Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Zhejiang Dahua Technology Co., Ltd.
2018 Third Quarterly Report
October 2018
1
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Section I Important Notes
The Board of Directors, Board of Supervisors, Directors, Supervisors and
Senior Management of Zhejiang Dahua Technology Co., Ltd. (hereinafter
referred to as the “Company”) hereby guarantee that the information presented
in this report is authentic, accurate and complete and free of any false records,
misleading statements or material omissions, and they will bear joint and several
legal liability for such information.
All directors attended the meeting of the Board of Directors for deliberation
of this quarterly report.
Fu Liquan, the Company’s legal representative, Wei Meizhong, chief
accountant, and Xu Qiaofen, person in charge of accounting institution
(Accounting Officer) hereby declare and warrant that the financial statements in
the quarterly report are authentic, accurate and complete.
2
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Section II. Basic Information of the Company
I. Key Accounting Data and Financial Indicators
Does the Company need to retroactively adjust or restate the annual accounting data of previous years?
□ Yes √ No
Increase or Decrease at This
The End of the Reporting
The End of the Previous Year Period-end Compared to the
Period
End of the Previous Year
Total Assets (RMB) 23,415,201,556.89 21,333,478,563.97 9.76%
Net Assets Attributable to Shareholders
11,447,836,224.25 10,466,434,375.19 9.38%
of the Listed Company (RMB)
Increase or Decrease
Increase or during the Period
Decrease in This From the from the
During this Reporting Reporting Period Year-beginning to the Year-beginning to the
Period Compared to the End of this Reporting End of the Reporting
Same Period of Period Period Compared to
Last year the Same Period of
Last Year
Operating Revenue (RMB) 5,216,687,713.72 22.50% 15,030,729,066.20 28.21%
Net Profit Attributable to Shareholders
481,764,501.06 4.39% 1,563,681,387.58 8.25%
of the Listed Company (RMB)
Net Profit Attributable to Shareholders
of the Listed Company after Deducting 515,756,982.03 14.65% 1,623,241,371.03 14.28%
Non-recurring Gains and Losses (RMB)
Net Cash Flow Generated by
-570,615,032.53 -159.03% -1,666,971,869.53 -46.01%
Operational Activities (RMB)
Basic Earnings per Share (RMB/Share) 0.17 6.25% 0.54 8.00%
Diluted Earnings per Share
0.17 6.25% 0.54 8.00%
(RMB/Share)
Weighted Average ROE 4.30% -0.66% 14.23% -2.01%
Items and Amounts of Non-recurring Gains and Losses
√Applicable □ Not applicable
Unit: RMB
Item Name Amount Note
Profits or Losses from Disposal of Non-Current Assets (Including the -351,393.89
3
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Write-Off for the Accrued Impairment of Assets)
The Government Subsidies Included in the Current Profits and Losses
(Excluding the Government Subsidies Closely Related to Regular
19,477,949.01
Businesses of the Company and Issued in the Quota or Quantity Based on
the National Standards
Profits and Losses Resulting from the Changes in Fair Value for Holding
Trading Financial Assets and Trading Financial Liabilities, and Investment
Income from Disposal of Trading Financial Assets, Trading Financial
-85,492,039.35
Liabilities, and Financial Assets Available for Trading, Excluding the
Effective Hedging Businesses Related to the Regular Business Operation of
the Company
Non-operating Revenue and Expenses Other Than the Above 11,432,160.49
Other Gains and Losses Items That Fit the Definition of Non-recurring
733,001.58
Gains and Losses
Less: Impact of Income Tax 4,132,626.03
Impact of Minority Equity (After Tax) 1,227,035.26
Total -59,559,983.45 --
For items defined as non-recurring gains and losses according to the No. 1 Explanatory Announcement on Information Disclosure for
Companies Offering Their Securities to Public - Non-recurring Gains and Losses, or non-recurring gains and losses items listed in the
said document defined as recurring ones, please specify the reasons.
□ Applicable √ Not applicable
During the reporting period, the Company did not define any non-recurring gains and losses items defined and listed in the No. 1
Explanatory Announcement on Information Disclosure for Companies Offering Their Securities to Public - Non-recurring Gains and
Losses, as recurring gains and losses items.
II. Total Number of Shareholders and Particulars of Shareholdings of Top 10 Shareholders at
the End of the Reporting Period
1. Numbers of Ordinary Shareholders and Preferred Shareholders with Resumed Voting Rights and
Particulars of Shareholdings of Top 10 Shareholders
Unit: Share
Total Number of Preferred
Total Number of Ordinary
Shareholders with Resumed
Shareholders at the End of the 102,455 0
Voting Rights (If Any) at the
Reporting Period
End of the Reporting Period
Particulars of Shareholdings of Top 10 Shareholders
Number of Shares Pledged or Frozen
Name of Nature of Shareholding Held with
Number of Shares
Shareholder Shareholder Percentage Limited Sales Status Amount
Condition
4
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Domestic natural
Fu Liquan 38.68% 1,121,181,880 841,961,985 Pledged 116,942,000
person
Domestic natural
Zhu Jiangming 5.37% 155,561,490 116,671,117 Pledged 24,154,000
person
Hong Kong
Securities
Overseas legal
Clearing 2.68% 77,708,409 0
person
Company
Limited
Domestic natural
Chen Ailing 2.46% 71,262,813 53,447,110 Pledged 11,170,000
person
Domestic natural
Wu Jun 2.10% 60,790,886 45,593,164
person
China Securities
Domestic
Finance
non-state-owned 1.37% 39,611,241 0
Corporation
legal person
Limited
Central Huijin
Asset
State-owned legal
Management 1.08% 31,448,750 0
person
Limited Liability
Company
Zhejiang Dahua
Technology Co.,
Ltd. - Phase III
Others 0.91% 26,247,928 0
ESOP (Employee
Stock Ownership
Plan)
BOC - Core
Growth Stock
Type Security
Investment Fund
Others 0.82% 23,828,925 0
of China
International
Fund
Management
GIC PRIVATE Overseas legal
0.78% 22,491,130 0
LIMITED person
Particulars of Shareholdings of Top Ten Shareholders without Limited Sales Condition
Name of Shareholder Number of Shares Held without Limited Sales Type
5
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Condition Type Amount
RMB common
Fu Liquan 279,219,895 279,219,895
stock
Hong Kong Securities Clearing RMB common
77,708,409 77,708,409
Company Limited stock
China Securities Finance RMB common
39,611,241 39,611,241
Corporation Limited stock
RMB common
Zhu Jiangming 38,890,373 38,890,373
stock
Central Huijin Asset Management RMB common
31,448,750 31,448,750
Limited Liability Company stock
Zhejiang Dahua Technology Co.,
RMB common
Ltd. - Phase III ESOP (Employee 26,247,928 26,247,928
stock
Stock Ownership Plan)
BOC - Core Growth Stock Type
RMB common
Security Investment Fund of China 23,828,925 23,828,925
stock
International Fund Management
RMB common
GIC PRIVATE LIMITED 22,491,130 22,491,130
stock
RMB common
Chen Ailing 17,815,703 17,815,703
stock
One One Seven Combination of RMB common
16,531,387 16,531,387
National Social Security Fund stock
Explanation on Associated
Relationship or Concerted Actions Mr. Fu Liquan and Ms. Chen Ailing are husband and wife. The Company has no idea whether
among the Above-Mentioned the other shareholders are related or are persons acting in concert.
Shareholders
Explanation on Top Ten Ordinary
Shareholders' Participation in N/A
Securities Margin Trading (If Any)
Whether the Company’s top ten ordinary shareholders or top ten ordinary shareholders without limited shares agree on any
repurchase transaction during the reporting period
□ Yes √ No
None of the Company’s top ten ordinary shareholders or top ten ordinary shareholders without limited shares agreed on repurchase
during the reporting period.
2. Total Number of Preferred Shareholders and Particulars of Shareholdings of Top 10 Preferred
Shareholders of the Company
□ Applicable √ Not applicable
6
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Section III Significant Events
I. Changes of Major Financial Data and Financial Indicators during the Reporting Period
and Explanation
√ Applicable □ Not applicable
(i) Changes in assets and liabilities and the reasons
1. Monetary funds reduced by 46.03% compared to the period-end of the previous year, which is mainly caused by the expansion of
company scale and the increase of investment and expenditures;
2. Other receivables increased by 33.60% compared to the period-end of the previous year, which is mainly caused by the expansion
of company scale and increase of margin and payment made and received;
3. The inventory increased by 41.96% compared to the period-end of the previous year, which is mainly caused by the expansion of
the sales volume and the increase of inventory;
4. Non-current assets maturing within a year increased by 38.34% compared to the period-end of the previous year, which is mainly
caused by the transfer of long-term receivables maturing within a year;
5. Long-term equity investment decreased by 66.09% compared to the period-end of the previous year, which is mainly caused by the
investment loss of the confirmed shareholding companies;
6. Projects under construction increased by 128.70% compared to the period-end of the previous year, which is mainly caused by
investment increase of the Company in house properties under construction;
7. The goodwill increased by 35.81% compared to the period-end of the previous year, which is mainly caused by the increase of
goodwill brought by acquisition of two companies in this period;
8. The long-term prepaid expenses increased by 100% compared to the period-end of the previous year, which is mainly caused by
the increase of long-term unamortized decoration fee;
9. The deferred income tax assets increased by 33.42% compared to the period-end of the previous year, which is mainly caused by
the increase of deductable temporary difference in this period;
10. Other non-current assets increased by 102.98% compared to the period-end of the previous year, which is mainly caused by the
increase of prepayment for long-term assets in this period;
11. The short-term loans increased by 57.92% compared to the period-end of the previous year, which is mainly caused by the
increase of borrowings from banks in this period;
12. Financial liabilities measured in fair value with changes recorded into current profit and loss increased by 103.86% compared to
the period-end of the previous year, which is mainly caused by the fair value changes of financial derivative instruments;
13. Taxes payable reduced by 32.16% compared to the period-end of the previous year, which is mainly caused by the decrease of
payable added-value tax and corporate income tax in this period;
14. Non-current liabilities maturing within a year increased by 100% compared to the period-end of the previous year, which is
mainly caused by the transfer of long-term loan maturing within a year;
15. Other current liabilities increased by 35.80% compared to the period-end of the previous year, which is mainly caused by the
increase of tax for items to be written off in this period;
16. The anticipation liabilities increased by 43.15% compared to the period-end of the previous year, which is mainly caused by the
increase of estimated after-sales maintenance fee for products;
17. Other comprehensive income decreased by 33.56% compared to the period-end of the previous year, which is mainly caused by
7
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
the changes of foreign currency statement translation in this period;
18. The equity of minority shareholders increased by 69.01% compared to the period-end of the previous year, which is mainly
caused by the increase of investment by minority shareholders in this period;
(ii) Changes of items in the profit statement and the reasons
1. The operating cost increased by 34.04% compared to the same period of last year, which is mainly caused by the corresponding
increase of cost brought by income increase;
2. The selling expenses increased by 30.51% compared to the same period of last year, which is mainly caused by the increase of
relevant investment in order to promote stable increase of sale volume;
3. The financial expenses decreased by 274.44% compared to the same period of last year, which is mainly caused by the increase of
exchange gains in this period;
4. The investment income decreased by 145.46% compared to the same period of last year, which is mainly caused by the increase of
investment loss of joint ventures confirmed by the equity method in this period;
5. The income from disposal of assets decreased by 93.22% compared to the same period of last year, which is mainly caused by less
loss arising from disposal of fixed assets than the prior period;
6. The non-operating expenses reduced by 79.75% compared to the same period of last year, which is mainly caused by less loss
arising from disposal of fixed assets than the prior period;
(iii) Changes of items in the cash flow statement and the reasons
1. The net amount of cash flow generated from operating activities reduced by 46.01% compared to the same period of last year,
which is mainly caused by the expansion of business scale and the increase of cash payment during operation;
2. The net amount of cash flow generated from investment activities reduced by 107.25%, which is mainly caused by the increase of
long-term assets bought and built and asset acquisition in this period;
3. The net amount of cash flow generated by financing activities reduced by 40.42%, which is mainly caused by the decrease of bank
loans in net amount and the increase of dividend in this period.
II. Progress of Significant Events and the Analysis and Explanation of the Influence and
Solutions
√ Applicable □ Not applicable
1. On January 24, 2017, the Company's holding sub-subsidiary South North United Information Technology Co., Ltd. and its
wholly-owned subsidiary Zhejiang Dahua System Engineering Co., Ltd. signed a Cooperation Agreement on PPP Investment in Safe
City Project of Shache County with the People's Government of Shache County in Kashgar, Xinjiang, which is just a framework
agreement on the PPP project. The agreement stipulates that the service content is the pre-feasibility study of the project and the
design of the project, etc. For the implementation of the specific project, it still needs to fulfill related decision-making and approval
procedures, such as government procurement.
On July 21, 2017, the Company received the Notification of Award issued by the project purchasing unit, which confirmed that
the wholly-owned subsidiary Zhejiang Dahua System Engineering Co., Ltd. (the consortium leader), with the holding sub-subsidiary
South North United Information Technology Co., Ltd. (member of the consortium) was the winning bidder for the Safe City
Construction Project (PPP) in Shache County. The winning bid amount of the project is RMB 4,314,790,000 (the final amount is
based on the signed contract), which is the total amount for construction and operation within 10 years project cooperation period.
On August 4, 2017, the Company's 34th session of the 5th Board of Directors' meeting reviewed and approved the Proposal on
Investing to Establish a PPP Project Company in Shache County, Xinjiang, and the Company submitted a bid based on the
requirements for the Shache County City Construction Project (PPP). The winning consortium jointly funded the establishment of the
8
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
project company, with a registered capital of RMB 335,567,200. Among them, Zhejiang Dahua System Engineering Co., Ltd.
contributed RMB 234,897,040, accounting for 70% of the total contribution; South North United Information Technology Co., Ltd.
contributed RMB 100,670,160, accounting for 30%. In August 2017, the project company was established and the name of the
company approved by the industrial and commercial bureau was Xinjiang Dahua Xinzhi Information Technology Co., Ltd.
On April 18, 2018, the winning bidder received the requirements of Shache Public Security Bureau to stop implementation of
Safe City Construction Project (PPP) in Shache County. Near a half of the construction progress during the project construction
period has been completed, but no expenses for subsequent equipment replacement, operation and maintenance have been incurred.
The actual investment during the construction period will be further accounted and confirmed with the government.
The various activities and construction of this project engaged in by the winning bidder are in compliance with the requirements
in PPP-related laws and regulations, but the risk exists that the project will not be furthered and the identifiable income of the
Company in the future may be reduced. The Company will actively cooperate with relevant government departments in their work,
and timely perform the obligation of information disclosure in accordance with the subsequent progress of the project and the
provisions in relevant laws and regulations and the Articles of Association.
2. On January 25, 2018, the Company's 5th session of the 6th Board of Directors' meeting reviewed and approved the Proposal
on Adjustment of Joint Investment Plan with Connected Persons and Connected Transactions (I). It's agreed to adjust the
contributions to Zhejiang Huaan Technology Co., Ltd. (temporary name) with the connected legal person Zhejiang Huashi
Investment Management Co., Ltd., the connected natural person Wei Meizhong and 15 unconnected natural persons. After the
adjustment, the Company will contribute RMB 25.5 million with its own funds, accounting for 51% of the registered capital. In
March 2018, the project company was established and the name of the company approved by the industrial and commercial bureau is
Zhejiang Huaxiao Technology Co., Ltd.
3. On January 25, 2018, the Company's 5th session of the 6th Board of Directors' meeting reviewed and approved the Proposal
on Adjustment of Joint Investment Plan with Connected Persons and Connected Transactions (II). It's agreed to adjust the
contributions to Zhejiang Huazhi Technology Co., Ltd. (renamed as Zhejiang Dahua Robot Technology Co., Ltd.) with the connected
legal person Zhejiang Huashi Investment Management Co., Ltd. and the unconnected persons. After the adjustment, the Company
will contribute RMB 25.5 million with its own funds, accounting for 51% of the registered capital; Huashi Investment will contribute
RMB 24.5 million in cash, accounting for 49% of the registered capital. In August 2018, the project company was established.
4. On January 25, 2018 the Company's 5th session of the 6th Board of Directors' meeting reviewed and approved the Proposal
on Giving up the Shareholding Company's Right to Increase Capital with the Same Percentage and Connected Transactions. It is
agreed to give up the right of 8 investors including Ningbo Jinghang Equity Investment Partnership, Ningbo Gulin Equity Investment
Partnership and Hangzhou Yixun Investment Management Partnership to increase the capital of Zhejiang Leapmotor Technology Co.,
Ltd. with the same percentage. The total amount of connected transactions involved in giving up the right to increase the capital with
the same percentage is RMB 41,948,300. The change of industrial and commercial registrations for the above matter was completed
in March 2018.
5. On February 24, 2018, the Company disclosed the Announcement on Subsidiary's Release of External Guarantees. The
Company's subsidiaries, System Engineering, Dahua Zhicheng and Yunnan International Trust Co., Ltd. signed the Pledge Contract
on December 6, 2017. System Engineering and Dahua Zhicheng as a pledger provided a pledge guarantee for the debt under the Trust
Loan Contract signed between Guangxi Baixing Holdings Co., Ltd. as a debtor and Yunnan International Trust Co., Ltd. as a creditor
(with the trust loan principal of RMB 0.23 billion). The collateral in this guarantee was System Engineering and Dahua Zhicheng's
accounts receivable income rights. This guarantee responsibility was released on February 22, 2018.
6. On March 6, 2018, the Company's First Extraordinary General Meeting of Shareholders in 2018 reviewed and approved the
Management Measures for Core Employee Venture Capital Investment New Businesses (Draft), and decided to implement the core
employee venture capital investment new business plan of the Company.
7. On April 17, 2018, the Company's 8th session of the 6th Board of Directors' meeting reviewed and approved the Proposal on
Increasing Capital in Holding Subsidiaries and Connected Transactions. The Company and the connected person Mr. Fu Liquan
9
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
increased capital in holding subsidiary Hangzhou Huacheng Network Technology Co., Ltd. with the same percentage. Among them,
the Company increased the capital by RMB 20.4 million. Upon completion of the capital increase, the registered capital of Huacheng
Network was increased from RMB19.6 million. Upon completion of the capital increase, the registered capital of Huacheng Network
was increased from RMB 10 million to RMB 50 million. The change of industrial and commercial registrations for the above matter
was completed in April 2018.
8. On May 16, 2017, the Company's 2016 Annual General Meeting of Shareholders reviewed and approved the Zhejiang Dahua
Technology Co., Ltd. Phase III Employee Stock Ownership Plan (Draft) and its summary, and decided to implement the Phase III
Employee Stock Ownership Plan. On June 1, 2017, the Company's Phase III Employee Stock Ownership Plan completed the
purchase of the shares through the Caitong Securities Asset Management Dahua No. 3 Directed Asset Management Plan, with an
average purchase price of RMB16.83 per share and a purchase volume of 47,000,000 shares. As of June 2, 2018, the lock-up period
of the Company's Phase III Employee Stock Ownership Plan expired.
9. On May 17, 2017, the Company's 31st session of the 5th Board of Director's meeting reviewed and approved the Proposal on
Increasing Capital in Holding Subsidiaries, and it's agreed that the Company will increase its capital in Dahua Zhilian by RMB 610
million with its own funds. In this capital increase, China Development Bank Development Fund Co., Ltd. gives up the right to
increase the capital with the same percentage. Upon completion of the capital increase, the registered capital of Dahua Zhilian will be
increased from RMB 500 million to RMB 1.11 billion. The proportion of equity held by the Company will be 90.09%. This capital
increase was completed on June 26, 2018.
10. On May 31, 2018, the Company's 11th session of the 6th Board of Director's meeting reviewed and approved the Proposal
on Accepting Transfer of Part of the Equity of the Company and Giving up the Priority to Accept Transfer and Connected
Transactions. It is agreed to: (1) Accept transfer of 6% equity in HuaRay Technology held by the connected legal person Zhejiang
Huashi Investment Management Co., Ltd., and give up the priority to accept transfer of 49% equity in HuaRay Technology by the
connected legal person Huashi Investment, the connected natural person Zhang Xingming and other unconnected persons to the
connected legal persons and the core employee venture capital investment new business shareholding platform Ningbo Huayu
Investment Management Partnership Enterprise (hereinafter referred to as "Ningbo Huayu"); (2) Give up the priority to accept
transfer of 49% equity in Zhejiang Huachuang Vision Technology Co., Ltd. held by the connected legal person Huashi Investment
and other unconnected natural persons to Ningbo Huayu; (3) Give up the priority to accept proposed transfer of 49% equity in
Zhejiang Dahua Security Network Operation Service Co., Ltd. held by the connected legal person Huashi Investment, the connected
natural person Wu Jun and other unconnected persons to Ningbo Huayu. In July 2018, the above three matters about equity transfer
were completed.
11. On May 31, 2018, the Company's 11th session of the 6th Board of Director's meeting reviewed and approved the Proposal
on Making Joint Investment with the Connected Persons and Connected Transactions. It is agreed to jointly fund the establishment of
Wuxi Dahua Ruipin Technology Co., Ltd. with the connected legal person Huashi Investment. Among them, the Company
contributed RMB 25.5 million with its own funds, accounting for 51% of the registered capital. Huashi Investment contributed RMB
24.5 million by cash, accounting for 49% of the registered capital. In June 2018, the project company was established.
12. On June 21, 2018, the Company's 12th session of the 6th Board of Director's meeting reviewed and approved the Proposal
on Giving up the Priority to Accept Transfer and Connected Transactions. It is agreed to give up the priority to accept the proposed
transfer of 49% equity in Hangzhou Huacheng Network Technology Co., Ltd. held by the Company's controlling shareholder Fu
Liquan to the connected legal persons and the core employee venture capital investment new business shareholding platform Ningbo
Huayu. In July 2018, this equity transfer was completed.
13. On July 16, 2018, the Company’s 13th session of the 6th Board of Director’s meeting reviewed and approved the Proposal
on Investing to Build the “Dahua Intelligent Base in West China and the Dahua R&D Center in West China” in Xi’an. It’s agreed that
the Company will invest about RMB 800 million in the construction of this project. The land use of this project is about 133.64 mu,
mainly planned for construction of the R&D and office sites, as well as the supporting facilities. The overall construction period of
this project is about 42 months.
10
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
14. On September 14, 2018, the Company’s 4th extraordinary shareholders’ general meeting reviewed and approved the 2018
Incentive Plan for Restricted Shares (draft) and its summary, the Management Measures for Implementation and Assessment of the
Incentive Plan for Restricted Shares in 2018, the Proposal on Requesting the Shareholders’ Meeting to Authorize the Board of
Directors to Handle Issues Relating to the Share Ownership Incentive. It’s agreed to allow the Company to implement the 2018
incentive plan for restricted shares. Total number of the incentive targets is 3423, and the proposed number of shares to be granted is
121,749,000 (the actual number shall be subject to the actually subscribed amount). Now, the event is still underway.
Indexes for Inquiring the Websites
Overview of the Significant Events Date of Disclosure
Disclosing the Interim Reports
The Announcement on the Signing of the
Juchao Information Website
Framework Agreement for the PPP Project January 26, 2017
http://www.cninfo.com.cn/
by the Subsidiary
The Advisory Announcement on the
Juchao Information Website
Pre-Publicity of the Award of the PPP July 18, 2017
http://www.cninfo.com.cn/
Project to the Subsidiary
The Announcement on Investing to
Juchao Information Website
Establish A PPP Project Company in August 7, 2017
http://www.cninfo.com.cn/
Shache County, Xinjiang,
The Announcement on the Progress of the Juchao Information Website
April 18, 2018
Subsidiary’s PPP Project http://www.cninfo.com.cn/
The Announcement on Adjustment of the
Joint Investment Plan with Connected
Persons and Connected Transactions (I),
Announcement on Adjustment of the Joint
Investment Plan with Connected Persons Juchao Information Website
January 26, 2018
and Connected Transactions (II), and the http://www.cninfo.com.cn/
Announcement on Giving up the
Shareholding Company’s Right to Increase
Capital with the Same Percentage and
Connected Transactions
The Announcement on Removing the Juchao Information Website
February 24, 2018
Subsidiary’s External Guarantee http://www.cninfo.com.cn/
The Management Measures on Core
Juchao Information Website
Employees’ Venture Capital Investment in January 26, 2018
http://www.cninfo.com.cn/
New Business (draft)
Announcement of Resolutions at the First Juchao Information Website
March 7, 2018
Extraordinary General Meeting of 2018 http://www.cninfo.com.cn/
The Announcement on Increasing Capital
Juchao Information Website
in a Holding Subsidiary and the Connected April 18, 2018
http://www.cninfo.com.cn/
Transactions
The Announcement on the Resolutions of May 3, 2017 Juchao Information Website
11
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
the 29th Session of the 5th Board of http://www.cninfo.com.cn/
Directors’ Meeting, the Announcement on
the Resolutions of the 19th Session of the
5th Board of Supervisors’ Meeting,
Summary of the Dahua Phase III
Employee Stock Ownership Plan (Draft)
The Announcement on the Resolutions of
Juchao Information Website
the 2016 Annual Shareholders’ General May 17, 2017
http://www.cninfo.com.cn/
Meeting
The Announcement on Increasing Capital Juchao Information Website
May 18, 2017
in a Holding Subsidiary http://www.cninfo.com.cn/
The Announcement on the
Juchao Information Website
Accomplishment of Purchase for the Phase June 2, 2017
http://www.cninfo.com.cn/
III Employee Stock Ownership Plan
The Announcement on Accepting the
Transfer of Part of the Subsidiary’s Equity
and Giving up the Priority to Accept
Juchao Information Website
Transfer and Connected Transactions, and June 1, 2018
http://www.cninfo.com.cn/
the Announcement on Joint Investment
with Connected Persons and Connected
Transactions
Announcement on Giving up the Priority
Juchao Information Website
to Accept Transfer and Connected June 22, 2018
http://www.cninfo.com.cn/
Transactions
The Announcement on Investing to Build
the “Dahua Intelligent Base in West China Juchao Information Website
July 17, 2018
and the Dahua R&D Center in West http://www.cninfo.com.cn/
China” in Xi’an
The Announcement on the Resolutions of
the 15th Session of the 6th Board of
Directors’ Meeting, the Announcement on
the Resolutions of the 7th Session of the
6th Board of Supervisors’ Meeting, 2018 Juchao Information Website
August 29, 2018
Incentive Plan for Restricted Shares (draft) http://www.cninfo.com.cn/
and Its Summary, the Management
Measures for Implementation and
Assessment of the Incentive Plan for
Restricted Shares in 2018
The Announcement on Resolutions of the
Juchao Information Website
4th Extraordinary Shareholders’ General September 15, 2018
http://www.cninfo.com.cn/
Meeting in 2018
12
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
III. Overdue Commitments Not Yet Preformed by the Company’s De Facto Controller,
Shareholders, Connected Parties, Acquirers, the Company, and Other Commitment-related
Parties during the Reporting Period
√ Applicable □ Not applicable
Giver of Types of
Performanc
Commitments Commitm commitme Details Time Term
e
ents nts
As of the
disclosure
The number of shares transferred each year during
Fu Liquan, date of this
his/her term of service shall not exceed 25 percent of
Commitments Zhu announcem
Commitm the total number of shares he/she holds in the Company;
Made during Jiangming, ent, the
ent on he/she shall not transfer his/her shares in the Company July 15,
Initial Public Chen Long-term aforementi
restricted within half a year after he/she leaves the Company; 2007
Offerings or Ailing, oned
shares within the next twelve months, the number of shares
Refinancing and Wu commitmen
sold through the stock exchange listing transactions
Jun ts are still
shall not exceed 50% of the total shares he/she holds.
in strict
execution.
As of the
(1) He/she will not directly engage in operational
disclosure
activities that constitute horizontal competition with the
date of this
Other stock company's business; (2) for companies he/she
Commitm announcem
Commitments held or indirectly held, he/she will fulfill the obligations
Fu Liquan, ent on ent, the
to Minority under this commitment through agencies and personnel June 30,
and Chen horizontal Long-term aforementi
Shareholders (including but not limited to directors and managers); 2007
Ailing competitio oned
of the (3) if the stock company further expands its range of
n commitmen
Company products and business scope, he/she and the company
ts are still
held by him/her will not compete with the expanded
in strict
range of products or businesses of the stock company.
execution.
Whether the
Commitment
Yes
Is Fulfilled on
Time
IV. Forecast on the Company’s Operating Results for 2018
Forecasted operating results for 2018: The net profit attributable to shareholders of the listed company is in a positive number, and
it’s not a circumstance of turning losses into profit.
Amount of Variation in Net Profit Attributable to Shareholders
0% to 15%
of the Listed Company in 2018
Range of Variation in Net Profit Attributable to Shareholders of 237,872.68 to 273,553.58
13
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
the Listed Company in 2018 (Rmb10,000)
Net Profit Attributable to Shareholders of the Listed Company
237,872.68
in 2017 (Rmb10,000)
The Company’s sale volume expanded and the operation revenue
increased. It’s estimated that the net profit attributable to owners of
Reasons for the Performance Variation
the parent company increased by 0% ~ 15% compared to the same
period of last year.
V. Financial Assets Measured at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Amount
Changes in Fair
Cumulative Amount Sold
Initial Value Gains and Cumulative
Asset Fair Value Purchased During During Amount at the Capital
Investm Losses during Investment
Class Changes in the Reporting the End of the Period Source
ent Cost the Current Income
Equity Period Reportin
Period
g Period
Financial
derivative Equity
-64,861,287.24 1,694,800,000.00 -21,635,760.81 1,081,920,000.00
instrument Fund
s
Total -64,861,287.24 1,694,800,000.00 -21,635,760.81 1,081,920,000.00 --
VI. Guarantee for Third Parties in Violation of Regulations
□ Applicable √ Not applicable
During the reporting period, there was no guarantee for third parties in violation of regulations.
VII. Appropriation of Non-operational Funds of Listed Companies by Controlling
Shareholders and Their Connected Parties
□ Applicable √ Not applicable
VIII. Entrusted Wealth Management
√ Applicable □ Not applicable
Unit: Ten thousand RMB
Overdue Outstanding
Specific Type Funding Source Entrusted Amount Unexpired Balance
Amount
14
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Bank financial products Equity Fund 3,900 0 0
Total 3,900 0 0
Situation of high-risk entrusted WM with significant single amount or low security, poor liquidity and no principal protection
□ Applicable √ Not applicable
Cases of entrusted financing expected to be unable to recover the principal or cases that may result in impairment
□ Applicable √ Not applicable
IX. Registration Record for Analyst Reception, Communications, Interviews, and Other
Activities during the Reporting Period
√ Applicable □ Not applicable
Index of the Basic Information of
Reception Time Reception Method Reception Target Type
Research
For more information, please see the
July 2, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
Institutional and individual
July 8, 2018 Communication via phone investor relations activity list in
investors
http://www.cninfo.com.cn
For more information, please see the
July 17, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
July 18, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
August 23, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
August 29, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
August 30, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 6, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 7, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
15
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
For more information, please see the
September 12, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 13, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 14, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 18, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 19, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 20, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 26, 2018 Communication via phone Institution investor relations activity list in
http://www.cninfo.com.cn
For more information, please see the
September 27, 2018 Field Investigation Institution investor relations activity list in
http://www.cninfo.com.cn
16
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Section IV. Financial Statements
I. Financial Statements
1. Consolidated Balance Sheet
Prepared by: Zhejiang Dahua Technology Co., Ltd.
September 30, 2018
Unit: RMB
Items Closing Balance Opening Balance
Current Assets:
Cash and Bank Balances 1,950,080,565.32 3,612,937,164.14
Deposit Reservation for Balance
Loans to Banks and Other Financial Institutions
Financial Assets at Fair Value through Profit or Loss
Derivative Financial Assets
Notes Receivable and Accounts Receivable 11,724,224,390.52 9,971,240,927.27
Notes Receivable 2,158,210,607.00 2,431,296,170.58
Accounts Receivable 9,566,013,783.52 7,539,944,756.69
Prepayments 172,563,190.47 154,357,171.13
Premium Receivable
Reinsurance Accounts Receivable
Reinsurance Contract Reserves Receivable
Other Receivables 390,477,962.01 292,278,208.02
Buying Back the Sale of Financial Assets
Inventories 3,983,493,620.76 2,806,142,598.65
Assets Held for Sale
Non-current Assets Due within 1 Year 508,123,156.73 367,302,811.80
Other Current Assets 334,398,018.68 352,055,656.65
Subtotal of Current Assets 19,063,360,904.49 17,556,314,537.66
Non-current Assets:
Loans and Advances
Financial Assets Available for Sale 82,970,227.00 77,970,227.00
Held-to-maturity Investments
17
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Long-term Receivables 1,676,664,764.93 1,480,947,137.80
Long-term Equity Investment 20,778,210.52 61,272,885.41
Investment Property 186,682,164.13 181,050,142.29
Fixed Assets 1,301,919,596.37 1,248,305,165.77
Projects under Construction 134,426,331.91 58,779,225.41
Productive Biological Assets
Oil and Gas Assets
Intangible Assets 293,554,853.39 253,357,254.66
Development Expenditure
Goodwill 96,540,278.38 71,083,281.09
Long-term Prepaid Expenses 34,163,106.29
Deferred Income Tax Assets 335,482,309.11 251,453,971.05
Other Non-current Assets 188,658,810.37 92,944,735.83
Subtotal of Non-current Assets 4,351,840,652.40 3,777,164,026.31
Total Assets 23,415,201,556.89 21,333,478,563.97
Current Liabilities:
Short-term Borrowings 2,796,729,838.96 1,770,924,255.90
Borrowings from the Central Bank
Deposit Taking and Interbank Deposit
Borrowings from Banks and Other Financial Institutions
Financial Liabilities Measured at Fair Value with Changes Recorded
127,311,287.24 62,450,000.00
into Current Profit and Loss
Derivative Financial Liabilities
Notes Payable and Accounts Payable 6,352,341,522.39 6,136,607,389.03
Received Prepayments 461,813,353.75 461,715,422.38
Financial Assets Sold for Repurchase
Service Charge and Commission Payable
Employee Compensation Payable 603,163,381.51 851,146,379.97
Tax Payable 325,332,337.92 479,536,571.45
Other Payables 131,404,867.44 107,991,640.10
Reinsurance Accounts Payable
Insurance Contract Reserves
Receiving from Vicariously Traded Securities
Receiving from Vicariously Sold Securities
18
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Liabilities Held for Sale
Non-current Liabilities Due within 1 Year 25,500,000.00
Other Current Liabilities 62,391,071.01 45,941,962.85
Subtotal of Current Liabilities 10,885,987,660.22 9,916,313,621.68
Non-current Liabilities:
Long-term Borrowings 179,500,000.00 230,000,000.00
Bonds Payable
Including: Preferred Shares
Perpetual Bonds
Long-term Payables
Long-term Employee Compensation Payable
Expected Liabilities 183,227,904.04 127,998,889.61
Deferred Income 59,486,689.27 61,866,156.88
Deferred Income Tax Liabilities 57,617,847.02 45,468,946.77
Other Non-current Liabilities 387,253,299.37 358,600,936.54
Subtotal of Non-current Liabilities 867,085,739.70 823,934,929.80
Total Liabilities 11,753,073,399.92 10,740,248,551.48
Shareholders' Equity:
Share Capital 2,898,756,130.00 2,898,756,130.00
Other Equity Instruments
Including: Preferred Shares
Perpetual Bonds
Capital Reserves 593,047,746.10 593,340,751.52
Less: Treasury Share
Other Comprehensive Incomes 4,424,881.94 6,660,189.04
Special Reserves
Surplus Reserves 971,547,268.36 971,547,268.36
General Risk Reserves
Undistributed Profits 6,980,060,197.85 5,996,130,036.27
Total Shareholders' Equity Attributable to the Parent Company 11,447,836,224.25 10,466,434,375.19
Minority Shareholders' Equity 214,291,932.72 126,795,637.30
Total Shareholders' Equity 11,662,128,156.97 10,593,230,012.49
Total Liabilities and Shareholders' Equity 23,415,201,556.89 21,333,478,563.97
Legal representative: Fu Liquan Person in charge of accounting: Wei Meizhong Person in charge of the accounting institution:
19
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Xu Qiaofen
2. Balance Sheet of the Parent Company
Unit: RMB
Balance at the
Balance at the End of the
Item Name Commencement of the
Period
Period
Current Assets:
Cash and Bank Balances 71,405,246.50 528,918,086.71
Financial Assets at Fair Value through Profit or Loss
Derivative Financial Assets
Notes Receivable and Accounts Receivable 3,426,033,208.87 5,961,186,747.25
Notes Receivable 809,348,902.91 28,625,396.43
Accounts Receivable 2,616,684,305.96 5,932,561,350.82
Prepayments 25,728,385.69 60,553,036.53
Other Receivables 6,709,796,459.94 2,745,958,536.36
Inventories 163,606,404.79 155,981,228.49
Assets Held for Sale
Non-current Assets Due within 1 Year 13,876,282.77 721,747.17
Other Current Assets 2,029,756.40 613,008.35
Subtotal of Current Assets 10,412,475,744.96 9,453,932,390.86
Non-current Assets:
Financial Assets Available for Sale 80,496,000.00 75,496,000.00
Held-to-maturity Investments
Long-term Receivables 103,462,663.88 2,900,649.67
Long-term Equity Investment 2,801,028,137.56 2,492,439,607.09
Investment Property 185,678,627.21 188,865,490.54
Fixed Assets 481,168,448.33 457,103,573.22
Projects under Construction 71,884,083.59 32,179,351.04
Productive Biological Assets
Oil and Gas Assets
Intangible Assets 175,680,461.28 183,721,662.56
Development Expenditure
Goodwill
Long-term Prepaid Expenses 27,404,226.91
20
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Deferred Income Tax Assets 40,923,167.45 36,986,523.59
Other Non-current Assets 4,975,897.63 3,611,195.07
Subtotal of Non-current Assets 3,972,701,713.84 3,473,304,052.78
Total Assets 14,385,177,458.80 12,927,236,443.64
Current Liabilities:
Short-term Borrowings 1,238,603,047.41 700,000,000.00
Financial Liabilities Measured at Fair Value with Changes Recorded
into Current Profit and Loss
Derivative Financial Liabilities
Notes Payable and Accounts Payable 671,719,813.13 524,188,372.26
Received Prepayments 52,538,394.26 87,898,434.50
Employee Compensation Payable 454,065,987.85 632,166,128.79
Tax Payable 144,004,473.39 346,992,152.22
Other Payables 147,322,352.42 137,023,150.55
Liabilities Held for Sale
Non-current Liabilities Due within 1 Year
Other Current Liabilities 1,622,539.72 67,347.75
Subtotal of Current Liabilities 2,709,876,608.18 2,428,335,586.07
Non-current Liabilities:
Long-term Borrowings
Bonds Payable
Including: Preferred Shares
Perpetual Bonds
Long-term Payables
Long-term Employee Compensation Payable
Expected Liabilities 866,100.00 925,500.00
Deferred Income
Deferred Income Tax Liabilities 43,435.80 43,435.80
Other Non-current Liabilities 13,713,673.83 452,397.55
Subtotal of Non-current Liabilities 14,623,209.63 1,421,333.35
Total Liabilities 2,724,499,817.81 2,429,756,919.42
Shareholders' Equity:
Share Capital 2,898,756,130.00 2,898,756,130.00
Other Equity Instruments
21
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Including: Preferred Shares
Perpetual Bonds
Capital Reserves 589,258,331.39 589,895,836.49
Less: Treasury Share
Other Comprehensive Incomes
Special Reserves
Surplus Reserves 971,547,268.36 971,547,268.36
Undistributed Profits 7,201,115,911.24 6,037,280,289.37
Total Shareholders' Equity 11,660,677,640.99 10,497,479,524.22
Total Liabilities and Shareholders' Equity 14,385,177,458.80 12,927,236,443.64
3. Consolidated Income Statement during the Reporting Period
Unit: RMB
This Period's Amount of Previous Period's
Item Name
Occurrence Amount of Occurrence
I. Total Operating Revenue 5,216,687,713.72 4,258,629,946.91
Including: Operating Revenue 5,216,687,713.72 4,258,629,946.91
Interest Income
Earned Premiums
Service Charge and Commission Income
II. Total Operating Cost 4,924,556,705.48 3,988,697,415.89
Including: Operating Cost 3,333,731,189.72 2,614,967,687.65
Interest Expenditures
Service Charge and Commission Expenses
Surrender Value
Net Claims Paid
Net Amount Withdrawn for Insurance Contract Reserves
Policyholder Dividend Expense
Reinsurance Cost
Taxes and Surcharges 41,313,194.06 29,265,243.65
Sales Expenses 823,964,851.51 644,345,628.10
Administrative Expenses 208,144,671.11 164,459,090.85
Research and Development Expense 646,771,713.83 414,353,282.97
Financial Expenses -166,844,524.16 60,123,771.90
22
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Interest Expenses 29,722,966.77 17,142,477.83
Interest Income -29,379,494.71 -10,325,899.80
Losses on Assets Impairment 37,475,609.41 61,182,710.77
Add: Other Incomes 182,833,069.63 167,151,052.30
Investment Income (Mark "-" for Loss) -31,254,782.85 -7,216,081.77
Including: Investment Income from Affiliates and Joint Ventures -6,657,627.72 -9,622,121.02
Incomes from Changes in Fair Value (Mark "-" for Losses) -23,528,521.97
Exchange Gains (Mark "-" for Losses)
Asset Disposal Income (Mark "-" for Loss) 30,560.71 24,143.20
III. Operating Profit (Mark "-" for Loss) 420,211,333.76 429,891,644.75
Add: Non-operating Revenues 19,971,732.76 17,373,984.31
Less: Non-operating Expenses 330,608.26 10,761,224.43
IV. Total Profit (Mark "-" for Total Loss) 439,852,458.26 436,504,404.63
Less: Income Tax Expense -47,525,102.25 -27,577,340.21
V. Net Profit (Mark "-" for Net Loss) 487,377,560.51 464,081,744.84
(I) Net Profit as a Going Concern (Mark "-" for Net Loss) 487,377,560.51 464,081,744.84
(II) Net Profit of Discontinued Operation (Mark "-" for Net Loss)
Net Profit Attributable to the Parent Company's Owner 481,764,501.06 461,492,620.03
Minority Shareholders' Profit and Loss 5,613,059.45 2,589,124.81
VI. Net Amount of Other Comprehensive Incomes after Tax -10,629,067.12 670,976.56
Net Amount of Other Comprehensive Incomes after Tax Attributable to
-10,629,067.12 670,976.56
the Parent Company's Owner
(I) Other Comprehensive Incomes That Cannot Be Subsequently
Reclassified as P/L
1. Changes Arising from Remeasurement of Net Liabilities or
Net Assets in Defined Benefit Plans
2. Share in Other Comprehensive Incomes of the Investee That
Cannot Be Reclassified as P/L under the Equity Method
(II) Other Comprehensive Incomes That Will Be Subsequently
-10,629,067.12 670,976.56
Reclassified as P/L
1. Share in Other Comprehensive Incomes of the Investee That
Will Be Subsequently Reclassified as P/L under the Equity Method
2. Profit or Loss Arising from Changes in the Fair Value of
Financial Assets Available for Sale
3. Profit or Loss Arising from Reclassifying Investments Held
to Maturity as Financial Assets Available for Sale
23
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
4. Effective Part of Profit or Loss from Cash Flow Hedging
5. Currency Translation Difference -10,629,067.12 670,976.56
6. Others
Net Amount of Other Comprehensive Incomes after Tax Attributable to
Minority Shareholders
VII. Total Comprehensive Income 476,748,493.39 464,752,721.40
Total Comprehensive Income Attributable to the Parent Company's
471,135,433.94 462,163,596.59
Owner
Total Comprehensive Income Attributable to Minority Shareholders 5,613,059.45 2,589,124.81
VIII. Earnings per Share:
(I) Basic Earnings per Share 0.17 0.16
(II) Diluted Earnings per Share 0.17 0.16
For consolidation under the same control in this period, the net profit realized by the consolidated party before consolidation is:
RMB. The net profit realized by the consolidated party in previous period is: RMB.
Legal representative: Fu Liquan Person in charge of accounting: Wei Meizhong Person in charge of the accounting
institution: Xu Qiaofen
4. Income Statement of the Parent Company during the Reporting Period
Unit: RMB
This Period's Amount of Previous Period's
Item Name
Occurrence Amount of Occurrence
I. Operating Revenue 1,792,844,785.59 1,485,813,679.96
Less: Operating Cost 287,661,878.89 92,090,181.65
Taxes and Surcharges 22,733,401.39 22,839,772.98
Sales Expenses 488,743,169.47 401,932,848.45
Administrative Expenses 99,149,898.12 82,010,686.04
Research and Development Expense 589,456,757.42 374,797,651.53
Financial Expenses 5,462,603.59 9,035,089.64
Interest Expenses 8,996,914.10 7,996,610.52
Interest Income -4,962,437.30 -547,735.65
Losses on Assets Impairment -44,895,002.92 10,477.35
Add: Other Incomes 171,234,834.51 165,899,068.25
Investment Income (Mark "-" for Loss) -6,657,627.72 -5,886,140.85
Including: Investment Income from Affiliates and Joint Ventures -6,657,627.72 -9,814,908.55
Incomes from Changes in Fair Value (Mark "-" for Losses)
24
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Asset Disposal Income (Mark "-" for Loss)） 21,718.55 24,143.20
II. Operating Profit (Mark "-" for Loss) 509,131,004.97 663,134,042.92
Add: Non-operating Revenues 17,831,075.48 8,466,711.09
Less: Non-operating Expenses 245,021.42 9,804,377.97
III. Total Profit (Mark "-" for Total Loss) 526,717,059.03 661,796,376.04
Less: Income Tax Expense -110,393,938.26 7,148,065.16
IV. Net Profit (Mark "-" for Net Loss) 637,110,997.29 654,648,310.88
(I) Net Profit as a Going Concern (Mark "-" for Net Loss) 637,110,997.29 654,648,310.88
(II) Net Profit of Discontinued Operation (Mark "-" for Net Loss)
V. Net Amount of Other Comprehensive Incomes after Tax
(I) Other Comprehensive Incomes That Cannot Be Subsequently
Reclassified as P/L
1. Changes Arising from Remeasurement of Net Liabilities or
Net Assets in Defined Benefit Plans
2. Share in Other Comprehensive Incomes of the Investee That
Cannot Be Reclassified as P/L under the Equity Method
(II) Other Comprehensive Incomes That Will Be Subsequently
Reclassified as P/L
1. Share in Other Comprehensive Incomes of the Investee That
Will Be Subsequently Reclassified as P/L under the Equity Method
2. Profit or Loss Arising from Changes in the Fair Value of
Financial Assets Available for Sale
3. Profit or Loss Arising from Reclassifying Investments Held
to Maturity as Financial Assets Available for Sale
4. Effective Part of Profit or Loss from Cash Flow Hedging
5. Currency Translation Difference
6. Others
VI. Total Comprehensive Income 637,110,997.29 654,648,310.88
VII. Earnings per Share:
(I) Basic Earnings per Share 0.22 0.23
(II) Diluted Earnings per Share 0.22 0.23
5. Consolidated Income Statement from the Beginning of the Year to the End of the Reporting Period
Unit: RMB
Item Name This Period's Amount of Previous Period's
25
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Occurrence Amount of Occurrence
I. Total Operating Revenue 15,030,729,066.20 11,723,294,881.29
Including: Operating Revenue 15,030,729,066.20 11,723,294,881.29
Interest Income
Earned Premiums
Service Charge and Commission Income
II. Total Operating Cost 13,709,855,396.51 10,666,539,007.22
Including: Operating Cost 9,563,851,634.78 7,135,008,488.79
Interest Expenditures
Service Charge and Commission Expenses
Surrender Value
Net Claims Paid
Net Amount Withdrawn for Insurance Contract Reserves
Policyholder Dividend Expense
Reinsurance Cost
Taxes and Surcharges 104,005,456.03 83,288,603.07
Sales Expenses 2,076,706,752.34 1,591,164,605.13
Administrative Expenses 477,344,075.64 386,655,575.69
Research and Development Expense 1,511,900,765.92 1,210,847,177.33
Financial Expenses -189,724,920.01 108,763,323.85
Interest Expenses 78,284,369.59 55,665,027.12
Interest Income -80,171,832.38 -41,353,705.55
Losses on Assets Impairment 165,771,631.81 150,811,233.36
Add: Other Incomes 467,750,068.56 511,561,355.58
Investment Income (Mark "-" for Loss) -52,122,659.16 -21,234,624.42
Including: Investment Income from Affiliates and Joint Ventures -32,224,908.63 -28,341,585.19
Incomes from Changes in Fair Value (Mark "-" for Losses) -64,861,287.24
Exchange Gains (Mark "-" for Losses)
Asset Disposal Income (Mark "-" for Loss) 17,535.97 258,708.67
III. Operating Profit (Mark "-" for Loss) 1,671,657,327.82 1,547,341,313.90
Add: Non-operating Revenues 25,206,031.85 34,817,551.32
Less: Non-operating Expenses 2,525,495.61 12,470,065.49
IV. Total Profit (Mark "-" for Total Loss) 1,694,337,864.06 1,569,688,799.73
Less: Income Tax Expense 118,196,431.38 125,783,329.50
26
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
V. Net Profit (Mark "-" for Net Loss) 1,576,141,432.68 1,443,905,470.23
(I) Net Profit as a Going Concern (Mark "-" for Net Loss) 1,576,141,432.68 1,443,905,470.23
(II) Net Profit of Discontinued Operation (Mark "-" for Net Loss)
Net Profit Attributable to the Parent Company's Owner 1,563,681,387.58 1,444,493,831.26
Minority Shareholders' Profit and Loss 12,460,045.10 -588,361.03
VI. Net Amount of Other Comprehensive Incomes after Tax -2,235,307.10 1,037,096.85
Net Amount of Other Comprehensive Incomes after Tax Attributable to
-2,235,307.10 1,037,096.85
the Parent Company's Owner
(I) Other Comprehensive Incomes That Cannot Be Subsequently
Reclassified as P/L
1. Changes Arising from Remeasurement of Net Liabilities or
Net Assets in Defined Benefit Plans
2. Share in Other Comprehensive Incomes of the Investee That
Cannot Be Reclassified as P/L under the Equity Method
(II) Other Comprehensive Incomes That Will Be Subsequently
-2,235,307.10 1,037,096.85
Reclassified as P/L
1. Share in Other Comprehensive Incomes of the Investee That
Will Be Subsequently Reclassified as P/L under the Equity Method
2. Profit or Loss Arising from Changes in the Fair Value of
Financial Assets Available for Sale
3. Profit or Loss Arising from Reclassifying Investments Held
to Maturity as Financial Assets Available for Sale
4. Effective Part of Profit or Loss from Cash Flow Hedging
5. Currency Translation Difference -2,235,307.10 1,037,096.85
6. Others
Net Amount of Other Comprehensive Incomes after Tax Attributable
to Minority Shareholders
VII. Total Comprehensive Income 1,573,906,125.58 1,444,942,567.08
Total Comprehensive Income Attributable to the Parent Company's
1,561,446,080.48 1,445,530,928.11
Owner
Total Comprehensive Income Attributable to Minority Shareholders 12,460,045.10 -588,361.03
VIII. Earnings per Share:
(I) Basic Earnings per Share 0.54 0.50
(II) Diluted Earnings per Share 0.54 0.50
Occurred enterprise consolidation under the same control during this period, the net profit realized by consolidated party before
consolidation is: RMB. The net profit realized by the consolidated party during previous period is: RMB.
27
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
6. Income Statement of the Parent Company from the Beginning of the Year to the End of the Reporting
Period
Unit: Yuan
This Period's Amount of Previous Period's
Item Name
Occurrence Amount of Occurrence
I. Total Operating Revenue 5,576,992,611.46 4,043,735,258.60
Less: Operating Cost 1,455,015,004.83 288,635,592.04
Taxes and Surcharges 67,645,018.11 66,811,843.17
Sales Expenses 1,173,616,922.24 1,014,775,829.54
Administrative Expenses 224,057,849.24 201,962,723.77
Research and Development Expense 1,347,566,767.39 1,104,532,182.66
Financial Expenses -5,455,841.16 23,023,817.59
Interest Expenses 25,612,631.49 20,829,917.99
Interest Income -32,752,271.20 -1,575,603.23
Losses on Assets Impairment -33,694,833.36 11,203,668.00
Add: Other Incomes 443,719,222.41 492,967,360.46
Investment Income (Mark "-" for Loss) -30,125,038.40 -18,924,742.01
Including: Investment Income from Affiliates and Joint Ventures -31,510,214.43 -28,397,370.97
: Incomes from Changes in Fair Value (Mark "-" for Losses)
Asset Disposal Income (Mark "-" for Loss) 8,194.76 174,322.85
II. Operating Profit (Mark "-" for Loss) 1,761,844,102.94 1,807,006,543.13
Add: Non-operating Revenues 20,752,070.15 20,965,767.64
Less: Non-operating Expenses 573,768.45 10,098,026.68
III. Total Profit (Mark "-" for Total Loss) 1,782,022,404.64 1,817,874,284.09
Less: Income Tax Expense 38,435,556.77 135,263,469.24
IV. Net Profit (Mark "-" for Net Loss) 1,743,586,847.87 1,682,610,814.85
(I) Net Profit as a Going Concern (Mark "-" for Net Loss) 1,743,586,847.87 1,682,610,814.85
(II) Net Profit of Discontinued Operation (Mark "-" for Net Loss)
V. Net Amount of Other Comprehensive Incomes after Tax
(I) Other Comprehensive Incomes That Cannot Be Subsequently
Reclassified as P/L
1. Changes Arising from Remeasurement of Net Liabilities or
Net Assets in Defined Benefit Plans
2. Share in Other Comprehensive Incomes of the Investee That
Cannot Be Reclassified as P/L under the Equity Method
28
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
(II) Other Comprehensive Incomes That Will Be Subsequently
Reclassified as P/L
1. Share in Other Comprehensive Incomes of the Investee That
Will Be Subsequently Reclassified as P/L under the Equity Method
2. Profit or Loss Arising from Changes in the Fair Value of
Financial Assets Available for Sale
3. Profit or Loss Arising from Reclassifying Investments Held
to Maturity as Financial Assets Available for Sale
4. Effective Part of Profit or Loss from Cash Flow Hedging
5. Currency Translation Difference
6. Others
VI. Total Comprehensive Income 1,743,586,847.87 1,682,610,814.85
VII. Earnings per Share:
(I) Basic Earnings per Share 0.60 0.58
(II) Diluted Earnings per Share 0.60 0.58
7. Consolidated Cash Flow Statement from the Beginning of the Year to the End of the Reporting Period
Unit: RMB
This Period's Amount of Previous Period's
Item Name
Occurrence Amount of Occurrence
I. Cash Flow from Operational Activities:
Cash from Sales of Merchandise and Provision of Services 14,096,899,342.48 10,440,057,304.60
Net Increase in Customer's Bank Deposits and Interbank Deposits
Net Increase in Borrowings from the Central Bank
Net Increase in Borrowings from Other Financial Institutions
Cash Arising from Receiving Premiums for the Original Insurance
Contract
Net Amount Arising from Reinsurance Business
Net Increase in Deposits and Investments from Policyholders
Net Additions to Financial Assets from Disposal at Fair Value
Measurement and Its Inclusion in Current Profit or Loss
Cash Arising from Interests, Service Charges and Commissions
Net Increase in Borrowings from Banks and Other Financial
Institutions
Net Increase in Repurchase Business Funds
Tax Refund 1,175,466,753.02 1,067,052,799.19
29
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Other Received Cashes Related to Operational Activities 179,706,020.35 55,867,722.02
Subtotal of Operational Activities Free Cash Inflow 15,452,072,115.85 11,562,977,825.81
Cash Paid for Merchandise and Services 11,313,035,144.29 8,177,127,518.54
Net Increase in Loans and Advances to Customers
Net Increase in Deposits with Central Bank and Other Financial
Institutions
Cash Paid for Original Insurance Contract Claims
Cash Paid for Interests, Service Charges and Commissions
Cash Paid for Policy Dividends
Cash Paid to and for Employees 3,147,424,488.01 2,225,705,207.91
Cash Paid for Taxes and Surcharges 1,148,544,384.30 1,009,317,685.70
Other Paid Cashes Related to Operational Activities 1,510,039,968.78 1,292,520,319.37
Subtotal of Operational Activities Free Cash Outflow 17,119,043,985.38 12,704,670,731.52
Net Cash Flow from Operational Activities -1,666,971,869.53 -1,141,692,905.71
II. Cash Flow from Investment Activities:
Cash Arising from Disposal of Investments 146,950,000.00 62,960,476.45
Cash Arising from Investment Incomes 1,738,010.28 8,104,273.12
Net Cash Arising from Disposal of Fixed Assets, Intangible Assets and
552,893.76 1,552,766.02
Other Long-term Assets
Net Cash Arising from Disposal of Subsidiaries and Other Business
Units
Other Received Cashes Related to Investment Activities 3,254,123.87 33,252,642.22
Investment Activities Free Cash Inflow Subtotal 152,495,027.91 105,870,157.81
Cash Paid for Purchase and Construction of Fixed Assets, Intangible
389,636,120.07 242,841,832.28
Assets and Other Long-term Assets
Cash Paid for Investments 144,300,000.00 121,796,449.00
Net Increase in Pledge Loans
Net Cash Paid for Acquisition of Subsidiaries and Other Business
56,408,605.39
Units
Other Paid Cashes Related to Investment Activities 100,527,143.08 997,312.35
Investment Activities Free Cash Outflow Subtotal 690,871,868.54 365,635,593.63
Net Amount of Cash Flow from Investment Activities -538,376,840.63 -259,765,435.82
III. Cash Flow from Financing Activities:
Cash Arising from Absorbing Investments 77,742,285.10 40,773,116.00
Including: Cash Arising from Subsidiaries Absorbing Investments by
77,742,285.10 40,773,116.00
Minority Shareholders
30
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Cash Arising from Borrowings 4,608,755,547.11 3,423,644,986.19
Cash Arising from Bonds Issue
Other Received Cashes Related to Financing Activities 1,073,755,819.97 364,546,900.00
Financing Activities Free Cash Inflow Subtotal 5,760,253,652.18 3,828,965,002.19
Cash Paid for Debts Repayment 3,615,177,763.81 1,878,090,687.31
Cash Paid for Distribution of Dividends and Profits or Payment of
650,902,100.63 344,872,157.65
Interests
Including: Dividends and Profits Paid to Minority Shareholders by
Subsidiaries
Other Paid Cashes Related to Financing Activities 912,488,000.04 629,723,815.79
Financing Activities Free Cash Outflow Subtotal 5,178,567,864.48 2,852,686,660.75
Net Amount of Cash Flow from Financing Activities 581,685,787.70 976,278,341.44
IV. Impact of Fluctuation in Exchange Rate on Cash and Cash Equivalents 59,968,947.69 -49,317,751.79
V. Net Increase in Cash and Cash Equivalents -1,563,693,974.77 -474,497,751.88
Add: Cash and Cash Equivalents at the Commencement of the Period 3,062,678,993.88 2,075,176,785.56
VI. Cash and Cash Equivalents at the End of the Period 1,498,985,019.11 1,600,679,033.68
8. Cash Flow Statement of the Parent Company from the Beginning of the Year to the End of the Reporting
Period
Unit: RMB
This Period's Amount of Previous Period's
Item Name
Occurrence Amount of Occurrence
I. Cash Flow from Operational Activities:
Cash from Sales of Merchandise and Provision of Services 8,565,255,144.00 3,151,052,612.32
Tax Refund 440,611,381.06 492,967,360.46
Other Received Cashes Related to Operational Activities 21,008,777.53 16,687,704.93
Subtotal of Operational Activities Free Cash Inflow 9,026,875,302.59 3,660,707,677.71
Cash Paid for Merchandise and Services 1,529,294,174.11 87,945,929.82
Cash Paid to and for Employees 1,986,373,244.95 1,510,598,490.80
Cash Paid for Taxes and Surcharges 839,005,205.65 796,146,139.81
Other Paid Cashes Related to Operational Activities 800,738,387.79 740,565,784.34
Subtotal of Operational Activities Free Cash Outflow 5,155,411,012.50 3,135,256,344.77
Net Cash Flow from Operational Activities 3,871,464,290.09 525,451,332.94
II. Cash Flow from Investment Activities:
Cash Arising from Disposal of Investments 107,950,000.00 52,912,476.45
31
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Cash Arising from Investment Incomes 1,385,176.03 5,627,365.05
Net Cash Arising from Disposal of Fixed Assets, Intangible Assets and
66,112,836.14 529,006.41
Other Long-term Assets
Net Cash Arising from Disposal of Subsidiaries and Other Business
Units
Other Received Cashes Related to Investment Activities 29,536,675.15 1,592,642.22
Investment Activities Free Cash Inflow Subtotal 204,984,687.32 60,661,490.13
Cash Paid for Purchase and Construction of Fixed Assets, Intangible
91,063,022.15 108,818,341.54
Assets and Other Long-term Assets
Cash Paid for Investments 453,686,250.00 736,185,000.00
Net Cash Paid for Acquisition of Subsidiaries and Other Business
Units
Other Paid Cashes Related to Investment Activities
Investment Activities Free Cash Outflow Subtotal 544,749,272.15 845,003,341.54
Net Amount of Cash Flow Generated by Investment Activities -339,764,584.83 -784,341,851.41
III. Cash Flow from Financing Activities:
Cash Arising from Absorbing Investments
Cash Arising from Borrowings 1,488,603,047.41 690,000,000.00
Cash Arising from Bonds Issue
Other Received Cashes Related to Financing Activities 111,547,737.65 77,735,148.36
Financing Activities Free Cash Inflow Subtotal 1,600,150,785.06 767,735,148.36
Cash Paid for Debts Repayment 950,000,000.00 550,000,000.00
Cash Paid for Distribution of Dividends and Profits or Payment of
602,162,751.51 311,948,216.34
Interests
Other Paid Cashes Related to Financing Activities 4,041,706,031.13 398,406,311.70
Financing Activities Free Cash Outflow Subtotal 5,593,868,782.64 1,260,354,528.04
Net Amount of Cash Flow from Financing Activities -3,993,717,997.58 -492,619,379.68
IV. Impact of Fluctuation in Exchange Rate on Cash and Cash Equivalents -115,776.35 -128,479.57
V. Net Increase in Cash and Cash Equivalents -462,134,068.67 -751,638,377.72
Add: Cash and Cash Equivalents at the Commencement of the Period 524,670,812.68 792,226,544.55
VI. Cash and Cash Equivalents at the End of the Period 62,536,744.01 40,588,166.83
II. Audit Reports
Has the Third Quarter Report been audited?
□ Yes √ No
The Third Quarter Report of the Company has not been audited.
32
Third Quarter 2018 Report of Zhejiang Dahua Technology Co., Ltd.
Zhejiang Dahua Technology Co., Ltd.
Chairman: Fu Liquan
October 26, 2018
33
