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Offcn Education Technology Co., Ltd. Interim / Quarterly Report 2020

Oct 30, 2020

54632_rns_2020-10-30_f916cbe9-7ef1-4127-b680-b56a8b705939.PDF

Interim / Quarterly Report

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OFFCN EDUCATION TECHNOLOGY CO., LTD. Third Quarter 2020 Report

Stock Code: 002607

Stock Abbr.: OFFCN EDU

October, 2020

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Chapter I. Important Notes

The board of directors, the supervisor committee, the directors, supervisors, and senior management of the Company shall hereby guarantee the authenticity, accuracy and completeness of this quarterly report without misrepresentations, misleading statements, or material omissions, and bear individual and joint legal liabilities. All directors attended the board meeting approving this quarterly report.

Wang Zhendong, the Company ’s legal representative, Shi Lei, the responsible person in charge of accounting work, and Luo Xue, the person in charge of the accounting department, hereby declare that the financial report in this quarterly report is authentic, accurate and complete.

Note: The Company’s Third Quarter 2020 Report is prepared and published in Chinese version, and the English version is for reference only. Should there be any inconsistency between the Chinese version and English version, the Chinese version shall prevail.

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1

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Chapter II. Corporate Profile

Sector I. Key accounting information and financial indicators

Does the Company need to adjust its financial information retrospectively or restate its accounting information of previous year?

□Yes √No

End of current reporting
period		 End of current reporting
period		 End of the previous year End of the previous year Increase/decrease at the end
of this reporting period over
end of the previous year		 Increase/decrease at the end
of this reporting period over
end of the previous year
Total assets (RMB) 15,351,254,073.24 9,960,705,427.94 54.12%
Net assets attributable to
shareholders of the listed
Company (RMB)		 3,299,163,560.79 3,431,545,903.82 -3.86%
Current reporting
period		 Increase/decrease in
current reporting
period over same
period of the
previous year		 From beginning of
the year 2020 to end
of this reporting
period		 Increase/decrease
from beginning of
the year 2020 to end
of this reporting
period over same
period of the
previous year
Revenue (RMB) 4,630,989,349.21 83.65% 7,438,969,829.81 20.78%
Net profit attributable to
shareholders of the listed
Company (RMB)		 1,553,920,155.49 233.58% 1,320,893,510.33 37.76%
Net profit attributable to
shareholders of the listed
Company after deducting
non-recurring gains or losses
(RMB)		 1,445,848,093.32 247.44% 1,078,305,710.49 21.35%
Net cash flow from operating
activities (RMB)		 2,654,154,595.86 302.28% 6,717,830,100.05 120.79%
Basic earnings per share
(RMB/share)		 0.25 212.50% 0.21 31.25%
Diluted earnings per share
(RMB/share)		 0.25 212.50% 0.21 31.25%
Weighted average return on
assets		 51.35% 31.05% 42.35% 8.39%

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2

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Items and amounts of non-recurring gains or losses

√Applicable □Not applicable

Unit: RMB

Item Amount from beginning of
the year 2020 to end of the
reporting period		 Notes
Gains or losses on disposal of non-current assets (including the
offsetting amount for the provision of impairment of assets)		 162,043.59
Government subsidies included in the current gains or losses
(not including subsidies enjoyed in quota or ration according to
national standards, which are closely relevant to the Company’s
business.)		 475,756.81
Gains or losses from entrusting others to invest or manage
assets		 130,365,075.07
Non-operating income and expenses other than the above -457,000.58
Other items that meet the definition of non-recurring gains or
losses		 159,614,478.41
Less：Influenced amount of income tax 47,572,553.46
Total 242,587,799.84 --

Provide explanations for classifying non-recurring profit and loss items defined in the Explanatory Announcement No. 1 for Public Company Information Disclosures - Non-recurring Gains and Losses , and for classifying non-recurring profit and loss items listed in the Explanatory Announcement No. 1 for Public Company – Information Disclosures Non-recurring Gains and Losses as recurring profit and loss items.

□Applicable √Not applicable

The Company has not classified non-recurring profit and loss items defined or listed in the Explanatory Announcement No. 1 for Public Company Information Disclosures - Non-recurring Gains and Losses as recurring profit and loss items in the reporting period.

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3

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Sector II. Tables on the total number of shareholders and shares held by the top 10 shareholders at the end of the reporting period

1. Table on the total number of common shareholders and preferred shareholders with restored voting rights and shares held by the top 10 shareholders

Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723		 Unit: share(s)
Total number of common
shareholders at the end of
reporting period
30,880
Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)
0
Particulars about shares held by the top 10 shareholders
Name of
shareholder
Nature of
shareholder
Shareholding
percentage (%)
Shares held
Number of
shares held
with sales
restrictions
Pledged or frozen
Status of shares
Number of
shares
Lu Zhongfang
Domestic
natural person
41.36%
2,550,549,260
2,550,549,260
Pledged
450,000,000
Li Yongxin
Domestic
natural person
18.35%
1,131,415,121
1,131,415,121
Pledged
774,495,000
Wang
Zhendong
Domestic
natural person
15.61%
962,471,418
962,471,418
Pledged
107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)
Domestic
non-state-owne
d legal person
4.33%
267,353,171
267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
2.89%
178,235,447
178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)
Domestic
non-state-owne
d legal person
1.44%
89,117,723
89,117,723
Total number of common
shareholders at the end of
reporting period		 30,880 Total number of preferred
shareholders with restored
voting rights at end of the
reporting period (if any)		 0
Particulars about shares held by the top 10 shareholders
Name of
shareholder		 Nature of
shareholder		 Shareholding
percentage (%)		 Shares held Number of
shares held
with sales
restrictions		 Pledged or frozen
Status of shares Number of
shares
Lu Zhongfang Domestic
natural person		 41.36% 2,550,549,260 2,550,549,260 Pledged 450,000,000
Li Yongxin Domestic
natural person		 18.35% 1,131,415,121 1,131,415,121 Pledged 774,495,000
Wang
Zhendong		 Domestic
natural person		 15.61% 962,471,418 962,471,418 Pledged 107,100,000
Beijing
Aerospace
Industry
Investment
Fund (Limited
Partnership)		 Domestic
non-state-owne
d legal person		 4.33% 267,353,171 267,353,171
Beijing
Guangyin
Venture Capital
Center
(Limited
Partnership)		 Domestic
non-state-owne
d legal person		 2.89% 178,235,447 178,235,447
Beijing Kerui
Technology
Innovation
Investment
Center
(Limited
Partnership)		 Domestic
non-state-owne
d legal person		 1.44% 89,117,723 89,117,723

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4

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Hong Kong
Securities
Clearing
Co.,Ltd.		 Overseas legal
person		 1.41% 86,771,865 0
Beijing Offcn
Future
Information
Consulting
Center
(Limited
Partnership)		 Domestic
non-state-owne
d legal person		 1.30% 80,000,000 0
Zhou Xiayun Domestic
natural person		 1.28% 78,848,640 0 Pledged 47,148,845
Zhou Hui Domestic
natural person		 1.17% 72,277,920 0 Pledged 9,450,000
Particulars about shares held by the top 10 shareholders without sales restrictions
Name of shareholder Number of shares without sales restrictions held Type of shares
Type of shares Number of
shares
Hong Kong Securities Clearing
Co.,Ltd.		 86,771,865 RMB common
shares		 86,771,865
Beijing Offcn Future Information
Consulting Center (Limited
Partnership)		 80,000,000 RMB common
shares		 80,000,000
Zhou Xiayun 78,848,640 RMB common
shares		 78,848,640
Zhou Hui 72,277,920 RMB common
shares		 72,277,920
Zhou Li 48,185,280 RMB common
shares		 48,185,280
China Merchants Bank Co.,Ltd.-
China Universal Asset
Management Mid-Capitalization
Active Growth Hybrid Securities
Investment Fund		 10,742,427 RMB common
shares		 10,742,427
Agricultural Bank of China
Co.,Ltd.-BOCOM Schroders
Growth Hybrid Securities
Investment Fund		 10,163,856 RMB common
shares		 10,163,856
China Construction Bank 9,235,717 RMB common 9,235,717
Hong Kong
Securities
Clearing
Co.,Ltd.		 Overseas legal
person		 1.41% 86,771,865 0
Beijing Offcn
Future
Information
Consulting
Center
(Limited
Partnership)		 Domestic
non-state-owne
d legal person		 1.30% 80,000,000 0
Zhou Xiayun Domestic
natural person		 1.28% 78,848,640 0 Pledged 47,148,845
Zhou Hui Domestic
natural person		 1.17% 72,277,920 0 Pledged 9,450,000
Particulars about shares held by the top 10 shareholders without sales restrictions
Name of shareholder Number of shares without sales restrictions held Type of shares
Type of shares Number of
shares
Hong Kong Securities Clearing
Co.,Ltd.		 86,771,865 RMB common
shares		 86,771,865
Beijing Offcn Future Information
Consulting Center (Limited
Partnership)		 80,000,000 RMB common
shares		 80,000,000
Zhou Xiayun 78,848,640 RMB common
shares		 78,848,640
Zhou Hui 72,277,920 RMB common
shares		 72,277,920
Zhou Li 48,185,280 RMB common
shares		 48,185,280
China Merchants Bank Co.,Ltd.-
China Universal Asset
Management Mid-Capitalization
Active Growth Hybrid Securities
Investment Fund		 10,742,427 RMB common
shares		 10,742,427
Agricultural Bank of China
Co.,Ltd.-BOCOM Schroders
Growth Hybrid Securities
Investment Fund		 10,163,856 RMB common
shares		 10,163,856
China Construction Bank 9,235,717 RMB common 9,235,717

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5

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

Co.,Ltd.-Huatai Pinebridge
Prosperity Optimal Hybrid
Securities Investment Fund		 shares
China CITIC Band Co.,Ltd.-
BOCOM Schroders New Vitality
Flexible Allocation Hybrid
Securities Investment Fund		 8,493,732 RMB common
shares		 8,493,732
China Construction Bank
Co.,Ltd.-BOCOM Schroders Blue
Chip Hybrid Securities Investment
Fund		 8,028,102 RMB common
shares		 8,028,102
Description of the relationship or
concerted action among the above
mentioned shareholders		 The Company's controlling shareholder and actual controller Lu Zhongfang and Li Yongxin
are in a parent-child relationship. Lu Zhongfang, Li Yongxin, and Beijing Offcn Future
Information Consulting Center (Limited Partnership) constitute persons acting in concert.
Zhou Xiayun and Zhou Hui have a father-son relationship. Zhou Xiayun and Zhou Li have
a father-daughter relationship. It is unknown whether there is an associated relationship
among the above-mentioned other shareholders, nor whether the above-mentioned
shareholders belong to the parties acting in concert as stipulated in the Administrative
Measures on Information Disclosure of Shareholding Changes in Listed Companies.
Description of the top 10
shareholders participating in the
margin trading (if any)		 None

Whether the Company’s top 10 common shareholders and top 10 common shareholders without sales restrictions conducted agreed repurchase transactions during the reporting period?

□Yes √No

The Company’s top 10 common shareholders and top 10 common shareholders without sales restrictions did not conduct agreed repurchase transactions during the reporting period.

2. Table on the total number of preferred shareholders and shares held by the top 10 preferred shareholders

□Applicable √Not Applicable

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6

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Chapter III. Significant Events

Section I. Cases and reasons of main financial data and indicators fluctuation during the reporting period

√Applicable □Not Applicable

Balance Sheet September 30, 2020 December 31, 2019 Growth Statements
Cash and cash
equivalents		 5,069,423,730.49 2,724,335,001.58 86.08% The
main
reason
for
the
growth
is
the
recruitment
examinations
have
been
fully
resumed and the marketing and enrollment of
the Company have returned to the normal
level.
The
revenue
therefore
has
been
increased.
Financial assets held for
trading		 4,123,307,227.54 1,754,396,227.54 135.03% It is mainly due to the increased revenue of
training business in this reporting period and
the increased purchase of financial products.
Accounts receivable 20,252,907.35 2,721,638.09 644.14% It is mainly due to the increase of rents from
retained assets in the major asset restructuring
in the current period.
Prepayments 5,734,527.16 2,461,009.00 133.02% It is mainly due to the increased prepayments
for the employees’ business travel air tickets to
the travel agency.
Non-current assets due
within one year		 1,959,426,969.04 0.00 100.00% The reason for the growth is that the fixed
deposit due within one year is listed under
“non-current assets due within one year” item
based on the liquidity of assets.
Other current assets 179,404,189.50 97,336,600.16 84.31% It is mainly due to the increased prepayments
for rent and property management in the
current period.
Debt investments 20,000,000.00 1,923,598,909.09 -98.96% The reason for the growth is that the fixed
deposit due within one year is listed under
“non-current assets due within one year” item
based on the liquidity of assets.
Deferred tax assets 11,310,880.26 21,482,832.13 -47.35% The main reason is that the accrual of the
employees’ remuneration in the previous year
is paid in the current period.
Other non-current assets 500,359,990.69 325,967,628.34 53.50% It is mainly due to the prepayments for the
decoration of branches and training centers in
the current period.
Accounts payable 124,596,162.88 236,481,990.86 -47.31% It is mainly due to the settlement and payment
of the initial payables in the current period.
Receipts in advance 0.00 2,634,276,203.88 -100.00% The reason is that
“ receipts in advance ”

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7

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

carried over within one year are listed under
“ Contract liabilities ”
and
“ Other current
liabilities” item according to the new criteria
of revenue in the current period.
Contract liabilities 7,410,923,947.05 0.00 100.00% It is mainly due to the “receipts in advance”
carried over within one year after tax deduction
is listed under
“ Contract liabilities ”
item
according to the new criteria of revenue in the
current period.
Employee benefits
payable		 602,771,357.67 411,475,636.03 46.49% It is mainly due to the expansion of business
scale and increase in personnel costs.
Taxes payable 253,433,295.83 184,306,027.84 37.51% It is mainly due to the increase of income tax
of the Company in the third quarter from the
beginning of the period.
Other current liabilities 222,327,718.41 0.00 100.00% The reason is that the pending output tax in the
“receipts in advance” carried over within one
year is adjusted to be listed under
“ Other
current liabilities” item according to the new
criteria of revenue in the current period.
Income Statement January-September
2020		 January-September
2019		 Growth Statements
Taxes and surcharges 9,832,926.10 43,197,122.47 -77.24% It is mainly due to the tax reduction and
exemption during the pandemic.
Financial expenses 346,754,421.65 65,332,528.30 430.75% It is mainly due to the increased receivables
and commissions in the current period.
Other income 221,416,613.84 500,478.07 44141.02% It is mainly due to the reduction and exemption
of value-added tax enjoyed by the Company
during the pandemic.
Investment income 187,595,273.90 126,753,395.24 48.00% The main reason is that the interest income
from fixed deposit is adjusted from being
included in
“ financial expenses ”
to be
included in “investment income” based on the
new
accounting
standards
of
financial
instruments.
Income tax expenses 261,121,317.06 189,559,243.49 37.75% It is mainly due to the increase of taxable
profits.
Cash Flow Statement January-September
2020		 January-September
2019		 Growth Statements
Cash receipts from the
sale of goods and the
rendering of services		 12,630,977,793.14 8,330,180,757.44 51.63% It is mainly due to the increase of training fees
received in advance in the current period.
Other cash receipts
related to operating		 246,310,360.72 2,290,953.16 10651.44% It is mainly due to the resumption of land
auction deposit in the current period.

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8

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

activities
Cash paid to and for
employees		 3,833,750,101.55 2,877,043,972.46 33.25% It is mainly due to the increased number of the
the Company’s employee, thus increasing the
payment for the employees’ remuneration.
Cash paid for all types
of taxes		 200,151,843.84 424,466,382.02 -52.85% It is mainly due to the tax reduction and
exemption during the pandemic.
Cash receipts from
disposals and recovery
of investments		 25,895,487,090.00 18,199,290,000.00 42.29% It is mainly due to the redemption of financial
products in the current period.
Cash payments to
acquire or construct
fixed assets, intangible
assets and other
long-term assets		 897,559,659.37 516,034,598.11 73.93% It
is
mainly
due
to
the
acquisition
of
Guancheng
training
center
in
Shaanxi
province,
the prepayments
for
cooperative
construction funds to Shenfu training center of
Liaoning
Offcn,
and
the
payments
for
construction in progress, decoration and etc in
the current period.
Cash paid for investment 28,265,198,090.00 19,445,620,000.00 45.36% It is mainly due to the Company’s optimized
fund management and the increased purchase
of financial products in the current period.
Cash from borrowings 3,002,000,000.00 986,698,800.00 204.25% It is mainly due to the increased borrowings
from the bank in the current period.
Cash paid for debt
repayment		 2,641,000,000.00 496698800 431.71% It is mainly due to the repayment of bank loans
due in the current period.

Section II. Progress of significant events, their impact and analysis on the solutions

Applicable √ Not applicable

Progress in the implementation of share repurchase

Applicable √ Not applicable

Progress in the implementation of centralized bidding to reduce holdings of repurchased shares

Applicable √ Not applicable

Section III. Commitments in implementation by the Company's actual controller, shareholders, related parties, acquirer and the Company itself, etc. during the reporting period

  • √ Applicable Not applicable

The important commitments made by the major asset restructuring parties are as follows:

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Commitment Type of
commitm
ent		 Content of commitment Date of
commitm
ent		 Period of
commitm
ent		 Performa
nce
Lu
Zhongfang,
Li Yongxin,
Wang
Zhendong,
Guo Shihong,
Liu Bin,
Zhang
Yongsheng,
Yang
Shaofeng,
Zhang Zhi’an		 Performa
nce
commitm
ent and
compensa
tion
arrangem
ent		 1. The profit forecast and compensation periods are the years
of 2018, 2019 and 2020.
2. Performance commitment: The compensation obligors
confirm and promise that the net profits attributable to the
shareholders
of
the
parent
company
after
deducting
non-recurring
gains
and
losses
under
the
consolidated
statements of Offcn Ltd. shall not be less than 930 million
RMB, 1.3 billion RMB and 1.65 billion RMB in years of
2018, 2019 and 2020 respectively.
3. The parties agree that the certified public accountants
employed by Yaxia Auto shall review the actual net profits of
Offcn Ltd. after the end of each of the three fiscal years. The
difference between the actual net profits of Offcn Ltd. and the
net profits committed by the compensation obligors shall be
reviewed and a special audit report shall be issued. At the end
of the third fiscal year, an auditing agency with qualifications
for executing securities and futures engaged by Yaxia Auto
will conduct an impairment test on Offcn Ltd. and issue an
impairment test report, within 90 days after the certified
public accountant issues a special audit report.
4. Compensation measures:
(1) If the certified public accountant confirms that the actual
net profits accumulated by Offcn Ltd. fails to meet the
aggregate committed net profits as of the end of each of three
fiscal years, each compensation obligor shall assume the
compensation obligation according to the proportion of the
shares to the total shares of Offcn Ltd. held by all the
compensation
obligors
before
the
transaction.
All
compensation
obligors
are
given
priority
to
conduct
compensation with shares. When the total amount of share
compensation reaches 90% of the total number of shares
issued for purchasing assets, all compensation obligors shall
conduct compensation in cash. The formula for calculating the
amount of compensation payable by the obligors in the
current period is as follows: compensation amount for the
current period = (aggregate committed net profits as of the
end of the current period - accumulated net profits as of the
end of the current period) ÷ the sum of committed net profits
of years within the compensation period × the price of Offcn
Ltd. in this transaction - aggregate compensated amount.
In the application of the above formula, it should be as
follows: ①“As of the end of the current period” refers to
the period starting from 2018 and ending at the end of the
current period; ②“the sum of committed net profits” refers
to the sum of committed net profits in 2018, 2019 and 2020,
that
is
RMB
3.88
billion.
Number
of
shares
to
be
compensated by the obligor in the current period = Obligor's
compensation amount ÷
the issue price per share of the
shares issued for purchasing assets. When the number of		 May 4,
2018		 Years of
2018,
2019,
2020		 Performance
commitment
s of the year
2018 and
2019 have
been
fulfilled.

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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shares for compensation is not a whole number, it shall be
handled in accordance with the rounding principle.
(2) The upper limit of the compensation obligor in the
compensation commitments and end-of-period impairment
compensation of Offcn Ltd. shall not exceed the total
transaction consideration obtained by all shareholders in this
transaction. When the calculated compensable amount is less
than or equal to 0, the value is taken as 0, that is, the amount
or the shares that have been compensated are not redeemed.
(3) If Yaxia Auto implements ex-rights and ex-dividends, such
as bonus shares, the capitalization of the capital reserve to
share capital, or allotment within the period of profit
compensation, the number of shares to be compensated shall
be adjusted accordingly as follows: the number of shares to be
compensated by the obligor (after adjustment) = the number
of shares to be compensated by the obligor ×
(1 + the
proportion of bonus shares or transferred capital stock).
(4) If Yaxia Auto implements cash dividends during the period
of profit compensation, the cash dividends shall be returned
accordingly. The calculation formula is: repayment amount of
the compensation obligor = total cash distribution received by
the compensation obligor (before tax) ÷the number of shares
obtained by the compensation obligor in this transaction
(including shares acquired in this transaction and shares
newly added by bonus shares and transfer of capital stock) ×
the number of obligor’s compensation shares.
5. Impairment test and compensation after the performance
commitment period expires:
(1) At the end of the performance commitment period, the
auditing agency with qualifications for executing securities
and
futures
engaged
by Yaxia Auto
will
perform
an
impairment test on exchange-in assets in this transaction (i.e.
100% of the shares of Offcn Ltd.) and issue an Impairment
Test Report.
(2) If the amount of exchange-in assets impairment at the end
of the period> the total number of compensated shares × the
issue price +
the amount
of compensated
cash,
each
compensation obligor shall compensate Yaxia Auto separately
according to the proportion of the shares to the total shares of
Offcn Ltd. held by all the compensation obligors before the
transaction. The calculation formula is: the amount to be
compensated for the impairment of the exchange-in assets=
the amount of impairment of exchange-in assets at the end of
the period－the total compensated amount in the commitment
year(s).
In
any
situations,
the
total
amount
of
the
compensation for exchange-in assets impairment and the
compensation for performance commitment shall not exceed
the total amount of this transaction's consideration received by
all the shareholders of Offcn Ltd.
(3)
The
aforementioned
amount
of
impairment
is
the
consideration of exchange-in assets minus the estimated value

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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of exchange-in assets at the end of the period, deducting the
effects of capital injection, capital reduction, gift acceptance
and
profit
distribution
of
the
shareholders
during
compensation period.
6. Implementation of compensation:
(1) If the compensation obligor is required to compensate
Yaxia Auto because the net profits generated by exchange-in
assets are lower than its commitment, Yaxia Auto shall
convene a board meeting within 30 working days after the
special audit report or impairment test report is issued by the
accounting firm, and shall determine the number of shares or
cash amount to be compensated by each compensation obligor
in accordance
with
the
"Profit
Forecast
Compensation
Agreement". The board of directors shall convene a general
meeting of shareholders to consider the repurchase and/or
cancellation of compensated shares for the current period.
(2) Based on the terms and conditions of the agreement, each
compensation obligor will compensate Yaxia Auto in the
following order: each compensation obligor shall perform the
compensation obligation according to the proportion of the
shares to the total shares of Offcn Ltd. held by all the
compensation obligors before the transaction.
①Firstly, all compensation obligors shall compensate the
listed Company with Yaxia Auto shares obtained in this
transaction according to the proportion of the shares to the
total shares of Offcn Ltd. held by all the compensation
obligors before the transaction. If the aforementioned shares
are insufficient for compensation, each compensation obligor
shall make compensation by purchasing Yaxia Auto shares
from the secondary market or by other legal means. In order
to avoid ambiguity, the compensation obligors shall not bear
joint liability for the above compensation obligations.
②Yaxia Auto shall notify all compensation obligors in writing
within 5 working days after the date of announcement of
resolution by the shareholders ’
meeting. All compensation
obligors shall transfer their compensation shares of the current
year to the designated account set up by the board of directors
of Yaxia Auto at a total price of RMB 1.00 within 5 working
days after receiving the aforementioned notice, and cancel the
repurchase of aforementioned shares in accordance with
relevant laws and regulations. (If there are changes in relevant
laws and regulations and/or in regulations of relevant
authorities at that time, the cancellation shall be completed in
accordance with the relevant regulations at that time)
③
From the date on which the number of compensation
shares of each compensation obligor is determined until the
cancellation of these shares, these shares are with no voting
rights or rights for dividend distribution.
④
If the compensation obligor needs to compensate Yaxia
Auto in cash in accordance with the stipulations of the Profit
Forecast
Compensation
Agreement,
each
compensation

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12

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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obligor shall pay the compensation amount to Yaxia Auto
within the period specified in the notice. In case of overdue
payment, the compensation obligor shall pay the late payment
interest to Yaxia Auto on the overdue portion at daily interest
rate
of
5 ‱ ,
with
the
continuity
of
obligation
of
compensation.
Yaxia
Industry,
Zhou Xiayun,
Zhou Hui,
Zhou Li,
Phase-I
employee
stock
ownership
plan		 Letter of
commitm
ent on
lock-up
period		 After the completion of the transaction (starting from the date
of the listing of shares issued in this transaction), the
Company/I/the plan shall not transfer the shares with rights of
Yaxia Auto within 36 months .
After the completion of the transaction, the shares held by the
Company/I/the plan, derived from Yaxia Auto shares due to
the distribution of stock dividends and/or the transfer of the
capital reserve to share capital by Yaxia Auto, shall also
comply with the above-mentioned sales restrictions.
If
the China Securities
Regulatory Commission
and/or
Shenzhen Stock Exchange have/has other provisions for the
aforementioned
lock-up
period
arrangement,
the
Company/I/the
plan
will
adjust
and
implement
the
aforementioned
lock-up
period
according
to
the
latest
regulations of the China Securities Regulatory Commission
and/or Shenzhen Stock Exchange.
If violating the above commitments, the Company/I/the plan
will bear all losses caused to Yaxia Auto.		 May 4,
2018		 January
31, 2022		 Under
normal
implement
ation
Li Yongxin Letter of
Commitm
ent on
lock-up
period for
subscripti
on of
shares		 1. The shares of the listed Company subscribed by myself in
this transaction shall not be transferred or dealt with in any
other forms within 36 months from the date of the listing of
the shares. Within 6 months after the listing of the shares, if
the closing price of the listed Company stock is lower than the
issue price for consecutive 20 trading days, or the closing
price of the stock at the end of the 6 months after the listing of
the shares is lower than the issue price, the lock-up period of
consideration
shares
acquired
by
myself
shall
be
automatically
extended
for
6
months.
(If
ex-rights
or
ex-dividend events, such as dividend distribution, bonus
shares, transfer of capital stock, or allotment to the listed
Company occurred during the aforementioned period, the
aforementioned issue price shall be calculated based on the
price adjusted by factors as ex-dividend and ex-rights, etc.)
2. As the transferee of 72,696,561 Yaxia Auto shares held by
Anhui Yaxia Industry Co., Ltd., I shall not transfer the
aforementioned shares within 36 months from the date of
registration in my securities account.
3. The aforesaid arrangement of share lock-up does not affect
the
implementation
of
profit
compensation
for
this
transaction, that is, when I need to make profit compensation,
the listed Company has the right to relieve the lock-up of
shares
in
corresponding
amount
in
advance
for
profit
compensation.
4. I promise to abide by the following provision: if the
transaction is investigated by judiciary authorities or the
China Securities Regulatory Commission on suspicion of		 April 27,
2018		 January
31, 2022		 Under
normal
implement
ation

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13

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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misrepresentations,
misleading
statements,
or
material
omissions in regard to the information provided or disclosed,
the shares of the listed Company acquired in this transaction
shall
not
be
transferred
until
the
conclusion
of
the
investigation is clarified.
5. After the completion date of this transaction, my increased
shares due to bonus shares and transfer of capital stock of the
listed
Company
shall
also
comply
with
the foregoing
requirements.
6. If the aforementioned lock-up period arrangement does not
match the latest laws and regulations and the latest regulatory
requirements of the securities regulatory institution, the
enterprise agrees to implement the latest laws and regulations
and the requirements of the regulatory agency.
7. After the lock-up period expires, it will be implemented in
accordance with the relevant regulations of the China
Securities Regulatory Commission and the Shenzhen Stock
Exchange.
Lu Zhongfang Letter of
commitm
ent on
lock-up
period for
subscripti
on of
shares		 1. The shares of the listed Company subscribed by myself in
this transaction shall not be transferred or dealt with in any
other forms within 36 months from the date of the listing of
the shares. Within 6 months after the listing of the shares, if
the closing price of the listed Company stock is lower than the
issue price for consecutive 20 trading days, or the closing
price of the stock at the end of the 6 months after the listing of
the shares is lower than the issue price, the lock-up period of
consideration
shares
acquired
by
myself
shall
be
automatically
extended
for
6
months.
(If
ex-rights
or
ex-dividend events, such as dividend distribution, bonus
shares, transfer of capital stock, or allotment to the listed
Company occurred during the aforementioned period, the
aforementioned issue price shall be calculated based on the
price adjusted by factors as ex-dividend and ex-rights, etc.)
2. The aforesaid share lock-up arrangement does not affect the
implementation of profit compensation for this transaction,
that is, when I need to make profit compensation, the listed
Company has the right to relieve the lock-up of shares in
corresponding amount in advance for profit compensation.
3. I promise to abide by the following provision: if the
transaction is investigated by judiciary authorities or the
China Securities Regulatory Commission on suspicion of
misrepresentations,
misleading
statements,
or
material
omissions in regard to the information provided or disclosed,
the shares of the listed Company acquired in this transaction
shall
not
be
transferred
until
the
conclusion
of
the
investigation is clarified.
4. After the completion date of this transaction, my increased
shares due to bonus shares and transfer of capital stock of the
listed
Company
shall
also
comply
with
the foregoing
requirements.
5. If the aforementioned lock-up period arrangement does not
match the latest laws and regulations and the latest regulatory		 April 27,
2018		 January
31, 2022		 Under
normal
implement
ation

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14

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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requirements of the securities regulatory institution, I agree to
implement
the
latest
laws
and
regulations
and
the
requirements of the regulatory agency.
6. After the lock-up period expires, it will be implemented in
accordance with the relevant regulations of the China
Securities Regulatory Commission and the Shenzhen Stock
Exchange.
Kerui
Technology
Innovation		 Letter of
commitm
ent on
lock-up
period for
subscripti
on of
shares		 1. The shares of the listed Company subscribed by the
enterprise in this transaction shall not be transferred or dealt
with in any other forms within 36 months from the date of
listing of the shares. Within 6 months after the listing of the
shares, if the closing price of the listed Company stock is
lower than the issue price for consecutive 20 trading days , or
the closing price of the stock at the end of the 6 months after
the listing of the stock is lower than the issue price, the
lock-up period of consideration shares acquired in this
transaction shall be automatically extended for 6 months. (If
ex-rights or ex-dividend events, such as dividend distribution,
bonus shares, transfer of capital stock, or allotment to the
listed Company occurred during the aforementioned period,
the aforementioned issue price shall be calculated based on
the price adjusted by factors as ex-dividend and ex-rights,
etc.)
2. The enterprise promises to abide by the following
provision: if the transaction is investigated by judiciary
authorities or the China Securities Regulatory Commission on
suspicion of misrepresentations, misleading statements, or
material omissions in regard to the information provided or
disclosed, the shares of the listed Company acquired in this
transaction shall not be transferred until the conclusion of the
investigation is clarified.
3. After the completion date of this transaction, the shares that
the enterprise owns increased due to bonus shares and transfer
of capital stock of the listed Company shall also comply with
the foregoing requirements.
4. If the aforementioned lock-up period arrangement does not
match the latest laws and regulations and the latest regulatory
requirements of the securities regulatory institution, the
enterprise agrees to implement the latest laws and regulations
and the requirements of the regulatory agency.
5. After the lock-up period expires, it will be implemented in
accordance with the relevant regulations of the China
Securities Regulatory Commission and the Shenzhen Stock
Exchange.		 July 27,
2018		 January
31, 2022		 Under
normal
Implement
ation
Aerospace
Industry,
Guangyin
Venture		 Letter of
commitm
ent on
lock-up
period for
subscripti
on of
shares		 1. The shares of the listed Company subscribed by the
enterprise in this transaction shall not be transferred or dealt
with in any other forms within 36 months from the date of
listing of the shares. Within 6 months after the listing of the
shares, if the closing price of the listed Company stock is
lower than the issue price for consecutive 20 trading days , or
the closing price of the stock at the end of the 6 months after
the listing of the stock is lower than the issue price, the		 July 27,
2018		 January
31, 2021		 Under
normal
Implement
ation

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15

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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lock-up period of consideration shares acquired in this
transaction shall be automatically extended for 6 months. (If
ex-rights or ex-dividend events, such as dividend distribution,
bonus shares, transfer of capital stock, or allotment to the
listed Company occurred during the aforementioned period,
the aforementioned issue price shall be calculated based on
the price adjusted by factors as ex-dividend and ex-rights,
etc.)
2. The enterprise promises to abide by the following
provision: if the transaction is investigated by judiciary
authorities or the China Securities Regulatory Commission on
suspicion of misrepresentations, misleading statements, or
material omissions in regard to the information provided or
disclosed, the shares of the listed Company acquired in this
transaction shall not be transferred until the conclusion of the
investigation is clarified.
3. After the completion date of this transaction, the shares that
the enterprise owns increased due to bonus shares and transfer
of capital stock of the listed Company shall also comply with
the foregoing requirements.
4. If the aforementioned lock-up period arrangement does not
match the latest laws and regulations and the latest regulatory
requirements of the securities regulatory institution, the
enterprise agrees to implement the latest laws and regulations
and the requirements of the regulatory agency.
5. After the lock-up period expires, it will be implemented in
accordance with the relevant regulations of the China
Securities Regulatory Commission and the Shenzhen Stock
Exchange.
Wang
Zhendong,
Guo Shihong,
Liu Bin,
Zhang
Yongsheng,
Yang
Shaofeng,
Zhang Zhi’an		 Letter of
commitm
ent on
lock-up
period for
subscripti
on of
shares		 1. The shares of the listed Company subscribed by myself in
this transaction shall not be transferred or dealt with in any
other forms within 24 months from the date of listing of the
shares. Within 6 months after the listing of the shares, if the
closing price of the listed Company stock is lower than the
issue price for consecutive 20 trading days , or the closing
price of the stock at the end of the 6 months after the listing of
the shares is lower than the issue price, the lock-up period of
consideration shares acquired in this transaction by myself is
automatically extended for 6 months. (If dividend distribution,
bonus shares, transfer of capital stock, or allotment to the
listed Company occurred during the above period, the
aforementioned issuance price is calculated based on the price
adjusted by factors as ex-dividend and ex-rights, etc.)
If Offcn Ltd. fails to meet the committed net profits as
stipulated in the Profit Forecast Compensation Agreement in
either 2018 or 2019, the lock-up period of the shares of the
listed Company I obtained in this transaction will be extended
to 36 months. At the expiration of 36 months from the date
when
the
aforementioned
shares
are
registered
to
my
securities
account,
if
the
performance
compensation
obligations
under
the
Profit
Forecast
Compensation
Agreement have not been fulfilled, the above lock-up period		 July 27,
2018		 January
31, 2021		 Under
normal
Implement
ation

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16

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

will
be extended
to the date when
the compensation
obligations are fulfilled.
2. The aforesaid share lock-up arrangement does not affect the
implementation of profit compensation for this transaction,
that is, when I need to make profit compensation, the listed
Company has the right to relieve the shares in corresponding
amount in advance for profit compensation.
3. I promise to abide by the following provision: if the
transaction is investigated by judiciary authorities or the
China Securities Regulatory Commission on suspicion of
misrepresentations,
misleading
statements,
or
material
omissions in regard to the information provided or disclosed,
the shares of the listed Company acquired in this transaction
shall
not
be
transferred
until
the
conclusion
of
the
investigation is clarified.
4. After the completion date of this transaction, my increased
shares due to bonus shares and/or transfer of capital stock of
the listed Company shall also comply with the foregoing
requirements.
5. If the aforementioned lock-up period arrangement does not
match the latest laws and regulations and the latest regulatory
requirements of the securities regulatory institution, I agree to
implement
the
latest
laws
and
regulations
and
the
requirements of the regulatory agency.
6. After the lock-up period expires, it will be implemented in
accordance with the relevant regulations of the China
Securities Regulatory Commission and the Shenzhen Stock
Exchange.
Offcn
Partnership		 Letter of
commitm
ent on the
lock-up
of shares		 Within 36 months from the date of the transfer of 80,000,000
shares of Yaxia Auto held by Anhui Yaxia Industry Co., Ltd.
to the enterprise, the shares shall not be transferred. The
lock-up period of the shares increased during the above period
due to bonus shares, transfer of capital stock or allotment of
shares by Yaxia Auto, shall also comply with the foregoing
requirements.
If the enterprise violates commitments listed above, it will
bear all losses caused to Yaxia Auto.		 April 27,
2018		 January
31, 2022		 Under
normal
Implement
ation
Li Yongxin
and other 10
counterparties		 Letter of
commitm
ent on the
lock-up
of Offcn
Partnershi
p’s
contributi
on shares		 Within 36 months from the date of the transfer of 80,000,000
shares of Yaxia Auto held by Anhui Yaxia Industry Co.,Ltd. to
Beijing Offcn Future Information Consulting Center (Limited
Partnership), I or the enterprise shall not in any way transfer
the shares of Beijing Offcn Future Information Consulting
Center
(Limited
Partnership)
or
withdraw
from
the
partnership with Beijing Offcn Future Information Consulting
Center (Limited Partnership), nor do we transfer, assign or
authorize other entities in any way to fully or partially have
the rights and interests indirectly related to the shares of Yaxia
Auto held by Beijing Offcn Future Information Consulting
Center (Limited Partnership).		 July 27,
2018		 January
31, 2022		 Under
normal
Implement
ation
Li Yongxin
Lu Zhongfang		 Letter of
commitm		 1. Guarantee the independence of the listed Company ’ s
personnel		 April 27,
2018		 Long-ter
m		 Under
normal

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17

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Wang
Zhendong
Offcn
Partnership		 ent on
maintaini
ng
independ
ence of
the listed
Company		 (1) It is guaranteed that after the completion of transaction,
the labor, personnel and salary management of the listed
Company shall be completely independent from myself/Offcn
Partnership,
and
from
other
related
parties,
such
as
companies, enterprises or economic organizations, controlled
by myself/Offcn Partnership.
(2) It is guaranteed that after the completion of transaction,
senior executives shall work as full-time employees and
receive remuneration in the listed Company. They shall not
hold any positions other than directors or supervisors in other
companies, enterprises, or economic organizations controlled
by myself/Offcn Partnership.
(3) It is guaranteed that after the completion of transaction,
the official powers of the shareholders’ meeting and board of
directors on personnel appointments and dismissals shall not
be interfered.
2. Guarantee the independence of institutes of the listed
Company
(1) It is guaranteed that after the completion of transaction,
the listed Company shall build a sound structure of corporate
governance
and
develop
an
independent
and
complete
organizational structure.
(2) It is guaranteed that after the completion of transaction,
the shareholders ’
meeting, the board of directors, and the
supervisor
committee
shall
independently
exercise
their
powers
in
accordance
with
laws,
regulations
and
the
Company’s articles.
3. Guarantee the independence and completeness of the assets
of the listed Company.
(1) It is guaranteed that after the transaction, the listed
Company shall have independent and complete assets related
to production and operation.
(2) It is guaranteed that after the completion of transaction,
the business premises of the listed Company shall be
independent from myself/Offcn Partnership, and other related
parties, such as companies, enterprises, or other economic
organizations controlled by myself/Offcn Partnership.
(3) It is guaranteed that after the completion of transaction,
except for normal business dealings, there shall be no capital
and/or assets of the listed Company occupied by myself/Offcn
Partnership, and other related parties, such as companies,
enterprises or economic organizations, controlled by myself or
Offcn Partnership.
4. Guarantee the independence of the listed Company ’ s
business.
(1) It is guaranteed that after the completion of transaction,
the
listed
Company
shall
have
the
qualifications
of
independently
conducting
business
activities
and
the
capabilities
of
running
market-oriented,
independent,
autonomous, sustainable business.
(2) It is guaranteed that after the completion of transaction,
I/Offcn
Partnership,
or
other
related
parties,
such
as
companies,
enterprises,
or
other
economic
organization		 implement
ation

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18

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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controlled by myself/Offcn Partnership shall avoid businesses
which
have
a
competitive
relationship
with
the
listed
Company and its subsidiaries.
(3) It is guaranteed that after the completion of transaction,
I/Offcn Partnership, or related parties, such as companies,
enterprises, or other economic organizations controlled by
myself/Offcn
Partnership
shall
reduce
related-party
transactions with the listed Company and its subsidiaries.
Related-party transactions that are really necessary and
unavoidable shall be conducted in a market-oriented and fair
way and perform relevant approval processes and information
disclosure obligations in accordance with relevant laws,
regulations and regulatory documents.
5.
Guarantee
the
financial
independence
of
the
listed
Company.
(1) It is guaranteed that after the completion of transaction,
the listed Company shall establish an independent financial
department with independent financial accounting systems
and standardized and independent financial accounting rules.
(2) It is guaranteed that after the completion of transaction,
the listed Company shall open bank accounts independently
and
shall
not
share
bank
accounts
with
myself/Offcn
Partnership/other
related
parties,
such
as
companies,
enterprises or other economic organizations controlled by
myself or Offcn Partnership.
(3) It is guaranteed that after the completion of transaction,
financial personnel hired by the listed Company shall not hold
part-time positions in other related parties, such as companies,
enterprises or other economic organizations controlled by
myself or Offcn Partnership.
(4) It is guaranteed that after the completion of transaction,
the
listed
Company
can
make
financial
decisions
independently. I/Offcn Partnership shall not interfere with the
use of funds by the listed Company.
(5) It is guaranteed that after the completion of transaction,
the listed Company will pay taxes independently according to
laws.
I/Offcn Partnership shall be liable for all losses caused to the
listed
Company
and
its
subsidiaries
due
to
my/Offcn
Partnership’s failure in fulfilling the above commitments.
Li Yongxin,
Lu Zhongfang		 Letter of
Commitm
ent on
avoiding
horizontal
competiti
on		 1. As of the date of signing this commitment letter, myself,
my close relatives and other companies, enterprises or
economic organizations controlled by myself, and my close
relatives,
except
for
Beijing
Offcn
Online
Education
Technology Co., Ltd. (hereinafter referred to as Offcn
Online), controlled by my relatives Xuhua and Lu Yan, and
its affiliated schools which are involved in the same or similar
businesses conducted by Offcn Ltd., other related parties are
not involved in any same, similar or related businesses
conducted by the listed Company, Offcn Ltd. and its affiliated
companies and schools.. Except for serving as a director in
Kunming Wuhua Offcn training school, which is affiliated to		 September
20, 2018		 1.The
transfer
of
Kairuier
Training
School in
Haidian
District of
Beijing:
within 24
months
from the		 As of the
end of the
reporting
period,
Kairuier
Training
School in
Haidian
District of
Beijing had
been
transferred

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19

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

==> picture [47 x 24] intentionally omitted <==

Offcn Online, Li Yongxin neither holds any full-time or
part-time positions nor provides consultancy at any companies
or enterprises, which conducts competitive businesses with
the listed Company, Offcn Ltd. and their affiliates. I also hold
directly or indirectly no stock rights(shares) of companies or
enterprises conducting the same, similar or related businesses
as the listed Company, Offcn Ltd. and its affiliates.
2. As of the date of signing this commitment letter, Offcn
Online and its two affiliated training schools’ disposals are as
follow: Offcn Online conducts no education businesses (to be
canceled
after
affiliated
schools
transferred).
Kairuier
Training School in Haidian District of Beijing is to be
transferred to an unrelated third party and the transfer
agreement of owner’s equity has been signed. If the transfer is
not completed within 24 months since the date of signing this
commitment letter, I will urge Offcn Online to cancel the
Kairuier Training School in Haidian District of Beijing.
Kunming Wuhua Offcn Training School, associated with
Offcn Online, has been closed and it will be transferred to an
unrelated third party or will be canceled within 12 months
after the revised Regulations for the Implementation of the
Law on the Promotion of Private Education of the People’s
Republic of China (hereinafter referred to as Regulations of
Implementation) is officially promulgated and implemented
and supporting regulations formulated by relevant local
education
authorities
in
accordance
with
the
revised
Regulations of Implementation_come into effect.
3. As of the date of signing this commitment letter, Offcn Ltd.
as the organizer intends to transfer its 100% of the rights of 33
private
schools
for
non-academic
qualifications
to
Li
Yongxin, and it has signed the _Agreement on Transfer of
Rights of Private Schools for Non-Academic Qualifications
Affiliated to Beijing Offcn Education Technology Co., Ltd. Li
Yongxin is willing to entrust the transferred 33 private
schools for non-academic qualifications to Offcn Ltd. and has
signed the Trusteeship Agreement of Private Schools for
Non-academic Qualifications.
4. After the completion of transaction, except for the
above-mentioned cases, I promise that during the time of
being the actual controller of the listed Company, I, my close
relatives and other related parties, such as companies,
enterprises or other economic organizations, controlled by
myself and my close relatives shall not in any way (including
but not limited to self operated or with other parties to operate
joint
venture,
cooperation,
joint
operation,
investment,
mergence, and trustee operation home and/or aboard) engage
in the same, similar, related or competitive businesses with
the listed Company, which include the follows:
(1) I will not directly or indirectly operate, participate in or
assist others to conduct same, similar businesses or other
economic activities which directly or indirectly constitute a
competitive relationship with businesses currently operated by
the listed Company and its affiliated companies.		 date of
the
signing of
this letter
of
commitm
ent
2. The
transfer
of
Kunming
Wuhua
Offcn
Training
School :
within 12
months
after the
revised
Regulatio
ns of
Implemen
tation
officially
promulga
ted and
implemen
ted and
supportin
g
regulation
s
formulate
d by
relevant
local
education
authoritie
s in
accordanc
e with the
revised
Regulatio
ns of
Implemen
tation
come into
effect.		 to an
unrelated
third party.
Other
commitme
nts are
under
normal
implement
ation.

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20

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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(2) I will not directly or indirectly invest on any economic
entities whose businesses constitute a direct or indirect
competitive relationship with the listed Company and its
affiliates.
(3) I will not be hired by any competitors that directly or
indirectly compete with the listed Company and its affiliates,
nor provide any advice, assistance or business opportunities
directly or indirectly to such competitors.
(4) I will not instigate, mislead, encourage or otherwise
induce, persuade, or coerce the employees or management
personnel in the listed Company and its affiliates to terminate
their labor or employment relationship with the Company and
its affiliates.
(5) I will not urge others to hire employees or management
personnel from the listed Company and its affiliates.
5. I promise that if I, my close relatives and other related
parties, such as companies, enterprises or other economic
organizations controlled by myself and my close relatives
obtain any business opportunities from any third party, which
can or may compete with the listed Company and its affiliates
in the future, I will notify the listed Company and its affiliates
in writing within 5 working days. After obtaining the third
party ’ s promise, I will attempt to transfer these business
opportunities to the listed Company and its affiliates.
6. I guarantee that I will never use my knowledge about and
the information I ’ m aware of the listed Company and its
affiliates to assist any third party to engage, participate, or
invest in businesses or projects that compete with the listed
Company and its affiliates.
7. If I violate the above commitments, the benefits obtained
by the violation of commitments shall belong to the listed
Company and I shall be liable for all losses caused to the
listed Company and its affiliates. Within 30 working days
since receiving the writing notice from the listed Company,
compensation will be made in cash.
8. I will disclose relevant information in a timely manner if
commitments fail to be fulfilled or fail to be fulfilled on
schedule because of objective reasons, such as changes in
relevant laws, regulations and policies, or natural disasters.
Except for the above-mentioned objective reasons, if the
commitments is anyhow unable to be fulfilled or fulfilling the
commitments is not conducive to safeguarding the rights and
interests of the listed Company, I should fully disclose the
reasons and either provide a new commitment to the listed
Company and related investors to replace the original one, or
propose an exemption from fulfilling the commitment.
9. The commitment is valid from the date on which the letter
of commitment is signed to the time when I cease to be the
actual controller of the listed Company.
Wang
Zhendong,
Offcn		 Letter of
Commitm
ent on		 1. As of the date of signing this letter of commitment, I, my
close
relatives,
or
related
parties
such
as
companies,
enterprises or other economic organizations controlled by		 April 27,
2018		 Long-ter
m		 Under
normal
implement

==> picture [61 x 28] intentionally omitted <==

21

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

==> picture [47 x 24] intentionally omitted <==

Partnership avoiding
horizontal
competiti
on		 myself and my close relatives / Offcn Partnership and its
related
parties,
such
as
other
enterprises
or
economic
organizations controlled by Offcn Partnership, participate in
no businesses which are the same, similar or related to
businesses competing with the listed Company, Offcn Ltd.
and their affiliated companies or schools. Except for serving
as a director at Kairuier Training School in Haidian District of
Beijing affiliated to Offcn Online ( Offcn Online tends to
transfer the rights of Kairuier Training School to an unrelated
third party and after this transfer, Wang Zhendong will no
longer hold the post as a director), I neither holds any
full-time or part-time positions nor provides consultancy at
any companies or enterprises which conducts competitive
businesses with the listed Company, Offcn Ltd. and their
affiliates.
I
also
hold
directly
or
indirectly
no
stock
rights(shares) of companies or enterprises conducting the
same, similar or related businesses as the listed Company,
Offcn Ltd. and its affiliates.
2. After the completion of transaction, except for the
above-mentioned cases, I/Offcn Partnership promise(s) that
during the time of being the actual controller of the listed
Company, I, my close relatives and other related parties, such
as companies, enterprises or other economic organizations,
controlled
by
myself
and
my
close
relatives
/
Offcn
Partnership and its related parties, such as other enterprises or
economic organizations controlled by Offcn Partnership, shall
not in any way (including but not limited to self operated or
with other parties to operate joint venture, cooperation, joint
operation, investment, mergence, and trustee operation home
and/or aboard) engage in the same, similar, related or
competitive businesses with the listed Company, which
include the follows:
(1) I/Offcn Partnership will not directly or indirectly operate,
participate in or assist others to conduct same, similar
businesses or other economic activities which directly or
indirectly
constitute
a
competitive
relationship
with
businesses currently operated by the listed Company and its
affiliated companies.
(2) I/Offcn Partnership will not directly or indirectly invest
on any economic entities whose businesses constitute a direct
or indirect competitive relationship with the listed Company
and its affiliates.
(3) I will not be hired by any competitors that directly or
indirectly compete with the listed Company and its affiliates,
nor provide any advice, assistance or business opportunities
directly or indirectly to such competitors.
(4) I/Offcn Partnership will not instigate, mislead, encourage
or otherwise induce, persuade, or coerce the employees or
management personnel in the listed Company and its affiliates
to terminate their labor or employment relationship with the
Company and its affiliates.
(5) I/Offcn Partnership will not urge others to hire employees		 ation

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22

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

==> picture [47 x 24] intentionally omitted <==

or management personnel from the listed Company and its
affiliates.
3. I/Offcn Partnership promise(s) that if I, my close relatives
and other related parties, such as companies, enterprises or
other economic organizations controlled by myself and my
close relatives / Offcn Partnership and its related parties, such
as other enterprises or economic organizations controlled by
Offcn Partnership obtain any business opportunities from any
third party, which can or may compete with the listed
Company and its affiliates in the future, I/Offcn Partnership
will notify the listed Company and its affiliates in writing
within 5 working days. After obtaining the third party ’ s
promise, I/Offcn Partnerhsip will attempt to transfer these
business opportunities to the listed Company and its affiliates.
4. I/Offcn Partnership guarantee(s) that I/Offcn Partnership
will never use my knowledge about and the information I’m
aware of the listed Company and its affiliates to assist any
third party to engage, participate, or invest in businesses or
projects that compete with the listed Company and its
affiliates.
If I/Offcn Partnership fail(s) to fulfill the above-mentioned
commitments, I/Offcn Partnership shall be liable for all losses
caused to the listed Company and its affiliates.
Li Yongxin,
Lu Zhongfang		 Letter of
Commitm
ent on
reducing
and
regulating
related-pa
rty
transactio
ns		 1. After the transaction is completed, during the time of being
the actual controller of the listed Company, I, my close
relatives and other companies, enterprises or other economic
organizations controlled by myself, my close relatives will try
to avoid and reduce the related-party transactions with the
listed Company and its affiliates; unless it is necessary for the
business
development
of
the
listed
Company,
any
related-party transactions with the listed Company and its
affiliates will not be conducted.
2. After the transaction is completed, for the related-party
transactions which are unavoidable or reasonable to happen
with the listed Company and its affiliates, I, my close relatives
and other companies, enterprises or economic organizations
controlled by myself and my close relatives, will sign
related-party transaction agreements with the listed Company
and its affiliates in accordance with the relevant laws,
regulations and regulatory documents and follow the general
business principles of equality, willingness, equivalence and
paid-use. The prices of related-party transactions shall be fair.
Decision-making procedures, lawful information disclosure
obligations and relevant reporting and approval procedures
regarding the related-party transactions, shall be followed.
The status of shareholders shall not be used to damage the
legitimate rights and interests of the listed Company and other
shareholders.
3. After the completion of the transaction, I will not use the
shareholders’ rights of the listed Company to manipulate or
instruct the listed Company or its directors, supervisors and
senior executives to make the listed Company provide or		 July 27,
2018		 Long-ter
m		 Under
normal
implement
ation

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23

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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accept funds, commodities, services or other assets under
inequal conditions or engage in any behaviors that would
damage the interests of the listed Company.
4. I will urge my close relatives and other companies,
enterprises or other economic organizations controlled by
myself and my close relatives to abide by the aforementioned
commitments.
5. If I, my close relatives and other companies, enterprises or
other economic organizations controlled by myself and my
close relatives violate the above commitments, the profits
obtained by the violation of commitments shall belong to the
listed Company, and I shall be liable for all losses caused to
the listed Company and its affiliates. Within 30 working days
since receiving the written notice from the listed Company,
compensation will be made in cash.
6. The commitments are valid from the date on which the
letter of commitment is signed to the time when I cease to be
the actual controller of Yaxia Auto and there is no other
related relationship with Yaxia Auto.
Wang
Zhendong,
Aerospace
Industry,
Offcn
Partnership		 Letter of
Commitm
ent on
reducing
and
regulating
related-pa
rty
transactio
ns		 1. After the completion of transaction, during the period of
being the actual controller/shareholder, I, my close relatives
and
other
companies,
enterprises
or
other
economic
organizations controlled by myself, my close relatives,
Aerospace Industry or Offcn Partnership, will try to avoid and
reduce the related-party transactions with the listed Company
and its affiliates.
2. After the completion of transaction, for the related-party
transactions which are unavoidable or reasonable to happen
with the listed Company and its affiliates, myself, my close
relatives and other companies, enterprises or economic
organizations controlled by myself and my close relatives,
Aerospace
Industry
or
Offcn
Partnership,
will
sign
related-party transaction agreements with the listed Company
and its affiliates in accordance with the relevant laws,
regulations and regulatory documents and follow the general
business principles of equality, willingness, equivalence and
paid-use. The prices of related-party transactions shall be fair.
Decision-making procedures, lawful information disclosure
obligations and relevant reporting and approval procedures
regarding the related-party transactions, shall be followed.
The status of shareholders shall not be used to damage the
legitimate rights and interests of the listed Company and other
shareholders.
3. After the completion of the transaction, I/Aerospace
Industry/Offcn Partnership will not use the shareholders ’
rights of the listed Company to manipulate or instruct the
listed Company or the directors, supervisors and senior
executives of the listed Company to make the listed Company
provide or accept funds, commodities, services or other assets
in different forms under unequal conditions or engage in any
behaviors that would damage the interests of the listed
Company.		 April 27,
2018		 Long-ter
m		 Under
normal
implement
ation

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24

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report I/Aerospace Industry/Offcn Partnership shall be liable for all losses caused to the listed Company and its affiliates due to my/Aerospace Industry ’ s/Offcn Partnership ’ s failures in fulfilling the aforementioned commitments. Whether the commitments Yes are fulfilled on schedule

Section IV. Financial assets investment

1. Securities investment

□Applicable √Not applicable

There was no securities investment during the reporting period.

2. Derivatives investment

□Applicable √Not applicable

There was no derivatives investment during the reporting period.

Section V. Progress of the funded investment project(s)

□Applicable √Not applicable

Section VI. Prediction on annual business performance of the year 2020

Alarm and explanations on that the cumulative net profit from the beginning of the year to the end of the next reporting period may be a loss or have a significant change compared with the same period of last year.

□Applicable √Not applicable

Section VII. Significant contracts of daily operations

□Applicable √Not applicable

Section VIII. Entrusted financing

√Applicable □Not applicable

Unit: 10 thousands RMB

Type Source of entrusted
financing		 Amount of entrusted
financing		 Unexpired balance Amount not recovered
after the due date
Bank financial
products		 Self-owned fund 730,064.8 395,326.1 0
Brokerage financial
products		 Self-owned fund 8,000 0 0
Trust financial Self-owned fund 519,953 27,000 0

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25

Offcn Education TechnologyCo.,Ltd. ThirdQuarter 2020 Report Offcn Education TechnologyCo.,Ltd. ThirdQuarter 2020 Report Offcn Education TechnologyCo.,Ltd. ThirdQuarter 2020 Report Offcn Education TechnologyCo.,Ltd. ThirdQuarter 2020 Report Offcn Education TechnologyCo.,Ltd. ThirdQuarter 2020 Report
products
Total
1,258,017.8
422,326.1
0
products
Total 1,258,017.8 422,326.1 0

Particulars of high-risk entrusted financial management with a large single amount, low security, poor liquidity or no capital protection

□ Applicable √ Not applicable

Entrusted financing is overdue and the principal cannot be recovered or there are other cases that may cause impairments.

  • Applicable √ Not applicable

Section IX. External guarantee violating regulations

  • Applicable √ Not applicable

There was no external guarantee violating regulations during the reporting period of the Company.

Section X. Capital of the listed Company used for non-operational purposes by the controlling shareholders or their related parties

□ Applicable √ Not applicable

There was no occupation of the Company’s capital by the controlling shareholders or their related parties for non-operating purposes during the reporting period of the Company.

Sction XI. Registration form(s) of activities including reception of research, communication or interviews during the reporting period

□ Applicable √ Not applicable

There was no reception of research, communication or interviews during the reporting period of the Company.

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26

Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Chapter IV. Financial Statements

Section I. Financial statements

1. Consolidated balance sheet

Company: Offcn Education Technology Co., Ltd.

September 30, 2020

Unit: RMB

Item September 30, 2020 December 31, 2019
Current Assets:
Cash and cash equivalents 5,069,423,730.49 2,724,335,001.58
Settlement reserve
Due from banks and other
financial institutions
Financial assets held for trading 4,123,307,227.54 1,754,396,227.54
Derivative Financial assets
Notes Receivable
Accounts Receivable 20,252,907.35 2,721,638.09
Financing receivables
Prepayments 5,734,527.16 2,461,009.00
Premium receivable
Reinsurance premium receivable
Reserve receivable for
reinsurance
Other receivables 276,857,922.57 255,013,296.96
Inc: Interest receivables 5,104,477.73 567,341.68
Dividends receivables
Financial assets purchased under
resale agreements
Inventories
Contract assets
Held-for-sale assets
Non-current assets due within
one year		 1,959,426,969.04
Other current assets 179,404,189.50 97,336,600.16

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Total current assets 11,634,407,473.65 4,836,263,773.33
Non-current assets:
Loans and advances
Debt investments 20,000,000.00 1,923,598,909.09
Other debt investments
Long-term receivables
Long-term equity investments
Other equity instruments 162,800,000.00 162,800,000.00
Other non-current financial
assets		 138,166,559.96 138,166,559.96
Investment properties 673,644,955.82 688,475,053.53
Fixed assets 866,069,135.46 672,429,601.44
Construction in progress 838,185,436.29 653,580,160.32
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets 192,463,617.08 197,507,227.40
Development expenditure
Goodwill 99,867,720.38 99,867,720.38
Long-term prepaid expenses 213,978,303.65 240,565,962.02
Deferred tax assets 11,310,880.26 21,482,832.13
Other non-current assets 500,359,990.69 325,967,628.34
Total Non-current Assets 3,716,846,599.59 5,124,441,654.61
Total Assets 15,351,254,073.24 9,960,705,427.94
Current liabilities:
Short-term borrowings 3,228,000,000.00 2,867,000,000.00
Borrowings from central bank
Placement from banks and other
financial institutions
Financial liabilities held for
trading
Derivative Financial liabilities
Notes payable
Accounts payable 124,596,162.88 236,481,990.86
Receipts in advance 2,634,276,203.88

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

Contract liabilities 7,410,923,947.05
Financial assets sold under
repurchase agreements
Absorbing deposit and deposit in
inter-bank market
Customer deposits for trading in
securities
Amounts due to issuer for
securities underwriting
Employee benefits payable 602,771,357.67 411,475,636.03
Taxes payable 253,433,295.83 184,306,027.84
Other payables 105,020,152.13 88,693,411.98
Inc: Interest payables 14,224,814.22 4,521,557.54
Dividends payables
Fees and commissions payable
Reinsurance amounts payable
Held-for-sale liabilities
Non-current liabilities due
within one year
Other current liabilities 222,327,718.41
Total Current Liabilities 11,947,072,633.97 6,422,233,270.59
Non-current Liabilities:
Deposits for insurance contracts
Long-term borrowings
Bonds payable
Inc: preferred share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee benefits
payable
Provisions
Deferred Income
Deferred tax liabilities 105,031,118.33 106,932,273.03
Other non-current liabilities
Total non-current liabilities 105,031,118.33 106,932,273.03

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

Total liabilities 12,052,103,752.30 6,529,165,543.62
Owners' equity:
Share capital 103,807,623.00 103,807,623.00
Other equity instrument
Inc: preferred share
Perpetual bond
Capital reserve 1,225,481,049.50 1,198,581,049.50
Less: Treasury stock
Other comprehensive income 37,500,000.00 37,500,000.00
Special reserve
Surplus reserve 45,000,000.00 45,000,000.00
General risk reserve
Retained earnings 1,887,374,888.29 2,046,657,231.32
Total owners'equity attributable to
parent company		 3,299,163,560.79 3,431,545,903.82
Minority interests -13,239.85 -6,019.50
Total owners’ equity 3,299,150,320.94 3,431,539,884.32
Total liabilities and owners’ equity 15,351,254,073.24 9,960,705,427.94

Legal representative: Wang Zhendong Person in charge of accounting work: Shi Lei Head of the accounting department: Luo Xue

2. Balance sheet of the parent company

Unit: RMB

Item September 30, 2020 December 31, 2019
Current Assets:
Cash and cash equivalents 5,766,823.16 6,931,803.33
Financial assets held for trading 1,601,681.64 101,681.64
Derivative financial assets
Notes receivable
Accounts receivable 10,887,569.17
Financing receivables
Prepayments
Other receivables 677,572,345.68 1,717,949,520.99
Inc: interest receivables
Dividends receivables 1,700,000,000.00
Inventories

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

Contract assets
Held-for-sale assets
Non-current assets due within
one year
Other current assets 930,179.30
Total current assets 696,758,598.95 1,724,983,005.96
Non-current assets:
Debt investments
Other debt investments
Long-term receivables
Long-term equity investments 18,582,307,907.14 18,582,307,907.14
Other equity instruments 162,800,000.00 162,800,000.00
Other non-current financial
assets
Investment properties 387,476,257.91 395,978,156.15
Fixed assets
Construction in progress 372,569,103.57 72,569,103.57
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets
Development expenditure
Goodwill
Long-term prepaid expenses
Deferred tax assets 10,948,186.11 10,804,928.62
Other non-current assets
Total non-current assets 19,516,101,454.73 19,224,460,095.48
Total assets 20,212,860,053.68 20,949,443,101.44
Current liabilities:
Short-term borrowings 800,000,000.00
Financial liabilities held for
trading
Derivative Financial liabilities
Notes payable
Accounts payable 561,752.26 561,752.26

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Receipts in advance
Contract liabilities
Employee benefits payable
Taxes payable 1,190,410.34 791,191.77
Other payables 7,652,009.31 40,275,566.88
Inc: Interest payables 957,000.00
Dividends payables
Held-for-sale liabilities
Non-current liabilities due
within one year
Other current liabilities
Total current liabilities 809,404,171.91 41,628,510.91
Non-current liabilities:
Long-term borrowings
Bonds payable
Inc: preferred share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee benefits
payable
Provisions
Deferred income
Deferred tax liabilities 12,500,420.41 12,500,420.41
Other non-current liabilities
Total non-current liabilities 12,500,420.41 12,500,420.41
Total liabilities 821,904,592.32 54,128,931.32
Owners’ equity:
Share capital 6,167,399,389.00 6,167,399,389.00
Other equity instrument
Inc: preferred share
Perpetual bond
Capital reserve 12,775,326,370.33 12,775,326,370.33
Less: Treasury stock
Other comprehensive income 37,500,000.00 37,500,000.00

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Special reserve
Surplus reserve 387,458,806.65 387,458,806.65
Retained earnings 23,270,895.38 1,527,629,604.14
Total owners’ equity 19,390,955,461.36 20,895,314,170.12
Total liabilities and owners’ equity 20,212,860,053.68 20,949,443,101.44

3. Consolidated profit statement for the reporting period

Unit: RMB

Item Amount for the current period Amount for the previous period
I.Total revenue 4,630,989,349.21 2,521,688,418.01
Inc: Revenue 4,630,989,349.21 2,521,688,418.01
Interest income
Insurance gained
Fee and commission income
II. Total operating costs 3,019,768,100.60 2,042,255,143.77
Inc: Cost of revenue 1,619,290,590.57 1,065,755,848.75
Interest expenses
Fee and commission expenses
Cash surrender value
Net amount of expense of compensation
Net amount of withdrawal of insurance
contract reserve
Bonus expense of guarantee slip
Reinsurance expenses
Taxes and surcharges 3,555,293.06 11,363,875.26
Selling and marketing 577,293,364.56 405,619,023.15
General and administrative expenses 383,190,228.80 328,939,780.61
Research and development expenses 272,338,825.62 207,753,576.34
Financial expenses 164,099,797.99 22,823,039.66
Inc:Interest expenses 43,003,356.67 27,288,799.46
Interest income 9,009,075.02 20,145,598.82
Add: Other income 136,961,906.40 269,801.65
Investment income (Losses are indicated
by "-")		 58,777,147.46 72,781,468.62
Inc: Income from investments in associates

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Offcn Education Technology Co.,Ltd. ThirdQuarter 2020 Report
and joint ventures
The termination of income
recognition for financial assets
measured by amortized cost (Loss is
indicated by “-”)
Exchange income (Loss is indicated by
“-”)
Net exposure hedging income (Loss is
indicated by “-”)
Gains from changes in fair values (Loss is
indicated by "-")
Impairment losses of creditability (Loss is
indicated by "-")		 -612,214.97
Impairment losses of assets (Loss is
indicated by "-")
Income from assets disposal (Loss is
indicated by "-")		 -16,145.38
III. Operating profit (Loss is indicated by "-") 1,806,348,087.50 552,468,399.13
Add: Non-operating income 1,255,543.92
Less: Non-operating expenses 363,846.30 1.02
IV. Total profit (Total Loss is indicated by "-") 1,805,984,241.20 553,723,942.03
Less: Income tax expenses 252,065,622.62 87,887,105.17
V. Net profit (Net loss is indicated by "-") 1,553,918,618.58 465,836,836.86
1. Classified by continuing/discontinuing
operation
(1) Net profit from continuing operations (Net
loss is indicated by "-")		 1,553,918,618.58 465,836,836.86
(2) Net profit from discontinued operations
(Net loss is indicated by"-")
2. Classified by ownership
(1) Net profit attributable to owners of the
Company		 1,553,920,155.49 465,837,656.14
(2) Minority shareholders’ gains and losses -1,536.91 -819.28
VI:Other comprehensive income after tax
Net other comprehensive income after tax
attributable to controlling interest
1. Other comprehensive income not reclassified
into gains or losses

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Offcn Education Technology Co.,Ltd. ThirdQuarter 2020 Report
(1) Changes of the defined benefit plans
that re-measured
(2) Under the equity method, the share
of other comprehensive income not
reclassified into gains or losses
(3) Changes in the fair value of other
equity instruments
(4) Change in fair value of the
enterprise’s own credit risk
(5) Others
2. Other comprehensive income classified into
gains or losses
(1) Under the equity method, the share
of other comprehensive income which
can be reclassified into gains or losses
(2) Changes in the fair value of other
debt instruments
(3) Amount of financial assets
reclassified to other comprehensive
income
(4) Credit impairment provision for
other debt investment
(5) Cash flow hedging reserve
(6) Conversion difference of foreign
currency financial statements
(7) Others
Net after-tax of other comprehensive income
attributable to minority shareholders
VII. Total comprehensive income 1,553,918,618.58 465,836,836.86
Total comprehensive income attributable to
owners of the Company		 1,553,920,155.49 465,837,656.14
Total comprehensive income attributable to
minority interests		 -1,536.91 -819.28
VIII. Earnings per share
1. Basic earnings per share 0.25 0.08
2. Diluted earnings per share 0.25 0.08

If a business combination under the same control occurs in this period, the net profit realized by the combined party before the

combination is RMB 0.00 and in the previous period is RMB 0.00.

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Legal representative: Wang Zhendong

Person in charge of accounting: Shi Lei Head of the accounting department: Luo Xue

4. Profit statement of the parent company for the reporting period

Unit: RMB

Item Amount for the current period Amount for the previous period
I. Revenue 3,638,285.45 3,638,285.43
Less: Cost of revenue 2,833,966.13 2,831,674.88
Taxes and surcharges 1,043,887.94 1,073,115.58
Selling and marketing
General and administrative expenses 340,832.27 848,474.90
Research and development expenses
Financial expenses 9,781,325.12 960.04
Inc:Interest expenses 9,782,666.66
Interest income 89,668.69 310.46
Add: Other income
Investment income (Loss is indicated by
"-")		 249,600.00
Inc: Income from investments in
associates and joint ventures
The termination of income
recognition for financial assets
measured by amortized cost(Loss is
indicated by “-”)
Net exposure hedging income (Loss is
indicated by “-”)
Gains from changes in fair values (Loss is
indicated by "-")
Impairment losses of creditability (Loss is
indicated by "-")		 -191,009.99
Impairment losses of assets(Loss is
indicated by "-")
Income from assets disposal (Loss is
indicated by “-”)
II. Operating profit (Loss is indicated by "-") -10,303,136.00 -1,115,939.97
Add: Non-operating income
Less: Non-operating expenses

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Offcn Education Technology Co.,Ltd. ThirdQuarter 2020 Report
III. Total profit (Total loss is indicated by "-") -10,303,136.00 -1,115,939.97
Less: Income tax expenses -47,752.50
IV. Net profit (Net loss is indicated by "-") -10,255,383.50 -1,115,939.97
1. Net profit from continuing operations (Net
loss is indicated by "-")		 -10,255,383.50 -1,115,939.97
2. Net profit from discontinued operations (Net
loss is indicated by"-")
V. Other comprehensive income after tax
1. Other comprehensive income not reclassified
into gains or losses
(1) Changes of the defined benefit
plans that re-measured
(2) Under the equity method, the share
of other comprehensive income not
reclassified into gains or losses
(3) Changes in the fair value of other
equity instruments
(4) Change in fair value of the
enterprise’s own credit risk
(5) Others
2. Other comprehensive income classified into
gains or losses
(1) Under the equity method, the share
of other comprehensive income which
can be reclassified into gains or losses
(2) Changes in the fair value of other
debt instruments
(3) Amount of financial assets
reclassified to other comprehensive
income
(4) Credit impairment provision for
other debt investment
(5) Cash flow hedging reserve
(6) Conversion difference of foreign
currency financial statements
(7) Others
VI. Total comprehensive income -10,255,383.50 -1,115,939.97
VII. Earnings per share

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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  1. Basic earnings per share 2. Diluted earnings per share

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5. Consolidated profit statement (from beginning of the year to end of the reporting period)

Unit: RMB

Item Amount for the current period Amount for the previous period
I.Total revenue 7,438,969,829.81 6,159,107,933.49
Inc: Revenue 7,438,969,829.81 6,159,107,933.49
Interest income
Insurance gained
Fee and commission income
II. Total operating costs 6,264,315,976.76 5,140,860,641.89
Inc: Cost of revenue 3,071,901,770.96 2,611,044,308.31
Interest expenses
Fee and commission expenses
Cash surrender value
Net amount of expense of
compensation
Net amount of withdrawal of
insurance contract reserve
Bonus expense of guarantee slip
Reinsurance expenses
Taxes and surcharges 9,832,926.10 43,197,122.47
Selling and marketing 1,278,110,818.48 1,080,932,122.44
General and administrative expenses 902,149,682.94 828,570,826.52
Research and development expenses 655,566,356.63 511,783,733.85
Financial expenses 346,754,421.65 65,332,528.30
Inc:Interest expenses 128,133,368.78 74,213,689.89
Interest income 11,898,982.50 57,868,274.95
Add: Other income 221,416,613.84 500,478.07
Investment income (Loss is indicated
by "-")		 187,595,273.90 126,753,395.24
Inc: Income from investments in
associates and joint ventures
The termination of income

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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recognition for financial assets
measured by amortized cost(Loss
is indicated by “-”)
Exchange income (Loss is indicated by
“-”)
Net exposure hedging income (Loss is
indicated by "-")
Gains from changes in fair values
(Loss is indicated by "-")
Impairment losses of creditability
(Loss is indicated by "-")		 -1,382,976.76
Impairment losses of assets (Loss is
indicated by "-")
Income from assets disposal (Loss is
indicated by "-")		 162,043.59 182,662.36
III. Operating profit (Loss is indicated by "-") 1,582,444,807.62 1,145,683,827.27
Add: Non-operating income 20,148.00 2,820,715.78
Less: Non-operating expenses 457,348.58 82,997.55
IV. Total profit (Total Loss is indicated by "-") 1,582,007,607.04 1,148,421,545.50
Less: Income tax expenses 261,121,317.06 189,559,243.49
V. Net profit (Net loss is indicated by "-") 1,320,886,289.98 958,862,302.01
1. Classified by continuing/discontinuing
operation
(1) Net profit from continuing operations
(Net loss is indicated by "-")		 1,320,886,289.98 958,862,302.01
(2) Net profit from discontinued operations
(Net loss is indicated by"-")
2. Classified by ownership
(1) Net profit attributable to owners of the
Company		 1,320,893,510.33 958,863,121.29
(2) Minority shareholders’ gains and losses -7,220.35 -819.28
VI:Other comprehensive income after tax
Net other comprehensive income after tax
attributable to controlling interest
1. Other comprehensive income not
reclassified into gains or losses
(1) Changes of the defined benefit
plans that re-measured

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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(2) Under the equity method, the
share of other comprehensive
income not reclassified into gains or
losses
(3) Changes in the fair value of
other equity instruments
(4) Change in fair value of the
enterprise’s own credit risk
(5) Others
2. Other comprehensive income classified
into gains or losses
(1) Under the equity method, the
share of other comprehensive
income which can be reclassified
into gains or losses
(2) Changes in the fair value of
other debt instruments
(3) Amount of financial assets
reclassified to other comprehensive
income
(4) Credit impairment provision for
other debt investment
(5) Cash flow hedging reserve
(6) Conversion difference of foreign
currency financial statements
(7) Others
Net after-tax of other comprehensive income
attributable to minority shareholders
VII. Total comprehensive income 1,320,886,289.98 958,862,302.01
Total comprehensive income attributable to
owners of the Company		 1,320,893,510.33 958,863,121.29
Total comprehensive income attributable to
minority interests		 -7,220.35 -819.28
VIII. Earnings per share
(1) Basic earnings per share 0.21 0.16
(2) Diluted earnings per share 0.21 0.16

If a business combination under the same control occurs in this period, the net profit realized by the combined party before the

combination is RMB 0.00 and in the previous period is RMB 0.00.

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Legal representative: Wang Zhendong Person in charge of accounting: Shi Lei Head of the accounting department: Luo Xue

6. Profit statement of the parent company (from the beginning of the year to end of the reporting period)

Unit: RMB

Item Amount for the current period Amount for the previous period
I. Revenue 10,914,856.31 10,914,856.29
Less: Cost of revenue 8,501,898.24 8,500,488.23
Taxes and surcharges 3,164,729.29 17,475,546.28
Selling and marketing
General and administrative expenses 3,271,489.33 12,769,860.71
Research and development expenses
Financial expenses 20,454,223.42 1,080.25
Inc:Interest expenses 20,486,445.83
Interest income 46,061.41 2,581.24
Add: Other income 474,801.04
Investment income (Loss is indicated
by "-")		 249,600.00 30,534.61
Inc: Income from investments in
associates and joint ventures
The termination of income
recognition for financial assets
measured by amortized cost(Loss
is indicated by "-")
Net exposure hedging income (Loss is
indicated by "-")
Gains from changes in fair values
(Loss is indicated by "-")
Impairment losses of creditability
(Loss is indicated by "-")		 -573,029.96
Impairment losses of assets (Loss is
indicated by "-")
Income from assets disposal (Loss is
indicated by "-")
II. Operating profit (Loss is indicated by "-") -24,326,112.89 -27,801,584.57
Add: Non-operating income
Less: Non-operating expenses

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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III. Total profit (Total loss is indicated by "-") -24,326,112.89 -27,801,584.57
Less: Income tax expenses -143,257.49
IV. Net profit (Net loss is indicated by "-") -24,182,855.40 -27,801,584.57
(1) Net profit from continuing operations
(Net loss is indicated by "-")		 -24,182,855.40 -27,801,584.57
(2) Net profit from discontinued operations
(Net loss is indicated by"-")
V. Other comprehensive income after tax
1. Other comprehensive income not
reclassified into gains or losses
(1) Changes of the defined benefit
plans that re-measured
(2) Under the equity method, the
share of other comprehensive
income not reclassified into gains or
losses
(3) Changes in the fair value of
other equity instruments
(4) Change in fair value of the
enterprise’s own credit risk
(5) Others
2. Other comprehensive income classified
into gains or losses
(1) Under the equity method, the
share of other comprehensive
income which can be reclassified
into gains or losses
(2) Changes in the fair value of
other debt instruments
(3) Amount of financial assets
reclassified to other comprehensive
income
(4) Credit impairment provision for
other debt investment
(5) Cash flow hedging reserve
(6) Conversion difference of
foreign currency financial
statements

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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(7) Others
VI. Total comprehensive income -24,182,855.40 -27,801,584.57
VII. Earnings per share
1. Basic earnings per share
2. Diluted earnings per share

7. Consolidated cash flow statement (from beginning of the year to end of the reporting period)

Unit: RMB

Item Amount for the current period Amount for the previous period
I. Cash flows from operating activities:
Cash receipts from the sale of goods and the
rendering of services		 12,630,977,793.14 8,330,180,757.44
Net increase in customer bank deposits and
due to banks and other financial institutions
Net increase in borrowings from central
bank
Net increase in placements from other
financial institutions
Premiums received from original insurance
contracts
Net cash received from reinsurance
Net increase in deposits from policyholders
Cash received from interests,fees and
commissions
Net increase in placements from banks and
other financial institutions
Net increase in repurchase business capital
Net cash from acting trading securities
Tax rebates received
Cash received relating to other operating
activities		 246,310,360.72 2,290,953.16
Sub-total of cash inflows from operating
activities		 12,877,288,153.86 8,332,471,710.60
Cash payments for goods purchased and
services received		 1,241,258,102.15 1,232,423,568.58
Net increase in loans and advances to

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

customers
Net increase in deposits with central bank
and other financial institutions
Original insurance contract claims paid
Net increase in loans to banks and other
financial institutions
Cash paid for interest, fee and commission
Cash paid as policy dividend
Cash paid to and for employees 3,833,750,101.55 2,877,043,972.46
Cash paid for all types of taxes 200,151,843.84 424,466,382.02
Cash paid relating to other operating
activities		 884,298,006.27 755,878,077.76
Sub-total of cash outflows from operating
activities		 6,159,458,053.81 5,289,812,000.82
Net cash flow from operating activities 6,717,830,100.05 3,042,659,709.78
II. Cash flows from investing activities:
Cash receipts from disposals and recovery
of investments		 25,895,487,090.00 18,199,290,000.00
Cash receipts from investment income 132,306,688.95 135,682,859.12
Net cash receipts from disposals of fixed
assets, intangible assets and other long-term
assets		 162,043.59
Net cash receipts from disposals of
subsidiaries and other business units
Cash received relating to other investing
activities
Sub-total of cash inflows from investing
activities		 26,027,955,822.54 18,334,972,859.12
Cash payments to acquire or construct fixed
assets, intangible assets and other long-term
assets		 897,559,659.37 516,034,598.11
Cash paid for investment 28,265,198,090.00 19,445,620,000.00
Net increase in pledged loans receivables
Net cash payments for acquisitions of
subsidiaries and other business units
Cash paid relating to other investing
activities

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Sub-total of cash outflows from investing
activities		 29,162,757,749.37 19,961,654,598.11
Net cash flow from investing activities -3,134,801,926.83 -1,626,681,738.99
III. Cash flows from financing activities:
Cash received from investors
Inc: cash receipts from capital contributions
from minority owners of subsidiaries
Cash from borrowings 3,002,000,000.00 986,698,800.00
Cash received relating to other financing
activities
Sub-total of cash inflows from financing
activities		 3,002,000,000.00 986,698,800.00
Cash repayments of borrowings 2,641,000,000.00 496,698,800.00
Cash payments for distribution of dividends
or profits or settlement of interest expenses		 1,598,605,965.46 1,475,449,057.25
Inc: payments for distribution of dividends
or profits to minority owners of subsidiaries
Cash paid relating to other financing
activities		 333,478.85 320,723.05
Sub-total of cash outflows from financing
activities		 4,239,939,444.31 1,972,468,580.30
Net cash flow from financing activities -1,237,939,444.31 -985,769,780.30
IV. Effect of foreign exchange rate changes on
cash and cash equivalents
V. Net increase in cash and cash equivalents 2,345,088,728.91 430,208,190.49
Add: Initial cash and cash equivalents
balance		 2,724,335,001.58 648,711,545.32
VI. The final cash and cash equivalents balance 5,069,423,730.49 1,078,919,735.81

8. Cash flow statement of the parent company (from beginning of the year to end of the reporting period)

Unit: RMB

Item Amount for the current period Amount for the previous period
I. Cash flows from operating activities:
Cash receipts from the sale of goods and the
rendering of services
Tax rebates received

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Cash received relating to other operating
activities		 1,765,726.02 544,070,513.56
Sub-total of cash inflows from operating
activities		 1,765,726.02 544,070,513.56
Cash payments for goods purchased and
services received
Cash paid to and for employees 895,723.48
Cash paid for all types of taxes 4,063,237.82 20,718,284.89
Cash paid relating to other operating
activities		 697,578,290.33 105,180,989.65
Sub-total of cash outflows from operating
activities		 701,641,528.15 126,794,998.02
Net cash flow from operating activities -699,875,802.13 417,275,515.54
II. Cash flows from investing activities:
Cash receipts from disposals and recovery of
investments		 23,960,000.00
Cash receipts from investment income 1,700,249,600.00 1,550,030,534.61
Net cash receipts from disposals of fixed
assets, intangible assets and other long-term
assets
Net cash receipts from disposals of
subsidiaries and other business units
Cash received relating to other investing
activities
Sub-total of cash inflows from investing activities 1,700,249,600.00 1,573,990,534.61
Cash payments to acquire or construct fixed
assets, intangible assets and other long-term
assets		 300,000,000.00 11,929,500.00
Cash paid for investment 1,500,000.00 24,060,000.00
Net cash payments for acquisitions of
subsidiaries and other business units
Cash paid relating to other investing
activities
Sub-total of cash outflows from investing
activities		 301,500,000.00 35,989,500.00
Net cash flow from investing activities 1,398,749,600.00 1,538,001,034.61
III. Cash flows from financing activities:
Cash received from investors

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

Cash from borrowings 800,000,000.00
Cash received relating to other financing
activities
Sub-total of cash inflows from financing
activities		 800,000,000.00
Cash repayments of borrowings 216,000,000.00
Cash payments for distribution of dividends
or profits or settlement of interest expenses		 1,499,705,299.19 1,738,432,883.87
Cash paid relating to other financing
activities		 333,478.85 1,503,370.80
Sub-total of cash outflows from financing
activities		 1,500,038,778.04 1,955,936,254.67
Net cash flow from financing activities -700,038,778.04 -1,955,936,254.67
IV. Effect of foreign exchange rate changes on
cash and cash equivalents
V. Net increase in cash and cash equivalents -1,164,980.17 -659,704.52
Add: Initial cash and cash equivalents
balance		 6,931,803.33 5,304,519.61
VI. The final cash and cash equivalents balance 5,766,823.16 4,644,815.09

Section II. Explanation on the adjustments to the financial statements

1. Adjustments to the financial statements at the beginning of the first execution year of the new standards governing income and lease since 2020

√ Applicable □ Not applicable

Whether items listed in the consolidated balance sheet at beginning of the year need to be adjusted

√ Yes □ No

Consolidated Balance Sheet

Unit: RMB

Item December 31, 2019 January 1, 2020 Adjustments
Current Assets:
Cash and cash equivalents 2,724,335,001.58 2,724,335,001.58
Settlement reserve
Due from banks and other
financial institutions

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

Financial assets held for
trading		 1,754,396,227.54 1,754,396,227.54
Derivative Financial assets
Notes Receivable
Accounts Receivable 2,721,638.09 2,721,638.09
Financing receivables
Prepayments 2,461,009.00 2,461,009.00
Premium receivable
Reinsurance premium
receivable
Reserve receivable for
reinsurance
Other receivables 255,013,296.96 255,013,296.96
Inc: Interest receivables 567,341.68 567,341.68
Dividends
receivables
Financial assets purchased
under resale agreements
Inventories
Contract assets
Held-for-sale assets
Non-current assets due
within one year
Other current assets 97,336,600.16 97,336,600.16
Total current assets 4,836,263,773.33 4,836,263,773.33
Non-current assets:
Loans and advances
Debt investments 1,923,598,909.09 1,923,598,909.09
Other debt investments
Long-term receivables
Long-term equity
investments
Other equity instruments 162,800,000.00 162,800,000.00
Other non-current financial
assets		 138,166,559.96 138,166,559.96
Investment properties 688,475,053.53 688,475,053.53

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Fixed assets 672,429,601.44 672,429,601.44
Construction in progress 653,580,160.32 653,580,160.32
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets 197,507,227.40 197,507,227.40
Development expenditure
Goodwill 99,867,720.38 99,867,720.38
Long-term prepaid
expenses		 240,565,962.02 240,565,962.02
Deferred tax assets 21,482,832.13 21,482,832.13
Other non-current assets 325,967,628.34 325,967,628.34
Total non-current assets 5,124,441,654.61 5,124,441,654.61
Total assets 9,960,705,427.94 9,960,705,427.94
Current liabilities:
Short-term borrowings 2,867,000,000.00 2,867,000,000.00
Borrowings from central
bank
Placement from banks and
other financial institutions
Financial liabilities held for
trading
Derivative Financial
liabilities
Notes payable
Accounts payable 236,481,990.86 236,481,990.86
Receipts in advance 2,634,276,203.88 -2,634,276,203.88
Contract liabilities 2,557,549,712.50 2,557,549,712.50
Financial assets sold under
repurchase agreements
Absorbing deposit and
deposit in inter-bank
market
Customer deposits for
trading in securities
Amounts due to issuer for

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

securities underwriting
Employee benefits payable 411,475,636.03 411,475,636.03
Taxes payable 184,306,027.84 184,306,027.84
Other payables 88,693,411.98 88,693,411.98
Inc: Interest payables 4,521,557.54 4,521,557.54
Dividends
payables
Fees and commissions
payable
Reinsurance amounts
payable
Held-for-sale liabilities
Non-current liabilities due
within one year
Other current liabilities 76,726,491.38 76,726,491.38
Total current liabilities 6,422,233,270.59 6,422,233,270.59
Non-current liabilities:
Deposits for insurance
contracts
Long-term borrowings
Bonds payable
Inc: preferred share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee
benefits payable
Provisions
Deferred Income
Deferred tax liabilities 106,932,273.03 106,932,273.03
Other non-current liabilities
Total non-current liabilities 106,932,273.03 106,932,273.03
Total liabilities 6,529,165,543.62 6,529,165,543.62
Owners' equity:
Share capital 103,807,623.00 103,807,623.00
Other equity instrument

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

Inc: preferred share
Perpetual bond
Capital reserve 1,198,581,049.50 1,198,581,049.50
Less: Treasury stock
Other comprehensive
income		 37,500,000.00 37,500,000.00
Special reserve
Surplus reserve 45,000,000.00 45,000,000.00
General risk reserve
Retained earnings 2,046,657,231.32 2,046,657,231.32
Total owners'equity attributable
to parent company		 3,431,545,903.82 3,431,545,903.82
Minority interests -6,019.50 -6,019.50
Total owners’ equity 3,431,539,884.32 3,431,539,884.32
Total liabilities and owners’
equity		 9,960,705,427.94 9,960,705,427.94

Explanation on the adjustments

Part of the item “receipts in advance” is adjusted to the item “contract liabilities” in accordance with the new revenue standard.

Balance sheet of the parent company

Unit: RMB

Item December 31, 2019 January 1, 2020 Adjustments
Current Assets:
Cash and cash equivalents 6,931,803.33 6,931,803.33
Financial assets held for
trading		 101,681.64 101,681.64
Derivative financial assets
Notes receivable
Accounts receivable
Financing receivables
Prepayments
Other receivables 1,717,949,520.99 1,717,949,520.99
Inc: interest receivables
Dividends
receivables		 1,700,000,000.00 1,700,000,000.00
Inventories

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

Contract assets
Held-for-sale assets
Non-current assets due
within one year
Other current assets
Total current assets 1,724,983,005.96 1,724,983,005.96
Non-current assets:
Debt investments
Other debt investments
Long-term receivables
Long-term equity
investments		 18,582,307,907.14 18,582,307,907.14
Other equity instruments 162,800,000.00 162,800,000.00
Other non-current
financial assets
Investment properties 395,978,156.15 395,978,156.15
Fixed assets
Construction in progress 72,569,103.57 72,569,103.57
Bearer biological assets
Oil and gas assets
Right-of-use assets
Intangible assets
Development expenditure
Goodwill
Long-term prepaid
expenses
Deferred tax assets 10,804,928.62 10,804,928.62
Other non-current assets
Total non-current assets 19,224,460,095.48 19,224,460,095.48
Total assets 20,949,443,101.44 20,949,443,101.44
Current liabilities:
Short-term borrowings
Financial liabilities held for
trading
Derivative financial

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

liabilities
Notes payable
Accounts payable 561,752.26 561,752.26
Receipts in advance
Contract liabilities
Employee benefits payable
Taxes payable 791,191.77 791,191.77
Other payables 40,275,566.88 40,275,566.88
Inc: Interest payables
Dividends
payables
Held-for-sale liabilities
Non-current liabilities due
within one year
Other current liabilities
Total current liabilities 41,628,510.91 41,628,510.91
Non-current liabilities:
Long-term borrowings
Bonds payable
Inc: preferred share
Perpetual bond
Lease liabilities
Long-term payables
Long-term employee
benefits payable
Provisions
Deferred Income
Deferred tax liabilities 12,500,420.41 12,500,420.41
Other non-current liabilities
Total non-current liabilities 12,500,420.41 12,500,420.41
Total liabilities 54,128,931.32 54,128,931.32
Owners’ equity:
Share capital 6,167,399,389.00 6,167,399,389.00
Other equity instrument
Inc: preferred share

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Offcn Education Technology Co., Ltd. Third Quarter 2020 Report

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Perpetual bond
Capital reserve 12,775,326,370.33 12,775,326,370.33
Less: Treasury stock
Other comprehensive
income		 37,500,000.00 37,500,000.00
Special reserve
Surplus reserve 387,458,806.65 387,458,806.65
Retained earnings 1,527,629,604.14 1,527,629,604.14
Total owners’ equity 20,895,314,170.12 20,895,314,170.12
Total liabilities and owners’
equity		 20,949,443,101.44 20,949,443,101.44

2. Description of retroactive adjustment of comparative data in the early stage by the new revenue standard and the new lease standard initially implemented since 2020

□Applicable √Not Applicable

Section III. Auditor’s report

Whether this Third Quarter 2020 Report has been audited

□Yes √No

The Company’s Third Quarter 2020 Report has not been audited.

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