---|---|---|---|
| InforeGroup | ChinaConstructionBankCorporationLimited,FoshanBranch | 100,000,000 | 12/28/2023 | Long-term | Financing |
| NingboInforeAssetManagementCo.,Ltd. | ChinaMinshengBankingCorporationLimited,FoshanBranch | 610,798,429 | 6/25/2021 | 3/21/2024 | FinancingforM&A |
| Total | 710,798,429 |
XVI. Notes to items ofparent company financial statements
(I) Notes to items ofparent company balance sheet
-
- Other receivables
- (1) Details
| Items | Closingbalance | Openingbalance |
|---|---|---|
| Dividendreceivable | 176,000,000.00 | |
| Otherreceivables | 4,294,847,162.66 | 4,492,807,441.80 |
| Total | 4,470,847,162.66 | 4,492,807,441.80 |
(2) Dividend receivable
| Items | Closingbalance | Openingbalance |
|---|---|---|
| FoshanShunheEnvironmentalProtectionCo.,Ltd. | 176,000,000.00 | |
| Subtotal | 176,000,000.00 |
(3) Other receivables
- Other receivables categorized by nature
| Natureofreceivables | Closingbookbalance | Openingbookbalance | ||
|---|---|---|---|---|
| Temporaryadvancepaymentreceivable | 4,189,643,502.15 | 4,380,717,882.96 | ||
| Performancecommitmentcompensation | 113,460,620.00 | 113,460,620.00 | ||
| Securitydeposits | 493,673.40 | 293,673.40 | ||
| Total | 4,303,597,795.55 | 4,494,472,176.36 |
2) Provision for bad debts
a. Details on categories
| Closingbalance | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionfor | ||||||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | ||||||
| Receivableswithprovisionmadeonanindividualbasis | ||||||||||
| Receivableswithprovisionmadeonacollectivebasis | 4,303,597,795.55 | 100.00 | 8,750,632.89 | 0.20 | 4,294,847,162.66 | |||||
| Total | 4,303,597,795.55 | 100.00 | 8,750,632.89 | 0.20 | 4,294,847,162.66 |
(Continued)
| Openingbalance | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Categories | Bookbalance | Provisionfor | ||||||||
| Amount | %tototal | Amount | Provisionproportion(%) | Carryingamount | ||||||
| Receivableswith | ||||||||||
| provisionmadeonanindividualbasis | ||||||||||
| Receivableswithprovisionmadeonacollectivebasis | 4,494,472,176.36 | 100.00 | 1,664,734.56 | 0.04 | 4,492,807,441.80 | |||||
| Total | 4,494,472,176.36 | 100.00 | 1,664,734.56 | 0.04 | 4,492,807,441.80 |
b. Other receivables with provision made on a collective basis
| Closingbalance | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Portfolios | Bookbalance | Provisionforbaddebts | Provisionproportion(%) | ||||||
| Portfoliogroupedwithbalancesduefromrelatedpartieswithintheconsolidationscope | 4,161,013,533.28 | ||||||||
| Portfoliogroupedwithbuyer'scredit | 24,127,705.88 | 4,857,450.12 | 20.13 | ||||||
| Portfoliogroupedwithperformancecommitmentcompensation | 113,460,620.00 | 2,179,342.69 | 1.92 | ||||||
| Portfoliogroupedwithages | 4,995,936.39 | 1,713,840.08 | 34.30 | ||||||
| Including:1-180days | 258,669.54 | ||||||||
| 180days-1year | 1,019,113.00 | 20,382.26 | 2.00 | ||||||
| 1-2years | 315,690.79 | 31,569.08 | 10.00 | ||||||
| 2-3years | 329,381.49 | 98,814.45 | 30.00 | ||||||
| 3-4years | 2,779,408.17 | 1,389,704.09 | 50.00 | ||||||
| 4-5years | 205,228.40 | 102,614.20 | 50.00 | ||||||
| Over5years | 88,445.00 | 70,756.00 | 80.00 | ||||||
| Total | 4,303,597,795.55 | 8,750,632.89 | 0.20 |
| debts | forbad | provision | in | Changes | 3) | |
|---|---|---|---|---|---|---|
| ------- | ------------ | -- | ----------- | ---- | --------- | ---- |
| Stage1 | Stage2 | Stage3 | ||
|---|---|---|---|---|
| Items | ‑12monthexpectedcreditlosses | Lifetimeexpectedcreditlosses(creditnotimpaired) | Lifetimeexpectedcreditlosses(creditimpaired) | Total |
| Openingbalance | 82,938.15 | 1,581,796.41 | 1,664,734.56 | |
| Openingbalanceinthecurrentperiod | —— | —— | —— | |
| --Transferredtostage2 | ||||
| --Transferredtostage3 | -32,938.15 | 32,938.15 | ||
| --Reversedtostage2 | ||||
| --Reversedtostage1 | ||||
| Provisionmadeinthecurrentperiod | 20,382.26 | -18,430.92 | 7,083,946.99 | 7,085,898.33 |
| Provisionrecoveredorreversedinthecurrentperiod | ||||
| Provisionwrittenoffinthecurrentperiod | ||||
| Otherchanges | ||||
| Closingbalance | 20,382.26 | 31,569.08 | 8,698,681.55 | 8,750,632.89 |
| Provisionproportion(%) | 1.60 | 0.25 | 7.44 | 0.20 |
Division basis for three stages: Ages of other receivables.
| 4) | Detailsofthetop | 5debtorswithlargestbalances | |
|---|---|---|---|
| ---- | ----------------------------- | --------------------------------------------- | -- |
| Debtors | Natureofreceivables | Closingbookbalance | Ages | Proportiontothetotalbalanceofotherreceivables(%) | Provisionforbaddebtsatthebalancesheetdate |
|---|---|---|---|---|---|
| No.1 | Temporaryadvancepaymentreceivable | 694,294,343.85 | 1-180days | 16.13 | |
| No.2 | Temporaryadvancepaymentreceivable | 626,243,925.00 | 1-180days | 14.55 | |
| No.3 | Temporaryadvancepaymentreceivable | 388,319,645.00 | 1-180days | 9.02 | |
| No.4 | Temporaryadvancepaymentreceivable | 366,279,140.95 | 1-180days | 8.51 | |
| No.5 | Temporaryadvancepaymentreceivable | 256,124,048.42 | 1-180days | 5.95 | |
| Subtotal | 2,331,261,103.22 | 54.16 |
2. Long-term equity investments
(1) Details
| Closingbalance | Openingbalance | ||||||
|---|---|---|---|---|---|---|---|
| Items | Bookbalance | Provisionforimpairment | Carryingamount | Bookbalance | Provisionforimpairment | Carryingamount | |
| Investmentsinsubsidiaries | 16,597,592,874.70 | 16,597,592,874.70 | 16,730,929,074.70 | 16,730,929,074.70 | |||
| Investmentsinassociatesandjointventures | 372,846,476.68 | 372,846,476.68 | 345,687,796.45 | 345,687,796.45 | |||
| Total | 16,970,439,351.38 | 16,970,439,351.38 | 17,076,616,871.15 | 17,076,616,871.15 |
(2) Investments in subsidiaries
| Openingbalance | Increase/Decrease | Closingbalance | ||||||
|---|---|---|---|---|---|---|---|---|
| Investees | Carryingamount | Provisionforimpairment | Investmentsincreased | Investmentsdecreased | Provisionforimpairment | Others | Carryingamount | Provisionforimpairment |
| InforeWaterEnvironmentInvestmentCo.,Ltd. | 113,055,998.06 | 113,055,998.06 | ||||||
| FoshanShunheEnvironmentalProtectionCo.,Ltd. | 250,064,088.09 | 250,064,088.09 | ||||||
| InforeTechnologyCompany | 134,352,901.63 | 134,352,901.63 | ||||||
| InforeZoomlionCityEnvironmentalServiceCo.,Ltd. | 15,300,000.00 | 15,300,000.00 | ||||||
| GuangdongInforeEnvironmentalInvestmentCo.,Ltd. | 100,000,000.00 | 100,000,000.00 | ||||||
| ChangshaZhongbiaoEnvironmentalIndustryCo.,Ltd. | 5,270,000.00 | 5,270,000.00 | ||||||
| NingboInforeFinanceLeaseCo.,Ltd. | 356,322,974.66 | 356,322,974.66 | ||||||
| HuaqingyuanCompany | 987,791.57 | 987,791.57 | ||||||
| ZoomlionEnvironmentalCompany | 15,260,177,431.68 | 15,260,177,431.68 | ||||||
| ShangfengIndustrialCompany | 200,198,801.05 | 200,198,801.05 | ||||||
| GreenOrientalCompany | 191,192,917.50 | 191,192,917.50 | ||||||
| XiantaoYingheEnvironmentalProtectionCo.,Ltd. | 103,754,840.00 | 33,336,200.00 | 70,418,640.00 | |||||
| LianjiangCompany | 51,330.46 | 51,330.46 | ||||||
| GuangdongInforeIntelligentCleaningTechnologyCo.,Ltd. | 200,000.00 | 200,000.00 | ||||||
| Subtotal | 16,730,929,074.70 | 133,336,200.00 | 16,597,592,874.70 |
| Opening | balance | Increase/Decrease | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Investees | Carryingamount | Provisionforimpairment | Investmentsincreased | Investmentsdecreased | Investmentincomerecognizedunderequitymethod | Adjustmentinothercomprehensiveincome | |||
| Associates | |||||||||
| ShenzhenYingmeiCityHousekeeperCo.,Ltd. | 28,165.29 | 41.05 | |||||||
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | 29,631,523.07 | -1,821,854.32 | |||||||
| GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | 218,640,961.90 | 30,240,907.09 | |||||||
| ChinaUrbanInstitute(Beijing)EnvironmentalTechnologyCo.,Ltd. | 97,387,146.19 | 3,801,154.35 | |||||||
| Total | 345,687,796.45 | 32,220,248.17 |
(3) Investments in associates and joint ventures
(Continued)
| Increase/Decrease | Closingbalance | |||||
|---|---|---|---|---|---|---|
| Investees | Changesinotherequity | Cashdividend/Profitdeclaredfordistribution | Provisionforimpairment | Others | Carryingamount | Provisionforimpairment |
| Associates | ||||||
| ShenzhenYingmeiCityHousekeeperCo.,Ltd. | 28,206.34 | |||||
| TengineInnovation(Beijing)MonitoringInstrumentCo.,Ltd. | 27,809,668.75 | |||||
| GuangdongShunkongEnvironmentalInvestmentCo.,Ltd. | 5,061,567.94 | 243,820,301.05 | ||||
| ChinaUrbanInstitute(Beijing)EnvironmentalTechnologyCo.,Ltd. | 101,188,300.54 | |||||
| Total | 5,061,567.94 | 372,846,476.68 |
(II) Notes to items of the parent company income statement
- Operating revenue/Operating cost
(1) Details
| Items | Currentperiodcumulative | Precedingperiodcomparative | ||
|---|---|---|---|---|
| Revenue | Cost | Revenue | Cost | |
| Mainoperations | 45,108.06 | 45,108.06 | 818,861.05 | 818,861.05 |
| Otheroperations | 111,690.97 | |||
| Total | 156,799.03 | 45,108.06 | 818,861.05 | 818,861.05 |
2. Investment income
| Items | Currentperiodcumulative | Precedingperiodcomparative |
|---|---|---|
| Investmentincomefromlong-termequityinvestmentsunderequitymethod | 32,220,248.17 | 25,737,537.83 |
| Investmentincomefromlong-termequityinvestmentsundercostmethod | 526,000,000.00 | 216,137,869.15 |
| Investmentincomefromdisposaloflong-termequityinvestments | 69,138,964.19 | |
| Investmentincomefromfinancialproducts | 193,472.38 | |
| Performancecompensation | -50,000,000.00 | |
| Others | 408,044.00 | 414,960.00 |
| Total | 627,767,256.36 | 192,483,839.36 |
XVII. Other supplementary information
(I) Non-recurring profit or loss
1. Schedule of non-recurring profit or loss
| Items | Amount | Remarks |
|---|---|---|
| Gainsondisposalofnon-currentassets,includingwrite-offofprovisionforimpairment | -4,146,549.53 | |
| Governmentgrantsincludedinprofitorloss(excludingthosecloselyrelatedtooperatingactivitiesoftheCompany,satisfyinggovernmentpoliciesandregulations,enjoyedbasedoncertainstandards,andcontinuouslyaffectinggainsorlossesoftheCompany) | 52,966,550.75 | |
| Gainsonchangesinfairvalueoffinancialassetsandfinancialliabilitiesheldbynon-financialenterprises,andgainsfromdisposaloffinancialassetsandfinancialliabilities,excludingthosearisingfromhedgingbusinessrelatedtooperatingactivities | ||
| Fundpossessionchargefromnon-financialentitiesandincludedinprofitorloss | 52,623.28 | |
| Gainsonassetsconsignedtothethirdpartyforinvestmentormanagement | 12,111,406.99 | Investmentincomefromfinancialproductswas12,111,406.99yuan. |
| Gainsondesignatedloans | ||
| Lossesonassetsincurredduetoforcemajeuresuchasnaturaldisasters | ||
| Reversedprovisionforimpairmentofreceivablesbasedonimpairmenttestingonanindividualbasis | 484,240.00 | |
| Gainsonacquisitionofsubsidiaries,jointventuresandassociatesduetothesurplusofacquisition-datefairvalueofnetidentifiableassetsinacquireeovertheacquisitioncost | ||
| Netprofitonsubsidiariesacquiredthroughbusinesscombinationundercommoncontrolfromthebeginningoftheperiodtothecombinationdate |
| Items | Amount | Remarks |
|---|---|---|
| Gainsonnon-cashassetsexchange | ||
| Gainsondebtrestructuring | -3,130,560.92 | |
| One-offexpensesincurredduetothediscontinuationofrelevantoperatingactivities,suchasseverancepayments | ||
| One-offeffectsonprofitorlossduetoamendmentsoflawsandregulationsontaxation,accounting,etc. | ||
| Share-basedpaymentsrecognizedatonetimeduetocancellationormodificationofequityincentiveplan | ||
| Gainsarisingfromchangesinthefairvalueofemployeebenefitspayableafterthevestingdateforcash-settledshare-basedpayment | ||
| Gainsonchangesinfairvalueofinvestmentpropertieswithsubsequentmeasurementusingthefairvaluemodel | ||
| Gainsontransactionswithunfairvalue | ||
| Contingentgainsonnon-operatingactivities | ||
| Managementchargesforconsignedoperations | ||
| Othernon-operatingrevenueorexpenditures | 9,532,774.64 | |
| Otherprofitorlosssatisfyingthedefinitionofnonrecurringprofitorloss | ||
| Subtotal | 67,870,485.21 | |
| Less:Enterpriseincometaxaffected | 11,730,712.09 | |
| Non-controllinginterestaffected(aftertax) | 2,509,473.34 | |
| Netnon-recurringprofitorlossattributabletoshareholdersoftheparentcompany | 53,630,299.78 |
- Effect on non-recurring profit or loss in 2022 due to implementation of "Interpretation Pronouncement on Information Disclosure Criteria for Public Companies No. 1 – Non-Recurring Profit or Loss (2023 Edition)"
| Netnon-recurringprofitorlossattributabletotheownerof94,040,767.95 |
|---|
| theparentcompanyin2022 |
| Netnon-recurringprofitorlossattributabletotheowneroftheparentcompanycalculatedbasedonthe"InterpretationPronouncementonInformationDisclosureCriteriafor73,584,397.70PublicCompaniesNo.1–Non-RecurringProfitorLoss(2023Edition)"in2022 |
| Difference-20,456,370.25 |
(II) ROE and EPS
1. Details
| WeightedaverageROE(%) | EPS(yuan/share) | |||
|---|---|---|---|---|
| Profitofthereportingperiod | BasicEPS | DilutedEPS | ||
| Netprofitattributabletoshareholdersofordinaryshares | 2.88 | 0.16 | 0.16 | |
| Netprofitattributabletoshareholdersofordinarysharesafterdeductingnon-recurringprofitorloss | 2.57 | 0.14 | 0.14 |
- Calculation process of weighted average ROE
| Items | Symbols | Currentperiodcumulative | ||
|---|---|---|---|---|
| Netprofitattributabletoshareholdersofordinaryshares | A | 498,383,730.00 | ||
| Non-recurring | profitorloss | B | 53,630,299.78 | |
| Netprofitsharesafter | attributabletoshareholdersofordinarydeductingnon-recurringprofitorloss | C=A-B | 444,753,430.22 | |
| Openingbalanceshareholders | ofnetassetsattributabletoofordinaryshares | D | 17,288,602,018.09 | |
| Netassetssharesincreasedconversionof | attributabletoshareholdersofordinaryduetoofferingofnewsharesordebtsintoshares | E | 1,111.00 | |
| Numberofmonthscountingfromthenextmonthwhenthenetassetswereincreasedtotheendofthereportingperiod | F | 6 | ||
| Netassetsattributabletoshareholdersofordinarysharesdecreasedduetosharerepurchaseorcashdividendsappropriation | G | 348,363,541.68 | ||
| Numberofmonthscountingfromthenextmonthwhenthenetassetsweredecreasedtotheendofthereportingperiod | H | 7 | ||
| Netassetsincreasedduetoconversionofdebtsintoshares | I1 | 7,046.13 | ||
| Numberofmonthscountingfromthenextmonthwhenthenetassetswereincreasedordecreasedtotheendofthereportingperiod | J1 | 6 | ||
| Netassetsincreasedduetodecreaseofequityinvestmentsinsubsidiaries | I2 | 156,152.45 | ||
| Others | Numberofmonthscountingfromthenextmonthwhenthenetassetswereincreasedordecreasedtotheendofthereportingperiod | J2 | ||
| Netassetsdecreasedduetoacquisitionofnon-controllinginterest | I3 | 1,277,359.26 | ||
| Numberofmonthscountingfromthenextmonthwhenthenetassetswereincreasedordecreasedtotheendofthereportingperiod | J3 | 6 | ||
| Numberofmonthsinthereportingperiod | K | 12 |
| Items | Symbols | Currentperiodcumulative |
|---|---|---|
| Weightedaveragenetassets | L=D+A/2+E×F/K-G×H/K±I×J/K | 17,333,947,216.05 |
| WeightedaverageROE | M=A/L | 2.88% |
| WeightedaverageROEafterdeductingnonrecurringprofitorloss | N=C/L | 2.57% |
3. Calculation process of basic EPS and diluted EPS
(1) Calculation process ofbasic EPS
| Items | Symbols | Currentperiodcumulative |
|---|---|---|
| Netprofitattributabletoshareholdersofordinaryshares | A | 498,383,730.00 |
| Non-recurringprofitorloss | B | 53,630,299.78 |
| Netprofitattributabletoshareholdersofordinarysharesafterdeductingnon-recurringprofitorloss | C=A-B | 444,753,430.22 |
| Openingbalanceoftotalshares | D | 3,179,505,559 |
| Numberofsharesincreasedduetoconversionofreservetosharecapitalorsharedividendappropriation | E | |
| Numberofsharesincreasedduetoofferingofnewsharesorconversionofdebtsintoshares | F | 1,111 |
| Numberofmonthscountingfromthenextmonthwhentheshareswereincreasedtotheendofthereportingperiod | G | 6 |
| Numberofsharesdecreasedduetosharerepurchase | H | |
| Numberofmonthscountingfromthenextmonthwhenthesharesweredecreasedtotheendofthereportingperiod | I | |
| Numberofsharesdecreasedinthereportingperiod | J | |
| Numberofmonthsinthereportingperiod | K | 12 |
| Weightedaverageofoutstandingordinaryshares | L=D+E+F×G/K-H×I/K-J | 3,179,506,115 |
| BasicEPS | M=A/L | 0.16 |
| BasicEPSafterdeductingnon-recurringprofitorloss | N=C/L | 0.14 |
(2) Calculation process ofdiluted EPS
The calculation process of diluted EPS is the same as that of basic EPS.
Infore Environment Technology Group Co.,Ltd. April 26, 2024