2023 Annual Report
Shenzhen Textile (Holdings) Co., Ltd.
2023 Annual Report
March 2024
1
2023 Annual Report
I. Important Notice, Table of Contents and Definitions
The Board of Directors，the Supervisory Committee, the directors, the supervisors, and executives of the
Company guarantee that there are no significant omissions, fictitious or misleading statements carried in the
Report and we will accept individual and joint responsibilities for the truthfulness, accuracy and completeness
of the Report.
Mr.Yin Kefei, The Company leader, Ms. Liu Yu, Chief financial officer and Mr. Huang Min,the person in
charge of the accounting department (the person in charge of the accounting )hereby confirm the authenticity
and completeness of the financial report enclosed in this annual report.
All the directors attended the board meeting for the review of this Report.
Concerning the forward-looking statements with future planning involved in the Report, they do not constitute a
substantial commitment for investors, Investors and related persons shall keep sufficient risk awareness, and
shall understand the differences between plans, forecasts and commitments, and remind investors of investment
risks.
The company has the macroeconomic risks, market competition and technological risks, raw material risks and
intensified competition risks. Investors are advised to pay attention to investment risks. For details, please refer
to the possible risk factors that the company may face in the XI "Risks facing the Company and
countermeasures " in the Section III "Management Discussion & Analysis".
The company’s profit distribution plan approved by the board of directors this time is: based on
506,521,849 shares, a cash dividend of 0.65 yuan (tax included) will be distributed to all shareholders for every
10 shares, and 0 shares (tax included) will be given as bonus shares. The capital reserve will not be converted
into share capital.
This Report has been prepared in both Chinese and English. In case of any discrepancy, the Chinese version
shall prevail.
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2023 Annual Report
Table of Contents
I.Important Notice, Table of contents and Definitions
II. Company Profile & Financial Highlights.
III. Management Discussion & Analysis
IV. Corporate Governance
V. Environmental & Social Responsibility
VI. Important Events
VII. Change of share capital and shareholding of Principal Shareholders
VIII. Situation of the Preferred Shares
IX. Corporate Bond
X. Financial Report
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2023 Annual Report
Documents available for inspection
1. Accounting statements carried with personal signatures and seals of legal representative, General Manager, Chief
Financial officer.
2. Original of Auditors’ Report carried with the seal of Certified Public Accountants as well as personal signatures of
certified Public accountants.
3. The texts of all the Company's documents publicly disclosed on the newspapers and periodicals designated by China
Securities Regulatory Commission in the report period.
The above documents were completely placed at the Office of Secretaries of the Board of Directors of the Company.
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2023 Annual Report
Definition
Company/The Company/ Shen Textile Refers to Shenzhen Textile (Holdings) Co., Ltd
Articles of Association of Shenzhen Textile
Articles of Association Refers to
(Holdings) Co., Ltd
Actual controller / National Assets
National Assets Regulatory Commission of
Regulatory Commission of Shenzhen Refers to
Shenzhen Municipal People's Government
Municipal People's Government
The Controlling shareholder/ Shenzhen
Refers to Shenzhen Investment Holdings Co., Ltd.
Investment Holdings Co., Ltd.
Shenzhen Shenchao Technology Investment
Shenchao Technology Refers to
Co., Ltd.
SAPO Photoelectric Refers to Shenzhen SOPO Photoelectric Co., Ltd.
Beauty Century Refers to Shenzhen Beauty Century Garment Co., Ltd.
Huaqiang Hotel Refers to Shenzhen Huaqiang Hotel Co., Ltd
Shenzhen Xieli Refers to Shenzhen Xieli Automobile Co., Ltd.
Hengmei Photoelectric Refers to Hengmei Photoelectric Co., Ltd.
Qimei Material Refers to Qimei Material Technology Co., Ltd.
Haosheng（Danyang）Investment
Haosheng Danyang Refers to
Management Co., Ltd.
Danyang Nuoyan Tianxin Investment
Danyang Nuoyan Refers to
Partnership（LP)
Xiamen Nuoyan Private Equity Fund
Xiamen Nuoyan Refers to
Management Co., Ltd.
Fuxhou New Area Development & Investment
Fuzhou New Investment Refers to
Group Co., Ltd.
Hefei Beicheng No.2 Photoelectric industry
Hefei Beicheng Refers to
investment partnership(LP)
Hangzhou Rencheng Refers to Hangzhou Rencheng Trade Partnership(LP)
Kunshan Guochuang Investment Group Co.,
KSGC Refers to
Ltd.
Shenzhen Xinghe Hard Technology Private
Xinghe Technology Refers to Equity Investment Fund Partnership (limited
partnership)
Lishui Huahui Equity Investment
Lishui Huahui Refers to
Partnership(LP)
Huzhou Pinuohuacai Equity Investment
Huzhou Pinuohuacai Refers to
Parnership（LP）
Lishui Tengbei Mingcheng Equity Investment
Lishui Tengbei Refers to
Partnership(LP)
Fuzhou Investment Refers to Fuzhou Investment Management Co., Ltd.
Xiamen Zhifeng Equity Investment
Xiamen Zhifeng Refers to
Partnership(LP)
Jiaxing Painuo Xiancai quity Investment
Jiaxing Painuo Refers to
Partnership(LP)
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2023 Annual Report
Huzhou Zhekuang Equity Investment
HuzHOU Zhekuang Refers to
Partnership(LP)
Guangdong Xingzhi Venture Investment
Guangdong Xingzhi Refers to
Partnership(LP)
Guangzhou Boyue Venture Investment
Guangzhou Boyue Refers to
Partnership(LP)
Hangzhou Jinhang Investment Fund Partnership
Jinhang Investment Refers to
（LP）
Line 4 Refers to T TFT-LCD polarizer II phase Line 4 project
Line 5 Refers to TFT-LCD polarizer II phase Line 5 project
Line 6 Refers to TFT-LCD polarizer II phase Line 6 project
Industrialization project of polaroid for super
Line 7 Refers to
large size TV
“CSRC” Refers to China Securities Regulatory Commission
The Report Refers to 2023 Annual Report
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2023 Annual Report
II. Company Profile & Financial Highlights
1.Company Profile
Shen Textile A ,Shen Textile
Stock abbreviation Stock code 000045,200045
B
Modified stock ID (if any) No
Stock exchange for listing Shenzhen Stock Exchange
Name in Chinese 深圳市纺织(集团)股份有限公司
Chinese abbreviation (If any) 深纺织
English name (If any) SHENZHEN TEXTILE(HOLDINGS)CO.,LTD
English abbreviation (If any) STHC
Legal representative Yin Kefei
708M, Building 8, Qianhai Excellence Financial Center (Phase I), No.5033 Menghai Avenue,
Registered address
Nanshan Street, Qianhai Shenzhen-Hong Kong Cooperation Zone, Shenzhen
Postal code of the Registered
518052
Address
On April 27, 2023, the Company completed the industrial and commercial change registration,
and its registered address was changed from "6/F, Shenfang Building, No.3 Huaqiang North
Historical change of the
Road, Futian District, Shenzhen" to "708M, Building 8, Qianhai Excellence Financial Center
company's registered address (Phase I), No.5033 Menghai Avenue, Nanshan Street, Qianhai Shenzhen-Hong Kong
Cooperation Zone, Shenzhen".
Office Address 6/F, Shenfang Building, No.3 Huaqiang North Road, Futian District, Shenzhen
Postal code of the office
518031
address
Internet Web Site http://www.chinasthc.com
E-mail szfzjt@chinasthc.com
2. Contact person and contact manner
Board secretary Securities affairs Representative
Name Jiang Peng Li Zhenyu
6/F, Shenzhen Textile Building, No.3 6/F, Shenzhen Textile Building, No.3
Contact address Huaqiang North Road, Futian District, Huaqiang North Road, Futian District,
Shenzhen Shenzhen
Tel 0755-83776043 0755-83776043
Fax 0755-83776139 0755-83776139
E-mail jiangp@chinasthc.com lizy@chinasthc.com
3. Information disclosure and placed
Internet website designated by CSRC for publishing the Annual
www.cninfo.com.cn
report of the Company
Newspapers selected by the Company for information Securities Times, China Securities Journal, Shanghai Securities
disclosure Daily,Securities News and www.cninfo.com.cn
Internet website designated by CSRC for publishing the Annual
www.cninfo.com.cn
report of the Company
The place where the Annual report is prepared and placed Office of the Board of directors
4.Changes in Registration
Unified social credit code 91440300192173749Y
Changes is the controlling shareholder in the past (is any) In October 2004,In accordance with the Decision on
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2023 Annual Report
Establishing Shenzhen Investment Holdings Co., Ltd. issued by
State-owned Assets Administration Committee of Shenzhen
Municipal People's Government (Shen Guo Zi Wei (2004) No.
223 Document), Shenzhen Investment Management Co., Ltd.,
the controlling shareholder of the Company, and Shenzhen
Construction Holding Company and Shenzhen Commerce and
Trade Holding Company merged into Shenzhen Investment
Holdings Co., Ltd.
5. Other Relevant Information
CPAs engaged
Deloitte Touche Tohmatsu CPA Ltd.(special general
Name of the CPAs
partnership)
Office address： 30/F, No.222,Yanan East Road, Qingpu District, Shanghai
Names of the Certified Public Accountants as the signatories Huang Tianyi, Chen Jun Heng
The sponsor performing persistent supervision duties engaged by the Company in the reporting period.
□ Applicable√ Not applicable
The Financial advisor performing persistent supervision duties engaged by the Company in the reporting period
□ Applicable√ Not applicable
6. Summary of Accounting data and Financial index
May the Company make retroactive adjustment or restatement of the accounting data of the previous years
□ Yes √ No
Changes of this period
2023 2022 over same period of 2021
Last year(%)
Operating income
3,079,678,375.45 2,837,988,264.36 8.52% 2,330,061,681.00
（Yuan）
Net profit attributable
to the shareholders of
the listed company 79,268,250.45 73,309,182.94 8.13% 55,733,468.82
（Yuan）
Net profit after
deducting of non-
recurring gain/loss
attributable to the 62,328,667.73 61,951,894.68 0.61% 41,288,192.98
shareholders of listed
company（Yuan）
Cash flow generated by
business operation, net 184,766,739.80 490,238,550.60 -62.31% -4,436,980.35
（Yuan）
Basic earning per
0.16 0.14 14.29% 0.11
share(Yuan/Share)
Diluted gains per
0.16 0.14 14.29% 0.11
share(Yuan/Share)
Weighted average
2.77% 2.59% 0.18% 2.00%
ROE(%)
Changed over last year
End of2023 End of2022 （％） End of2021
Gross assets（Yuan） 5,649,822,363.44 5,617,137,367.90 0.58% 5,563,539,326.16
Net assets
attributable to
shareholders of the 2,882,152,266.22 2,849,264,555.21 1.15% 2,811,366,974.46
listed company
（Yuan）
The lower of the company’s net profit before and after the deduction of non-recurring gains and losses in
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2023 Annual Report
the last three fiscal years is negative, and the auditor's report of the previous year shows that the Company’s
going concern ability is uncertain.
□ Yes √No
The lower of the net profit before and after the deduction of the non-recurring gains and losses is negative.
□ Yes √No
7.The differences between domestic and international accounting standards
1 ） Simultaneously pursuant to both Chinese accounting standards and international accounting standards
disclosed in the financial reports of differences in net income and net assets.
□ Applicable□√ Not applicable
None
2） Differences of net profit and net assets disclosed in financial reports prepared under overseas and Chinese
accounting standards.
□ Applicable √Not applicable
None
8.Main Financial Index by Quarters
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating income 679,306,013.14 810,789,656.41 827,289,643.21 762,293,062.69
Net profit
attributable to the
13,108,613.21 23,198,549.76 30,277,434.06 12,683,653.42
shareholders of the
listed company
Net profit after
deducting of non-
recurring gain/loss
7,600,013.36 16,086,591.17 28,366,690.84 10,275,372.36
attributable to the
shareholders of listed
company
Net Cash flow
generated by business 2,240,056.33 12,162,917.27 50,337,535.36 120,026,230.84
operation
Whether significant variances exist between the above financial index or the index with its sum and the
financial index of the quarterly report as well as semi-annual report index disclosed by the Company.
□Yes No
9.Items and amount of non-current gains and losses
√Applicable □Not applicable
In RMB
Items Amount (2023) Amount (2022) Amount (2021) Notes
Non-current asset
disposal
gain/loss(including the
1.72 31,264.60 -961,982.35
write-off part for which
assets impairment
provision is made)
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2023 Annual Report
Government
subsidy recognized in
current gain and
loss(excluding those Mainly for the
19,927,836.02 11,048,569.36 7,747,114.25
closely related to the government subsidies.
Company’s business
and granted under the
state’s policies)
Except for effective
hedging business
related to the normal
operation of the
company, the fair value
gains and losses arising
from the holding of
financial assets and
2,151,780.82
financial liabilities by
non-financial
enterprises, as well as
the gains and losses
arising from the
disposal of financial
assets and financial
liabilities
Reverse of the
provision for
impairment of accounts
15,031,480.15 989,313.04
receivable undergoing
impairment test
individually
Net amount of non-
operating income and
-6,755,922.25 7,516,025.10 19,964,046.87
expense except the
aforesaid items
Other non-recurring
0.00 0.00 0.00
Gains/loss items
Less :Influenced
3,478,333.83 3,294,064.39 4,241,451.36
amount of income tax
Influenced amount
of minor shareholders’ 9,937,259.91 3,944,506.41 9,051,764.61
equity (after tax)
Total 16,939,582.72 11,357,288.26 14,445,275.84 --
Details of other profit and loss items that meet the non-recurring profit and loss definition
√Applicable□ Not applicable
Due to the special nature of the impairment provision for management and maintenance expenses advanced by
the Guangzhou-Foshan Expressway to be clarified, it will affect the normal judgment of the Company's
operating performance and profitability by the user of the report.
None
For the Company’s non-recurring gain/loss items as defined in the Explanatory Announcement No.1 on
information disclosure for Companies Offering their Securities to the Public-Non-recurring Gains and Losses
and its non-recurring gain/loss items as illustrated in the Explanatory Announcement No.1 on information
Disclosure for Companies offering their securities to the public-non-recurring Gains and losses which have been
defined as recurring gains and losses, it is necessary to explain the reason.
□ Applicable√ Not applicable
None of Non-recurring gain /loss items recorgnized as recurring gain /loss/items as defined by the information
disclosure explanatory Announcement No.1- Non –recurring gain/loss in the report period.
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2023 Annual Report
III. Management Discussion & Analysis
I. Industry information of the Company during the reporting period
Polarizers are also known as polaroid, which can control the polarization direction of specific light beams.
When natural light passes through the polarizer, the light whose vibration direction is perpendicular to the
transmission axis of the polarizer will be absorbed, leaving only polarized light whose vibration direction is
parallel to the transmission axis of the polarizer. The downstream polarizer is mainly used in the panel industry.
According to different panel types, polarizers mainly include TN, STN, TFT and OLED. Currently, the global
polarizer market is dominated by polarizers for TFT-LCD panels. Each LCD panel requires two polarizers.
The high-quality development of the polarizer industry has a profound impact on the entire display industry. As
one of the three core raw materials for display panels, the demand for polarizers is directly affected by the
fluctuations in the display panel market. In recent years, with the accelerated transfer of the global display panel
industry to Chinese Mainland, China's polarizer industry has ushered in a stage of rapid development. The
capacity scale and process technology level of domestic polarizer manufacturers have continued to rise. The status
and influence of China's polarizer industry in the global market have significantly improved, and Chinese
Mainland has become the world's largest polarizer production base.
The company is one of the main domestic polarizer research and development, production, and sales
enterprises. It is a pioneer in the polarizer industry in China and has now developed into a leading enterprise in
the domestic polarizer industry, becoming an important supplier of mainstream panel enterprises worldwide. In
2023, affected by the severe and complex global economic and political situation, global demand for display
panels and terminal markets has slowly recovered. However, polarizer companies still face significant
operational pressures such as intensified market competition, declining sales prices, and rising raw material
costs.
II.Main Business the Company is Engaged in During the Report Period
1.The company's main business
The company's main business covered such the high and new technology industry as represented by LCD
polarizer, its own property management business and the retained business of high-end textile and garment.
During the reporting period, the Company's main business has not changed significantly.
First, the Company actively adjusts the product structure, implements the product differentiation strategy,
further optimizes the product structure, increases the proportion of large-size products, increases the market
share of high-value products, implements the policy of "ensuring utilization" and seizes market share; Second, it
carries out lean management in depth, continuously strengthens efficiency improvement, significantly reduces
production line switching time, reduces production costs and strengthens production management by unifying
production technology, to continuously reduce the loss rate of main raw materials, and increase the product
yield rate to a higher level in the industry; Third, it strengthens the guidance of innovation, accelerates the
construction of a market-oriented and professional R&D management system, focuses on key technologies and
product research, completes the process optimization and upgrading of No.4 wide production line, realizes the
mass production delivery of 55-inch and 65-inch high-transmittance OLED TV polarizers, and completes the
development of high alkali-resistant fixed-curvature OLED mobile phone polarizers; Fourth, it actively
promotes the elimination of enterprises with "non-main business assets non-dominant business assets,
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2023 Annual Report
inefficient assets and ineffective assets", steadily promotes the survival of the fittest, promotes the concentration
of resources from non-non-main business to main business, and improves the efficiency of resource allocation;
Fifth, it strengthens supervision and management, well ensures work safety, formulates safety management
system, strengthens safety training and education, carries out safety risk management and control, investigates
and rectifies hidden dangers, consolidates weak links and prevents accidents; Sixth, it continues to well ensure
the lease of its own property, improves service quality, and carries out the improvement of textile business
operation; Seventh, it promotes major asset restructuring, and actively promotes the audit, evaluation, due
diligence and other work involved in this transaction with relevant parties.
2.Main products and their purposes
Currently, the Company has 7 mass production lines for polarizers, covering TN, STN, TFT, OLED, 3D, dye
sheet, optical film for touch screen and other fields, It is mainly used in TV, laptops, navigators, monitors, on-
board equipment, industrial control, instrumentation, smart phones, wearable devices, 3D glasses, sunglasses
and other products.
the company has become a mainstream panel company such as Huaxing Optoelectronics, BOE, Sharp, LGD,
Shenzhen Tianma, Huike, etc. by continuously strengthening sales channel expansion and building its own
brand. Qualified suppliers.
The Company's main products made in each polarizer production line and their application are as follows:
Line Place Product breadth Planned capacity Main projuct
Line 1 Pingshan 500mm 600，000 m2 TN/STN/ Dye sheet
Line 2 Pingshan 500mm 1.2 million m2 TN/STN/CSTN
Line 3 Pingshan 650mm 1 million m2 TFT
Line 4 Pingshan 1490mm 6 million m2 TFT/OLED
Line 5 Pingshan 650mm 2 millin m2 TFT/OLED
Line 6 Pingshan 1490mm 10 million m2 TFT/OLED
Line 7 Pingshan 2500mm 32 millin m2 TFT/OLED
3.Company's business model
The polarizer industry has gradually shifted from a traditional business model of R&D, production, and sales to a
customer-centric, joint research and development, and comprehensive service business model. By understanding
customer needs, joint research and develop, manage high-standard production, manufacture high-quality products,
use advanced polarizer roll and attaching equipment to cooperate with downstream panel manufacturers'
production lines, reduce production links, reduce production and transportation costs, and create value for
customers, win-win.
4. Major factors for driving the Company's performance
Refer to "III. Analysis on core competitiveness" in this section for details.
5. Market position of company products
The company is one of the main polarization film research and development, production, and sales enterprises
in China. It began to engage in polarization film business in 1995 and achieved mass production of the first
polarization film in China in 1998. It is a pioneer in the polarization film industry in China and has now
mastered the core technology of TN/STN, TFT-LCD, OLED display polarization film research and production.
It is one of the few polarization film manufacturers in China with the ability to produce a full range of large,
medium, and small size polarization film products. It is the first to achieve mass production of polarization
films for OLED TVs and OLED phones, filling the domestic gap.
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2023 Annual Report
The company mainly produces polarizing film products for medium and large-sized TFT-LCD. The company's
Line 7 is one of the few 2500mm ultra wide polarizing film production lines in the world, which can meet the
needs of higher generation panel production lines such as the 8.5/8.6/10.5/11 generation globally. Especially
matching the 10.5/11 generation line has the best economic production efficiency, and has industry-leading
advantages in the technical level and production capacity of ultra large and large-sized products.
6. Advantages and disadvantages in competition
(1) Competitive edge
See "III. Analysis of core competitiveness" in this chapter for details.
(2) Competitive disadvantage
See "XI. Future development prospect of the Company (III) Possible risks" in this chapter for details.
III. Analysis On core Competitiveness
(I) Technology advantages. SAPO Photoelectric is the first domestic national high-tech company which entered
into the R&D and production of the polarizer，We are one of the largest, most technical and professional
polarizer R&D teams in the country，With 28 years of operating experience in the polarizer industry, its
products cover mainstream display applications such as TN type, STN type, TFT type, OLED type, etc., and has
a complete set of proprietary technology of polarizer that can meet customer needs and has independent
intellectual property rights of various new products. As of the end of the reporting period, SAPO Photoelectric
has obtained a total of 104 patent authorizations, including 18 domestic invention patents, 82 domestic utility
model patents, and 4 overseas utility model patents. 6 national standards and 2 industry standards independently
drafted and formulated by SAPO Photoelectric are implemented through examination and approval; In addition,
1 industry standard that it participated in the drafting and formulation passed the approval and implementation.
SAPO Photoelectric has three innovative platforms: Guangdong Engineering Technology Research Center,
Shenzhen Polarizing Materials and Technology Engineering Laboratory and Shenzhen Enterprise Technology
Center. It focuses on the R&D and industrialization of OLED and LCD polarizer core production technology,
and the localization research of polarizer raw materials, among which, mass production has been achieved for
the polarizer projects for OLED TV and OLED mobile phones successfully, filling the domestic gap. Based on
the successful development of OLED polarizer products, the Company's "A Polarizer for Improving the
Contrast of OLED Display" was granted a national patent in 2023. Through in-depth research and meticulous
design of the material structure and optical path of OLED polarizer, the patent successfully solved the key
technical problems in the industry and promoted the technical progress in the field of OLED polarizer, which
has high commercial value and application prospects.
（II）Talents advantages.
The Company emphasizes independent innovation and has established its own R&D management system.
At present, it has a polarizer management team and a team of senior technicians with strong technical ability,
rich experience and international vision. In order to adapt to the Company's high-quality development trend, the
Company continues to strengthen the construction of talent team, enhance the core competitiveness of
enterprise talents by stimulating the potential and vitality of existing talents, and lay a solid foundation for the
transformation and upgrading of the Company's strategy .First, the Company attaches great importance to
personnel training and team building, and strives to build an efficient, collaborative and creative technical team,
which team can quickly gain insight into market trends, accurately grasp the technical direction, overcome
technical difficulties, and successfully launch a number of influential innovative products such as ultra-large
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2023 Annual Report
size TV polarizers and OLED TV/mobile phone polarizers; Second, it further enriches the ranks of middle-level
cadres and core talents, and supplements them with core talents through market-oriented recruitment, social
recruitment and internal introduction of subordinate enterprises; Third, it strengthens the exchange and study of
internal personnel, combined with the actual situation of the Group, after full communication and brewing, it
continuously carried out the two-way exchange and training activities of cadres and talents of the Group and its
affiliated enterprises in 2023, which strengthened the communication and exchange of talents between the
Group headquarters and its affiliated enterprises, enhanced the comprehensive ability and performance ability of
employees, and stimulated the vitality of cadres; Fourth, according to the principle of "strategic leading,
performance-orientation, fairness and justice", the Company has established a performance-based salary
assessment and distribution mechanism of "efficiency first, fairness emphasized, rewarding the excellent and
punishing the poor, allowing both high and low based on performance, and combining incentives and
constraints", reasonably determining the salary structure and level, and forming an incentive and constraint
mechanism in which value creation determines value distribution.
(III).Market advantages.
The Company has a good market customer base at home and abroad. Compared with advanced foreign
peers, its biggest advantage lies in the localization supporting ability close to the panel market and the strong
support of the national industrial policy.In terms of market demand, with the continuous mass production of
domestic 10.5/11 generation TFT-LCD panel production lines, the domestic polarizer market demand has also
increased; And with the further acceleration of the development of large-size panels, mainland manufacturers
with large-size polarizers have ushered in important industry opportunities. In terms of market development, the
Company focuses on customer demand, constantly optimizes production technology and product structure,
improves quality control, organically combines production and sales, establishes a rapid response mechanism,
gives full play to localization advantages, and earnestly provides peer-to-peer professional services. Around the
overall strategic deployment, it promotes the verification of various models, forms a stable supply chain, and
continuously increases market share.At the same time, it utilizes the capital market for asset restructuring,
implements its development strategy, and seizes the important market opportunity of becoming better and
stronger.
(IV). Quality advantages.
The Company always adheres to the quality policy of "meeting customers' needs, pursuing excellent quality,
promoting green manufacturing and realizing continuous improvement", pays attention to product quality
control, and its products comply with international quality standards. The Company strictly controls product
performance indicators, standardizes incoming inspection standards, and takes quality improvement and
consumption reduction as the starting point to achieve simultaneous improvement of output and quality; It
introduces modern management system, and passes ISO9001 quality management system, ISO14001
environmental management system, ISO450001 occupational health and safety management system,
QCO80000 hazardous substance management system and ISO50001 energy management system certification;
Its products have passed CTI testing, and meet the RoHS directive environmental protection requirements,
realizing the standardized management of the whole process from raw material supply, manufacturing,
marketing to customer service, thus ensuring the stability of product quality.
(V).Management advantages. SAPO Photoelectric has accumulated rich management experiences in more
than 20 years in the manufacturing of polarizer, possessing the home most advanced control technology of the
production management process of the polarizer and quality management technology and the stable raw
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2023 Annual Report
material procurement channel so forth management systems；The Company continues to implement advanced
management system and reasonable incentive mechanism, etc., to improve decision-making efficiency, speed
up market reaction, refine the R&D reward system, and in the meantime to realize the in-depth integration of
enterprise and employee values and stimulate new business vitality; It formulates the work plan for improving
the operation of subordinate companies, set up the operation improvement working group, comprehensively sort
out the Company's operation, and carry out business optimization, cost control and cash flow improvement in a
steady and orderly manner to help improve the Company's production and operation; It strengthens the on-site
technical management level of subordinate companies, enhances the production stability, sets up a film breaking
improvement task team, and the film breaking improvement results of each production line are remarkable;
Through the implementation of the key work management list of "Solid Party Building +, Lean Promotes
Development", it used the lean means to achieve continuous cost reduction and efficiency increase; Through the
implementation of the "Amoeba Business Model" project and segmenting small independent accounting unit to
enable grassroots backbone employees can participate in production and operation activities.
(VI)6.Policy advantages. Polarizer is seen as an essential part of the panel display industry and SAPO
Photoelectric in its development has promoted the supply capacity of national polarizers, greatly lowered the
dependence of national panel enterprises on imported polarizers, and safeguarded the national panel industry, It
has promoted the coordinated development of the entire industrial chain of Shenzhen "20+8" ultra-high definition
video display industry cluster. the Company tightened supplier management, improved its overall purchasing
strategy, and downsized suppliers while introducing a competitive mechanism, wherein focus was given to
introduction of new materials at a competitive price, to further lower its production cost and improve its product
competitiveness.
IV. Main business analysis
Ⅰ.General
The year of 2023 is the first year of a new round of state-owned enterprise reform, and it is also the year
when the Company continues to deepen reform, strengthen independent innovation and improve the quality of
operation.Over the past year, faced with the severe and complicated economic situation, under the strong
leadership of the Board of Directors of the Company, the whole Company has been firmly confident, united and
hard-working. Focusing on the "Tenth Five-Year Plan" strategic plan, it has persisted in deepening the main
business of polarizers, made every effort to promote the continuous improvement of production capacity and
technical level and the continuous breakthrough and innovation of cutting-edge technologies, steadily promoted
major asset restructuring, strived to turn challenges into opportunities, continuously optimized its business
quality and steadily improved its operating efficiency, thus achieving a better overall operation situation and
laying a solid foundation for further transformation and development for the Company.
During the reporting period, the Company achieved an operating income of RMB 3.08 billion, with a year-on-
year increase of 8.52% and a net profit attributable to shareholders of listed companies of RMB 79,268,300,
with an year-on-year increase of 8.13%.
Review of the company's key works carried out in 2023 as follows:
(I) Enhance the operational capability of polarizer business and implement the differentiated development
strategy.
15
2023 Annual Report
In 2023, first, the Company actively optimized the product structure, increased the proportion of ultra-large
polarizer products, implemented the policy of "ensuring utilization" and seized market share; Second, it
strengthened the guidance of innovation, accelerated the construction of a market-oriented and professional
R&D management system, focused on promotion of key technologies and product research, completed the
process optimization and upgrading of No.4 wide production line, completed the new product development and
mass production of 55-inch and 65-inch high-transmittance OLED TV polarizers, and achieved a major
breakthrough in the supply chain system of high-end OLED TV terminal brand manufacturers; Third, it
strengthened technical research, completed the development of high alkali-resistant fixed-curvature OLED
mobile phone polarizer, passed the strict test and verification of mainstream panel manufacturers, entered the
supply chain system of domestic smart phone brand terminal manufacturers and achieve massed production;
Fourth, it carried out in-depth refined management, continuously improved production capacity and yield,
reduced losses, and thus improved comprehensive production efficiency, in which product yield was raised to a
higher level in the industry; Fifth, it continuously improved the level of production technology, actively
promoted cost reduction and quality improvement, strengthened the on-site management level, set up a film
breaking improvement task team, effectively solving the problem of film breaking in production, and achieving
remarkable results in film breaking improvement in various production lines; Sixth, it improved product
performance, promoted the performance of glue materials to improve product durability, and greatly reduced
inventory pressure and customer complaint risk.
It completed the application for 10 new patents in 2023, including 5 invention patents and 5 utility model
patents; And it was granted with 7 authorized patents, including 1 invention patent and 6 utility model
patents.By the end of 2023, the Company was granted with 104 authorized patents, including 18 invention
patents and 86 utility model patents.
The Company has three innovative platforms: Guangdong Engineering Technology Research Center,
Shenzhen Polarizing Materials and Technology Engineering Laboratory and Shenzhen Enterprise Technology
Center. It focuses on the R&D and industrialization of OLED and LCD polarizer core production technology,
and the localization research of polarizer raw materials, among which, mass production has been achieved for
the OLED TV polarizers and OLED mobile phone polarizers successfully, filling the domestic gap.Based on the
successful development of OLED polarizer products, the Company's "A Polarizer for Improving the Contrast of
OLED Display" was granted a national patent in 2023. Through in-depth research and meticulous design of the
material structure and optical path of OLED polarizer, the patent successfully solved the key technical problems
in the industry and promoted the technical progress in the field of OLED polarizer, which has high commercial
value and application prospects.
(II) Cooperate with upstream and downstream manufacturers on technical research and create an innovation
ecosystem
In 2023, the Company paid attention to multi-party collaboration, cooperated with upstream and
downstream manufacturers in the new display industry chain, worked together to build an innovation ecosystem
and achieved outstanding results in many fields.First, it worked with the upstream optical module material
manufacturers and downstream panel enterprises to carry out technical research on the project of OLED circular
polarizers and optical compensation films, and obtained state funding. The project is expected to make
important contributions to the localization of key materials of OLED polarizers and the industrialization of
domestic OLED polarizers.Second, it cooperated with the leading manufacturers in the touch panel industry to
carry out technical research on nano-silver touch integrated polarizer, and completed the development and
customer verification of nano-silver touch integrated OLED polarizer.Third, it cooperated with panel
16
2023 Annual Report
manufacturers to develop car polarizers, and the "Research and Development of Key Technologies of Polarizers
for Car Display" won the policy support from Shenzhen.
(III) Stabilize property leasing and management business and maintain sufficient cash flow
In 2023, facing the grim situation of the downturn in the leasing market, property companies continued to
improve their management and made steady progress in their business development. First, it actively carried out
market research to analyze the needs of potential customers and judge the future development trend of the
leasing market, and formulated a refined annual leasing plan; Second, it strengthened management, designed
flexible lease terms and flexible payment methods to ensure the implementation and landing of the annual lease
plan; Third, it actively responded to the needs of tenants, steadily improved service quality and enhanced tenant
satisfaction; Fourth, it carried out refined and standardized management to improve the comprehensive ability
of property management.The revenue and total profit of property leasing and management business continued to
grow throughout the year, which provided sufficient cash flow for the Company's business development.
(IV) Orderly carry out the operation improvement work of textile
In 2023, the textile business faced significant operational pressure due to factors such as declining
consumer demand and market contraction. Based on the actual operating conditions, the company formulates an
improvement work plan, establishes a working group, steadily and orderly carries out business optimization,
cost control and other work, continuously optimizes personnel, revitalizes existing assets, strengthens fund
control, and promotes the improvement of Meibai Nian Company's operation.
(V) Actively promote the disposal of "two non two assets" and promote the concentration of resources
towards the main business
In 2023, in order to revitalize idle assets, optimize resource allocation, and promote high-quality
development, the company will plan and grasp key points in accordance with the requirements for the clearance
of "two non two assets", and orderly promote the clearance work. One is to complete the cancellation and
removal of Shenzhen Shengjinlian Technology Co., Ltd; The second is to complete the deregistration and
retirement of the joint venture company Yehui (Jordan) Clothing Factory Co., Ltd; Thirdly, the liquidation and
cancellation work of Shenzhen Huaqiang Hotel Co., Ltd. will be initiated within the year.
(VI) Carry out major asset restructuring in depth and promote industrial integration
In 2023, the Company continued to promote the acquisition of 100% equity of Hengmei Optoelectronics
Co., Ltd. (hereinafter referred to as "this restructuring") by issuing shares and paying cash, and simultaneously
carried out related work of raising supporting funds.Due to the changes in the shareholder composition and
shareholding ratio of the target company Hengmei Optoelectronics during the reorganization, it is necessary to
adjust the counterparty of this restructuring and the transaction plan according to the requirements of the
relevant rules of the registration system. At present, while intermediaries continue to promote the overtime audit,
evaluation and supplementary due diligence of the target company, the Company further negotiates the
transaction details with the counterparty to consolidate the restructuring transaction plan.After the transaction
plan is determined and the state-owned assets examination and approval procedures are fulfilled, the Company
will convene the meeting of the Board of Directors again to consider matters related to this transaction.
This restructuring is the adjustment and optimization of the Company's main polarizer business in the face
of the rapidly developing new display industry environment. Through the integration of high-quality resources
in the same industry and the realization of large-scale development, the restructuring will help the Company to
optimize the industrial chain layout in the polarizer industry, deepen the depth of technical reserves, enhance its
core competitiveness, enhance its overall profitability, give full play to the synergistic effect, and help it become
a bigger and stronger listed company.
17
2023 Annual Report
(VII) Strengthen safety awareness and earnestly well ensure safety and environmental protection
In 2023, the Company adhered to the work safety policy of "safety first, prevention foremost and
comprehensive treatment", firmly established the concept of safety development, continuously consolidated the
Company's work safety foundation, made great efforts to improve the safety management level and strive to
create a good safety environment. First, improve the safety production responsibility system, and subordinate
enterprises implement the safety target responsibility letter signed at different levels as required, consolidate the
main responsibility of work safety, and ensure that the safety responsibility is implemented "horizontally to
edge and vertically to the bottom"; Second, improve the safety management system, compile the safety
management system, strengthen the on-site safety inspection for the engineering projects of the affiliated
enterprises, standardize the punishment standards for work safety accidents, and increase the punishment for
safety accidents; Third, carry out safety education and training, organize emergency drills, and improve
emergency handling of safety incidents and safety management; Fourth, actively implement the environmental
protection upgrading and transformation, practice the sustainable development production concept of green
environmental protection, energy conservation and consumption reduction, and continue to save energy and
reduce emissions.
(VIII) Improve the quality of party building and lead the healthy development of the enterprise
In 2023, the company will strengthen the construction of party conduct and clean governance, conduct solid
research on party building topics, deeply analyze the problems and difficulties faced by the company's current
business management, and lead the company's high-quality development with high-quality party building. By
guiding party members to tackle key technical difficulties, party building empowers and promotes business
development more effectively. The problem of PVA film breakage on the production line has been significantly
improved, resulting in a cumulative cost savings of over 30 million yuan.
2. Revenue and cost
(1) Component of Business Income
In RMB
2023 2022
Increase /decrease
Amount Proportion Amount Proportion
Total operating
3,079,678,375.45 100% 2,837,988,264.36 100% 8.52%
revenue
On Industry
Manufacturing 2,968,884,717.77 96.40% 2,722,034,654.94 95.91% 9.07%
Lease and
Management of 110,793,657.68 3.60% 115,953,609.42 4.09% -4.45%
Property
On Products
Polarizer sheet 2,885,625,542.77 93.70% 2,693,787,636.62 94.92% 7.12%
Lease and
Management of 194,052,832.68 6.30% 144,200,627.74 5.08% 34.57%
Property
Area
Domestic 2,963,091,439.22 96.21% 2,722,632,231.25 95.94% 8.83%
Overseas 116,586,936.23 3.79% 115,356,033.11 4.06% 1.07%
Sub-sale model
Credit 2,948,168,591.89 95.73% 2,642,221,654.15 93.10% 11.58%
Cash on sale 131,509,783.56 4.27% 195,766,610.21 6.90% -32.82%
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2023 Annual Report
(2)Situation of Industry, Product and District Occupying the Company’s Business Income and Operating Profit
with Profit over 10%
√ Applicable □Not applicable
In RMB
Increase/decrea Increase/decrea
Increase/decrea
se of business se of gross
se of revenue in
Gross profit cost over the profit rate over
Turnover Operation cost the same period
rate(%) same period of the same period
of the previous
previous year of the previous
year(%)
(%) year (%)
On Industry
2,968,884,717. 2,539,763,710.
Manufacturing 14.45% 9.07% 8.03% 0.82%
77 92
On Products
2,885,625,542. 2,499,416,729.
Polarizer sheet 13.38% 7.12% 7.84% -0.58%
77 45
Area
2,963,091,439. 2,469,125,834.
Domestic 16.67% 8.83% 8.35% 0.37%
22 03
Sub-sale model
2,948,168,591. 2,500,093,866.
Credit 15.20% 11.58% 13.82% -1.67%
89 48
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main
business based on latest on year’s scope of period-end.
□ Applicable √Not applicable
(3) Whether the Company’s Physical Sales Income Exceeded Service Income
√ Yes □ No
Classification Items Unit 2023 2022 Changes
10,000 square
Sales 4,067.17 3,537.08 14.99%
meters
10,000 square
Polarizer sheet Production 4.059.98 3,518.80 15.38%
meters
10,000 square
Stock 105.22 112.41 -6.40%
meters
Explanation for a year-on –year change of over 30%
□ Applicable √ Not applicable
(4)Degree of Performance of the Significant Sales Contract Signed up to this Report Period
□ Applicable √Not applicable
(5)Component of business cost
Industry category
In RMB
2023 2022
Industry Proportion Increase/De
Items Proportion in
classification in the
Amount Amount the operating crease (%)
operating
costs (%)
costs (%)
Polarizer sheet, 2,539,763,710. 2,350,898,811.
Manufacturing 99.15% 99.03% 8.03%
Knitted clothing 92 44
19
2023 Annual Report
Lease of
Lease of Property
Property and 21,868,133.61 0.85% 23,107,084.99 0.97% -5.36%
and others
others
Product category
In RMB
2023 2022 Increase/Decrea
Industry Proportion in Proportion in se (%)
Items
classification Amount the operating Amount the operating
costs (%) costs (%)
2,037,672,15 1,825,615,76
Polarizer sheet Direct materials 81.53% 76.90% 11.62%
0.22 1.47
56,414,151.2 61,855,540.3
Polarizer sheet Direct labor 2.26% 2.61% -8.80%
8 7
74,399,845.1 68,806,666.7
Polarizer sheet Power cost 2.98% 2.90% 8.13%
8 3
Manufacturing 330,930,582. 361,515,128.
Polarizer sheet 13.23% 15.23% -8.46%
and cost 77 87
Note
(6)Whether Changes Occurred in Consolidation Scope in the Report Period
□ Yes √ No
(7)Relevant Situation of Significant Changes or Adjustment of the Business, Product or Service in the
Company’s Report Period
□ Applicable √Not applicable
(8)Situation of Main Customers and Main Supplier
Information of Main Customers
Total sales amount to top 5 customers (RMB) 2,151,239,401.31
Proportion of sales to top 5 customers in 69.85%
Proportion of the sales volume to the top five customers in the
0.00%
total sales to the related parties in the year
Information of the Company’s top 5 customers
No Name Amount（RMB） Proportion(%)
1 Customer 1 943,955,872.82 30.65%
2 Customer 2 413,109,606.84 13.41%
3 Customer 3 338,699,601.68 11.00%
4 Customer 4 280,667,500.69 9.11%
5 Customer 5 174,806,819.28 5.68%
Total -- 2,151,239,401.31 69.85%
Other note
□ Applicable √ Not applicable
Principal suppliers
Total purchase of top 5 Suppliers（RMB） 936,958,039.17
Percentage of total purchase of top 5 suppliers In total annual
39.02%
purchase(%
Proportion of purchase amount from the top 5 suppliers in the
0.00%
total purchase amount from the related parties in the year
Information about the top 5 suppliers
No Name Amount（RMB） Proportion(%)
1 Supplier 1 272,540,426.36 11.35%
2 Supplier 2 258,042,882.44 10.75%
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2023 Annual Report
3 Supplier 3 232,584,736.46 9.69%
4 Supplier 4 110,044,625.22 4.58%
5 Supplier 5 63,745,368.69 2.65%
Total -- 936,958,039.17 39.02%
Other note
□ Applicable √Not applicable
3.Expenses
In RMB
2023 2022 Increase/Decrease(%) Notes
Sale expenses 34,195,670.61 35,962,529.35 -4.91%
Administrative
134,371,410.53 128,388,940.29 4.66%
expenses
It was mainly due to
the fluctuation of
Financial expenses 24,399,501.16 12,943,606.57 88.51%
foreign currency
exchange rate.
It was mainly due to
R & D expenses 104,653,040.92 80,520,155.54 29.97% the increase in R&D
investment.
4. Research and Development
√ Applicable □ Not applicable
Expected impact on the
Name of main R&D
Project purpose Project progress Goal to be achieved future development of
project
the Company
Development of MNT Provide new market
Achieve mass
polarizer with high High-end model of Completed growth points and
production and supply
transmittance and high layout product
of clients.
polarization competitiveness.
Increase the order
Import large-size volume of OLED TV
Development of Development of large- products successfully polarizers and enhance
Completed
1,540mm wide OLED size OLED TV into the client to the Company's
circular polarizer products achieve mass competitiveness in the
production delivery. field of OLED TV
polarizers
As the Company's first
iterative product for
Solve the artificial mass production of
Improve product
Key technic alkaline sweat OLED mobile phone
performance and lay Completed
development of resistance, and pass the polarizers, extend its
out the brand mobile
AMOLED polarizer brand mobile phone promotion on high-end
phone market
terminal verification. brand mobile phones to
solve the problem in
industrial chain.
Development of TV Through customer
Requirements of
polarizer with high Completed verification, the
industry technology Ensure the company's
transmittance and high volume verification is
development trend ability to take orders.
polarization completed.
Requirements for
Research on extension
improving quality, Completed Reduce waste cost of
core technology of Reduce switching.
reducing consumption chemical materials.
ultra-wide polarizer
and controlling cost.
21
2023 Annual Report
Improve the product
Development of high IPS high-transmittance
performance and
performance polarizer products can meet the
Requirements for competitiveness, and at
for IPS mobile Partially completed reliability requirements
terminal brand models. the same time
consumer electronic of 65°C* 95%RH*14
effectively increase the
products days
market share.
Company's research and development personnel situation
2023 2022 Increase /decrease
Number of Research and
Development persons 178 184 -3.26%
(persons)
Proportion of Research and
12.57% 12.00% 0.57%
Development persons
The Company's R & D investment situation
2023 2022 Increase /decrease
Amount of Research and
Development Investment (In 104,653,040.92 80,520,155.54 29.97%
RMB)
Proportion of Research and
Development Investment of 3.40% 2.84% 0.56%
Operation Revenue
Amount of Research and
Development Investment 0.00 0.00 0.00%
Capitalization (In RMB)
Proportion of Capitalization
Research and Development
0.00% 0.00% 0.00%
Investment of Research and
Development Investment
Reasons and influence of significant changes in R&D personnel composition of the Company
□ Applicable √Not applicable
The Reason of the Prominent Change in Total Amount of Research and Development Input Occupying the
Business Income Year on Year
□ Applicable √Not applicable
Reasons for the drastic change of capitalization rate of R&D investment and its rationality explanation
□ Applicable √Not applicable
5.Cash Flow
In RMB
Items 2023 2022 Increase/Decrease(%)
Subtotal of cash inflow -8.89%
received from operation 3,078,145,063.09 3,378,370,114.97
activities
Subtotal of cash outflow 0.18%
received from operation 2,893,378,323.29 2,888,131,564.37
activities
Net cash flow arising from
184,766,739.80 490,238,550.60 -62.31%
operating activities
Subtotal of cash inflow
received from investing 1,467,781,075.59 1,362,677,014.25 7.71%
activities
Subtotal of cash outflow for
1,904,569,967.97 1,263,644,263.66 50.72%
investment activities
Net cash flow arising from
-436,788,892.38 99,032,750.59 -541.05%
investment activities
Subtotal cash inflow received
8,000,000.00 73,230,492.79 -89.08%
from financing activities
Subtotal cash outflow for
169,488,356.86 92,382,872.47 83.46%
financing activities
22
2023 Annual Report
Net cash flow arising from
-161,488,356.86 -19,152,379.68 -743.18%
financing activities
Net increase in cash and cash
-413,054,377.13 572,066,400.74 -172.20%
equivalents
Notes to the year-on-year change of the relevant data
√ Applicable □ Not applicable
The net cash flow from investment activities increased by -541.05% year-on-year, mainly due to the purchase of
structured deposits and bank wealth management products during the reporting period;
The net cash flow generated by fund-raising activities increased by -743.18% year-on-year, mainly due to the
repayment of loan
The net increase in cash and cash equivalents was -172.20% year-on-year, mainly due to the purchase of
structured deposits and bank wealth management products during the reporting period.
Reasons of major difference between the cash flow of operation activity in report period and net profit of the
Company
□ Applicable √ Not applicable
V.Analysis of Non-core Business
√ Applicable □Not applicable
In RMB
Proportion in total
Amount Explanation of cause Sustainable (yes or no)
profit
It was mainly the
income obtained by the
Company from
purchasing the Have the sustainability
Investment income 10,828,635.56 7.39%
unexpired part of
wealth management
products during the
reporting period.
It was mainly the
income obtained by the
Company from
Gains and losses on purchasing the
2,151,780.82 1.47% Not sustainable.
changes in fair value unexpired part of
wealth management
products during the
reporting period.
It was mainly due to
the Company's
inventory depreciation
provision in Have the sustainability
Impairment of assets -126,089,709.42 -86.04%
accordance with
accounting policies
during the reporting
period.
It was mainly due to
Non-operating income 1,449,879.26 0.99% the Company's receipt Not sustainable.
of liquidated damages
23
2023 Annual Report
during the reporting
period.
It was mainly due to
the Company's
Non-operating expense 8,205,801.51 5.60% payment for quality Not sustainable.
claims during the
reporting period.
It was mainly due to
the fact that the
Company received
government subsidies
Have the sustainability
Other income 50,740,363.91 34.62% and enjoyed
preferential policies of
value-added tax
deduction during the
reporting period.
VI.Condition of Asset and Liabilities
1.Condition of Asset Causing Significant Change
In RMB
End of 2023 End of 2022
Proportion Notes to the
Proportion in Proportion in increase/decrea significant
Amount the total Amount the total se change
assets(%) assets(%)
Mainly due to
the purchase of
Monetary fund 472,274,448.00 8.36% 991,789,968.19 17.66% -9.30% wealth
management
products
It was mainly
due to the
Company's
income growth
during the
Accounts reporting
820,134,833.95 14.52% 636,583,469.93 11.33% 3.19%
receivable period and the
extension of
some
customers'
account
periods.
It was mainly
due to the
Company's
Inventories 736,392,172.27 13.03% 558,447,648.77 9.94% 3.09%
stocking during
the reporting
period.
Investment real
125,603,207.18 2.22% 126,315,834.76 2.25% -0.03%
estate
Long-term
equity 127,682,020.70 2.26% 134,481,835.74 2.39% -0.13%
investment
2,066,006,237. 2,240,221,656. Mainly due to
Fixed assets 36.57% 39.88% -3.31%
73 36 depreciation.
Construction in
31,307,060.74 0.55% 38,061,619.60 0.68% -0.13%
process
24
2023 Annual Report
Use right assets 11,999,466.57 0.21% 15,365,393.88 0.27% -0.06%
Short-term
8,000,000.00 0.14% 7,000,000.00 0.12% 0.02%
borrowing
Contract
1,436,943.34 0.03% 4,274,109.40 0.08% -0.05%
liabilities
It was mainly
due to the
Long-term Company's
505,578,314.56 8.95% 607,421,585.00 10.81% -1.86%
borrowing stocking during
the reporting
period.
Lease liabilities 6,687,317.22 0.12% 8,628,672.71 0.15% -0.03%
Mainly due to
the purchase of
Transaction
821,946,114.68 14.55% 319,605,448.44 5.69% 8.86% wealth
financial assets
management
products
Other payable 184,528,344.55 3.27% 197,345,455.37 3.51% -0.24%
Overseas assets account for a relatively high proportion.
□ Applicable √ Not applicable
2.Asset and Liabilities Measured by Fair Value
√Applicable □ Not applicable
In RMB
Gain/Loss
on fair Cumulative Impairment Purchased Sold
value fair value provisions amount in amount in
Opening Other Closing
Items change in change in the the the
amount changes amount
the recorded reporting reporting reporting
reporting into equity period period period
period
Financial assets
1. Financial
assets
measured
at fair
value
through 319,605,44 2,151,780.8 1,690,500,0 1,195,000,0 4,688,885.4 821,946,11
0.00 0.00
profit or 8.44 2 00.00 00.00 2 4.68
loss
(excluding
derivative
financial
assets)
2.
Derivative
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
financial
assets
3.Other
creditor's
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
right
investment
-
4．Other 167,678,28 145,988,90
0.00 21,689,383. 0.00 0.00 0.00 0.00
equity 3.27 0.00
27
25
2023 Annual Report
Instrument
Investment
5.Other
Non-
current 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Financial
assets
Subtotal of -
487,283,73 2,151,780.8 1,690,500,0 1,195,000,0 4,688,885.4 967,935,01
financial 21,689,383. 0.00
1.71 2 00.00 00.00 2 4.68
assets 27
Real Estate
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
investment
Productive
biological 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
assets
Other 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
-
487,283,73 2,151,780.8 1,690,500,0 1,195,000,0 4,688,885.4 967,935,01
Total 21,689,383. 0.00
1.71 2 00.00 00.00 2 4.68
27
Financial
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Liability
Other changes
None
Did great change take place in measurement of the principal assets in the reporting period ?
□ Yes √ No
3. Restricted asset rights as of the end of this Reporting Period
The restricted assets as at the end of the reporting period are monetary funds, notes receivable, fixed assets and
intangible assets, including:
(1) The restricted monetary funds mainly include the restricted funds equivalent to RMB 3,400,000.00 due to
the freezing of the account, And the Note margin of RMB 5,905,118.06 .
and RMB 115,719,927.09 of the principal and interest of the deposit due more than three months from the date
of purchase
(2) Restricted notes receivable shall be notes receivable endorsed or discounted by the Company and not yet
due on the balance sheet date.
(3) limited fixed assets and intangible assets are mainly subsidiary SAPO photoelectric with its part of self
sustaining property to the bank of communications co., Ltd. Shenzhen branch as the lead of syndicated
application for mortgage loans, and the company for the mortgage guarantee, see the tide of information
network (http://www.cninfo.com.cn) company on the company for subsidiary bank mortgage guarantee
announcement (2020-19), the announcement of the progress of the company for the subsidiary guarantee (2020-
46).
VII. Investment situation
1. General
□ Applicable √Not applicable
2.Condition of Acquiring Significant Share Right Investment during the Report Period
□ Applicable √Not applicable
26
2023 Annual Report
3.Situation of the Significant Non-equity Investment Undergoing in the Report Period
□ Applicable √ Not applicable
4.Investment of Financial Asset
（1）Securities investment
□ Applicable √ Not applicable
（2）Investment in Derivatives
□ Applicable √ Not applicable
The Company had no investment in derivatives in the reporting period.
5.Application of the raised capital
□ Applicable √ Not applicable
The Company had no application of the raised capital in the reporting period.
VIII. Sales of major assets and equity
1. Sales of major assets
□ Applicable √ Not applicable
The Company had no sales of major assets in the reporting period.
2.Sales of major equity
□ Applicable √ Not applicable
IX. Analysis of the Main Share Holding Companies and Share Participating Companies
√ Applicable □ Not applicable
Situation of Main Subsidiaries and the Joint-stock Company with over 10% net profit influencing to the
Company
In RMB
Company Main Registered Operating
Type Total assets Net assets Turnover Net Profit
name business capital profit
Shenzhen
Lisi Property
Subsidiary 2,360,000.00 32,343,767.34 26,091,145.71 7,618,402.63 2,984,011.62 3,072,437.36
Industrial lease
Co., Ltd.
Shenzhen
Property
Huaqiang Subsidiary 10,005,300.00 21,117,565.97 20,587,426.97 0.00 -200,059.11 -200,972.20
Hotel lease
Shenzhen
Shenfang Property
Real Estate Subsidiary manageme 1,600,400.00 12,048,598.90 6,502,114.60 15,337,604.85 1,761,604.56 1,661,756.99
Manageme nt
nt Co., Ltd.
Shenzhen Production
Beauty of fully - - -
Subsidiary 13,000,000.00 16,559,745.28 35,017,435.14
Century electronic 12,819,020.61 22,850,886.49 22,846,931.63
Garment jacquard
27
2023 Annual Report
Co., Ltd. knitting
whole
shape
SAPO Production
583,333,333.0 4,434,012,261 3,062,504,373 2,944,147,907 135,338,212.8 119,242,465.5
Photoelectr Subsidiary and sales of
0 .90 .22 .27 0 4
ic polarizer
Shengtou
Sales of
（HK） Subsidiary HKD10,000 6,638,056.16 6,547,620.59 0.00 428,104.79 428,104.79
polarizer
Co., Ltd.
Shenzhen
Shenfang
Property
Sungang
Subsidiary manageme 1,000,000 11,737,482.85 9,367,913.27 4,962,787.60 2,752,677.73 2,584,909.35
Real Estate
nt
Manageme
nt Co., Ltd.
Shenzhen
Shengjinlia Production
n Subsidiary and sales of 1,000,000 0.00 0.00 0.00 2,984,011.62 0.00
Technolog polarizer
y Co., Ltd.
Subsidiaries obtained or disposed in the reporting period
√ Applicable □ Not applicable
Method of obtained or disposed of
Company name The impact on overall production, operation, and performance
subsidiaries in the reporting period
Complies with the company's strategic planning and has not had
Shenzhen Shengjinlian
deregistered a significant impact on the overall production, operation, and
Technology Co., Ltd.
performance of the company.
Description of the main holding and equity participation companies
The financial data of SAPO Photoelectric mentioned in the table above are the financial statements data of its
parent company and non-consolidated statements data. Shengtou（HK）Co., Ltd. and Shenzhen Shengjinlian
Technology Co., Ltd. are subsidiaries of SAPO Photoelectric.
For details of the fluctuation of subsidiary SAPO Photoelectric's performance and the reasons for the change,
please refer to "IV. Analysis of main business" in Section III Management Discussion and Analysis
X．Structured vehicle controlled by the Company
□ Applicable √ Not applicable
XI. Prospect for future development of the Company
（I）The Development Trend of the Industry
1. Industry competition pattern
Polarizer industry is a highly concentrated industry. Currently, there are about 10 major polarizer
manufacturers worldwide, mainly in mainland China, Japan, South Korea and Taiwan Province of China.With
the transfer of production capacity and the expansion of Chinese mainland manufacturers, mainland China has
become the largest polarizer production base in the world. According to Omdia data, by the end of 2023, the
global share of Chinese Mainland's polarizer capacity scale is about 54.91%. It is estimated that by 2027, the
share of Chinese Mainland's polarizer capacity scale will further increase to 69.66%. In the competition of ultra
wide polarizer production line brought about by the rapid growth of demand for 65 inch and above large-size
display products, Chinese Mainland is in the forefront of the industry. According to Omdia data, by the end of
28
2023 Annual Report
2023, there are 12 ultra wide production lines with a length of 2.3 meters or more in the world, of which 11
have been built in Chinese Mainland. Polarizer enterprises with good production and operation capacity of ultra
wide production lines will occupy a favorable position in the market competition.
2. Industry trends
With the gradual recovery of the global consumer electronics market and the increasing maturity of
different display technologies and products in multiple scenarios, the global display industry is entering a
recovery and upward trend. With the successive launch of international major events such as the Olympics and
the European Cup, a new cycle of display product replacement has begun. The global demand for display panels
is expected to further stabilize and accelerate its release in 2024. As one of the key upstream raw materials for
display panels, polarizers are expected to fully benefit from the industry's recovery and enter a new round of
demand growth.
In recent years, due to the continuous expansion of production capacity of major panel manufacturers in
Chinese Mainland, the domestic polarizer market demand has grown rapidly. Overseas polarizer manufacturers
have chosen to gradually shrink and exit, and there is significant room for domestic substitution, which has
brought good development opportunities for mainland polarizer manufacturers with market advantages, policy
advantages, and geographical advantages.
With the upgrading of consumption, the demand for large-sized televisions of 65 inches and above is
constantly increasing, bringing huge demand for ultra wide polarization film products. Market institution Omdia
predicts that from 2022 to 2027, the global demand for polarizers 65 inches and above will have a compound
annual growth rate of about 15%. It is expected that by 2027, the demand for large-sized panels 65 inches and
above will increase to 96 million square meters, corresponding to a demand for ultra wide polarizers exceeding
200 million square meters. At the same time, with the trend of OLED displays accelerating their penetration
into mid to large sizes on the basis of high penetration rates in mobile phone products, the demand for multiple
screens brought about by automotive intelligence and electrification, and the promotion of Apple's promotion
plan for OLED IT products, the demand for high-end products such as OLED and car polarizers is rapidly
growing, becoming a blue ocean market that polarizer companies are competing for. Manufacturers with large-
sized polarizer products, as well as high-end cutting-edge polarizer technology reserves and mass production
capabilities such as OLED and automotive, will have a greater competitive advantage.
(II) Company development strategy
Relying on the existing business foundation, the Company will actively plan for business innovation and
upgrading through two paths of tapping the potential of stock business and increasing business investment and
empowerment, vigorously implement the "polarizer+" strategy, promote the core business of polarizers to
become better and stronger, and meanwhile, choose the right opportunity to extend to upstream raw materials,
promote the development of polarizer integration business, actively expand other advanced new material fields,
and strive to build a world-class new material technology group.
(III) Possible risks
1. Macroeconomic risks
At present, the vitality of the market economy has gradually recovered, but the foundation of economic
recovery is still not solid, and residents' consumption is still restricted. As a member of the upstream
manufacturers of the display market, the Company cannot rule out the risk that unpredictable macroeconomic
fluctuations may affect the Company's performance.
2. Market risk
29
2023 Annual Report
The polarizer industry is an important part in the China's future manufacturing development, the demand for
display panels and the development of corresponding technologies have been changing day by day, and the
domestic substitution process of polarizer industry is underway. With the gradual mass production of the 10.5
generation line, the super-large size market will usher in new changes. Where the Company's technology and
products can not respond to the needs of the application field in time, the wide polarizer products or its
applications are not as expected, or the market competition intensifies leading to the price of display products
declining, or the price reduction pressure transits to the polarizer market, then those will adversely affect the
Company.
3. Raw material risk
As the core production technology of polarizer upstream materials has high barriers, it is basically
monopolized by foreign manufacturers and the localization rate is not high. At present, the key raw materials
required to manufacture polarizers, such as PVA film and TAC film, are monopolized by Japanese enterprises,
and the supply of key raw materials is constrained by Japan, while the prices of major film materials are
affected by suppliers' capacity, market demand and yen exchange rate, thus affecting the Company's product
costs.
4. Risk of intensified competition
With major domestic polarizer manufacturers accelerating the construction and expansion of production
lines in recent years, the production capacity of polarizers, especially large-sized polarizers, will continue to
grow in the future. If the downstream consumer market recovers less than expected, the competition in the
polarizer industry will further intensify.
(IV) Key Work in 2024
1. Expand sales, improve quality and efficiency, and promote the steady improvement of polarizer business
In terms of market, grab orders, ensure utilization and adjust the structure, and reduce costs; In terms of
operation, improve efficiency and quality, and promote the steady improvement of polarizer business
operation.First, seek for project increment, follow up the opening of new projects of customers, and improve the
utilization of production lines; Second, upgrade the production line process capacity, improve the on-site
manufacturing environment, improve the AOI detection accuracy and speed; Third, continue to reduce costs and
increase efficiency, focus on key indicators such as product yield, material loss, procurement unit price, energy
consumption, R&D investment, and improve cost-output benefits; Fourth, well ensure importing domestic
materials, reduce material loss and save production costs by combining new technology.
2. Actively promote major asset restructuring and promote the investment layout of the industrial chain
Promote the major asset restructuring in an orderly manner, ensure the completion of this major asset
restructuring project on schedule, realize the strong cooperation in the polarizer industry, rapidly increase the
production scale of polarizers, optimize the layout of industrial chain, and deepen the depth of technical
reserves, so as to make the Company move towards a new level of high-quality development. This major asset
restructuring is in line with the relevant development strategies of the state and Shenzhen, and is of positive
significance to ensuring the safety of the national new display supply chain.
3. Strengthen innovation leadership and create differentiated competitive advantages
We will firmly pursue the path of innovative development, strengthen research and development investment,
accelerate the development process and mass production scale of cutting-edge products and technologies such
as mid to high end OLED TVs, OLED phones, and car mounted products, further seize market opportunities,
30
2023 Annual Report
and create a competitive advantage in technology and product differentiation with other domestic polarizer
manufacturers in the field of cutting-edge products.
4. Ensure the steady growth of property leasing business and provide effective support for the development
of the Company
The property enterprises actively carry out market research, combine the market and the company's
situation, formulate a refined annual lease plan, further optimize the working mechanism, continue to
implement refined management, innovate and tap potential, increase revenue and reduce expenditure, improve
the service quality and management level of property enterprises, and enhance operating efficiency.
5. Activate existing assets and lay a solid foundation for the development of the main business
Actively activate the existing assets of the property, optimize asset allocation, improve asset operation
efficiency, and accelerate the cancellation and clearance work of Huaqiang Hotel to enrich the company's cash
flow, laying a solid foundation for the company to focus on the main business of polarizing film and seek
transformation and development.
6. Strengthen the construction of talent team and ensure development with talent-driven innovation
Strengthen the echelon construction of reserve talents in the headquarters of the Company Group, improve
the working mechanism of reserve talents training and assessment, and scientifically plan and design the
dimension and content of reserve talents training. Introduce talents with core competitiveness, especially
middle- and high-end technical talents and industrial management talents, in order to thoroughly implement the
strategy of strengthening enterprises through talents, mobilize resources from all sides and broaden the channels
for introducing core talents.
7. Well ensure work safety and maintain the harmony and stability of the enterprise
Always adhere to the work safety policy of "safety first, prevention foremost and comprehensive treatment",
firmly establish the concept of safety development, constantly improve and refine the Company's safety
management system, establish and improve various safety management system standards, further strengthen on-
site safety supervision and rewards and punishments, vigorously carry out safety education and training,
continuously improve the safety awareness and professional skills of all employees, and build a solid line of
defense for the Company's work safety.
8. Enhance the ability to operate in compliance with laws and regulations, and improve the ability of
comprehensive risk prevention and control
Build a compliance management organization and leadership mechanism, improve the risk control
compliance management system, implement the risk control compliance management operation mechanism,
and build a four-in-one prevention and control system with full participation, whole-process monitoring and
full-field coverage, with leading by improving the core competitiveness of the enterprise as the traction,
focusing on self-prevention, self-supervision and self-restraint, and aiming at effectively resolving risks and
operating in compliance with laws and regulations.
9. Strengthen party building leadership and innovate enterprise culture
Adhere to the guidance of Xi Jinping's new era socialism with Chinese characteristics, thoroughly study and
implement the spirit of the 20th Party Congress, comprehensively implement the important exposition of
General Secretary Xi Jinping on the reform and development of state-owned enterprises and party building,
continuously strengthen party building, further strengthen the ideological foundation, and lay a solid foundation
and provide guarantee for the healthy development of the Company.
31
2023 Annual Report
XII. Particulars about researches, visits and interviews received in this reporting period
Applicable √ □ Not applicable
The company did not receive researches, visits and interviews received in this reporting period.
XIII. The implementation of the action plan of "Double improvement of quality and return".
Whether the Company has disclosed the action plan of "Double improvement of quality and return".
□Yes No
32
2023 Annual Report
IV. Corporate Governance
I. General situation
During the reporting period, the Company operated in strict accordance with the requirements of relevant
laws, regulations and normative documents, such as Securities Law, Company Law, Governance Guidelines for
Listed Companies, Guidelines for Self-discipline Supervision of Listed Companies in Shenzhen Stock Exchange
No.1-Standard Operation of Listed Companies on Main Board, and strengthened risk management and control to
ensure the healthy and stable development of the Company. At present, the Company is with basically sound
governance systems, standardized operation, and refined corporate governance structure, which meets the
requirements of the normative documents on the governance of listed companies issued by China Securities
Regulatory Commission.
In 2023, company held a total of 3 general meetings, convened general meetings, standardized voting
procedures to safeguard the effectiveness and legality in strict accordance with the regulations and requirements
of Corporation Law, Articles of Corporation and Rule of Procedure of Shareholders' Meeting. Companies actively
protected the voting rights of minority investors, and general meetings were convened in the form of live network
to adequately assure small investors of their rights to exercise.
In 2023, the board of directors held 7 meetings, and the convening and voting procedures were all conducted
in strict accordance with the Articles of Corporation and Rule of Procedure of Shareholders' Meeting. All the
directors performed directors ' duties, exercise directors ’ rights, attended related meetings and actively
participated in the training and became familiar with relevant laws and regulations with serious, diligent and
honest attitudes. Independent directors independently performed their duties in strict accordance with Articles of
Corporation, The independent director system and other relevant laws and regulations, expressed fully their
independent opinions on corporate operation, decision-making, and important matters, etc. Strategy, audit,
remuneration, evaluation, nomination committees were established under board of directors, all committees
functioned properly, and performed duties such as internal audits, compensation assessment, nomination of senior
management personnel, and provided scientific and professional advisory opinions for board of directors ’
decision-making.
In 2023, the board of supervisors held 5 meetings. The board of supervisors strictly followed the
requirements of Articles of Corporation and Rules of procedure of the board of supervisors and other relevant
laws and regulations, supervised the legal compliance of the duties performed by company's financial personnel
and directors, managers and other senior management personnel in the aim of maintaining the legitimate rights
and interests of the company and its shareholders. All the supervisors fulfilled their obligations, exercised their
rights according to the laws. The convening and voting procedures of the board of supervisors were legal, and the
resolutions were legal and valid. The establishment and implementation of board of supervisors played an active
role in improving corporate governance structure and regulating corporate operations.
In 2023, in order to promote the standardized operation of the company, ensure the independent exercise of
powers by independent directors in accordance with the law, and fully leverage the role of independent directors
in corporate governance, the board of directors of the company revised the company's articles of association, rules
of procedure for shareholder meetings, rules of procedure for board meetings, and independent director work
system in accordance with current laws, regulations, and normative documents such as the Company Law,
Securities Law, Measures for the Administration of Independent Directors of Listed Companies, Shenzhen Stock
Exchange Listing Rules, and Shenzhen Stock Exchange Self regulatory Guidelines No. 1- Standardized Operation
33
2023 Annual Report
of Main Board Listed Companies, further improving the company's governance structure.
In 2023Moreover, the Company carried out the special work Blue Sky Action according to Notification on
Implementing Special Work where Investors Protect Blue Sky Action published by Shenzhen Securities Bureau to
enhance the quality of information disclosure as the key point, to continuously perfect the communication
mechanism and to promote the normative development of the Company. various platforms were made full use of,
such as telephone, e-mail, website, especially the interactive platform of investors in Shenzhen Stock Exchange,
solved questions brought by investors, and communicated with medium and small investors interactively, and
ensure all the investors obtained equal opportunities for informal access. Meanwhile, in the aim of improving the
transparency of listed companies, company accepted investors’ on-site investigation to have comprehensive
understandings of the company's business situation through face-to-face communication with management, also
urged the company established a responsibility to return on investors, improved and enhanced the corporate
governance standards. Meanwhile, the Company continued to perfect the voting mechanism for minority investors.
In 2023, the minority investors’ voting was counted separately at each of the 3 shareholder’ s meetings, and whose
result was disclosed at the decision announcement at the shareholder’s meeting, which fully guaranteed the
execution of power of the minority investors
Does there exist any difference in compliance with the corporate governance , the PRC Company Law and the
relevant provisions of CSRC
□ Yes √No
There exist no difference in compliance with the corporate governance , the PRC Company Law and the
relevant provisions of CSRC.
II. Independence and Completeness in business, personnel , assets, organization and finance
The code of conduct of the controlling shareholders of the company did not go beyond the general meetings
directly or indirectly to interfere with the decision-making and business activities, the company had independent
and complete business and autonomous operation capacity , achieved “five point separation” in respect of
personnel, financial, asset, agencies, business.
III. Competition situations of the industry
□ Applicable √ Not Applicable
IV. Annual General Meeting and Extraordinary Shareholders’ Meetings in the Reporting Period
1.Annual General Meeting
Investor
Sessions Type of meeting Meeting Date Disclosure date Disclosure index
participation ratio
The First Juchao Website
provisional Provisional （http://www.cnin
shareholders’ shareholders’ 49.58% March 22,2023 March 23,2023 fo.com.cn）
General meeting of General meeting Announcement
2023 No.: 2023-09
Juchao Website
2022 Annual （http://www.cnin
Shareholders’ Shareholders’ 49.57% May 26,2023 May 27,2023 fo.com.cn）
general meeting General Meeting Announcement
No.: 2023-25
34
2023 Annual Report
The Second Juchao Website
provisional Provisional （http://www.cnin
shareholders’ shareholders’ 49.53% December 25,2023 December 26,2023 fo.com.cn）
General meeting of General meeting Announcement
2023 No.: 2023-56
2. Request for extraordinary general meeting by preferred stockholders whose voting rights restore
□ Applicable √Not applicable
V. Information about Directors, Supervisors and Senior Executives
1.Basic situation
The Numb
Numb
numbe er of Reaso
Shares er of
r of shares ns for
Startin held at Other shares
Expiry shares reduce increas
Positio Office g date the change held at
Name Sex Age date of held in d in e or
ns status of year- s(share the end
tenure the the decrea
tenure begin( s) of the
current current se of
share) period(
period( period( shares
shares)
shares) shares)
Board
chairm
an n，
Februa
Secret
Yin In ry
Male 49 ary y 0 0 0 0 0 0
Kefei office 10,202
of the
1
party
commi
tt ee
Deput
y
Secret
ary of
the
Party
Zhu July
commi In
Meizh Male 59 19,201 93,000 0 0 0 93,000 0
ttee， office
u 7
Direct
or,
Genera
l
Mange
r
Direct
or ,De
puty
Decem
Ning Secret
In ber
Maoza Male 48 ary of 0 0 0 0 0 0
office 14,201
i the
7
Party
commi
ttee
Direct Octobe
Wang or, In r
Male 52 0 0 0 0 0 0
Chuan Deput office 28,202
y 2
35
2023 Annual Report
Genera
l
Manag
er
Februa
Direct
Femal In ry
Liu Yu 52 or ,CF 0 0 0 0 0 0
e office 28,202
O
4
Februa
Sun
Direct In ry
Mingh Male 42 0 0 0 0 0 0
or office 10,202
ui
1
Indepe Decem
Wu
ndent In ber
Guang Male 61 0 0 0 0 0 0
Direct office 25,202
quan or 3
Indepe Decem
Yang ndent In ber
Male 56 0 0 0 0 0 0
Gaoyu Direct office 25,202
or 3
Indepe Januar
Wang ndent In y
Male 40 0 0 0 0 0 0
Kai Direct office 16,202
or 0
Chair
man of
the
superv
isory
commi
ttee,
Januar
Secret
In y
Ma Yi Male 57 ary of 0 0 0 0 0 0
office 16,202
the
0
Comm
ission
for
Discipl
ine
Inspect
ion
Emplo Januar
Yuan
yee In y
Shuwe Male 43 0 0 0 0 0 0
superv office 16,202
n
isor 0
Emplo Februa
Zhan Femal yee In ry
54 0 0 0 0 0 0
Lumei e superv office 10,202
isor 1
Januar
Liu Deput In y
Male 59 3,000 0 0 0 3,000 0
Hong y GM office 19,201
7
Secret Januar
ary to
Jiang Femal In y
53 the 0 0 0 0 0 0
Peng e office 16,201
board
of 5
36
2023 Annual Report
directo
rs
Septe Octobe
Guan Deput Dimiss mber r
Male 38 0 0 0 0 0 0
Fei y GM ion 22,202 10,202
1 3
Januar
Direct Februa
Dimiss y
He Fei Male 46 or ,CF ry 0 0 0 0 0 0
ion 16,202
O 7,2024
0
Indepe Decem
He July
ndent Dimiss ber
Zuowe Male 61 19,201 0 0 0 0 0 0
Direct ion 25,202
n or 7
3
Indepe Decem
Cai July
ndent Dimiss ber
Yuanq Male 54 19,201 0 0 0 0 0 0
Direct ion 25,202
ing or 7
3
Total -- -- -- -- -- -- 96,000 0 0 0 96,000 --
During the reporting period, whether there is dismissal of directors and supervisors and recruitment of senior
managers
√Yes □ No
1.Guan Fei, the former deputy general manager of the Company, resigned on October 10, 2023. For details,
please refer to the Announcement on the Resignation of the Deputy General Manager of the Company on
CNINF (http://www.cninfo.com.cn)（2023-14）
2.The former independent directors of the company, He Zuowen and Cai Yuanqing, left their posts upon the
expiration of their terms.On November 17, 2023, the Company held the 25th meeting of the Eighth Board of
Directors, and agreed to nominate Yang Gaoyu and Wu Guangquan as candidates for independent directors of
the Eighth Board of Directors. For details, please refer to the Announcement on the Expiration of Independent
Directors' Term and By-election of Independent Directors on CNINF (http://www.cninfo.com.cn).（2023-484）
On December 25, 2023, the Company held the Second Extraordinary General Meeting of Shareholders in 2023,
and agreed to add Yang Gaoyu and Wu Guangquan as independent directors of the Eighth Board of Directors of
the Company. For details, please refer to the Announcement on Resolutions of the Second Extraordinary
General Meeting of Shareholders in 2023 on CNINF (http://www.cninfo.com.cn).（2023-56））
3.He Fei, the Company's Director and Chief Financial Officer, left his post on February 7, 2024.On February 7,
2024, the Company held the 27th meeting of the Eighth Board of Directors, and agreed to employ Liu Yu as the
Company's Chief Financial Officer and the Company's Financial Controller, and agreed to nominate Ms. Liu Yu
as a candidate for non-independent directors of the Eighth Board of Directors. For details, please refer to the
Announcement on Adjusting the Chief Financial Officer and Nominating Directors Candidates on CNINF
(http://www.cninfo.com.cn) (No.2024-04). On February 28, 2024, the Company held the First Extraordinary
General Meeting of Shareholders in 2024, and agreed to elect Liu Yu as a Non-independent Director of the
Company. For details, please refer to the Announcement of Resolutions of the First Extraordinary General
Meeting of Shareholders in 2024 on CNINF (http://www.cninfo.com.cn).（2024-06））
As of the disclosure date of this report, except for the above changes, other directors, supervisors and senior
managers of the Company have not changed
37
2023 Annual Report
Changes of directors, supervisors and senior executives
√ Applicable □ Not applicable
Name Positions Types Date Reason
The original
Wu Guangquan Independent Director Elected December 25,2023 Independent director
resigned
The original
Yang Gaoyu Independent Director Elected December 25,2023 Independent director
resigned
The original director
Liu Yu Director ,CFO Elected February 28,2024
and CFO RESIGNED
Guan Fei Deputy Dimission October 10,2023 Resign
He Fei Director ,CFO Dimission February 7,2024 Job adjustment
He Zuowen Independent Director Left for term expiration December 25,2023 Left for term expiration
Cai Yuanqing Independent Director Left for term expiration December 25,2023 Left for term expiration
2.Posts holding
Professional background, work experience and main duties in the Company of existing directors, supervisors
and senior management
(1) Director
Yin Kefei, male, born in July 1974, master degree, engineer, member of the Communist Party of China. He
has served as Technician and Deputy Director of Customer Service Center of Pipeline Gas Branch of Shenzhen
Gas Group Co., Ltd.; Deputy Director, Director of Civil Service Department and Director of General Office of
Pipeline Gas Customer Service Branch of Shenzhen Gas Group Co., Ltd.; Deputy General Manager of Shenzhen
Gas Group Co., Ltd. Ganzhou Shenran Natural Gas Co., Ltd.; Member of the Party Group and Deputy Director of
the State-owned Assets Supervision and Administration Commission of Dongguan City, Guangdong Province,
and concurrently the Vice Chairman of Dongguan Water Investment Group Co., Ltd.; Deputy Secretary-General
of Dongguan Municipal Government of Guangdong Province, Party Secretary and Director of Dongguan
Municipal Government Liaison Office in Beijing, and concurrently Chairman of the Board of Supervisors of
Dongguan Biotechnology Industry Development Co., Ltd.; Deputy Secretary of the Party Committee, Director
and General Manager of Dongguan Financial Holding Group Co., Ltd., concurrently Director of Dongguan Bank
and Director of Dongguan Asset Management Company; He is currently the Deputy General Manager of
Shenzhen Investment Holdings Co., Ltd. and Board chairman ， Secretary of the party committee of the
Company.
Zhu Meizhu, Male, Born in November 1964, Master degree, Senior engineer, once served successively as
chief Deputy general Manager of Enterprise Management Dept of the Company, Director of R& D Center,
Assistant General Manager and Deputy General Manager, He serves as Vice Secretary of the party
committee ,director and General Manager of the Company..
Ning Maozai, male, born in July 1975, bachelor degree, senior administration engineer, Chinese Communist
Party member; he has served successively as the office clerk of Shenzhen Guomao Automobile Industry Co., Ltd,
the clerk, principal staff member, associate director and director of party-mass office of Shenzhen Property
Development (Group) Corp. and hold a concurrent post of deputy human resource Deputy manager and manager;
At present he holds the position of company director and Vice Secretary of the party committee of the Company.
38
2023 Annual Report
Wang Chuan, male, born in March 1972, \master's degree, economist and engineer, CPC party member. He has
served as deputy department director, department director and assistant director of the Cooperative
Development Department of Shenzhen National High-tech Industry Innovation Center, Director, General
Manager and Chairman of Shenzhen Qidian Innovation Technology Co.,Ltd., and Deputy General Manager of
Shenzhen Tongchan Group Co., Ltd. He is currently the Director of Industrial Management Department of
Shenzhen Investment Holding Co., Ltd., member of the Party Committee, Director and Deputy General
Manager of the Company, and concurrently the Chairman of Shenzhen SAPO Photoelectric Technology Co.,
Ltd.
Liu Yu, female, born in November 1971, bachelor degree, senior accountant, certified public accountant in
China, member of Communist Party of China. She has served as the financial director of Shenzhen Women's
Newspaper Magazine, the vice president of Shenzhen Women's Newspaper Magazine, and the director and
chief financial officer of Shenzhen Wuzhou Hotel Group Co., Ltd. She is currently the Director and Chief
Financial Officer of the Company.
Sun Minghui, male, born in September 1981, master degree, accountant, member of the Communist Party of
China. He has served as Staff Member of the Finance Department of Shenzhen Energy Finance Co., Ltd. and the
Financial Management Department of Shenzhen Energy Group Co., Ltd., Finance Management Director of the
Financial Budget Department of Shenzhen Investment Holdings Co., Ltd., Senior Director of the Finance
Department and the Board Office, and Deputy Director of the Finance Department (Settlement Center). He is
currently the Chief Accountant of Shenzhen Investment Holdings Co., Ltd., concurrently serving as the Director
of the Finance Department (Settlement Center), and Director of the Company
Wu Guangquan, male, born in May 1962, Master of Tongji University, member of Communist Party of
China. He used to be the accountant, assistant manager of Finance Department, deputy manager, manager,
deputy chief accountant, deputy general manager, general manager and chairman of China National AERO-
TECHNOLOGY Shenzhen Company Limited; Chairman of Jiangxi Jiangnan Trust and Investment Co., Ltd.;
Party secretary, chairman and general manager of China Aviation Technology International Holdings Co., Ltd.;
Special officer of Aviation Industry Corporation of China; Party secretary and chairman of AVIC General
Aircraft Co., Ltd.; He once served as chairman and legal representative of Fiyta Precision Technology Co., Ltd.,
chairman and legal representative of Tianma Microelectronics Co., Ltd., chairman and legal representative of
Tianhong Shuke Commercial Co., Ltd., chairman and legal representative of AVIC Real Estate Co., Ltd. (now
renamed as China Merchants Surplus Industry Operation Service Co., Ltd.), chairman of Shennan Circuit Co.,
Ltd., executive director of China South City Holdings Limited and chairman of the board of Continental
Aerospace Technologies Holding Limited.He is currently the president of Federation of Shenzhen Industries,
the chairman of the presidium of China Federation of Industrial Economics and the director of Global Industrial
Research Center, the chairman of Shenzhen Jinling Times Technology Co., Ltd., the chairman of Shenzhen
Fanjing Investment Co., Ltd., the chairman of Shenzhen Fanjing Smart Enterprise Management Consulting Co.,
Ltd., the independent director of Zhongchuang Xinhang Technology Group Co., Ltd., the independent director
of Shenzhen Lihe Kechuang Co., Ltd. and the independent director of the Company.
Yang Gaoyu, male, born in February 1968, master degree in business administration at New York Institute
of Technology in the United States, certified public accountant in China, certified tax accountant in China, and
forensic accountant appraiser, member of China Zhi Gong Party.He used to be the accountant of Shenzhen A-
Fontane Fabric Co., Ltd. and the auditor, audit manager, partner and chief partner of Shenzhen Great Wall
Certified Public Accountants Co., Ltd.He is currently the director of Shenzhen Branch of Zhongzheng Tiantong
Certified Public Accountants (Special General Partnership), the executive director and general manager of
39
2023 Annual Report
Zhongtian Dexiang Tax Agency (Shenzhen) Co., Ltd., At the same time, he is the director of the 7th Council of
Chinese Certified Tax Agents Association, the executive director of Shenzhen Tax Agents Association, the vice
president of Shenzhen Futian Accounting Association, the visiting professor of Accounting College of Jiangxi
University of Finance and Economics, the distinguished professor of Modern Economics and Management
School of Jiangxi University of Finance and Economics, the part-time tutor of Shenzhen Research Institute of
Jiangxi University of Finance and Economics, the entrepreneurial tutor of Shenzhen Research Institute
Innovation and Entrepreneurship Center of Jiangxi University of Finance and Economics, the off-campus tutor
of MPAcc of Shenzhen University School of Economics, the independent director of Shenzhen EXC-LED
Technology Co.,Ltd., the independent director of Shenzhen New Trend International Logis-tech Co.,Ltd., and
the independent director or the Company.
Wang Kai, male, born in 1983, Ph.D. of Huazhong University of Science and Technology, Member of the
Communist Party of China, associate professor and researcher of Southern University of Science and Technology
Department of Electronic and Electrical Engineering, and Outstanding Young Man of Guangdong Province. He
has served as a member of the Technical Committee of Beijing Branch of Society for Information Display (SID),
a member of the National Standardization Technical Committee of Flat Panel Display Devices, Deputy Director
of the Key Laboratory of Energy Conversion and Storage Technology of the Ministry of Education, and Deputy
Director of the Key Laboratory of Quantum Dot Advanced Display and Lighting in Guangdong Universities, and
independent director of the Company.
（2）Supervisor
Ma Yi, male, born in August 1966, bachelor's degree, member of Communist Party of China, assistant
economist. He has successively served as a cadre of the automobile manufacturing and distribution plant of
Hainan automobile transportation corporation, director of the Business Department, assistant to the general
manager and manager of the Transportation Department of Shenzhen Shenjiu International Logistics Co., Ltd.
Guangzhou Branch, operation director of Cosco Logistics Guangzhou Antaida Logistics Co., Ltd., general
manager of Shenzhen Shenjiu International Logistics Co., Ltd. Guangzhou Branch, director of Planning and
Development Department, director assistant, chief of Futian station, deputy secretary of the Party Committee,
director and general manager of Shenzhen highway passenger and freight transportation service center. He is the
current chairman of the board of supervisors and secretary of Discipline Inspection Committee of the Company..
Yuan Shuwen, male, born in May 1980, master's degree. He has successively served as chief of Shigu
management station of Hengshan county rural management bureau, financial director of Shenzhen Fengcheng
Iron Wire Products Co., Ltd., project manager of Shenzhen branch of BDO Accounting Firm Co., Ltd., general
ledger accountant of Shenzhen Zhenye (Group) Co., Ltd., director of Financial Budget Department and senior
director of Assessment and Distribution Department of Shenzhen Investment Holding Co., Ltd. Currently, he is
vice director of Assessment and Distribution Department of Shenzhen Investment Holding Co., Ltd. and
supervisor of the Company
Zhan Lumei, female, born in June 1969, college degree, Senior Labor Relations Coordinator, Senior Career
Instructor, member of the Communist Party of China. She has served as the Administrative Personnel Director of
Shenzhen Hualang Garment Co., Ltd., Director and Manager of the Human Resources Department of the
Company. Currently, she is the vice chairman of the Federation of Trade Unions, Director of the Party-mass Work
Department, and Chairman of the Trade Union and the Employee Supervisor of the Company.
(3)Senior management
40
2023 Annual Report
Liu Honglei, male, born in May 1964, bachelor degree and CPC member, Senior engineer, He has served
Technician , Work director, Deputy director of office of First film factory of Ministry of Chemical
Engineering,Director of personnel Education Dept of Education Department of China Lekai Film Group, he has
served as the deputy general manager and general manager of SAPO Photoelectric Co., Ltd from June 2012 to
May 2013 and the head of the party-mass work department and the manager of the business management
department of Shenzhen Textile (Holdings) Co., Ltd; At present he holds the position of deputy general manager
of the company.
Jiang Peng, Female, born in October 1970, Bachelor Degree, member of communist party, She has served as
a Clerk and Deputy Section Chief of the office of Shandong Aquatic Enterprise Group Corporation, Section Chief
of the Office of the Board of Directors of Shandong Zhonglu Ocean Fishery Co., Ltd., Deputy Director and
Securities Affairs Representative. served as officer of the Secretary Office of Shandong Fishery Group Co.,Ltd.,
Deputy Director of the Secretary office and Securities affairs Representative of Shandong Zhonglu Oceanic
Fisheries Co., Ltd., Securities Representative of Huafu Holding Co., Ltd., Securities affairs representative and
Officer of the Secretariat of the Board of the Company, now serves as the secretary of the Board of the Company
and Director of SAPO Photoelectric Co., Ltd
Office taking in shareholder companies
√Applicable □Not applicable
Does he /she
receive
Names of the Names of the Titles engaged in Sharing date of Expiry date of
remuneration or
persons in office shareholders the shareholders office term office term
allowance from the
shareholder
Shenzhen
Yin Kefei Investment Deputy GM January 11,2021 Yes
Holdings Co., Ltd.
Director of the
Shenzhen
Industry
Wang Chuan Investment May 23,2018 No
Management
Holdings Co., Ltd.
Department
Director of
Shenzhen Financial
Sun Minghui Investment November 11,2020 Yes
Dept( Clearing
Holdings Co., Ltd.
centre）
Shenzhen
Sun Minghui Investment Chief Accountant March 14, 2024 Yes
Holdings Co., Ltd.
Deputy minister
Shenzhen of the
September
Yuan Shuwen Investment Assessment and Yes
Holdings Co., Ltd. 18,2017
distribution
Department
Offices taken in other organizations
√Applicable □Not applicable
Does he/she
Titles engaged in receive
Name of the Name of other Starting date of Expiry date of
the other remuneration or
persons in office organizations office term office term
organizations allowance from
other organization
Research Institute
of Tsinghua
Yin Kefei Director March 17,2023 No
University in
Shenzhen
41
2023 Annual Report
Shenzhen
Environmental
Yin Kefei Director April 23,2021 No
Technology Group
Co., Ltd.
Shenzhen
Yin Kefei international Vice chairman July 24,2023 No
Chamber
ULTRARICH
Yin Kefei INTERNATIONA Director September 4,2023 No
L LIMITED
Shenzhen
International The candidate for
Yin Kefei Investment the second January 20,2022 No
Promotion president
Federation
Shezhen
Shenfubao
Wang Chuan Director June 21,2018 No
（Group）Co.,
Ltd.
ULTRARICH
Wang Chuan INTERNATIONA Director June 27,2018 No
L LIMITED
Shenzhen
Wang Chuan Tongchan Group Director December 17,2020 No
Co., Ltd.
China Nanshan
Sun Minghui Development Supervisor October 17,2017 No
(Group) Co., Ltd.
Shenzhen
Highway
Passenger & Cargo
Sun Minghui Supervisor June 16,2017 No
Transportation
Service Center
Co., Ltd.
ULTRARICH
Sun Minghui INTERNATIONA Director November 11,2020 No
L LIMITED
Shenzhen Special
Sun Minghui Economic Zone Director November 11,2020 No
Real Estate
Hubei
Shentoukong
Sun Minghui Investment Director November 11,2020 No
Development Co.,
Ltd
Guotai Junan
Sun Minghui Securities Co., Director October 26,2023 No
Ltd.
Guotai Junan
Investment
Sun Minghui Director October 26,2023 No
Management Co.,
Ltd.
Shenzhen Chiwan
Sun Minghui Development Co., Supervisor June 30,2021 No
Ltd.
Shenzhen Water
Yuan Shuwen Planning & Design Supervisor February 20,2023 No
Institute Co., Ltd.
Description of his
No
position in other
42
2023 Annual Report
units
Punishments to the current and leaving board directors, supervisors and senior managers during the report
period by securities regulators in the recent three years
□ Applicable √Not applicable
3. Remuneration to directors, supervisors and senior executives
Decision-making procedures, basis for determination and actual payment of the remuneration to directors ,
supervisors and senior executives In the report period, The remuneration of directors and senior management
paid by the company is determined by “Director Compensation Management System” and “Executive
Compensation Management and Evaluation System ” , the remuneration of independent directors is determined
as per the resolution of shareholders’ meeting, and the remuneration of supervisors paid by the company is
determined by their position held in the company.
Remuneration to directors, supervisors and senior executives in the reporting period
In RMB10,000
Total Whether to get
remuneration paid in the
Name Sex Age Positions Office status
received from company
the Company related party
Director,Board
chairman ， In office
Yin Kefei Male 49 Secretary of the 0 Yes
party
committee
Deputy
Secretary of
the Party
Zhu Meizhu Male 59 committee， In office 101.68 No
Director,
General
Manger
Director ,Deput
y Secretary of
Ning Maozai Male 48 In office 95.75 No
the Party
committee
In office
Director,
Wang Chuan Male 52 78.75 No
Deputy GM
Liu Yu Female 52 Director ,CFO In office 0 Yes
Sun Minghui Male 42 Director In office 0 Yes
In office
Independent
Wu Guangquan Male 61 0.24 No
Director
Independent
Yang Gaoyu Male 56 In office 0.24 No
Director
Independent
Wang Kai Male 40 In office 12 No
Director
Chairman of
the supervisory In office
committee,
Ma Yi Male 57 112.14 No
Secretary of the
Commission
for Discipline
43
2023 Annual Report
Inspection
Yuan Shuwen Male 43 Supervisor In office 0 Yes
Employee
Zhan Lumei Female 54 In office 58.64 No
supervisor
Liu Honglei Male 59 Deputy GM In office 92.87 No
Secretary to the
Jiang Peng Female 53 board of In office 102.89 No
directors
Original
He Fei Male 46 Director and Dimission 99.74 No
CFO
Original
Guan Fei Male 38 Dimission 77.28 No
Deputy GM
Original
He Zuowen Male 61 Independent Dimission 11.76 No
director
Original
Cai Yuanqing Male 54 Independent Dimission 11.76 No
director
Total -- -- -- -- 855.74 --
Other note
□Applicable Not applicable
VI. Performance of directors' duties during the reporting period
1. Information of the board meetings during the reporting period
Session Convening date Disclosure date Meeting resolution
Juchao Website
The 20th meeting of the （http://www.cninfo.com.cn
March 6,2023 March 7,2023
Eighth Board of Directors ）Announcement No.:2023-
06
Juchao Website
The 21st meeting of the （http://www.cninfo.com.cn
April 1,2023 April 4,2023
Eighth Board of Directors ）Announcement No.:2023-
11
Juchao Website
The 22nd meeting of the （http://www.cninfo.com.cn
April 27,2023 April 29,2023
Eighth Board of Directors ）Announcement No.:2023-
20
Juchao Website
The 23rd meeting of the （http://www.cninfo.com.cn
August 22,2023 August 24,2023
Eighth Board of Directors ）Announcement No.:2023-
32
Juchao Website
The 24th meeting of the （http://www.cninfo.com.cn
October 26,2023 October 28,2023
Eighth Board of Directors ）Announcement No.:2023-
38
Juchao Website
The 25th meeting of the （http://www.cninfo.com.cn
November 17,2023 November 17,2023
Eighth Board of Directors ）Announcement No.:2023-
44
Juchao Website
The 26th meeting of the （http://www.cninfo.com.cn
December 8,2023 December 8,2023
Eighth Board of Directors ）Announcement No.:2023-
54
44
2023 Annual Report
2. Attendance of directors at the board meetings and the general meeting of shareholders
Attendance of directors at the board meetings and the general meeting of shareholders
Number of Number of
board Whether to
Number of board Number of
meetings Number of attend the General
board meetings board
Name of board board meetings of
director
attended meetings attended by meetings
meetings meeting in shareholders
during the attended in means of attended by
absent from person twice attended
reporting person communicati proxy
in a row
on
period
Yin Kefei 7 6 1 0 0 No 3
Zhu Meizhu 7 6 1 0 0 No 3
Ning Maozai 7 6 1 0 0 No 3
Wang Chuan 7 5 1 1 0 No 3
He Fei 7 6 1 0 0 No 3
Sun Minghui 7 5 1 1 0 No 1
He Zhuowen 7 1 6 0 0 No 3
Cai Yunqing 7 1 6 0 0 No 3
Wang Kai 7 0 6 1 0 No 3
Explanation of failure to attend the board meeting in person twice in a row
None
3. Directors' objections to related matters of the Company
Whether the director raises any objection to the relevant matters of the Company
□ Yes √ No
During the reporting period, the directors did not raise any objection to the relevant matters of the Company.
4. Other descriptions of directors' performance of duties
Whether the directors' suggestions on the Company have been adopted
√Yes □ No
The director's statement on whether the relevant suggestions of the Company have been adopted or not
During the reporting period, all directors of the Company worked diligently and conscientiously in strict
accordance with the relevant regulations of China Securities Regulatory Commission and Shenzhen Stock
Exchange, the Articles of Association, the Rules of Procedure of the Board of Directors and other systems
of the Company, paid close attention to the Company's standardized operation and business situation, put
forward relevant opinions on the Company's major governance and business decisions according to the
actual situation of the Company, reached a consensus after full communication and discussion, and
resolutely supervised and promoted the implementation of the resolutions of the Board of Directors, so as
to ensure scientific, timely and efficient decision-making, and protect the legitimate rights and interests of
the Company and all shareholders.
VII. Situation of special committees under the Board of Directors during the reporting period
Put forward Other
Number of Details of
Committee Member Convening Meeting important information
meetings objections (if
name information date content opinions and of duty
convened any)
suggestions performance
Nomination Cai To review It is
October
Committee Yuanqing, 2 matters suggested No No
16,2023
of the Board He Zhuowen, concerning that the
45
2023 Annual Report
of Directors Wang Kai the Board of
resignation Directors of
of the the Company
Company's agree to the
deputy resignation
general of the deputy
manager. general
manager.
It is agreed to
nominate
Yang Gaoyu
and Wu
Guangquan
To review
as candidates
matters
for
concerning
independent
Nomination Cai the addition
directors of
Committee Yuanqing, November of
2 the Eighth No No
of the Board He Zhuowen, 14,2023 independent
Board of
of Directors Wang Kai directors to
Directors of
the Eighth
the Company
Board of
and submit it
Directors.
to the Board
of Directors
of the
Company for
review.
It is agreed
that the
Company
should
formulate the
To review
Annual
matters
Operating
concerning
Performance
the
Appraisal
formulation
and Salary
of the 2022
Remuneratio Management
He Zuowen , annual
n and October Plan for
Wang Kai, 2 business No No
Appraisal 13,2023 Senior
He Fei performance
Committee Managers of
appraisal and
Shenzhen
salary
Textile
management
(Group)
plan for
Co.,Ltd. in
senior
2022
managers.
according to
the operation
and
management
requirements.
To review
the salary It is agreed to
Remuneratio
He Zuowen, assessment the
n and December
Wang Kai, 2 of the performance No No
Appraisal 5,2023
He Fei Company's appraisal
Committee
senior results of the
managers in Company's
46
2023 Annual Report
2022. senior
managers in
2022 and the
Company's
senior
managers'
salary in
2022.
It is
To review
suggested
the internal
that the
audit
accounting
summary in
firm should
2022 and the
complete the
audit plan in
annual audit
He Zhuowen, 2024, and
as planned
Audit Cai January communicate
6 and report No No
committee Yuanqing, 13,2023 with the
the audit
He Fei annual audit
progress and
accounting
problems
firm about
found in the
the audit
audit to the
matters of
Audit
the annual
Committee in
report.
time.
To
communicate
the audit
progress and
problems
found in the
audit process
with the It is agreed to
annual audit approve the
accountant; seven
To report on proposals
He Zhuowen, the including the
Audit Cai March performance 2022 Annual
6 No No
committee Yuanqing, 31,2023 of the Audit Report and
He Fei Committee in the 2022
2022; To Internal
review seven Control Self-
proposals evaluation
including the Report.
2022 Annual
Report and
the 2022
Internal
Control Self-
evaluation
Report.
The Audit It is agreed to
Department the
He Zhuowen,
reports the Company's
Audit Cai April
6 internal audit Work Report No No
committee Yuanqing, 27,2023
work in the on Internal
He Fei
1st quarter Control
and the work System in
47
2023 Annual Report
plan in the 2022 and
2nd quarter Major Risk
to the Audit Assessment
Committee; Report in
expresses 2023.
opinions on
the
effectiveness
of internal
control in the
1st quarter of
the
Company;
and reviews
the
Company's
Work Report
on Internal
Control
System in
2022 and
Report on
Major Risk
Assessment
in 2023.
The Audit
Department
reports the
internal audit
work in the
2nd quarter
and the work
plan in the
3rd quarter to
the Audit
Committee; It is agreed to
expresses approve two
He Zhuowen, opinions on proposals,
Audit Cai August the including the
6 No No
committee Yuanqing, 18,2023 effectiveness Company's
He Fei of internal 2023 Semi-
control in the annual
2nd quarter Report.
of the
Company;
and reviews
two
proposals,
including the
Company's
2023 Semi-
annual
Report.
The Audit It is agreed to
He Zhuowen,
Department approve two
Audit Cai October
6 reports the proposals, No No
committee Yuanqing, 26,2023
internal audit including the
He Fei
work in the Company's
48
2023 Annual Report
2nd quarter Report on the
and the work Third
plan in the Quarter of
3rd quarter to 2023.
the Audit
Committee;
expresses
opinions on
the
effectiveness
of the
Company's
internal
control in the
3rd quarter;
and reviews
two
proposals,
including the
Company's
Report on the
Third
Quarter of
2023.
To review It agreed to
the Proposal approve the
He Zhuowen, on Hiring Proposal on
Audit Cai November Audit Hiring Audit
6 No No
committee Yuanqing, 16,2023 Institutions Institutions
He Fei in 2023 of in 2023 of
the the
Company. Company.
VIII.The working status of the board of supervisors
The board of supervisors finds out whether the company has risks during the monitoring activities during the re
porting period
□ Yes √ No
The Supervisory Committee has no objection to the supervision matters during the reporting period.
IX. Particulars about employees.
1.Number of staff, professional structure and educational background
Number of in-service staff of the parent company(person) 55
Number of in-service staff of the main subsidiaries(person) 1,361
The total number of the in-service staff(person) 1,416
The total number of staff receiving remuneration in the current
1,416
period(person)
Retired staff with charges paid by the parent company and
0
main subsidiaries (person)
Professional
Category Number of persons（person）
Production 1,005
49
2023 Annual Report
Sales 17
Technical 180
Financial 29
Administrative 185
Total 1,416
Education
Category Number of persons（person）
Holders of master’s degree or above 42
Graduates of regular university 218
Colleges 150
Mid-school or below 1,006
Total 1,416
2. Remuneration policies
In 2023, the Company carried out management for employees’ compensation in strict accordance with the state’s
relevant laws and regulations and guaranteed the fairness and reasonability of the compensation, which offered
relevant rewards and incentives to the employees, accelerate them to jointly develop with the Company , and
simultaneously reflected humanistic care of the Company.
3.Training plan
Combined with the Company's development strategy, continue to improve the Company's talent training system
and strengthen the exchange and learning of personnel in the Shenzhen Textile system. First, combining with
the work of the department and the actual situation of employees, and according to the existing network college
resources, allocate appropriate courses for employees, including general management courses and professional
courses. During the year, it further improved the professional level and comprehensive quality of employees
through internal and external training courses; Second, continue to create an atmosphere of "reading after actual
practices" and encourage employees to love reading and read good books; Third, according to the needs of the
Company's business development and the actual work of various departments, organize key employees to
participate in professional training arranged by superior units and professional institutions to further enhance
their comprehensive ability, professional skills and professionalism.
4.Outsourcing situation
□ Applicable √ No Applicable
X. Specification of profit distribution and capitalizing of common reserves
Formulation, implementation or adjustment of the profit distribution policy, especially the cash dividend policy
during the reporting period
√ Applicable □ Not applicable
50
2023 Annual Report
On May 26, 2023, the Company held the 2022 annual general meeting of shareholders to deliberate and pass the
2022 profit distribution plan. The 2022 profit distribution plan of the Company is as follows: based on the profit
available for distribution in the consolidated statement, with the total share capital of 506,521,849 shares as the
base as of December 31, 2022, a cash dividend of RMB 0.60 (including tax) will be distributed to all
shareholders for every 10 shares, with a total cash dividend of RMB 30,391,310.94 (including tax), the
remaining undistributed profits will be carried forward to the next year; No bonus shares will be given, and no
capital reserve will be used to increase capital.
If the total share capital of the Company changes before the implementation of the distribution plan, the
total distribution amount will be adjusted based on the total share capital of date of record when the distribution
plan is implemented in the future, and with the above distribution ratio remained unchanged. The specific
amount will be subject to the actual distribution.
Special description of cash dividend policy
Whether it meets the requirements of the Articles of
Association or the resolution of the general meeting of Yes
shareholders:
Whether the dividend standard and proportion are explicit and
Yes
clear:
Whether the relevant decision-making procedures and
Yes
mechanisms are complete:
Whether the independent directors have performed their duties
Yes
and played their due role:
If the Company does not distribute cash dividends, specific
reasons, as well as the measures to be taken to enhance investor Not applicable
returns should be disclosed:
Whether the minority shareholders have the opportunity to
fully express their opinions and demands, and whether their Yes
legitimate rights and interests have been fully protected:
Whether the cash dividend policy is adjusted or changed, and
whether the conditions and procedures are compliant and Not applicable
transparent:
During the reporting period, the Company made a profit and the profit available to shareholders of the parent
company was positive, but no cash dividend distribution plan was put forward.
□ Applicable √ Not applicable
Profit distribution and capitalization of capital reserve during the reporting period
√ Applicable □ Not applicable
Bonus shares for every ten shares(Shares) 0
Cash dividend for every ten shares (Yuan)(Tax-included) 0.65
A total number of shares as the distribution basis(shares) 506,521,849
Cash dividend amount (yuan, including tax 32,923,920.19
Other means (such as repurchase of shares) cash dividend
0.00
amount (yuan)
Total cash dividend (yuan, including tax) 32,923,920.19
Distributable profit (yuan) 216,160,896.14
Proportion of cash dividend in the distributable profit 100%
Cash dividend distribution policy
When the company's development stage is in the growth period and there are major capital expenditure arrangements, when the
profit distribution is carried out, the proportion of cash dividends in this profit distribution should be at least 20%.
Detailed explanation of the profit distribution or capital reserve transfer plan
Based on the distributable profits in the consolidated statement, with the total share capital of 506,521,849 shares as of December
31, 2023 as the base, a cash dividend of RMB 0.6 (including tax) was distributed to every 10 shares of all shareholders, with a
total cash dividend of RMB 32,923,920.19 (including tax). No bonus shares will be issued and no capital reserve will be converted
51
2023 Annual Report
into share capital. Do not bonus shares , the capital reserve will not be converted into share capital.
If the total share capital of the Company changes before the implementation of the distribution plan, the total distribution
amount will be adjusted based on the total share capital of date of record when the distribution plan is implemented in the future,
and with the above distribution ratio remained unchanged. The specific amount will be subject to the actual distribution.
XI. Implementation Situation of Stock Incentive Plan of the Company, Employee Stock Ownership Plan
or Other Employee Incentive Measures
□Applicable Not applicable
None.
XII. Construction and implementation of internal control system during the reporting period
1. Construction and implementation of internal control
During the reporting period, the Company timely updated and improved the internal control system according to
the Basic Standards for Enterprise Internal Control and its supporting guidelines, and established a scientific,
concise, applicable and effective internal control system. The Audit Committee and the Risk Control Audit
Department jointly formed the Company's risk internal control management organization system to supervise and
evaluate the Company's internal control management. Through the operation, analysis and evaluation of the
Company's internal control system, the risks in operation and management are effectively prevented, and the
realization of internal control objectives is promoted.
According to the identification of major internal control defects in the Company's financial report, there were no
major internal control defects in the financial report on the base date of the internal control evaluation report. In
accordance with the requirements of enterprise internal control standard system and relevant regulations, the
Company has maintained effective internal control of financial reports in all major aspects.
According to the identification of major defects in the internal control of the Company's non-financial reports,
the Company found no major defects in the internal control of non-financial reports on the base date of the
internal control evaluation report.
2.Details of major internal control defects found during the reporting period
□ Yes √ No
XIII. Management and control of the Company's subsidiaries during the reporting period
Problems Subsequent
Integration Measures taken Solution
Company name Integration plan encountered in planned
progress for solution progress
integration solution
Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable
XIV.Internal control self-evaluation report or internal control audit report
1.Self-evaluation report on internal control
Disclosure date of appraisal report on March 28,2024
52
2023 Annual Report
internal control
Disclosure index of appraisal report on Juchao Website:（http://www.cninfo.com.cn）, Self-evaluation report of internal
internal control control in 2023
The ratio of the total assets of units
included in the scope of evaluation
accounting for the total assets on the 100.00%
company's consolidated financial
statements
The ratio of the operating income of
units included in the scope of evaluation
accounting for the operating income on 100.00%
the company's consolidated financial
statements
Standards of Defects Evaluation
Category Financial Report Non-financial Report
In the following circumstances, the
company was identified as existing non-
financial –reporting related significant
defects of internal controlling defects:
The business activities of the company
seriously violated national laws and
The defects related to financial reports regulations; (2) The decision-making
were divided into general defects, process of "Three-Importance& One-
important defects and significant defects Large" were unscientific, leading to
according to their severity. Significant major decision errors, and causing major
defects referred to one or multiple property loses to the company; (3)
combinations of controlling defects, Massive loss of key posts or technology
which may lead to serious deviation from talents; (4) The controlling system
the controlling objectives. Important involving important business fields of the
defects referred to one or multiple company failed; (5) It Caused serious
Qualitative standard
combinations of controlling defects, and negative effects on business of the
their severity and economic company, and the effects couldn’t be
consequences were below significant eliminated; (6) The evaluation results of
defects, but they could still lead to internal control were significant defects,
serious deviation from the controlling and couldn’t get effective rectification.
objectives. General defects referred to Important defects referred to one or
other internal controlling defects which multiple combinations of controlling
couldn't constitute significant defects or defects, and their severity and economic
important defects. consequences were below significant
defects, but they could still lead to
serious deviation from the controlling
objectives. General defects referred to
other internal controlling defects which
couldn't constitute significant defects or
important defects.
Misstatement amount of financial
statement fell into the following
intervals: significant defects:
Misstatement amount ≥ 1.5% of total
revenue; Misstatement amount ≥ 10% of
gross profit; Misstatement amount ≥ 1%
of total asset; Misstatement amount ≥ 5%
of net asset. significant defects: 0.5% of
Total revenue ≤Misstatement amount ＜
Quantitative criteria 1.5% of total revenue; 5% of gross profit Not applicable
≤Misstatement amount ＜ 10% of gross
profit; 0.5% of Total asset
≤Misstatement amount ＜ 1% of total
revenue; 3% of Net assets ≤Misstatement
amount ＜ 5% of net assets. General
defects:0% of total revenue ＜
Misstatement amount＜0.5% of Total
revenue; 2% of gross profit ＜
Misstatement amount＜5% of total
53
2023 Annual Report
profit; 0% of total assets ＜Misstatement
amount＜0.5 of total assets; 0% of net
assets ＜Misstatement amount＜3% of
net assets.
Number of major defects in financial
0
reporting（a）
Number of major defects in non financial
0
reporting (a)
Number of important defects in financial
0
reporting（a）
Number of important defects in non
0
financial reporting（a）
2. Internal Control audit report
√ Applicable □Not applicable
Review opinions in the internal control audit report
As of December 31, 2023, Shenzhen Textile Group has maintained effective internal control over financial reporting in all
material aspects in accordance with the Basic Standards for Enterprise Internal Control and relevant regulations.
Disclosure date of audit report Disclosure
Index of audit report of internal control March 28, 2024
Internal audit report's opinion Juchao Website（http://www.cninfo.com.cn）
Type of audit report on internal control Unqualified auditor's report
Whether there is significant defection non-financial report No
Has the CPAs issued a qualified auditor's report of internal control.
□Yes No
Does the internal control audit report issued by the CPAs agree with the self-assessment report of the Board of
Directors
Yes □No
XV. Rectification of self-examination problems in special governance actions of listed companies
None
54
2023 Annual Report
V. Environmental & Social Responsibility
I. Significant environmental issues
Whether the Company or any of its subsidiaries is identified as a key polluter by the environment authorities
√ Yes □ No
Policies and industry standards related to environmental protection
(I) SAPO Photoelectric:
1. Names of implementation standards for air pollutant emission:
① Emission Standard of Air Pollutants for Coal-burning Oil-burning Gas-fired Boiler (DB44/765-2019);
② Emission Limit of Air Pollutants DB44/ 27—2001;
③ The limit value of electronic components in the electronic industry in Tianjin's Emission Control Standard
for Volatile Organic Compounds in Industrial Enterprises (DB12/524-2020) shall be implemented;
④ Emission Standards for Odor Pollutants (GB 14554-93), Standard for Fugitive Emission of Volatile Organic
Compounds (GB 37822-2019).
Names of implementation standards for water pollutant discharge:
Discharge Limit Standard for Water Pollutants in Guangdong Province (DB44/26-2001)
(II) Beauty Century
1.Regulations of Guangdong Province on Environmental Protection
2.Administrative Measures for Ecological Environment Standards
Environmental protection administrative license
(I) SAPO Photoelectric: The existing sewage discharge permit was applied on September 7, 2022, and is valid
from December 13, 2022 to December 12, 2027.
(II) Beauty Century: The existing sewage discharge permit is valid from August 10, 2020 to August 9, 2023,The
Validity Period after application for extension is from August 10, 2023 to August 9 2028.
Industrial emission standards and the specific situation of the pollutant emission involved in the
production and business activities
Main
Main Emissio Emissio Impleme
Compan pollutant Excessiv
pollutant n port n nted Verified
and Emissio Total e
y or and Emissio distributi concentr pollutant total
specific n port emission emission
subsidiar specific n way on ation emission emission
pollutant number conditio
y name pollutant conditio (mg/Nm standard (Tons)
Typeam 3) n
name n s
e
The
discharg
e port is
Non
SAPO High located
Waste methane <50mg/ 120mg/
Photoele altitude 4 on the 21.9t/a 49.98t/a No
gases hydrocar m3 m3
ctric emission east side
bon
of No.1
and No.3
plants
55
2023 Annual Report
roof
Open
trench Southeas
SAPO
discharg t side of <20mg/ 25.0536/
Photoele Effluents COD 1 40mg/L 3.9347/a No
e after the L a
ctric
treatmen factory
t
Permissi
ble
discharg
COD, e value:
ammoni PH Discharg
a value: 6- e Limit
nitrogen, 9; Standard
PH Aniline: for
value, 1.0 Water
Atmosp
suspende mg/L; Pollutant
here:
d solids, Suspend s
unorgani
five-day ed DB44/2
zed;
BOD, solids: 6-2001,
wastewa
total 50mg/L; Discharg
ter: 1.
phospho Total e
Intermitt
rus nitrogen Standard
ent
(calculat (calculat of Water
discharg CODcr:0
ed as P), ed as N) Pollutant
e, with .349t/a CODcr1.
chromati 15 s in
unstable ； 62t/a；
city, mg/L; Danshui
and Ammoni Ammoni
aniline, Ammoni River
irregular Longitud a a
chlorine a and
flow rate e： nitrogen nitrogen
dioxide, nitrogen: Shima
during 114°15′3 ： ：
Beauty sulfide, 8 mg/L; River
Effluents discharg 1 1.36″Lat 0.0102t/ 0.216t/a No
Century total Sulfide: Basin
e, which itude： a；Total ；Total
nitrogen 0.5 DB44/2
however 22°43′38 nitrogen nitrogen
(calculat mg/L; 050-
is not .14″ （Calcul （calcul
ed as N), Chemica 2017,
impact ated as ated as
ammoni l oxygen Discharg
discharg N） N）
a demand: e
e; 2. 0.1305t/ 0.405t/a
(ammoni 60 Standard
Intermitt a
a gas), mg/L; of Water
ent
non- Chlorine Pollutio
discharg
methane dioxide: n in
e, with
total 0.5 Dyeing
stable
hydrocar mg/L; and
flow
bons, Chromat Finishin
during
sulfide icity 50; g Textile
discharg
and odor Five-day Industry
e
(concent BOD: 20 GB4287
ration), mg/L; -
Ammoni Total 2012GB
a phospho 4287-
(ammoni rus 2012.
a) (calculat
ed as P)
0.5
mg/L;
The treatment of the pollutants
（I）SAPO Photoelectric
56
2023 Annual Report
RTO waste gas regenerative incineration process is adopted for the organic waste gas produced in all production
lines of SAPO Photoelectric, and RTO+ advanced treatment process is adopted for Line 7. RTO waste gas
treatment equipment runs stably, with good waste gas treatment effect. The removal rate of VOCs in organic
waste gas reaches over 99%, which can fully meet the requirements of waste gas discharge. Meanwhile,
imported heat storage materials are adopted for the equipment, with a heat storage effect of 95%, and low
running energy consumption of the equipment; After RTO treatment, the waste gas from the production process
after treatment can meet the discharge standard. The wastewater treatment facility of SAPO Photoelectric Phase
I adopts the wastewater treatment process of Fenton + sedimentation + UASB anaerobic + aerobic + MBR
membrane, which has strong impact load resistance, stable system operation, low energy consumption, low
maintenance cost, high degree of automation and good effluent effect. In phase II, it adopts Fenton +
sedimentation + UASB anaerobic + aerobic + MBR membrane + mc membrane treatment + evaporation system,
and all the wastewater is recycled to the production line after treatment. All the wastewater of SAPO
Photoelectric can meet the environmental protection requirements after being treated by the treatment facilities.
（II）Beauty Century
Beauty Century has established a set of special wastewater treatment facilities, and continuously optimized
and upgraded the facilities and processes in the actual operation process to treat the wastewater professionally
through multiple processes, with good operation effect, and all pollutant indicators in line with relevant
standards, laws and regulations. In addition, Shenzhen Beauty Century built the reclaimed water reuse system in
2021, which can effectively save water consumption and reduce wastewater discharge after the system was put
into operation.
Environmental Self-Monitoring Program
（I）SAPO Photoelectric
According to the monitoring requirements issued by the monitoring station and the operation requirements of
each system of SAPO Photoelectric, the specific monitoring plan is as follows: 4 times/year (twice every
quarter) for organic waste gas, 12 times/year (once every quarter) for wastewater discharge, 2 times/year (once
every six months) for boiler waste gas, 1 time/year for canteen oil fume, 2 times/year (once every six months)
for noise at factory boundary and 1 time/year for drinking water.
（II）Beauty Century
According to the environmental management requirements of the pollution discharge permit, the specific
monitoring plan is as follows: automatic detection of wastewater pH value, flow rate, COD, and ammonia
nitrogen, once/day for chromaticity, suspended solids, total nitrogen, and total phosphorus, once/week for five
day biochemical oxygen demand, once/month for sulfides and aniline, once/year for chlorine dioxide, and
once/half a year for plant boundary ammonia, non-methane total hydrocarbons, sulfides, and odor
concentrations.
Emergency plan for sudden environmental events
(I) SAPO Photoelectric
According to the actual situation of the company, the emergency plan for sudden environmental incidents has
been compiled, and the application for filing the emergency plan for sudden environmental incidents by relevant
departments has been passed.
（II）Beauty Century
Some contents from the emergency plan for environmental events are extracted as follows:
Investigation and control measures for hidden dangers of environmental risks
57
2023 Annual Report
Investment in environmental governance and protection and the relevant payment of environmental protection
tax
(I) SAPO Photoelectric
Investment in environmental governance and protection in 2023: RMB 11.1646 million;
Environmental protection tax paid in 2023: RMB 25447.85.
（II）Beauty Century
Investment in environmental governance and protection in 2023: RMB 233,200;
Environmental protection tax paid in 2023: RMB 669.06.
Cost of purchasing environmental liability insurance: RMB 12,116.86.
Measures taken to reduce its carbon emissions during the reporting period and their effects
Applicable □Not applicable
(I) SAPO Photoelectric
During the reporting period, SAPO Photoelectric strictly abided by laws and regulations, strictly controlled the
company's waste gas and wastewater discharge, and ensured the effective operation of waste gas and
wastewater treatment facilities. No violations occurred throughout the year.
（II）Beauty Century
During the reporting period, Shenzhen Beauty Century strictly abided by laws and regulations, strengthened the
management of wastewater treatment, and ensured the effective operation of wastewater treatment facilities. No
violations occurred throughout the year.
Administrative penalties for environmental problems during the reporting period
Impact on the
Company's
Name of company Reasons for production
Violation situation Penalty result rectification
or subsidiary punishment and operation of
measures
listed companies
SAPO
No No / / /
Photoelectric
Beauty Century No No / / /
Other Environmental Information That Should Be Disclosed
(I)SAPO Photoelectric
1.Annual report on disclosure of enterprise environmental information according to law: https://www-
app.gdeei.cn/stfw/index
2.Annual implementation report of pollutant discharge permit: http://permit.mee.gov.cn/
(II)Beauty Century
None
Other Environmental Related Information
None
II. Social responsibilities
(I) Protection of shareholders' rights and interests
During the reporting period, the Company abided by laws and regulations, operated in compliance with
regulations, and constantly improved its governance structure and further standardized the Company's operation in
strict accordance with the requirements of the Company Law, the Securities Law and the Governance Guidelines
for Listed Companies and other laws and regulations. It adhered to the procedure system of general meeting of
shareholders, Board of Directors, Board of Supervisors and independent directors as the core, further improved
58
2023 Annual Report
the corporate governance structure and various management systems, constantly improved the internal control
system in the process of the Company's operation and management, took effective operational risk prevention
measures, earnestly safeguarded and protected shareholders' rights and interests, and laid a solid foundation for
the healthy and sustainable development of the Company. Independent directors paid close attention to the
Company's operation, put forward many valuable professional suggestions for the Company's daily operation and
key concerns, and played an important role in improving the supervision mechanism and safeguarding the
legitimate rights and interests of the Company and all shareholders. The Company strictly fulfilled its obligation
of information disclosure according to law, truly, accurately, completely, timely and fairly disclosed information
that has a significant impact on investment decision-making. The disclosure content was concise and easy to
understand, fully revealed risks, and facilitated all shareholders to consult. According to regulatory requirements,
it further combed and improved relevant systems and enhanced the quality of information disclosure.
During the reporting period, the Company further improved the information disclosure and information
transparency, fulfilled the obligation of information disclosure in strict accordance with regulatory requirements,
communicated with investors through various channels, answered questions raised by investors in a timely
manner, and improved information transparency. Meanwhile, it cooperated with regulatory authorities to
safeguard the rights and interests of investors, especially small and medium-sized investors, and realized the
benign interaction and harmonious development between investors and listed companies.
(II) Protection of employees' rights and interests
In 2023, according to the requirements of modern enterprise management, the Company strengthened the
scientific, standardized and professional management of human resources management through measures such
as system construction and cultural construction, effectively improved the management level of human
resources, avoided the risks of labor employment, created a good corporate culture atmosphere, further
mobilized employees' work enthusiasm, and enhanced their sense of acquisition and belonging.
First, according to the needs of enterprise development, the Company further revised and improved the
human resource management system. During the year, it newly revised the Management System of Selecting
and Appointing Cadres of Shenzhen Textile Group, the Management System of Employee Performance
Appraisal of Shenzhen Textile Group, the Organizational Structure, Department Setting and Functional Post
Establishment of Shenzhen Textile Group, and optimized and improved the Company's organizational structure
and functional setting, personnel training, cadre talent team allocation, performance salary management and
other human resources-related work; Second, the Company signed a formal labor contract with each employee,
and implemented necessary management for employees according to the Labor Law and relevant management
regulations of the Company;Thirdly, the Company established a scientific assessment and distribution system
according to the classification of senior managers, department managers and employees, established a
systematic and standardized performance assessment and evaluation system, and conducted a comprehensive,
objective, fair and accurate assessment of employees' performance of duties and tasks, which is used as the
basis for determining employees' remunerations, rewards and punishments and appointments; Fourth, the
Company strengthened the construction of talent team, thoroughly implemented the strategy of "strengthening
the enterprise through talents", and continued to carry out two-way exchange and training activities for cadres
and talents of the group and its affiliated enterprises, so as to better care for and help employees grow into
talents, enhance the comprehensive business ability and performance ability of employees, and stimulate the
vitality of cadres. At the same time, the Company selected talents through marketization, created a good
environment for talent development, and constantly stimulated innovation vitality and motivation; Fifth, the
headquarters of the Group actively guided and assisted subordinate enterprises to promote various human
59
2023 Annual Report
resources management standards and personnel optimization, and guided enterprises to strengthen salary
performance management, promote enterprise personnel optimization and help enterprises reform according to
their actual conditions.
(III) Environmental protection
Striving to build a modern "green enterprise" is the Company's long-term positive responsibility. We insist on
building the whole process of green cycle in the industrial chain, realizing the real green cycle economy,
improving the quality of the Company's surrounding environment and escorting the Company's production.
During the reporting period, the OSBL noise, industrial wastewater and waste gas emissions in the Company's
production process all passed the monitoring of the environmental protection department, and complied with the
standard requirements of relevant laws and regulations. During the reporting period, the Company's organic waste
gas was treated by the rotary RTO treatment process, and the removal rate of VOCs in organic waste gas reached
over 99%. On the basis of meeting the discharge standards, the pollutant discharge was further reduced, and no
major environmental incidents occurred. In addition, the Company vigorously advocated green office, carried out
various forms of environmental protection publicity and education activities, raised employees' awareness of
energy conservation and emission reduction, realized the coordinated development of production & operation and
environmental protection, and earnestly fulfilled social responsibilities.
(IV) Protection of consumers' rights and interests
The Company has been adhering to the core values of "honesty oriented and responsibility first". Being
responsible for customers is the source of our enterprise value. It is our unremitting pursuit to provide customers
with professional, personalized and all-round products and services. With customer demand as the core,
continuously innovating to serve customers, and continuously improving and enhancing product quality are the
driving force for the Company to achieve good performance and sustainable development, and also an important
guarantee to win customers' long-term trust. It has provided active attention to customer needs, quick response to
customer feedback, sincere consideration for customers and promotion of long-term cooperative partnership.
III. Consolidate and expand the achievements of poverty alleviation and rural revitalization
In 2023, the company earnestly fulfilled its social responsibility, actively participated in the work of
consumer assistance, and completed the purchase of 553,700 yuan of consumer assistance in the year to help
rural revitalization; It took the initiative to respond to Shenzhen Investment Holdings' 2023 theme public
welfare activity of "Love Shenzhen Investment Holdings Helping People's Livelihood 1+1", and proposed to
guide all employees to participate in garbage sorting publicity activities, and donated living materials to Keba
Village in Qinghai Tibetan area, with a total of 497 winter clothes and a number of quilts, pillows, shoes and
other warm materials donated.
60
2023 Annual Report
VI. Important Events
I. Commitments to fulfill the situation
1.The fulfilled commitments in the reporting period and under-fulfillment commitments by the end of the
reporting period made by the company, shareholder, actual controller, acquirer, director, supervisor,
senior management personnel and other related parities.
√Applicable □Not applicable
Time of making
commitment Period of
Fulfillment
Commitment commitment
Commitment Type Contents
maker
As Shenzhen
Investment
Holdings Co.,
Ltd., the
controlling
shareholder of
the company,
committed
when the
restricted-for-
sale shares
from the shares
restructuring
were listed for
circulation in
the market: i. if
they plan to sell
the shares
through the
securities
exchange
system in the
Shenzhen
future, and the
Commitment Investment Share reduction Sustained and Under
decrease of the August 4, 2006
on share reform Holdings Co., commitment effective Fulfillment
shares they
Ltd.
hold reaches
5% within 6
months after
the first
decrease, they
will disclose an
announcement
indicating the
sale through the
company
within two
trading days
before the first
decrease; ii.
They shall
strictly observe
the “Guidelines
on Transfer of
Restricted-for-
sale Original
Shares of
Listed
61
2023 Annual Report
Companies” an
d the provisions
of the relevant
business
principles of
Shenzhen Stock
Exchange.
Commitments
made during
asset
restructuring: 1.
The relevant
information
provided by the
Company
during this
transaction is
authentic,
accurate and
complete, and it
is guaranteed
that there are
no false
records,
misleading
statements or
major
omissions, and
the Company
Statement and
will bear
Commitment
individual and
on the
Commitment joint legal
Authenticity,
made upon the responsibilities November Sustained and Under
The Company Accuracy and
assets for the 17,2023 effective Fulfillment
Completeness
replacement authenticity,
of the
accuracy and
Information
completeness
Provided
of the
information
provided. If
there are false
records,
misleading
statements or
major
omissions in
the information
provided,
which cause
losses to the
company or
investors, the
Company will
be liable for
compensation
according to
law; 2. The
Company will
submit relevant
62
2023 Annual Report
information,
documents and
materials
(including but
not limited to
original written
materials,
electronic
materials,
duplicate
materials and
oral testimony)
required for this
transaction to
relevant
intermediaries
in a timely
manner, and at
the same time it
promises that
the information
and documents
provided are
authentic,
complete and
accurate, the
relevant
duplicate
materials or
photocopies are
consistent with
the original, all
signatures and
seals on the
documents are
authentic and
valid, and the
photocopies are
consistent with
the original,
and the
signatories of
these
documents
have legally
authorized and
effectively
signed the
documents, and
that there are
no false
records,
misleading
statements or
major
omissions; 3.
The Company
guarantees the
63
2023 Annual Report
authenticity and
rationality of
the relevant
data quoted in
this transaction
plan. As of the
signing date of
this transaction
plan, the audit
and evaluation
related to this
transaction
have not been
completed. The
audited
financial data,
evaluation or
valuation
results of the
underlying
assets and the
audited profit
forecast data (if
involved) will
be disclosed in
the
Restructuring
Report. The
audited
financial data
of the
underlying
assets may be
quite different
from the
disclosure of
the plan; 4.
During this
transaction, the
Company will
timely disclose
information
about this
transaction in
accordance
with relevant
laws and
regulations, and
relevant
regulations of
China
Securities
Regulatory
Commission
and Shenzhen
Stock
Exchange, and
guarantee the
64
2023 Annual Report
authenticity,
accuracy and
completeness
of such
information.
Commitments
made during
asset
restructuring:
1. The relevant
information
provided by me
during this
transaction is
authentic,
accurate and
complete, and it
is guaranteed
that there are
no false
records,
misleading
statements or
major
omissions, and
I will bear
individual and
Statement and joint legal
Commitment responsibilities
All the
on the for the
directors,
Authenticity, authenticity,
资产重组时所 supervisors and November Sustained and Under
Accuracy and accuracy and
作承诺 senior 17,2023 effective Fulfillment
Completeness completeness
managers of the
of the of the
company
Information information
Provided provided. If
there are false
records,
misleading
statements or
major
omissions in
the information
provided,
which cause
losses to the
company or
investors, I will
be liable for
compensation
according to
law. 2. I will
submit relevant
information,
documents and
materials
(including but
not limited to
65
2023 Annual Report
original written
materials,
electronic
materials,
duplicate
materials and
oral testimony)
required for this
transaction to
the company
and relevant
intermediaries
in a timely
manner, and at
the same time I
promise that the
information and
documents
provided are
authentic,
complete and
accurate, the
relevant
duplicate
materials or
photocopies are
consistent with
the original, all
signatures and
seals on the
documents are
authentic and
valid, and the
photocopies are
consistent with
the original,
and the
signatories of
these
documents
have legally
authorized and
effectively
signed the
documents, and
that there are
no false
records,
misleading
statements or
major
omissions. 3.
During this
transaction, I
will timely
disclose
information
about this
66
2023 Annual Report
transaction in
accordance
with relevant
laws and
regulations, and
relevant
regulations of
China
Securities
Regulatory
Commission
and Shenzhen
Stock
Exchange, and
guarantee the
authenticity,
accuracy and
completeness
of such
information. 4.
If this
transaction is
investigated by
the judicial
authorities or
by the China
Securities
Regulatory
Commission
because of false
records,
misleading
statements or
major
omissions in
the information
provided or
disclosed by
me, I will
suspend the
transfer of the
shares in the
company
before the
conclusion of
the case
investigation is
determined, and
submit a
written
application for
suspension of
the transfer and
the stock
account to the
board of
directors of the
company
67
2023 Annual Report
within two
trading days
after receiving
the notice of
filing the
investigation,
and the board
of directors of
the company
will apply to
the Shenzhen
Stock
Exchange and
Shenzhen
Branch of
China
Securities
Depository and
Clearing Co.,
Ltd.
(hereinafter
referred to as
"CSDC") for
locking; If the
application for
locking is not
submitted
within two
trading days,
the board of
directors of the
company is
authorized to
directly submit
my identity
information and
account
information to
Shenzhen Stock
Exchange and
CSDC after
verification and
apply for
locking; If the
board of
directors of the
listed company
fails to submit
my identity
information and
account
information to
Shenzhen Stock
Exchange and
CSDC,
Shenzhen Stock
Exchange and
CSDC are
68
2023 Annual Report
authorized to
directly lock
the relevant
stocks. If any
violation of
laws and
regulations is
found during
the
investigation, I
promise to lock
in the shares
and voluntarily
use them for
compensation
arrangements
of relevant
investors.
Commitments
made during
asset
restructuring:
1. There are no
false records,
misleading
statements or
major
omissions in
the application
documents for
this transaction;
2. The rights
and interests of
the listed
company are
All the not seriously
directors, Statement and damaged by the
资产重组时所 supervisors and Commitment controlling November Sustained and Under
作承诺 senior on No Illegal shareholder or 17,2023 effective Fulfillment
managers of the Acts actual
company controller and
have not been
eliminated; 3.
The listed
company and
its subsidiaries
do not provide
external
guarantees in
violation of
regulations and
have not been
lifted; 4. The
listed
company's
financial
statements for
the latest year
69
2023 Annual Report
and the first
stage have no
audit reports
with qualified
opinions,
negative
opinions or
disclaimer of
opinions issued
by certified
public
accountants; 5.
The listed
company and
its current
directors,
supervisors and
senior
managers have
not been
subjected to
administrative
punishment by
the China
Securities
Regulatory
Commission in
the last 36
months, and
nor have they
been publicly
condemned by
the stock
exchange or
found with
other major acts
of dishonesty in
the last 12
months; 6. The
listed company
and its current
directors and
senior
managers have
not been
investigated by
the judicial
authorities for
suspected
crimes or by
the China
Securities
Regulatory
Commission
for suspected
violations of
laws and
regulations,
70
2023 Annual Report
including but
not limited to
receiving or
foreseeing the
decision/notice
of filing
investigation by
the judicial
authorities, the
notice of filing
investigation by
the China
Securities
Regulatory
Commission
and its
dispatched
institutions, and
the advance
notice of
administrative
punishment,
and there is no
administrative
punishment
(except those
obviously
unrelated to the
securities
market) or
criminal
punishment; 7.
The listed
company has
no other
circumstances
that seriously
damage the
legitimate
rights and
interests of
investors and
social public
interests; 8. The
directors,
supervisors and
senior
managers of the
listed company
do not disclose
the relevant
inside
information of
this transaction
and use the
inside
information for
insider trading.
71
2023 Annual Report
Commitments
made during
asset
restructuring:
The listed
company, its
directors,
supervisors,
senior
managers and
the enterprises
controlled by
the above-
mentioned
entities have
Explanation on not been placed
the Absence of on file for
the investigation on
Circumstances suspicion of
Stipulated in insider trading
Article 12 of related to this
the Guidance transaction; In
All the
on Supervision the last 36
directors,
of Listed months, they
资产重组时所 supervisors and November Sustained and Under
Companies have not been
作承诺 senior 17,2023 effective Fulfillment
No.7 - punished by the
managers of the
Supervision of China
company
Abnormal Securities
Trading of Regulatory
Stocks Related Commission or
to Major Asset investigated by
Restructuring the judicial
of Listed organs for
Companies. criminal
responsibility
according to
law for insider
trading related
to major asset
restructuring of
listed
companies,
which does not
allow them to
participate in
any major asset
restructuring of
listed
companies.
Commitment
made during
All the
asset
directors, Explanation on
restructuring:
资产重组时所 supervisors and Whether There November Sustained and Under
From the date
作承诺 senior is a Reduction 17,2023 effective Fulfillment
of resumption
managers of the Plan
of trading to the
company
completion of
this transaction,
72
2023 Annual Report
if I hold shares
of the listed
company, I
have no plans
to reduce the
shares of the
listed company.
Commitment
made during
asset
restructuring: 1.
The relevant
information
provided by the
Company
during this
transaction is
authentic,
accurate and
complete, and it
is guaranteed
that there are
no false
records,
misleading
statements or
major
omissions, and
Statement and the Company
Commitment will bear
on the individual and
Shenzhen
Authenticity, joint legal
资产重组时所 Investment November Sustained and Under
Accuracy and responsibilities
作承诺 Holdings Co., 17,2023 effective Fulfillment
Completeness for the
Ltd.
of the authenticity,
Information accuracy and
Provided completeness
of the
information
provided. If
there are false
records,
misleading
statements or
major
omissions in
the information
provided,
which cause
losses to the
listed company
or investors, the
Company will
be liable for
compensation
according to
law; 2. The
Company will
73
2023 Annual Report
submit relevant
information,
documents and
materials
(including but
not limited to
original written
materials,
electronic
materials,
duplicate
materials and
oral testimony)
required for this
transaction to
the listed
company and
relevant
intermediaries
in a timely
manner, and at
the same time it
promises that
the information
and documents
provided are
authentic,
complete and
accurate, the
relevant
duplicate
materials or
photocopies are
consistent with
the original, all
signatures and
seals on the
documents are
authentic and
valid, and the
photocopies are
consistent with
the original,
and the
signatories of
these
documents
have legally
authorized and
effectively
signed the
documents, and
that there are
no false
records,
misleading
statements or
major
74
2023 Annual Report
omissions; 3.
During this
transaction, the
Company will
timely disclose
information
about this
transaction in
accordance
with relevant
laws and
regulations, and
relevant
regulations of
China
Securities
Regulatory
Commission
and Shenzhen
Stock
Exchange, and
guarantee the
authenticity,
accuracy and
completeness
of such
information;4.
If this
transaction is
investigated by
the judicial
authorities or
by the China
Securities
Regulatory
Commission
because of false
records,
misleading
statements or
major
omissions in
the information
provided or
disclosed by the
Enterprise, the
Enterprise will
suspend the
transfer of
shares with
interests in the
listed company,
and submit the
written
application for
suspension of
transfer and the
stock account
75
2023 Annual Report
to the board of
directors of the
listed company
within two
trading days
after receiving
the notice of
filing the
investigation,
and the board
of directors of
the listed
company will
apply to the
Stock
Exchange and
the Depository
and Clearing
Company for
locking on its
behalf; If the
application for
locking is not
submitted
within two
trading days,
the board of
directors of the
listed company
shall be
authorized to
directly submit
the identity
information and
account
information of
the Enterprise
to the Stock
Exchange and
the Depository
and Clearing
Company after
verification and
apply for
locking; If the
board of
directors of the
listed company
fails to submit
the identity
information and
account
information of
the Enterprise
to the Stock
Exchange and
the Depository
and Clearing
76
2023 Annual Report
Company, the
Stock
Exchange and
the Depository
and Clearing
Company are
authorized to
directly lock
the relevant
shares. If any
violation of
laws and
regulations is
found during
the
investigation,
the Enterprise
promises to
lock in the
shares and
voluntarily use
them for
compensation
arrangements
of relevant
investors.
Commitment
made during
asset
restructuring: 1.
The Company
has not been
subjected to
administrative
punishment
(except those
obviously
unrelated to the
securities
market) or
Shenzhen criminal
Commitment
资产重组时所 Investment punishment in November Sustained and Under
on Compliance
作承诺 Holdings Co., the last three 17,2023 effective Fulfillment
and Integrity
Ltd. years; 2. The
Company is in
good credit,
with no public
condemnation
by the stock
exchange or
other major
dishonesty in
the last 12
months; In the
last three years,
the Company
has not been
placed on file
77
2023 Annual Report
for
investigation by
the judicial
authorities for
suspected
crimes or by
the China
Securities
Regulatory
Commission
for suspected
violations of
laws and
regulations; 3.
The Company
does not
disclose the
relevant inside
information of
this transaction
or use the
inside
information for
insider trading;
4. The
Company does
not infringe the
rights and
interests of the
listed company;
5. The
Company
guarantees that
it is willing to
bear
corresponding
legal
responsibilities
if it violates the
above
statements and
commitments.
Explanation on Commitment
the Absence of made during
the asset
Circumstances restructuring:
Stipulated in Shenzhen
Article 13 of Investment
Shenzhen the Guidance Holdings and
资产重组时所 Investment on Supervision all its directors, November Sustained and Under
作承诺 Holdings Co., of Listed supervisors, 17,2023 effective Fulfillment
Ltd. Companies senior
No.7 - managers and
Supervision of the enterprises
Abnormal controlled by
Trading of the above-
Stocks Related mentioned
to Major Asset entities have
78
2023 Annual Report
Restructuring not been placed
of Listed on file for
Companies investigation
due to insider
trading related
to major asset
restructuring;
In the last 36
months, they
were not
subjected to
administrative
punishment
imposed by
China
Securities
Regulatory
Commission or
investigated for
criminal
responsibility
by judicial
organs
according to
law, which
does not allow
them to
participate in
any major asset
restructuring of
listed
companies.
Commitment
made during
asset
restructuring:
During the
period from the
date of
Shenzhen Explanation on resumption of
资产重组时所 Investment Whether There this November Sustained and Under
作承诺 Holdings Co., is a Reduction restructuring to 17,2023 effective Fulfillment
Ltd. Plan the completion
of this
restructuring,
the Company
has no plans to
reduce the
shares of listed
company.
Qimei Material, Statement and Commitment
Haosheng Commitment made during
Danyang, on the asset
资产重组时所 Danyang Authenticity, restructuring: 1. November Sustained and Under
作承诺 Ruoyan, Accuracy and The relevant 17,2023 effective Fulfillment
Xiamen Completeness information
Ruoyan, of the provided by the
Fuzhou Xintou, Information Enterprise
79
2023 Annual Report
Hefei Provided during this
Beicheng, transaction is
Hangzhou authentic,
Rencheng, accurate and
Xinghe complete, and it
Technology , is guaranteed
lishui Huahui, that there are
Huzhou Painuo, no false
Lishui Tengbei, records,
Fuzhou misleading
Investment, statements or
Xiamen major
Zhifeng, omissions, and
Jiaxing Painuo, the Enterprise
Huzhou will bear
Zhekuang, individual and
Guangdong joint legal
Xingzhi, responsibilities
Guangzhou for the
Boyue authenticity,
accuracy and
completeness
of the
information
provided. If
there are false
records,
misleading
statements or
major
omissions in
the information
provided,
which cause
losses to the
listed company
or investors, the
Enterprise will
be liable for
compensation
according to
law; 2. The
Enterprise will
submit relevant
information,
documents and
materials
(including but
not limited to
original written
materials,
electronic
materials,
duplicate
materials and
oral testimony)
required for this
transaction to
80
2023 Annual Report
the listed
company and
relevant
intermediaries
in a timely
manner, and at
the same time it
promises that
the information
and documents
provided are
authentic,
complete and
accurate, the
relevant
duplicate
materials or
photocopies are
consistent with
the original, all
signatures and
seals on the
documents are
authentic and
valid, and the
photocopies are
consistent with
the original,
and the
signatories of
these
documents
have legally
authorized and
effectively
signed the
documents, and
that there are
no false
records,
misleading
statements or
major
omissions; 3.
The Enterprise
guarantees that
it has fulfilled
its statutory
disclosure and
reporting
obligations on
this transaction,
and there are no
contracts,
agreements,
arrangements
or other matters
that should be
81
2023 Annual Report
disclosed but
not disclosed.
The Enterprise
is aware of the
possible legal
consequences
of the above
commitments,
and will bear
corresponding
legal
responsibilities
for acts that
violate the
above
commitments;
4. If this
transaction is
investigated by
the judicial
authorities or
by the China
Securities
Regulatory
Commission
because of false
records,
misleading
statements or
major
omissions in
the information
provided or
disclosed by the
Enterprise, the
Enterprise will
suspend the
transfer of
shares with
interests in the
listed company,
and submit the
written
application for
suspension of
transfer and the
stock account
to the board of
directors of the
listed company
within two
trading days
after receiving
the notice of
filing the
investigation,
and the board
of directors of
82
2023 Annual Report
the listed
company will
apply to the
Stock
Exchange and
the Depository
and Clearing
Company for
locking on its
behalf; If the
application for
locking is not
submitted
within two
trading days,
the board of
directors of the
listed company
shall be
authorized to
directly submit
the information
and account
information of
the Enterprise
to the Stock
Exchange and
the Depository
and Clearing
Company after
verification and
apply for
locking; If the
board of
directors of the
listed company
fails to submit
the information
and account
information of
the Enterprise
to the Stock
Exchange and
the Depository
and Clearing
Company, the
Stock
Exchange and
the Depository
and Clearing
Company are
authorized to
directly lock
the relevant
shares. If any
violation of
laws and
regulations is
83
2023 Annual Report
found during
the
investigation,
the Enterprise
promises to
lock in the
shares and
voluntarily use
them for
compensation
arrangements
of relevant
investors.
Commitment
made at the
time of asset
restructuring:
1. The shares of
the listed
company
obtained by the
company in this
transaction
shall not be
transferred
within 36
months from
the date of the
end of the
Qimei Material, issuance; 2.
Haosheng After the end of
Danyang, the issuance, if
Danyang the shares
Ruoyan, obtained by the
Xiamen Commitment company due to
资产重组时所 this transaction November Sustained and Under
Ruoyan,Lishui on share
作承诺 are increased 17,2023 effective Fulfillment
Huahui, lock-up
Xiamen due to the
Zhifeng, bonus shares of
Fuzhou Xintou, the listed
Kunshan company, the
Guochuang increase in
share capital
and other
reasons, the
above lock-up
period shall
also be
observed. After
the expiration
of the lock-up
period, the
transfer and
trading of the
shares of the
listed company
will be handled
in accordance
84
2023 Annual Report
with the laws
and regulations
in force at that
time and the
rules of the
Shenzhen Stock
Exchange; 3. If
the lock-up
period of the
shares
subscribed by
the company is
inconsistent
with the latest
regulatory
opinions of the
securities
regulatory
authorities, the
company will
make
corresponding
adjustments
according to the
regulatory
opinions of the
securities
regulatory
authorities; 4.
After the
expiration of
the above-
mentioned
lock-up period,
it will be
implemented in
accordance
with the
relevant
regulations of
the China
Securities
Regulatory
Commission
and the
Shenzhen Stock
Exchange.
Hefei Commitment
Beicheng, made at the
Xingheying time of asset
Technology, restructuring:
Huzhou Commitment 1. The shares of
资产重组时所 the listed November Sustained and Under
Painuo, Lishui on share lock-
作承诺 company 17,2023 effective Fulfillment
Tengbei, up
Fuzhou obtained by the
Investment, company in this
Jiaxing Painuo, transaction
Huzhou shall not be
85
2023 Annual Report
Zhekuang, transferred
Guangdong within 12
Xingzhi, months from
Guangzhou the date of the
Boyue end of the
issuance(When
the shares
obtained in this
transaction are
registered in the
name of the
company, if the
company holds
the underlying
assets for less
than 12 months,
they shall not
be transferred
within 36
months.); 2.
After the end of
the issuance, if
the shares
obtained by the
company due to
this transaction
are increased
due to the
bonus shares of
the listed
company, the
increase in
share capital
and other
reasons, the
above lock-up
period shall
also be
observed. After
the expiration
of the lock-up
period, the
transfer and
trading of the
shares of the
listed company
will be handled
in accordance
with the laws
and regulations
in force at that
time and the
rules of the
Shenzhen Stock
Exchange; 3. If
the lock-up
period of the
shares
86
2023 Annual Report
subscribed by
the company is
inconsistent
with the latest
regulatory
opinions of the
securities
regulatory
authorities, the
company will
make
corresponding
adjustments
according to the
regulatory
opinions of the
securities
regulatory
authorities; 4.
After the
expiration of
the above-
mentioned
lock-up period,
it will be
implemented in
accordance
with the
relevant
regulations of
the China
Securities
Regulatory
Commission
and the
Shenzhen Stock
Exchange.
Qimei Material, Commitment
Danyang made during
Nuoyan, asset
Xiamen restructuring:
Nuoyan, The Enterprise
Fuzhou Xintou, and its main
Hefei management
Beicheng, personnel have
Xinghe not been
Technology, Commitment subjected to
资产重组时所 November Sustained and Under
Lishui Huahui, on Compliance criminal
作承诺 17,2023 effective Fulfillment
Huzhou Painuo, and Integrity penalties or
Lishui Pengbei, administrative
Fuzhou penalties
Investment, (except those
Xiamen obviously
Zhifeng, unrelated to the
Jiaxing Painuo, securities
Huzhou market) in the
Zhekuang, last five years,
Guangdong and there is no
87
2023 Annual Report
Xingzhi, major civil
Guangzhou litigation or
Boyue arbitration
related to
economic
disputes; 2. In
the last five
years, the
Enterprise has
not been
investigated by
the judicial
authorities for
suspected
crimes or by
the China
Securities
Regulatory
Commission
for suspected
violations of
laws and
regulations; 3.
The Enterprise
and its main
management
personnel had
no failure to
repay large
debts, or to
fulfill their
commitments,
and were not
subjected to
administrative
supervision
measures by the
China
Securities
Regulatory
Commission or
disciplinary
actions by the
stock exchange
in the last five
years; 4. The
Enterprise and
its main
management
personnel have
not disclosed
the relevant
insider
information of
this transaction
or used the
insider
information for
88
2023 Annual Report
insider trading;
5. The
Enterprise has
none of the
following
circumstances:
(1) It has a
large amount of
debt, which is
not paid off at
maturity and is
in a continuous
state; (2) It had
major illegal
acts or
suspected
major illegal
acts in the last 3
years; (3) It had
serious acts of
dishonesty in
the securities
market in the
last 3 years; (4)
Other
circumstances
stipulated by
laws and
administrative
regulations and
determined by
China
Securities
Regulatory
Commission
that it is not
allowed to
acquire listed
companies.
Qimei material, Explanation on Commitment
Haosheng the Absence of made during
Danyang, the asset
Danyang Circumstances restructuring:
Nouyan, Stipulated in The Enterprise
Xiamen Article 12 of and its main
Nouyan, the Guidance management
Fuzhou Xintou, on Supervision personnel
Hefei of Listed (including
资产重组时所 November Sustained and Under
Beicheng, Companies directors,
作承诺 17,2023 effective Fulfillment
Hangzhou No.7 - supervisors and
Rencheng, Supervision of senior
Xinghe Abnormal management
Technology, Trading of personnel in the
Lishui Huhui, Stocks Related case of a
Huzhou Painuo, to Major Asset company; or
Lishui Tengbei, Restructuring executive
Fuzhou of Listed partners and
Investment , Companies key
89
2023 Annual Report
Xiamen management
Zhifeng, personnel in the
Jiaxing Painuo, case of a
Huzhou partnership),
Zhekuang, the controlling
Guangdong shareholder and
Xingzhi, actual
Guangzhou controller of the
Boyue Enterprise and
the enterprises
controlled by
the above-
mentioned
entities have
not been placed
on file for
investigation
due to insider
trading related
to major asset
restructuring;
In the last 36
months, they
were not
subjected to
administrative
punishment
imposed by
China
Securities
Regulatory
Commission or
investigated for
criminal
responsibility
by judicial
organs
according to
law, which
does not allow
them to
participate in
any major asset
restructuring of
listed
companies.
Qimei material, Commitment
Haosheng made during
Danyang, asset
Danyang restructuring: 1.
Explanation on
Nouyan, The Enterprise
the Ownership
资产重组时所 Xiamen legally owns November Sustained and Under
of the
作承诺 Nouyan, the 17,2023 effective Fulfillment
Underlying
Fuzhou Xintou, corresponding
Assets
Hefei shares of the
Beicheng, target company,
Hangzhou and its capital
Rencheng, contribution to
90
2023 Annual Report
Xinghe the target assets
Technology, has been fully
Lishui Huhui, paid, and there
Huzhou Painuo, is no false
Lishui Tengbei, capital
Fuzhou contribution or
Investment , withdrawal of
Xiamen capital
Zhifeng, contribution,
Jiaxing Painuo, and the
Huzhou Enterprise has
Zhekuang, complete
Guangdong ownership of
Xingzhi, the target
Guangzhou assets, with no
Boyue other
circumstances
that may affect
the legal
existence of the
target
company; 2.
The Enterprise
is the ultimate
and true owner
of the
underlying
assets, and the
ownership of
the underlying
assets is clear
with no dispute,
and there are no
circumstances
of holding the
underlying
assets by means
of trust,
entrusting
others or
accepting
others'
entrustment;
The underlying
assets are not in
custody, with
no pledge,
mortgage, lien
and other
security rights
or other third-
party rights, or
other terms or
agreements
restricting
transfer signed,
and no dispute
or potential
91
2023 Annual Report
dispute. The
underlying
assets have not
been sealed up
or frozen by
administrative
or judicial
organs, and
there are no
other
restrictions or
prohibitions on
transfer. The
Enterprise
guarantees that
the above-
mentioned state
will continue
until the
transfer of the
underlying
assets to the
name of the
listed company
or until the date
of termination
of this
transaction
(whichever is
earlier); 3. The
Enterprise
promises to
change the
ownership of
the underlying
assets in a
timely manner
according to the
agreement after
the relevant
agreement of
this transaction
comes into
effect, and all
the
responsibilities
arising from
disputes caused
by the
Enterprise in
the process of
ownership
change shall be
borne by the
Enterprise; 4.
The ownership
of the above-
mentioned
92
2023 Annual Report
underlying
assets to be
transferred by
the Enterprise
has none of
unresolved or
foreseeable
disputes such as
litigation and
arbitration, and
the
responsibilities
arising from
disputes such as
litigation and
arbitration shall
be borne by the
Enterprise.
Commitment
made during
asset
restructuring: 1.
The Enterprise
legally owns
the
corresponding
shares of the
target company,
and its capital
contribution to
the target assets
has been fully
paid, and there
is no false
capital
contribution or
Explanation on
withdrawal of
the Ownership
资产重组时所 Haosheng capital November Sustained and Under
of the
作承诺 Danyang contribution, 17,2023 effective Fulfillment
Underlying
and it has
Assets
complete
ownership of
the target
assets, and
there is no
other
circumstances
that may affect
the legal
existence of the
target
company; 2.
The Enterprise
is the ultimate
and true owner
of the
underlying
assets, and the
93
2023 Annual Report
ownership of
the underlying
assets is clear
with no dispute,
and there are no
circumstances
of holding the
underlying
assets by means
of trust,
entrusting
others or
accepting
others'
entrustment;
Except for the
pledge of
267,857,146
shares of the
underlying
company held
by the
enterprise, the
remaining
underlying
assets held by
the enterprise
are not in
custody, with
no pledge,
mortgage, lien
and other
security rights
or other third-
party rights, or
other terms or
agreements
restricting
transfer
signed,and no
dispute or
potential
dispute. The
underlying
assets have not
been sealed up
or frozen by
administrative
or judicial
organs, and
there are no
other
restrictions or
prohibitions on
transfer. The
Enterprise
guarantees to
release the
94
2023 Annual Report
aforementioned
equity pledge
before the
board meeting
of the listed
company
deliberates the
report (draft) of
this
restructuring,
and to maintain
this state after
the pledge is
released until
the target assets
are transferred
to the name of
the listed
company or
until the date of
termination of
this transaction
(whichever is
earlier); 3. The
Enterprise
promises to
change the
ownership of
the underlying
assets in a
timely manner
according to the
agreement after
the relevant
agreement of
this transaction
comes into
effect, and all
the
responsibilities
arising from
disputes caused
by the
Enterprise in
the process of
ownership
change shall be
borne by the
Enterprise; 4.
The ownership
of the above-
mentioned
underlying
assets to be
transferred by
the Enterprise
has none of
unresolved or
95
2023 Annual Report
foreseeable
disputes such as
litigation and
arbitration, and
the
responsibilities
arising from
disputes such as
litigation and
arbitration shall
be borne by the
Enterprise.
Commitments
made during
asset
restructuring:
The Enterprise
fully recognizes
the position of
Shenzhen
Investment
Holdings Co.,
Ltd.
(hereinafter
referred to as
"Shenzhen
Investment
Holdings") as
the controlling
shareholder of
listed
companies,
supports
Qimei Material,
Commitment Shenzhen
Danyang
资产重组时所 not to seek Investment November Sustained and Under
Nuoyan,
作承诺 control of listed Holdings to 17,2023 effective Fulfillment
Xiamen
companies continuously
Nuoyan
control the
listed
companies,
supports it to
lead the
production and
operation of
listed
companies, and
maintain its
status of state-
owned holding
enterprise of
listed
companies, thus
providing
assistance for
the sustainable
operation and
development of
listed
96
2023 Annual Report
companies.
Within 60
months from
the date when
the Enterprise
obtains the
shares of the
listed company
through this
transaction, the
Enterprise will
not seek the
status and
control of the
largest
shareholder or
controlling
shareholder of
the listed
company by
entrustment,
soliciting
voting rights,
signing a
concerted
action
agreement, and
uniting with
other
shareholders in
any other way,
nor will it assist
or urge other
shareholders to
seek the control
of the listed
company in any
way.
Commitments
made during
asset
restructuring:
The Enterprise
fully recognizes
the position of
Shenzhen
Commitment Investment
资产重组时所 Haosheng not to seek Holdings Co., November Sustained and Under
作承诺 Danyang control of listed Ltd. 17,2023 effective Fulfillment
companies (hereinafter
referred to as
"Shenzhen
Investment
Holdings") as
the controlling
shareholder of
listed
companies,
97
2023 Annual Report
supports
Shenzhen
Investment
Holdings to
continuously
control the
listed
companies,
supports it to
lead the
production and
operation of
listed
companies, and
maintain its
status of state-
owned holding
enterprise of
listed
companies, thus
providing
assistance for
the sustainable
operation and
development of
listed
companies.
Within 60
months from
the date when
the Enterprise
obtains the
shares of the
listed company
through this
transaction, the
Enterprise will
not seek the
status and
control of the
largest
shareholder or
controlling
shareholder of
the listed
company by
entrustment,
soliciting
voting rights,
signing a
concerted
action
agreement, and
uniting with
other
shareholders in
any other way,
nor will it assist
98
2023 Annual Report
or urge other
shareholders to
seek the control
of the listed
company in any
way.
Commitments
made during
asset
restructuring:
The Enterprise
fully recognizes
the position of
Shenzhen
Investment
Holdings Co.,
Ltd.
(hereinafter
referred to as
"Shenzhen
Investment
Holdings") as
the controlling
shareholder of
listed
companies,
supports
Shenzhen
Investment
Holdings to
Commitment continuously
Fuxhou Xintou,
资产重组时所 not to seek control the November Sustained and Under
Kunshan
作承诺 control of listed listed 17,2023 effective Fulfillment
Guochuang
companies companies,
supports it to
lead the
production and
operation of
listed
companies, and
maintain its
status of state-
owned holding
enterprise of
listed
companies, thus
providing
assistance for
the sustainable
operation and
development of
listed
companies.
Within 60
months from
the date when
the Enterprise
obtains the
99
2023 Annual Report
shares of the
listed company
through this
transaction, the
Enterprise will
not seek the
status and
control of the
largest
shareholder or
controlling
shareholder of
the listed
company by
entrustment,
soliciting
voting rights,
signing a
concerted
action
agreement, and
uniting with
other
shareholders in
any other way,
nor will it assist
or urge other
shareholders to
seek the control
of the listed
company in any
way.
Commitments
made during
asset
restructuring:
The Enterprise
fully recognizes
the position of
Shenzhen
Investment
Holdings Co.,
Ltd.
Commitment (hereinafter
资产重组时所 not to seek referred to as November Sustained and Under
Hefei Beicheng
作承诺 control of listed "Shenzhen 17,2023 effective Fulfillment
companies Investment
Holdings") as
the controlling
shareholder of
listed
companies,
supports
Shenzhen
Investment
Holdings to
continuously
control the
100
2023 Annual Report
listed
companies,
supports it to
lead the
production and
operation of
listed
companies, and
maintain its
status of state-
owned holding
enterprise of
listed
companies, thus
providing
assistance for
the sustainable
operation and
development of
listed
companies.
Within 60
months from
the date when
the Enterprise
obtains the
shares of the
listed company
through this
transaction, the
Enterprise will
not seek the
status and
control of the
largest
shareholder or
controlling
shareholder of
the listed
company by
entrustment,
soliciting
voting rights,
signing a
concerted
action
agreement, and
uniting with
other
shareholders in
any other way,
nor will it assist
or urge other
shareholders to
seek the control
of the listed
company in any
way.
101
2023 Annual Report
Commitments
made during
asset
restructuring:
I and the
Enterprise fully
recognizes the
position of
Shenzhen
Investment
Holdings Co.,
Ltd.
(hereinafter
referred to as
"Shenzhen
Investment
Holdings") as
the controlling
shareholder of
listed
companies,
Chen
supports
Rongsheng, Li
Shenzhen
Xinfei, Zhuang
Investment
Yingming,
Holdings to
Management
continuously
Committee of
control the
Danyang
Commitment listed
Economic
资产重组时所 not to seek companies, November Sustained and Under
Development
作承诺 control of listed supports it to 17,2023 effective Fulfillment
Zone, Jiangsu
companies lead the
Province(Dany
production and
ang Qua Street
operation of
office),
listed
Danyang State-
companies, and
owned assets
maintain its
operation
status of state-
service Center
owned holding
enterprise of
listed
companies, thus
providing
assistance for
the sustainable
operation and
development of
listed
companies.
Within 60
months from
the date when
the Enterprise
obtains the
shares of the
listed company
through this
transaction, the
Enterprise will
102
2023 Annual Report
not seek the
status and
control of the
largest
shareholder or
controlling
shareholder of
the listed
company by
entrustment,
soliciting
voting rights,
signing a
concerted
action
agreement, and
uniting with
other
shareholders in
any other way,
nor will it assist
or urge other
shareholders to
seek the control
of the listed
company in any
way.
Commitment
made during
asset
restructuring: 1.
The relevant
information
provided by the
Company
during this
transaction is
authentic,
Statement and accurate and
Commitment complete, and it
on the is guaranteed
Authenticity, that there are
资产重组时所 Hengmei November Sustained and Under
Accuracy and no false
作承诺 Photoelectric 17,2023 effective Fulfillment
Completeness records,
of the misleading
Information statements or
Provided major
omissions, and
the Company
will bear
individual and
joint legal
responsibilities
for the
authenticity,
accuracy and
completeness
of the
103
2023 Annual Report
information
provided. If
there are false
records,
misleading
statements or
major
omissions in
the information
provided,
which cause
losses to the
listed company
or investors, the
Enterprise will
be liable for
compensation
according to
law; 2. The
Company will
submit relevant
information,
documents and
materials
(including but
not limited to
original written
materials,
electronic
materials,
duplicate
materials and
oral testimony)
required for this
transaction to
the listed
company and
relevant
intermediaries
in a timely
manner, and at
the same time it
promises that
the information
and documents
of the paper
and electronic
materials
provided are
authentic,
complete,
accurate and
reliable, the
relevant
duplicate
materials or
photocopies are
consistent with
104
2023 Annual Report
the original, all
signatures and
seals on the
documents are
authentic and
valid, and the
photocopies are
consistent with
the original,
and the
signatories of
these
documents
have legally
authorized and
effectively
signed the
documents, and
that there are
no false
records,
misleading
statements or
major
omissions; 3.
The Company
guarantees that
it has fulfilled
its statutory
disclosure and
reporting
obligations on
this transaction,
and there are no
contracts,
agreements,
arrangements
or other matters
that should be
disclosed but
not disclosed.
The Company
is aware of the
possible legal
consequences
of the above
commitments,
and will bear
corresponding
legal
responsibilities
for acts that
violate the
above
commitments.
Commitments Shenzhen Commitments Shenzhen
October 9, Sustained and Under
made upon Investment on horizontal Investment
2009 effective Fulfillment
issuance Holdings Co., competition, Holdings Co.,
105
2023 Annual Report
Ltd. related Ltd. signed a
transaction and “Letter of
capital Commitment
occupation and Statement
on Horizontal
Competition
Avoidance”
when the
company issued
non-public
stocks in 2009.
Pursuant to the
Letter of
Commitment
and Statement,
Shenzhen
Investment
Holdings Co.,
Ltd. and its
wholly owned
subsidiary,
subsidiaries
under control or
any other
companies that
have actual
control of it
shall not be
involved in the
business the
same as or
similar to those
Shenzhen
Textile
currently or
will run in the
future, or any
businesses or
activities that
may constitute
direct or
indirect
competition
with Shenzhen
Textile; if the
operations of
Shenzhen
Investment
Holdings Co.,
Ltd. and its
wholly owned
subsidiaries,
subsidiaries
under control or
other
companies that
have actual
control of it
compete with
Shenzhen
Textile in the
same industry
or contradict
the interest of
the issuer in the
future,
Shenzhen
106
2023 Annual Report
Investment
Holdings Co.,
Ltd. shall urge
such companies
to sell the
equity, assets or
business to
Shenzhen
Textile or a
third party;
when the
horizontal
competition
may occur due
to the business
expansion
concurrently
necessary for
Shenzhen
Investment
Holdings Co.,
Ltd. and its
wholly owned
subsidiaries,
subsidiaries
under control or
other
companies that
have actual
control of it and
Shenzhen
Textile,
Shenzhen
Textile shall
have priority.
The
commitments
during the
period non-
public issuance
in 2012: 1.
Shenzhen
Investment
Holdings, as
the controlling
shareholder of
Shenzhen
Textile,
Commitments
currently hasn't
on horizontal
首次公开发行 Shenzhen the production
competition,
Investment and business July 14, Sustained and Under
或再融资时所 related
Holdings Co., activities of 2012 effective Fulfillment
作承诺 transaction and
Ltd. inter-industry
capital
competition
occupation
with Shenzhen
Textile or its
share-holding
subsidiary. 2.
Shenzhen
Investment
Holdings and
its share-
holding
subsidiaries or
other
enterprises
owned the
107
2023 Annual Report
actual control
rights can't be
directly and
indirectly on
behalf of any
person,
company or
unit to engage
in the same or
similar business
in any districts
in the future by
the form of
share-holding,
equity
participation,
joint venture,
cooperation,
partnership,
contract, lease,
etc., and ensure
not to use the
controlling
shareholder's
status to
damage the
legitimate
rights and
interests of
Shenzhen
Textile and
other
shareholders, or
to gain the
additional
benefits. 3. If
there will be
the situation of
inter-industry
competition
with Shenzhen
Textile for
Shenzhen
Investment
Holdings and
its share-
holding
subsidiaries or
other
enterprises
owned the
actual control
rights in the
future,
Shenzhen
Investment
Holdings will
promote the
related
enterprises to
avoid the inter-
industry
competition
through the
transfer of
equity, assets,
business and
108
2023 Annual Report
other ways. 4.
Above
commitments
will be
continuously
effective and
irrevocable
during
Shenzhen
Investment
Holdings as the
controlling
shareholder of
Shenzhen
Textile or
indirectly
controlling
Shenzhen
Textile.
Executed
Yes
timely or not?
If the
commitments
failed to
complete the
execution when
expired, should
specifically Not applicable
explain the
reasons of
unfulfillment
and the net
stage of the
working plan
2.The existence of the company's assets or projects earnings forecasts and earnings reporting period is still in
the forecast period, the company has assets or projects meet the original profit forecast made and the reasons
explained
□ Applicable √ Not applicable
II. Particulars about the non-operating occupation of funds by the controlling shareholder
□ Applicable √ Not applicable
None
III. Illegal provision of guarantees for external parties
□ Applicable √ Not applicable
None
IV. Explanation of the Board of Directors on the latest "Non-standard Audit Report"
□ Applicable √ Not applicable
109
2023 Annual Report
V. Notes for “non-standard audit report” of CPAs firm during the Reporting Period by board of
directors and supervisory board
□ Applicable √ Not applicable
VI. Explain change of the accounting policy, accounting estimate and measurement methods as compared
with the financial reporting of last year.
Applicable □Not applicable
For details of the changes in the Company's accounting policies and accounting estimates and the correction of
accounting errors in the previous period, see "(IV) Changes in important accounting policies and accounting
estimates and the correction of accounting errors in the previous period" in "Section X Financial Report" of this
report
VII.Explain change of the consolidation scope as compared with the financial reporting of last year.
□ Applicable √ Not applicable
None
VIII. Engagement/Disengagement of CPAs
CPAs currently engaged
Deloitte Touche Tohmatsu CPA Ltd
Name of the domestic CPAs
.(special general partnership)
Remuneration for domestic accounting firm
110
(Ten thousands yuan)
Successive years of the domestic CPAs offering
2
auditing services
Name of CPA Huang Tianyi, Chen Junheng
Continuous years of audit services of certified
0
public accountants of domestic public accounting firms
Has the CPAs been changed in the current period
□Yes □ No
Description of the CPAs, financial advisers or sponsors engaged for internal control auditing
√ Applicable □Not applicable
During the reporting period, the company engaged Deloitte Touche Tohmatsu CPA Ltd.(special general
partnership) as the company's internal control audit agency for 2023, with an audit remuneration of RMB 1.1
million (including travel expenses and other expenses). The related financial statement audit fee is RMB 850,000
(including tax), and the internal control audit fee is RMB 250,000 (including tax).
IX. Situation of Facing Listing Suspension and Listing Termination after the Disclosure of the Yearly
Report
□Applicable √ Not applicable
X. Relevant Matters of Bankruptcy Reorganization
□Applicable √ Not applicable
110
2023 Annual Report
None
XI. Matters of Important Lawsuit and Arbitration
√ Applicable □Not applicable
Amount Implementati
Basic Whether to Litigation(ar
involved Litigation(ar on of
situation of form bitration)trial Disclosure Disclosure
(Ten bitration)pro litigation(arb
litigation(arb estimated results and date index
thousand gress itration)judg
itration) liabilities impact
yuan) ments
During the
reporting
period, the
Company
As of the end
and its
of the
subsidiaries
reporting
involved in For the By the end of
period in
12 other concluded the reporting
October
litigation and cases, the period, the
2023, among
arbitration Company's concluded
the 12 cases
cases that did demands cases were
mentioned
not meet the were being
above, 7
disclosure 3,409.1 No basically executed or /
cases were
standards of supported, completed,
concluded, 2
major which had no which had no
cases were
litigation, significant significant
withdrawn
mainly adverse adverse
by the
contract impact on the impact on the
plaintiff, and
disputes and Company. company.
3 cases were
labor
not
disputes, of
concluded.
which 3 as
plaintiffs and
9 as
defendants.
XII. Situation of Punishment and Rectification
□Applicable √ Not applicable
None
XIII. Credit Condition of the Company and its Controlling Shareholders and Actual Controllers
√ Applicable □ Not applicable
No such cases in the Reporting Period.
XIV. Material related transactions
1. Related transactions in connection with daily operation
□Applicable Not applicable
During the reporting period, the total amount of related party transactions related to daily operations of a certain
related party did not meet the standard for significant related party transactions.
2. Related-party transactions arising from asset acquisition or sale
111
2023 Annual Report
□Applicable √ Not applicable
None
3. Related-party transitions with joint investments
□Applicable √ Not applicable
None
4. Credits and liabilities with related parties
√ Applicable □ Not applicable
Whether was any contract related to the non-operating credits and liabilities with related parties?
□Yes No
None
5. Transactions with related finance company, especially one that is controlled by the Company
□Applicable √ Not applicable
None
6. Transactions between the financial company controlled by the Company and related parties
□ Applicable √Not applicable
There is no deposit, loan, credit or other financial business between the financial company controlled by the
Company and related parties.
7. Other significant related-party transactions
√ Applicable □ Not applicable
The Company intends to purchase 100% equity of Hengmei Optoelectronics Co., Ltd. by issuing shares and
paying cash, and at the same time, it plans to raise matching funds from non-public offering of shares to no
more than 35 qualified specific targets (hereinafter referred to as "this transaction"). This transaction constitutes
a related party transaction and is expected to constitute a major asset restructuring, but it does not constitute a
restructuring and listing, nor will it lead to the change of the actual controller of the company.
The website to disclose the interim announcements on significant related-party transactions
Date of disclosing provisional Description of the website for disclosing
Description of provisional announcement
announcement provisional announcements
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching January 30,2023
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings) Juchao Website
February 28,2023
Co., Ltd. to Issue Shares, Pay Cash to http://www.cninfo.com.cn
Purchase Assets and Raise Matching
112
2023 Annual Report
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching March 31,2023
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to Juchao Website
Purchase Assets and Raise Matching April 29,2023 Juchao Website
Funds and Related Party Transactions" http://www.cninfo.com.cn
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching May 31,2023
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Special explanation on being unable to
issue notice of convening a shareholders'
meeting within the specified period onthe
Juchao Website
progress of issuing shares and paying June 28,2023
http://www.cninfo.com.cn
cash to purchase assets and raise
matching funds namely the related party
transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching July 28,2023
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching August 29,2023
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching September 28,2023
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Juchao Website
Co., Ltd. to Issue Shares, Pay Cash to October 28,2023
http://www.cninfo.com.cn
Purchase Assets and Raise Matching
Funds and Related Party Transactions"
113
2023 Annual Report
and Its Summary and other proposals
related to this transaction
Announcement on Suspension of the
Juchao Website
Proposed Adjustment of Major Asset November 15,2023
http://www.cninfo.com.cn
Restructuring Plan
Announcement of Resolutions of the
Juchao Website
25th Meeting of the Eighth Board of November 17,2023
http://www.cninfo.com.cn
Directors
Announcement of Resolutions of the
Juchao Website
18th Meeting of the Eight board of November 17,2023
http://www.cninfo.com.cn
supervisors
Announcement on Suspension of the
Juchao Website
Proposed Adjustment of Major Asset November 17,2023
http://www.cninfo.com.cn
Restructuring Plan
Announcement on the Shareholding of
the Top Ten Shareholders One Trading Juchao Website
November 17,2023
Day before the Suspension of Major http://www.cninfo.com.cn
Asset Restructuring Plan Adjustment
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching November 29,2023
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching December 29,2023
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching January 30,2024
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
Progress announcement the Proposal on
"Plan for Shenzhen Textile (Holdings)
Co., Ltd. to Issue Shares, Pay Cash to
Juchao Website
Purchase Assets and Raise Matching February 29,2024
http://www.cninfo.com.cn
Funds and Related Party Transactions"
and Its Summary and other proposals
related to this transaction
XV. Significant contracts and execution
1.Entrustments, contracting and leasing
（1）Entrustment
□Applicable √ Not applicable
No such cases in the reporting period.
114
2023 Annual Report
（2）Contracting
□Applicable √ Not applicable
No such cases in the reporting period.
（3）Leasing
□Applicable √ Not applicable
No such cases in the reporting period.
II. Other significant contract
√ Applicable □Not applicable
In RMB10,000
Guarantee of the Company for the controlling subsidiaries (Exclude controlled subsidiaries)
Relevant
Guarante
disclosur Date of
e
e happenin Counter- Complet
Name of Amount Actual Guarant for
date/No. g guarante Guarante e
the of mount of Guarante y（If associate
of (Date of impleme
Compan Guarante guarante e type e（If e term d
the signing any） ntation
y e e any） parties
guarante agreeme or not
(Yes or
ed nt)
no)
amount
Guarantee of the company for its subsidiaries
Relevant
Guarante
disclosur Date of
e
e happenin Counter- Complet
Name of Amount Actual Guarant for
date/No. g guarante e
the of mount of Guarante y（If Guarante associate
of (Date of e（If impleme
Compan Guarante guarante e type e term d
the signing any） ntation
y e e any） parties
guarante agreeme or not
(Yes or
ed nt)
no)
amount
From the
date the
guarante
e
agreeme
Guarante nt takes
SAPO Septemb eing of effect to
Photoele March 36,491.4
48,000 er joint the date No No
ctric 18,2020 5
8,2020 liabilitie when the
s actual
loan
performa
nce
period
expires
Total of guarantee Total of actual
for subsidiaries guarantee for
0 0
approved in the subsidiaries in the
period(B1) period (B2)
Total of guarantee Total of actual
for subsidiaries guarantee for
48,000 36,491.45
approved at period- subsidiaries at
end(B3) period-end(B4)
Guarantee of the subsidiaries for the controlling subsidiaries
115
2023 Annual Report
Relevant
Guarante
disclosur Date of
e
e happenin Counter- Complet
Name of Amount Actual Guarant for
date/No. g guarante e
the of mount of Guarante y（If Guarante associate
of (Date of e（If impleme
Compan Guarante guarante e type e term d
the signing any） ntation
y e e any） parties
guarante agreeme or not
(Yes or
ed nt)
no)
amount
Total actual
Total guarantee line
guarantee amount
for subsidiaries
for subsidiaries
approved during this 0 0
during this
reporting Period
Reporting period
（C1）
（C2）
Total actual
Total Approved
guarantee balance
guarantee line for
for subsidiaries at
subsidiaries at the 0 0
the end of this
end of this reporting
reporting Period
period（C3）
（C4）
The Company’s total guarantee(i.e. total of the first three main items)
Total amount of
Total guarantee
guarantee actually
quota approved in
the reporting period 0 incurred in the 0
reporting period
（A1+B1+C1）
（A2+B2+C2）
Total guarantee
Total balance of the
quota already
actual guarantee at
approved at the
48,000 the end of the 36,491.45
end of the
reporting period
reporting period
（A4+B4+C4）
（A3+B3+C3）
The proportion of the total amount of
actually guarantee in the net assets of the 12.66%
Company (that is A4+B4+C4）%
Including：
Amount of guarantee for shareholders, actual
0
controller and its associated parties（D）
The debts guarantee amount provided for the
Guaranteed parties whose assets-liability
ratio exceed 0
70% directly or indirectly（E）
Proportion of total amount of guarantee in
0
net assets of the company exceed 50%（F）
Total guarantee Amount of the
0
abovementioned guarantees（D+E+F）
Situations where there is guarantee liability
or evidence indicating the possibility of joint
and several repayment liability for unexpired 0
guarantee contracts during the reporting
period (if any)
Specific situation of the use of composite guarantees
3. Situation of Entrusted Finance
(1)Situation of Entrusted Finance
√ Applicable □Not applicable
116
2023 Annual Report
Overview of entrusted wealth-management during the reporting period
√ Applicable □Not applicable
In RMB10，000
Source of funds The Occurred
for entrusted Amount of Un-recovered of
Specific type Undue balance Amount overdue
financial Entrusted Wealth- overdue amount
management management
Bank financial
Self fund 140,000 50,000 0 0
products
Other Self fund 29,050 32,194.61 0 0
Total 169,050 82,194.61 0 0
The detailed information of entrusted wealth-management with significant amount or low safety, poor liquidity
or high risk with no promise of principal
√ Applicable □Not applicable
In RMB10,000
The
actu Whe
Actu al ther Sum
Nam
al reco Am ther mar
e of Typ Refe Whe
Met profi very ount e is y of
Trus e of renc ther
hod Exp t of of any even
tee Trus e pass
Fun of ecte and profi prov entr ts
Org tee Prod Capi Ann ed
Expi ds Rew d loss t ision uste and
aniz Org uct Am tal Start ualiz the
ry Allo ard Inco duri and for d relat
atio aniz Typ ount Sour Date ed statu
Date catio Dete me ng loss imp fina ed
n (or atio e ce Rate tory
n rmin (if the duri airm ncial sear
Trus n(or of proc
atio any) repo ng ent plan ch
tee Trus Retu edur
n rting the (if in inde
Nam tee) rn e
peri repo any) the x (if
e)
od rting futur any)
peri e
od
A
Mon lum Red
Stru ey p- emp
Ban Jan July Not
ctur Self mar sum tion
k of Ban 25,0 9, 7, 3.40 416. 416. appl
al fund ket pay upo 0 Yes
Chin k 00 202 202 % 84 84 icabl
depo s instr men n
a 3 3 e
sits ume twhe mat
nt n urity
due
A Red
Mon lum em
Ban
Stru ey p- ptio
k of Jan July Not
ctur Self mar sum n
Com Ban 15,0 9, 1, 3.36 254. 254. appl
al fund ket pay upo 0 Yes
mun k 00 202 202 % 07 07 icabl
depo s instr men n
icati 3 3 e
sits ume twhe mat
ons
nt n urit
due y
Ban Mon A Red
Stru
k of July Otc ey lum em Not
ctur Self
Com Ban 20,0 27, 31, mar p- 3.00 151. 151. ptio appl
al fund 0 Yes
mun k 00 202 202 ket sum % 83 83 n icabl
depo s
icati 3 3 instr pay upo e
sits
ons ume men n
117
2023 Annual Report
nt twhe mat
n urit
due y
A Red
Mon lum em
Stru ey p- ptio
Ban Aug Nov Not
ctur Self mar sum n
k of Ban 30,0 1, 1, 3.20 241. 241. appl
al fund ket pay upo 0 Yes
Chin k 00 202 202 % 97 97 icabl
depo s instr men n
a 3 3 e
sits ume twhe mat
nt n urit
due y
A
Mon lum
Stru Nov ey p-
Ban Febr Not
ctur Self emb mar sum Not
k of Ban 50,0 uary 3.08 383. appl
al fund er ket pay 0 expi 0 Yes
Chin k 00 9,20 % 95 icabl
depo s 10,2 instr men r ed
a 24 e
sits 023 ume twhe
nt n
due
Sout Red
hern emp
Fun Mo tion
Mon
d June June ney on T Not
etar Self Not
Man Fun 6,00 19, 27, mar day, 2.32 appl
y fund 2.67 2.67 expi 0 Yes
age ds 0 202 202 ket arriv % icabl
Fun s r ed
men 3 3 tool al e
d
t s on
Co., T+1
Ltd day
Red
Sout
emp
hern
tion
Fun Mo
Mon on T
d Aug ney Not
etar Self day, Not
Man Fun 6,00 28, mar 2.32 appl
y fund arriv 0 0 expi 0 Yes
age ds 0 202 ket % icabl
Fun s al r ed
men 3 tool e
d on
t s
T+1
Co.,
day
Ltd
Sout Red
hern emp
Fun Mo tion
Mon Dec
d ney on T Not
etar 27,1 Self emb Not
Man Fun mar day, 2.19 appl
y 94.6 fund er 0 0 expi 0 Yes
age ds ket arriv % icabl
Fun 1 s 16,2 r ed
men tool al e
d 022
t s on
Co., T+1
Ltd day
Pen Mo Red
Mon Dec
ghua ney emp Not
etar Self emb Not
Fun Fun 5,00 mar tion 2.26 appl
y fund er 0 0 expi 0 Yes
d ds 0 ket on T % icabl
Fun s 14,2 r ed
Man tool day, e
d 023
age s arriv
118
2023 Annual Report
men al
t on
Co., T+1
Ltd. day
162, 1,45 1,06
Total -- -- -- -- -- -- -- -- -- --
000 1.33 7.38
Entrusted financing appears to be unable to recover the principal or there may be other circumstances that
may result in impairment
□ Applicable √ Not applicable
(2)Situation of Entrusted Loans
□ Applicable √ Not applicable
No such cases in the reporting period.
4. Other significant contract
□ Applicable √ Not applicable
No such cases in the reporting period.
XVI. Explanation on other significant events
√ Applicable □Not applicable
(I) Issue shares to purchase assets and raise supporting funds
According to the relevant regulations of Shenzhen Stock Exchange, upon the application of the company,
the shares of the company were suspended from trading on the morning of December 19, 2022. On December
30, 2022, the company held the nineteenth meeting of the Eighth Board of Directors and the thirteenth meeting
of the Eighth Board of Supervisors, and deliberated and passed the Proposal on the "Plan for Shenzhen Textile
(Group) Co., Ltd. to Issue Shares, Pay Cash to Purchase Assets and Raise Matching Funds and Related Party
Transactions" and Its Summary and other proposals related to this transaction. The Company intends to
purchase 100% equity of Hengmei Optoelectronics Co., Ltd. by issuing shares and paying cash, and at the same
time, it plans to raise matching funds from non-public offering of shares to no more than 35 qualified specific
targets (hereinafter referred to as "this transaction"). The company's shares resumed trading on the morning of
January 3, 2023.
On June 28, 2023, due to the upcoming expiration of the validity period of the financial data of the target
company in this transaction, the intermediary agency planned to conduct additional audit and supplementary
due diligence, and the Company still needs to communicate with the counterparty to negotiate the details of the
transaction, so the Company could not disclose the draft restructuring report within six months and issue a
notice on the convening of General Meeting of Shareholders. After the parties to the transaction reached an
agreement through consultation, the Company continued to promote the transaction, and disclosed a special
explanation announcement according to relevant requirements. For details, please refer to Announcement
No.2023-29 of the Company on CNINF (http://www.cninfo.com.cn).
Due to the changes in the shareholders and shareholding ratio of the target company Hengmei
Optoelectronics during the reorganization, it is necessary to adjust the counterparty of this restructuring and the
119
2023 Annual Report
transaction plan according to the requirements of the relevant rules of the registration system. On November 17,
2023, the Company reconvened the meeting of the Board of Directors to review and approve the revised draft of
this transaction plan, and adjusted the pricing base date, issue price and counterparty of this transaction plan.At
present, while intermediaries continue to promote the overtime audit, evaluation and supplementary due
diligence of the target company, the Company further negotiates the transaction details with the counterparty to
consolidate the restructuring transaction plan. After the transaction plan is determined and the state-owned
assets examination and approval procedures are fulfilled, the Company will convene the meeting of the Board
of Directors again to consider matters related to this transaction.
This restructuring is the adjustment and optimization of the Company's main polarizer business in the face
of the rapidly developing new display industry environment. Through the integration of high-quality resources
in the same industry and the realization of large-scale development, the restructuring will help the Company to
optimize the industrial chain layout in the polarizer industry, deepen the depth of technical reserves, enhance its
core competitiveness, enhance its overall profitability, give full play to the synergistic effect, and help it become
a bigger and stronger listed company.
（2） Disposal of assets of the joint venture company Shenzhen Xieli
Shenzhen Xieli Automobile Enterprise Co., Ltd. (hereinafter referred to as "Shenzhen Xieli") is a Sino
foreign joint venture established by the company and Hong Kong Xieli Maintenance Company in 1981, with a
registered capital of 3.12 million yuan. The company holds 50% of the equity. The company's operating period
ended in 2008 and its business license was revoked in 2014. The company's main assets are real estate. In
March 2020, Shenzhen Xieli Industrial and Commercial Co., Ltd. has been cancelled, but there are still three
properties under its name that need to be resolved through further negotiation between the shareholders of both
parties.
On July 26, 2021, the Company filed a complaint with the People's Court of Yantian District, Shenzhen
City, Guangdong Province to revoke the approval of cancelation of Shenzhen Xieli Automobile Enterprise Co.,
Ltd by theShenzhen Market Supervision and Administration Bureau. In November 2021, the court ruled to
revoke the aforementioned approval of cancellation. Hong Kong Xieli Maintenance Company and Shenzhen
Market Supervision and Administration Bureau were not satisfied and submitted appeal petitions to the
Shenzhen Intermediate People's Court respectively. On June 28, 2022, the Shenzhen Intermediate People's
Court ruled in the second instance: revoked the administrative judgment-No. 1883(2021) Yue 0308 Xingchuof
the Yantian District People's Court of Shenzhen City, Guangdong Province, and remanded it to the Yantian
District People's Court of Shenzhen City, Guangdong Province for a new trial.
The case was reopened in Yantian District People's Court on September 29, 2022, and Yantian District People's
Court made a retrial judgment on December 30, 2022: The administrative act of Shenzhen Xieli Automobile
Enterprise Co., Ltd., which was approved by Shenzhen Administration for Market Regulation on March 9, 2020,
was revoked.The third party Xieli Maintenance Company filed an appeal in January 2023. Later, because Xieli
Maintenance Company failed to pay the appeal fee in advance, the Shenzhen Intermediate People's Court of
Guangdong Province issued an administrative ruling that Hong Kong Xieli withdrew the appeal. The retrial
verdict of the first instance came into effect on March 22, 2023.
（3） Matters on waiving the preemptive right and equity transfer of controlling subsidiaries
The shareholders' meeting of SAPO Photoelectric , the company's holding subsidiary, agreed that Hangzhou
Jinhang Equity Investment Fund Partnership (limited partnership) would transfer 40% of its shareholding in
SAPO Photoelectric to Hengmei Optoelectronics Co., Ltd. For details, see http//www.cninfo.com.cn
（ http://www.cninfo.com.cn ） Company Announcement No. 2023-01. On January 19, 2023, SAPO
120
2023 Annual Report
Photoelectric obtained the "Registration Notice" issued by the Shenzhen Municipal Market Supervision and
Administration Bureau, and the industrial and commercial change registration procedures for this equity transfer
have been completed. After this change, the company still holds 60% equity of SAPO Photoelectric, while
Hengmei Optoelectronics holds 40% equity of SAPO Photoelectric. This equity transfer is conducive to
synergizing the advantages of both parties in the polarizer industry, integrating high- quality resources of both
parties, further optimizing and strengthening the main polarizer industry, and better enhancing the core
competitiveness of listed companies.
XVII. Significant event of subsidiary of the Company
√ Applicable □Not applicable
(1)About the progress of the Company and its holding subsidiaries involved in litigation
In July and August 2022, the Company and its holding subsidiary SAPO Photoelectric received the legal
documents such as Notice of Respondence to Action, and Summon, with case numbers of (2022) Y0310 MC
No. 3507, No.4013 and No.4336 served by Pingshan District People's Court, Shenzhen City, Guangdong
Province, and were informed that the court had accepted Hangzhou Jinhang Equity Investment Fund
Partnership (Limited Partnership) (hereinafter referred to as "Jinhang Fund") v. SAPO Photoelectric for ①
dissolution dispute, ② dispute over the confirmation of the validity of company resolutions and ③ dispute over
shareholders' right to know, and the Company was informed to participate in the lawsuit as a party to the case,
and SAPO Photoelectric was informed to respond as the defendant to the case. For details, please refer to the
Company's Announcement No. 2022-20 and No. 2022-25 on CNINF (http://www.cninfo.com.cn).
In the above-mentioned lawsuits, concerning the dissolution dispute of SAPO Photoelectric and the
dispute over shareholders' right to know, the People's Court of Pingshan District of Shenzhen City, Guangdong
Province received the plaintiff's application for withdrawal on March 30, 2023, and made a ruling on April 6,
2023. The Company and SAPO Photoelectric have received the Civil Rulings of the above two cases, with the
rulings as follows: The plaintiff's withdrawal of the lawsuit is a self-disposition of its right of action, which does
not violate the law, does not harm the interests of the state, the collective and others, and it is allowed according
to law.
For details, please refer to the Company's Announcement No. 2023-19 on CNINF
(http://www.cninfo.com.cn).
In addition, on May 25, 2023, the People's Court of Pingshan District of Shenzhen City, Guangdong
Province rendered a first-instance judgment in the above-mentioned dispute case over the confirmation of the
validity of the resolution of SAPO Photoelectric , and the Company and SAPO Photoelectric have received the
Civil Judgment of the above-mentioned case, with the judgment is as follows: all claims of the plaintiff Jinhang
Fund are dismissed. For details, please refer to the Company's Announcement No. 2023-28 on CNINF
(http://www.cninfo.com.cn).
121
2023 Annual Report
VII. Change of share capital and shareholding of Principal Shareholders
I. Changes in share capital
1. Changes in share capital
In shares
Before the change Increase/decrease（+，-） After the Change
Amount Proportio Capitaliza
n tion of
Share Bonus Proportio
common Other Subtotal Quantity
allotment shares n
reserve
fund
1.Shares
with
condition
72,000 0.01% 0 0 0 0 0 72,000 0.01%
al
subscripti
on
1.State -
owned 0 0.00% 0 0 0 0 0 0 0.00%
shares
2. State-
owned
legal 0 0.00% 0 0 0 0 0 0 0.00%
person
shares
3.Other
domestic 72,000 0.01% 0 0 0 0 0 72,000 0.00%
shares
Incl：
Domestic
legal 0 0.00% 0 0 0 0 0 0 0.00%
person
shares
Domestic
Natural
72,000 0.01% 0 0 0 0 0 72,000 0.01%
Person
shares
4.Foreign
0 0.00% 0 0 0 0 0 0 0.00%
share
Incl：
Foreign
legal 0 0.00% 0 0 0 0 0 0 0.00%
person
share
Foreign
Natural 0 0.00% 0 0 0 0 0 0 0.00%
Person
shares
II.Shares
with
unconditi 506,449, 506,449,
99.99% 0 0 0 0 0 99.99%
onal 849 849
subscripti
on
1.Commo
457,021, 457,021,
n shares 90.23% 0 0 0 0 0 90.23%
in RMB 849 849
2.Foreign
49,428,0 49,428,0
shares in 9.76% 0 0 0 0 0 9.76%
domestic 00 00
122
2023 Annual Report
market
3. Foreign
shares in
0 0.00% 0 0 0 0 0 0 0.00%
foreign
market
4.Other 0 0.00% 0 0 0 0 0 0 0.00%
III. Total
506,521, 506,521,
of capital 100.00% 0 0 0 0 0 100.00%
shares 849 849
Reasons for share changed
□ Applicable √ Not applicable
Approval of Change of Shares
□Applicable √Not applicable
Ownership transfer of share changes
□Applicable √Not applicable
Progress on any share repurchase:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
Influence on the basic EPS and diluted EPS as well as other financial indexes of net assets per share attributable
to common shareholders of Company in latest year and period
□ Applicable √ Not applicable
Other information necessary to disclose for the company or need to disclosed under requirement from security
regulators
□ Applicable √Not applicable
2. Change of shares with limited sales condition
□ Applicable √Not applicable
II. Securities issue and listing
1.Explanation of the Situation of the Security Issue(No Preferred Shares) in the Report Period
□ Applicable √ Not applicable
2.Change of asset and liability structure caused by change of total capital shares and structure
□ Applicable √Not applicable
3.About the existing employees’ shares
□Applicable √Not applicable
III. Shareholders and actual controlling shareholder
1. Number of shareholders and shareholding
In Shares
Total Total The total n Total preference
number of shareholder umber of pr shareholders with
common s at the end eferred shar voting rights
26,709 26,787 0 0
shareholder of the eholders vo recovered at end
s at the end month from ting rights r of last month
of the before annual
the date of estored at p
123
2023 Annual Report
reporting disclosing eriod-end report disclosed(if
period the annual (if any)(Note8)
report any)(Note
8)
Particulars about shares held above 5% by shareholders or top ten shareholders（Excluding shares lent through refinancing)
Number of Amount of Number of share
Proportion Changes in Amount of
Shareholde Nature of shares held un- pledged/frozen
of shares reporting restricted
rs shareholder at period - restricted State of
held（%） period shares held Amount
end shares held share
Shenzhen State-
Investment owned 234,069,43 234,069,43 Not
46.21% 0 0 0
Holdings legal 6 6 applicable
Co., Ltd. person
Shenzhen
Shenchao State-
Technolog owned Not
3.18% 16,129,032 0 0 16,129,032 0
y Legal applicable
Investment person
Co., Ltd.
Domestic
Sun Not
Nature 1.26% 6,399,653 190,800 0 6,399,653 0
Huiming applicable
person
Domestic
Su
Nature 0.71% 3,580,000 0 0 3,580,000 Pledge 2,800,000
Weipeng
person
China
Constructio
n Bank
Co., Ltd －
Xinao new
Not
energy Other 0.60% 3,049,784 2,851,000 0 3,049,784 0
applicable
industry
equity
securities
investment
fund
Domestic
Chen Not
Nature 0.60% 3,035,100 3,035,100 0 3,035,100 0
Zhaoyao applicable
person
Domestic
Chen Not
Nature 0.59% 3,002,384 -27,100 0 3,002,384 0
Xiaobao applicable
person
Domestic
Li Not
Nature 0.56% 2,831,397 607,000 0 2,831,397 0
Zengmao applicable
person
Domestic
Not
Peng Xun Nature 0.38% 1,920,500 560,800 0 1,920,500 0
applicable
person
Overseas
Not
HKSCC Legal 0.36% 1,843,603 1,843,603 0 1,843,603 0
person applicable
Strategy investors or
general legal person
becomes top 10
None
shareholders due to rights
issued (if applicable)
（See Notes 3）
Explanation on Among the top 10 common shareholders, Shenzhen Investment Holdings Co., Ltd. and Shenzhen
shareholders participating Shenchao Technology Investment Co., Ltd. do not constitute a concerted party relationship. In
in the margin trading addition, the company does not know whether there is an associated relationship among the top 10
business ordinary shareholders, and between the top 10 ordinary shareholders and the top 10 shareholders, or
124
2023 Annual Report
whether they are persons taking concerted action defined in Regulations on Disclosure of
Information about Shareholding of Shareholders of Listed Company.
Above shareholders
entrusting or entrusted
None
with voting rights, or
waiving voting rights
Top 10 shareholders
including the special
None
account for repurchase (if
any) (see note 10)
Shareholding of top 10 shareholders of unrestricted shares
Share type
Name of the shareholder Quantity of unrestricted shares held at the end of the reporting period
Share type Quantity
Common
Shenzhen Investment 234,069,43
234,069,436 shares in
Holdings Co., Ltd. 6
RMB
Shenzhen Shenchao Common
Technology Investment 16,129,032 shares in 16,129,032
Co., Ltd. RMB
Foreign
shares in
Sun Huiming 6,399,653 domestic 6,399,653
market
Common
Su Weipeng 3,580,000 shares in 3,580,000
RMB
China Construction Bank
Common
Co., Ltd － Xinao new
3,049,784 shares in 3,049,784
energy industry equity RMB
securities investment fund
Common
Chen Zhaoyao 3,035,100 shares in 3,035,100
RMB
Common
Chen Xiaobao 3,002,384 shares in 3,002,384
RMB
Common
Li Zengmao 2,831,397 shares in 2,831,397
RMB
Common
Peng Xun 1,920,500 shares in 1,920,500
RMB
Common
HKSCC 1,843,603 shares in 1,843,603
RMB
Explanation on associated
relationship or consistent
action among the top 10 Among the top 10 common shareholders, Shenzhen Investment Holdings Co., Ltd. and Shenzhen
shareholders of non- Shenchao Technology Investment Co., Ltd. do not constitute a concerted party relationship. In
restricted negotiable addition, the company does not know whether there is an associated relationship among the top 10
shares and that between ordinary shareholders, and between the top 10 ordinary shareholders and the top 10 shareholders, or
the top 10 shareholders of whether they are persons taking concerted action defined in Regulations on Disclosure of
non-restricted negotiable Information about Shareholding of Shareholders of Listed Company.
shares and top 10
shareholders
Explanation on
shareholders participating
in the margin trading None
business(if any )(See
Notes 4)
Lending of shares by the top ten shareholders participating in refinancing business
□ Applicable √ Not applicable
125
2023 Annual Report
The top ten shareholders have changed from the previous period
Applicable □Not applicable
In Shares
Changes of the top ten shareholders compared with the end of the previous period
Number of shares held by
Number of shares lent by
Name of Addition/Wit shareholders in general accounts and
refinancing at the end of the period and
shareholder (full hdrawal in this credit accounts and lent by refinancing at
not yet returned
name) reporting period the end of the period and not yet returned
Proportion of total Proportion of total
Total quantity Total quantity
share capital share capital
HKSCC Newly increased 0 0.00% 1,843,603 0.36%
Zhangzhou
Xiaotian Venture
Left 0 0.00% 0 0.00%
Investment Co.,
Ltd.
Whether top ten common shareholders or top ten common shareholders with un-restrict shares held have a
buy-back agreement dealing in reporting period.
□ Yes √ No
The top ten common shareholders or top ten common shareholders with un-restrict shares held of the
Company have no buy –back agreement dealing in reporting period.
2.Controlling shareholder
Nature of Controlling Shareholders: Local state holding
Type: Legal person
Name of the
Legal Principal business
Controlling Date of incorporation Organization code
representative/Leader activities
shareholder
Investment and
acquisition of financial
and similar financial
stock rights such as
bank, security,
insurance, fund and
guarantee; Engage in
real estate development
and management
business within the
limit of legally-
acquired land use right;
Carry out investment
and service in the field
of strategic emerging
Shenzhen Investment industry; Carry out
He Jianfeng October 13,2004 76756642-1
Holdings Co., Ltd. investment, operation
and management of
state-owned stocks of
wholly-owned, holding
and joint-stock
company by
reorganization &
integration, capital
operation and asset
disposal; Other
businesses undertaken
by authorization of
municipal
SASAC(State Asset
Supervision and
Administration
126
2023 Annual Report
Commission) (If the
above business scope
needs to be approved
according to national
regulations, the
business can only be
operated after the
approvalis obtained)
Shen PropertyA（000011），Quantity of shares 301.41 million，Shareholding ratio：50.57%；
SPGA （000029），Quantity of shares 564.3538 million，Shareholding ratio：67.50%；
Shen Universe A（000023），Quantity of shares 8.21 million，Shareholding ratio：5.91%；Pingan
（601318），Quantity of shares962.72 million，Shareholding ratio：5.27%；Guosen Securities
（002736），Quantity of shares 3,223.11 million，Shareholding ratio：33.53%；Guotai Junan
（601211），Quantity of A shares 609.43 million，Quantity of H shares 103.37 million，Total
shareholding ratio：8.00%；Telling Holding（000829），Quantity of shares 195.03 million，
Shareholding ratio：19.03%；Shenzhen International（00152），Quantity of shares 1,059.0825
Equity of other
million，Shareholding ratio：44.25%；Beauty Star（002243），Quantity of shares 604.82 million，
domestic/foreign listed
Shareholding ratio:49.96%；Infinova（002528）, Quantity of shares 315.83 million，Shareholding
company with share
ratio:26.35%；Eternal Asia（002183），Quantity of shares 601.6733 million，Shareholding
controlling and share
ratio:23.17%；Shenzhen Water（301038），Quantity of shares 64.35 million，Shareholding
participation by
ratio:37.57%；Shenzhen Energy（000027)，Quantity of shares 6.77 million，Shareholding
controlling shareholder
ratio:0.14%；Bank of Communication（601328），Quantity of shares 9.52 million，Shareholding
in reporting period
ratio:0.01%； CECEP （300197），Quantity of shares 113.98million，Shareholding ratio:4.04%；
VANKE（02202），Quantity of shares 77.27 million，Shareholding ratio:0.66%；
SEG（000058）, Quantity of shares 696.16 million，Shareholding ratio56.54%；
SDG（000070）, Quantity of shares 325.7215 million，Shareholding ratio36.18%；
Shenzhen Telus A（000025）, Quantity of shares 205.3416 million，Shareholding ratio31.79%；
SDG（300917）, Quantity of shares 80.7398 million，Shareholding ratio47.78%；
Microgate（300319），Quantity of shares72 million，Shareholding ratio6.49%；
Merchants Shekou（001979），Quantity of shares456.1219 million，Shareholding ratio5.03%.
Changes of controlling shareholder in reporting period
□ Applicable √ Not applicable
No changes of controlling shareholder for the Company in reporting period.
3．Information about the controlling shareholder of the Company
Actual controller nature：Local state owned assets management
Actual controller type：Legal person
Name of the actual Legal representative Principal business
Date of incorporation Organization code
controller /Leader activities
Performing the
responsibilities of
State-owned Assets
investors on behalf of
Regulatory
the state and
Commission of Wang Yongjian July 30,2004 K3172806-7
supervising and
Shenzhen Municipal
managing state-owned
People's Government
assets according to
authorization and law.
Equity of other
domestic/foreign listed
It directly held 40.10% equity of Shenzhen Gas (601139); It directly held 21.93% equity of
company with share
Shenzhen Zhenye (000006); It directly held 43.91% equity of Shenzhen Energy (000027).
controlling and share
participation by
controlling shareholder
in reporting period
Changes of controlling shareholder in reporting period
□ Applicable √ Not applicable
No changes of controlling shareholder for the Company in reporting period
127
2023 Annual Report
Block Diagram of the ownership and control relations between the company and the actual controller
The actual controller controls the company by means of trust or managing the assets in other way
□Applicable √Not applicable
4.The cumulative number of shares pledged by the controlling shareholder or the largest shareholder of the
company and its person acting in concert accounts for 80% of the number of shares held by the company
□Applicable √Not applicable
5.Particulars about other legal person shareholders with over 10% share held
□Applicable √Not applicable
6.Situation of Share Limitation Reduction of Controlling Shareholders, Actual Controllers,
Restructuring Party and Other Commitment Subjects
□Applicable √Not applicable
IV. Specific implementation of share repurchase during the reporting period
Progress in implementation of share repurchase
□ Applicable √Not applicable
Implementation progress of reducing repurchased shares by centralized bidding
□ Applicable √Not applicable
128
2023 Annual Report
VIII. Situation of the Preferred Shares
□Applicable √Not applicable
The Company had no preferred shares in the reporting period.
129
2023 Annual Report
IX. Corporate Bond
□ Applicable √ Not applicable
130
X. Financial Report
Please refer to the attached financial statements and notes for details.
Chairman: Yin Kefei
Approval date for submission by the board of directors: March 26, 2024
Shenzhen Textile (Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
深圳市纺织(集团)股份有限公司
补充资料
2023 年 12 月 31 日止年度
Contents
Auditor's Report
Consolidated and Company Balance sheet
Consolidated and Company Income statement
Consolidated and Company cash flow statement
Consolidated and Company Statement on Change in Owners’ Equity
Shenzhen Textile (Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Contents
Auditor's Report
Consolidated and Company Balance sheet
Consolidated and Company Income statement
Consolidated and Company cash flow statement
Consolidated and Company Statement on Change in Owners’ Equity
Notes to Financial statements
1
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Auditor’ s Report
DeShiReport(Shen)Zi(24)No. P02833
To all shareholders of Shenzhen Textile (Holdings) Co., Ltd.：
I. Opinion
We have audited the financial statements of Shenzhen Textile (Holdings) Co., Ltd . (hereinafter referred to as "the Company"), which
comprise the balance sheet as at December 31, 2023, and the income statement, the statement of cash flows and the statement of changes in
owners' equity for the year then ended and notes to the financial statements.
In our opinion, the attached financial statements are prepared, in all material respects, in accordance with Accounting Standards for
Business Enterprises and present fairly the financial position of the Company as at December 31, 2023 and its operating results and cash
flows for the year then ended.
II. Basis for Our Opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants in China. Our responsibilities
under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report.
According to the Code of Ethics for Chinese CPA, we are independent of the Company in accordance with the Code of Ethics for Chinese
CPA and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide a basis for our audit opinion.
III. Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial
statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
1. Recognition of polarizer sales revenue
As mentioned in Note (V) 40 to the financial statement, in 2023 the operating income reported in the consolidated financial
statement of Shenzhen Textile Group was RMB3,079,678,375.45, of which the sales revenue of polarizers was RMB 2,885,625,542.77,
accounting for 93.70% of the total operating income. The sales revenue of Shenzhen Textile Group's polarizer is recognized when the
customer obtains control of the relevant goods. Due to the importance of polarizer sales revenue to the consolidated financial statement as
a whole, and the revenue is one of the key performance indicators of Shenzhen Textile Group, there is an inherent risk that management
will manipulate revenue recognition in order to achieve specific objectives or expectations, therefore, we have identified the recognition of
polarizer sales revenue as a key audit matter for the audit of the consolidated financial statement.
In response to the above key audit matter, the audit procedures we implement mainly include:
Test and evaluate the internal control of the revenue-related business of Shenzhen Textile Group.
Examine sales contracts with key customers, identify contractual terms and conditions related to the transfer of control of goods, and
assess whether the accounting policies for revenue recognition comply with the requirements of accounting standards for business
enterprises
Perform revenue analysis procedures by production line, product type and customer, and analyze the rationality of revenue changes
based on market and other factors.
Samples are taken to perform detailed tests on sales revenue, check supporting documents such as invoices, outbound delivery orders,
and receipts related to revenue recognition, and verify the sales of major customers by letter of confirmation and evaluate the authenticity of
polarizer sales revenue recognition.
Select samples of sales transactions before and after the balance sheet date, check the supporting documents such as invoices,
outbound delivery orders, and receipts, and evaluate whether the revenue is recorded in the appropriate accounting period.
2. Impairment of polarizer inventory
As mentioned in Note (V) 8 to the financial statement, as of December 31, 2023, the inventory book balance reported in the
consolidated financial statement of Shenzhen Textile Group was RMB852,104,157.04, of which the book balance of polarizer inventory was
RMB838,447,375.39 accounting for 98.40% of the total inventory, and the corresponding inventory decline reserve was
RMB107,290,039.96. In accordance with the Group's accounting policy, inventories are measured at the lower of cost or net realizable value
at the end of the year, and when the net realizable value of inventories is lower than cost, a provision is made for inventory price declines. As
the provision for inventory declines involves significant management estimates, we have identified the impairment of polarizer inventories
as a key audit matter in the audit of the consolidated financial statement.
In response to the above key audit matter, the audit procedures we implement mainly include:
Test and evaluate the design and implementation of internal controls related to inventory impairment;
Implement inventory on-site monitoring procedures, check the check-count quantity of inventory on a sampling basis, and observe the
status of inventory to evaluate the inventory quantity and condition at the balance sheet date;
Evaluate the reasonableness of management's methodology for accruing provisions for inventory declines and the important
assumptions and parameters used to calculate net realizable value;
IV. Other information
The management of the Company is responsible for the other information. The other information comprises information of the
Company's annual report in 2023, but excludes the financial statements and our auditor's report.
Our opinion on the financial statements does not cover the other information and we do not and will not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in
doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the
-1-
audit, or otherwise appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of this auditor's report, we
conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this
regard
V. Responsibilities of Management and Those Charged with Governance for the Financial Statements
The Company's management is responsible for preparing the financial statements in accordance with the requirements of Accounting
Standards for Business Enterprises to achieve a fair presentation, and for designing, implementing and maintaining internal control that is
necessary to ensure that the financial statements are free from material misstatements, whether due to frauds or errors.
In preparing the financial statements, management of the Company is responsible for assessing the Company's ability to continue as a
going concern, disclosing matters related to going concern and using the going concern basis of accounting unless management either
intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company's financial reporting process.
VI. Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accordance with the audit standards will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the
audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and
perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our
opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, omissions, misrepresentations, or the override of internal control.
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the
circumstances.
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures
made by management of the Company.
(4) Conclude on the appropriateness of using the going concern assumption by the management of the Company, and conclude, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the
Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause
the Company to cease to continue as a going concern.
(5) Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the
financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
(6) Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the
Company to express an opinion on the financial statements and bear all liability for the opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and
significant audit matters, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in
the audit of the financial statements of the current period and are therefore the key audit matters.
We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of
doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Deloitte Touche Tohmatsu CPA Ltd.(special general partnership) Chinese C.P.A.
（Project Partner)
Shanghai China
Chinese C.P.A.
March 26, 2024
-2-
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Consolidated balance sheet
December 31,2023
Consolidated balance sheet
In RMB
Items Note December 31,2023 December 31,2022
Current asset：
Monetary fund (V).1 472,274,448.00 991,789,968.19
Transactional financial assets (V).2 821,946,114.68 319,605,448.44
Note receivable (V).3 50,963,943.01 74,619,100.26
Account receivable (V.).4 820,134,833.95 636,583,469.93
Financing of receivables (V.).5 22,839,459.13 54,413,796.91
Prepayments (V).6 19,499,886.80 18,391,444.67
Other account receivable (V).7 3,220,285.42 10,585,975.38
Including：Interest receivable - -
Dividend receivable - -
Inventories (V).8 736,392,172.27 558,447,648.77
Other current asset (V.).9 60,773,457.39 69,535,531.24
Total of current assets 3,008,044,600.65 2,733,972,383.79
Non-current assets：
Long term share equity investment (V.).10 127,682,020.70 134,481,835.74
Other equity instruments investment (V)..11 145,988,900.00 167,678,283.27
Real estate investment (V.).12 125,603,207.18 126,315,834.76
Fixed assets (V.).13 2,066,006,237.73 2,240,221,656.36
Construction in progress (V.).14 31,307,060.74 38,061,619.60
Use right assets (V).15 11,999,466.57 15,365,393.88
Intangible assets (V).16 39,564,422.80 44,192,571.95
Goodwill (V).17 - -
Long-germ expenses to be amortized (V.).18 3,503,660.94 4,470,957.79
Deferred income tax asset (V).19 60,605,365.42 69,823,814.29
Other non-current asset (V).20 29,517,420.71 42,553,016.47
Total of non-current assets 2,641,777,762.79 2,883,164,984.11
Total of assets 5,649,822,363.44 5,617,137,367.90
-3-
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Consolidated balance sheet(Continued)
In RMB
Note December 31,2023 December 31,2022
Current liabilities：
Short-term loans (V).22 8,000,000.00 7,000,000.00
Notes payable (V).23 31,049,291.49 -
Account payable (V).24 408,548,136.24 327,049,873.70
Advance receipts (V).25 1,450,096.30 1,393,344.99
Contract liabilities (V).26 1,436,943.34 4,274,109.40
Employees’ wage payable (V).27 56,437,162.09 61,166,444.90
Tax payable (V).28 4,340,895.14 8,897,312.51
Other account payable (V).29 184,528,344.55 197,345,455.37
Including：Interest payable - -
Dividend payable - -
Non-current liability due within 1 year (V).30 108,102,752.99 104,183,438.22
Other current liability (V).31 80,082,477.22 92,945,741.78
Total of current liability 883,976,099.36 804,255,720.87
Non-current liabilities：
Long-term loan (V).32 505,578,314.56 607,421,585.00
Lease liability (V).33 6,687,317.22 8,628,672.71
Deferred income (V).34 97,485,986.89 117,814,796.10
Deferred income tax liability (V).19 44,177,287.45 47,974,267.80
Total non-current liabilities 653,928,906.12 781,839,321.61
Total of liability 1,537,905,005.48 1,586,095,042.48
Owners’ equity
Share capital (V).35 506,521,849.00 506,521,849.00
Capital reserves (V).36 1,961,599,824.63 1,961,599,824.63
Other comprehensive income (V).37 93,607,380.81 109,596,609.31
Special reserve (V)..38 104,262,315.64 100,909,661.32
Retained profit (V).39 216,160,896.14 170,636,610.95
Total of owner’s equity belong to the parent company 2,882,152,266.22 2,849,264,555.21
Minority shareholders’ equity 1,229,765,091.74 1,181,777,770.21
Total of owners’ equity 4,111,917,357.96 4,031,042,325.42
Total of liabilities and owners’ equity 5,649,822,363.44 5,617,137,367.90
The notes are integral parts of the financial statements
_____________________ ______________________ ______________________
Legal Representative: Person-in-charge of the accounting work：Person-in -charge of the accounting organ：
-4-
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Parent Company Balance Sheet
In RMB
Note December 31,2023 December 31,2022
Current asset：
Monetary fund 9,125,800.27 426,042,455.28
Transactional financial assets 741,243,309.42 319,605,448.44
Account receivable (XVI).、1 12,671,623.65 15,643,024.11
Prepayments - -
Other account receivable (XVI).2 14,013,552.95 14,132,756.62
Including：Interest receivable - -
Dividend receivable - -
Inventories 32,814.05 26,237.85
Total of current assets 777,087,100.34 775,449,922.30
Non-current assets：
Long term share equity investment (XVI).3 2,087,532,810.79 2,092,431,333.83
Other equity instruments investment 131,185,500.00 151,618,842.39
Real estate investment 102,430,682.27 101,190,712.85
Fixed assets 2,522,229.44 11,346,585.35
Construction in progress 191,875.56 308,243.90
Deferred income tax asset - -
Other non-current asset 27,823,005.45 25,997,082.15
Total of non-current assets 2,351,686,103.51 2,382,892,800.47
Total of assets 3,128,773,203.85 3,158,342,722.77
Current liabilities
Account payable 411,743.57 411,743.57
Advance receipts 540,673.07 691,160.58
Employees’ wage payable 15,810,919.71 18,510,589.33
Tax payable 3,115,369.56 7,121,466.14
Other account payable 106,722,393.87 113,736,371.24
Including：Interest payable - -
Dividend payable - -
Total of current liability 126,601,099.78 140,471,330.86
Non-current liabilities：
Deferred income 200,000.00 300,000.00
Deferred income tax liability 40,855,186.12 44,363,868.30
Total non-current liabilities 41,055,186.12 44,663,868.30
Total of liability 167,656,285.90 185,135,199.16
Owners’ equity
Share capital 506,521,849.00 506,521,849.00
-5-
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Capital reserves 1,577,392,975.96 1,577,392,975.96
Other comprehensive income 83,629,830.81 98,855,668.75
Surplus reserves 104,262,315.64 100,909,661.32
Retained profit 689,309,946.54 689,527,368.58
Total of owners’ equity 2,961,116,917.95 2,973,207,523.61
Total of liabilities and owners’ equity 3,128,773,203.85 3,158,342,722.77
The notes are integral parts of the financial statements
-6-
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Consolidated Income statement
In RMB
Note Year 2023 Year 2022
1.Operating Revenue (V).40 3,079,678,375.45 2,837,988,264.36
Less: Operating cost (V).40 2,561,631,844.53 2,374,005,896.43
Business tax and surcharge (V).41 9,293,623.13 7,907,126.91
Sales expense (V).42 34,195,670.61 35,962,529.35
Administrative expense (V).43 134,371,410.53 128,388,940.29
R & D costs (V).44 104,653,040.92 80,520,155.54
Financial expenses (V).45 24,399,501.16 12,943,606.57
Including：Interest expense 27,339,804.17 31,131,112.38
Interest income 12,947,471.64 8,327,248.75
Add: Other income (V).46 50,740,363.91 26,350,210.89
Investment gain (V).47 10,828,635.56 19,383,351.87
Incl: investment gains from affiliates (6,898,983.89) 1,307,639.15
Financial assets measured at amortized cost cease to be recognized as
- -
income
Changing income of fair value (V).48 2,151,780.82 -
Credit impairment loss (V).49 4,535,775.14 (4,618,553.09)
Impairment loss of assets (V.).50 (126,089,709.42) (202,573,465.84)
Assets disposal income (v).51 1.72 31,264.60
II. Operating profit 153,300,132.30 36,832,817.70
Add：Non-Operating income (V).52 1,449,879.26 14,993,082.57
Less：Non-Operating expenses (V).53 8,205,801.51 7,477,057.47
III. Total profit 146,544,210.05 44,348,842.80
Less：Income tax expenses (V).54 19,407,731.47 (67,443,123.52)
IV. Net profit 127,136,478.58 111,791,966.32
(I) Classification by business continuity
1.Net continuing operating profit 127,136,478.58 111,791,966.32
2.Termination of operating net profit - -
(II) Classification by ownership
Including：Net profit attributable to the owners of parent
79,268,250.45 73,309,182.94
company
Minority shareholders’ equity 47,868,228.13 38,482,783.38
V. Net after-tax of other comprehensive income (V).37 (15,870,135.10) (10,204,603.14)
Net of profit of other comprehensive income attributable to ow
(15,989,228.50) (10,085,509.74)
ners of the parent company.
（ I ） Other comprehensive income items that will not be
reclassified into gains/losses in the subsequent accounting (16,267,037.45) (10,058,739.46)
period
1.Re-
measurement of defined benefit plans of changes in net deb - -
t or net assets
2.Other comprehensive income under the equity method in - -
-7-
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
vestee can not be reclassified into profit or loss.
3. Changes in the fair value of investments in other equity
(16,267,037.45) (10,058,739.46)
instruments
4. Changes in the fair value of the company’s credit risks - -
(II)Other comprehensive income that will be reclassified into profi
277,808.95 (26,770.28)
t or loss.
1.Other comprehensive income under the equity method investee c - -
an be reclassified into profit or loss.
2. Changes in the fair value of investments in other debt
178,640.10 (178,640.10)
obligations
3. Other comprehensive income arising from the reclassification
- -
of financial assets
4.Allowance for credit impairments in investments in other debt
- -
obligations
5. Reserve for cash flow hedges - -
6.Translation differences in currency financial statements 99,168.85 151,869.82
7.Other - -
Net of profit of other comprehensive income attributable to Mi
119,093.40 (119,093.40)
nority shareholders’ equity
VI. Total comprehensive income 111,266,343.48 101,587,363.18
Total comprehensive income attributable to the owner of the
63,279,021.95 63,223,673.20
parent company
Total comprehensive income attributable minority shareholders 47,987,321.53 38,363,689.98
VII. Earnings per share
Basic earnings per share 0.16 0.14
The notes are integral parts of the financial statements
-8-
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Income statement of the Parent Company
In RMB
Note Year 2023 Year 2022
I.Operating revenue (XVI).4 77,822,508.75 56,046,883.88
Less：Operating cost (XVI).4 9,822,306.53 9,544,956.96
Business tax and surcharge 3,193,559.74 2,296,709.15
Sales expense 233,086.71 106,542.65
Administrative expense 46,901,768.72 46,419,746.13
Financial expenses (3,418,990.44) (5,381,252.49)
Including：Interest expenses 356,264.79 6,601.33
Interest income 3,838,789.68 5,369,095.59
Add：Other income 153,012.52 269,698.97
Investment gain (XVI).5 19,300,515.95 18,656,000.37
Including: investment gains from affiliates (6,898,983.89) 1,307,639.15
Financial assets measured at amortized cost cease to be recognized
- -
as income
Changing income of fair value 2,151,780.82 -
Credit impairment loss 708,847.28 940,005.04
Impairment loss of assets - -
Assets disposal income - -
II.Operating profit 43,404,934.06 22,925,885.86
Add：Non-operating income 6,431.44 6,004,050.33
Less：Non-operating expenses 59,123.40 100,500.00
III. Total profit 43,352,242.10 28,829,436.19
Less：Income tax expenses 9,825,698.88 2,191,277.71
IV. Net profit 33,526,543.22 26,638,158.48
1.Net continuing operating profit 33,526,543.22 26,638,158.48
2.Termination of operating net profit - -
V. Net after-tax of other comprehensive income (15,225,837.94) (9,906,869.64)
（ I ） Other comprehensive income items that will not be
(15,325,006.79) (10,058,739.46)
reclassified into gains/losses in the subsequent accounting period
1.Re-
measurement of defined benefit plans of changes in net debt or net - -
assets
2.Other comprehensive income under the equity method investee c
- -
an not be reclassified into profit or loss.
3. Changes in the fair value of investments in other equity
(15,325,006.79) (10,058,739.46)
instruments
4. Changes in the fair value of the company’s credit risks - -
5.Other - -
(II)Other comprehensive income that will be reclassified into profi 99,168.85 151,869.82
t or loss
1.Other comprehensive income under the equity method investee c - -
an be reclassified into profit or loss.
-9-
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
2. Changes in the fair value of investments in other debt
- -
obligations
3. Other comprehensive income arising from the reclassification
- -
of financial assets
4.Allowance for credit impairments in investments in other debt
- -
obligations
5. Reserve for cash flow hedges - -
6.Translation differences in currency financial statements 99,168.85 151,869.82
7.Other - -
VI. Total comprehensive income 18,300,705.28 16,731,288.84
The notes are integral parts of the financial statements
- 10 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Consolidated Cash flow statement
In RMB
Note Year 2023 Year 2022
I.Cash flows from operating activities
Cash received from sales of goods or rending of services 2,985,794,229.99 3,046,091,280.79
Tax returned 5,073,509.20 113,982,534.22
Other cash received from business operation (V).55(1) 87,277,323.90 218,296,299.96
Sub-total of cash inflow 3,078,145,063.09 3,378,370,114.97
Cash paid for purchasing of merchandise and services 2,466,252,261.73 2,453,492,479.82
Cash paid to staffs or paid for staffs 255,045,680.87 253,460,171.00
Taxes paid 54,636,406.53 59,230,421.14
Other cash paid for business activities (V).55(1) 117,443,974.16 121,948,492.41
Sub-total of cash outflow from business activities 2,893,378,323.29 2,888,131,564.37
Net cash generated from /used in operating activities (V).56(1) 184,766,739.80 490,238,550.60
II. Cash flow generated by investing
Cash received from investment retrieving - 28,500,000.00
Cash received as investment gains 13,769,440.75 18,075,712.72
Net cash retrieved from disposal of fixed assets, intangible assets,
11,634.84 101,301.53
and other long-term assets
Net cash received from disposal of subsidiaries or other
- -
operational units
Other investment-related cash received (V).55(2) 1,454,000,000.00 1,316,000,000.00
Sub-total of cash inflow due to investment activities 1,467,781,075.59 1,362,677,014.25
Cash paid for construction of fixed assets, intangible assets
64,069,967.97 123,210,891.17
and other long-term assets
Cash paid as investment - 1.00
Net cash received from subsidiaries and other operational
- -
units
Other cash paid for investment activities (V).55(2) 1,840,500,000.00 1,140,433,371.49
Sub-total of cash outflow due to investment activities 1,904,569,967.97 1,263,644,263.66
Net cash flow generated by investment (436,788,892.38) 99,032,750.59
III.Cash flow generated by financing
Cash received as investment - -
Including: Cash received as investment from minor shareholders - -
Cash received as loans 8,000,000.00 73,230,492.79
Other financing –related cash received - -
Sub-total of cash inflow from financing activities 8,000,000.00 73,230,492.79
Cash to repay debts 103,387,387.94 26,642,157.50
Cash paid as dividend, profit, or interests 57,324,944.21 56,596,142.54
Including: Dividend and profit paid by subsidiaries to minor
- -
shareholders
Other cash paid for financing activities (V).55(3) 8,776,024.71 9,144,572.43
- 11 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Sub-total of cash outflow due to financing activities 169,488,356.86 92,382,872.47
Net cash flow generated by financing (161,488,356.86) (19,152,379.68)
IV. Influence of exchange rate alternation on cash and cash
456,132.31 1,947,479.23
equivalents
V.Net increase of cash and cash equivalents (V).56(1) (413,054,377.13) 572,066,400.74
Add: balance of cash and cash equivalents at the beginning of
(V).56(2) 874,474,834.46 302,408,433.72
term
VI ..Balance of cash and cash equivalents at the end of term (V).56(2) 461,420,457.33 874,474,834.46
The notes are integral parts of the financial statements
- 12 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Cash Flow Statement of the Parent Company
In RMB
Note Year 2023 Year 2022
I.Cash flows from operating activities
Cash received from sales of goods or rending of services 79,719,541.58 49,647,323.90
Tax returned - 600,618.94
Other cash received from business operation 20,183,240.81 7,065,800.34
Sub-total of cash inflow 99,902,782.39 57,313,743.18
Cash paid for purchasing of merchandise and services 3,005,590.09 2,458,133.73
Cash paid to staffs or paid for staffs 38,735,139.38 33,850,730.29
Taxes paid 19,540,659.95 6,260,647.31
Other cash paid for business activities 18,940,923.33 5,334,787.37
Sub-total of cash outflow from business activities 80,222,312.75 47,904,298.70
Net cash generated from /used in operating activities 19,680,469.64 9,409,444.48
II. Cash flow generated by investing
Cash received from investment retrieving - -
Cash received as investment gains 12,954,592.48 17,348,361.22
Net cash retrieved from disposal of fixed assets, intangible assets,
- -
and other long-term assets
Net cash received from disposal of subsidiaries or other
- -
operational units
Other investment-related cash received 1,250,200,000.00 1,316,000,000.00
Sub-total of cash inflow due to investment activities 1,263,154,592.48 1,333,348,361.22
Cash paid for construction of fixed assets, intangible assets and
2,784,786.15 2,586,581.13
other long-term assets
Cash paid as investment - 1.00
Net cash received from subsidiaries and other operational units - -
Other cash paid for investment activities 1,550,500,000.00 1,134,754,229.41
Sub-total of cash outflow due to investment activities 1,553,284,786.15 1,137,340,811.54
Net cash flow generated by investment (290,130,193.67) 196,007,549.68
III. Cash flow generated by financing
Cash received as investment - -
Cash received as loans - -
Other financing –related ash received - -
Sub-total of cash inflow from financing activities - -
Cash to repay debts - -
Cash paid as dividend, profit, or interests 30,747,575.73 25,332,693.78
Other cash paid for financing activities - -
Sub-total of cash outflow due to financing activities 30,747,575.73 25,332,693.78
Net cash flow generated by financing (30,747,575.73) (25,332,693.78)
IV. Influence of exchange rate alternation on cash and cash
571.84 1,886.83
equivalents
- 13 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
V.Net increase of cash and cash equivalents (301,196,727.92) 180,086,187.21
Add: balance of cash and cash equivalents at the beginning of
310,322,528.19 130,236,340.98
term
VI ..Balance of cash and cash equivalents at the end of term 9,125,800.27 310,322,528.19
The notes are integral parts of the financial statements
- 14 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Consolidated Statement on Change in Owners’ Equity
In RMB
Year 2023
Owner’s equity Attributable to the Parent Company
Items
Minor shareholders’ Total of owners’
Other
equity equity
Share Capital Capital reserves Comprehensive Surplus reserves Retained profit
Income
I .Balance at the end of last year 506,521,849.00 1,961,599,824.63 109,596,609.31 100,909,661.32 170,636,610.95 1,181,777,770.21 4,031,042,325.42
Add: Change of accounting policy - - - - - - -
Correcting of previous errors - - - - - - -
Merger of entities under common
- - - - - - -
control
Other - - - - - - -
II. Balance at the beginning of current
506,521,849.00 1,961,599,824.63 109,596,609.31 100,909,661.32 170,636,610.95 1,181,777,770.21 4,031,042,325.42
year
III .Changed in the current year - - (15,989,228.50) 3,352,654.32 45,524,285.19 47,987,321.53 80,875,032.54
（1）Total comprehensive income - - (15,989,228.50) - 79,268,250.45 47,987,321.53 111,266,343.48
（ II ） Investment or decreasing of
- - - - - - -
capital by owners
1．Ordinary Shares invested by shareho
- - - - - - -
lders
2 ． Amount of shares paid and
- - - - - - -
accounted as owners’ equity
3．Other - - - - - - -
（III）Profit allotment - - - 3,352,654.32 (33,743,965.26) - (30,391,310.94)
1.Providing of surplus reserves - - - 3,352,654.32 (3,352,654.32) - -
2 ． Allotment to the owners (or
- - - - (30,391,310.94) - (30,391,310.94)
shareholders)
- 15 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
3．Other - - - - - - -
(IV) Internal transferring of owners’
- - - - - - -
equity
1. Capitalizing of capital reserves (or to
- - - - - - -
capital shares)
2. Capitalizing of surplus reserves (or to
- - - - - - -
capital shares)
3 ． Making up losses by surplus
- - - - - - -
reserves.
4. Other comprehensive income carry-
- - - - - - -
over retained earnings
5．Other - - - - - - -
(V). Special reserves - - - - - - -
1. Provided this year - - - - - - -
2．Used this term - - - - - - -
（VI）Other - - - - - - -
IV. Balance at the end of this term 506,521,849.00 1,961,599,824.63 93,607,380.81 104,262,315.64 216,160,896.14 1,229,765,091.74 4,111,917,357.96
The notes are integral parts of the financial statements
- 16 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Consolidated Statement on Change in Owners’ Equity(Continued)
In RMB
Year 2022
Owner’s equity Attributable to the Parent Company
Items
Minor shareholders’ Total of owners’
Other
equity equity
Share Capital Capital reserves Comprehensive Surplus reserves Retained profit
Income
I .Balance at the end of last year 506,521,849.00 1,961,599,824.63 119,682,119.05 98,245,845.47 125,317,336.31 1,143,414,080.23 3,954,781,054.69
Add: Change of accounting policy - - - - - - -
Correcting of previous errors - - - - - - -
Merger of entities under common
- - - - - - -
control
Other - - - - - - -
II. Balance at the beginning of current
506,521,849.00 1,961,599,824.63 119,682,119.05 98,245,845.47 125,317,336.31 1,143,414,080.23 3,954,781,054.69
year
III .Changed in the current year - - (10,085,509.74) 2,663,815.85 45,319,274.64 38,363,689.98 76,261,270.73
（1）Total comprehensive income - - (10,085,509.74) - 73,309,182.94 38,363,689.98 101,587,363.18
（ II ） Investment or decreasing of
- - - - - - -
capital by owners
1．Ordinary Shares invested by shareho
- - - - - - -
lders
2 ． Amount of shares paid and
- - - - - - -
accounted as owners’ equity
3．Other - - - - - - -
（III）Profit allotment - - - 2,663,815.85 (27,989,908.30) - (25,326,092.45)
1.Providing of surplus reserves - - - 2,663,815.85 (2,663,815.85) - -
2 ． Allotment to the owners (or
- - - - (25,326,092.45) - (25,326,092.45)
shareholders)
- 17 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
3．Other - - - - - - -
(IV) Internal transferring of owners’
- - - - - - -
equity
1. Capitalizing of capital reserves (or to
- - - - - - -
capital shares)
2. Capitalizing of surplus reserves (or to
- - - - - - -
capital shares)
3 ． Making up losses by surplus
- - - - - - -
reserves.
4. Other comprehensive income carry-
- - - - - - -
over retained earnings
5．Other - - - - - - -
(V). Special reserves - - - - - - -
1. Provided this year - - - - - - -
2．Used this term - - - - - - -
（VI）Other - - - - - - -
IV. Balance at the end of this term 506,521,849.00 1,961,599,824.63 109,596,609.31 100,909,661.32 170,636,610.95 1,181,777,770.21 4,031,042,325.42
The notes are integral parts of the financial statements
- 18 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Statement of change in owner’s Equity of the Parent Company
In RMB
Year 2023
Items
Other Comprehensive
Share Capital Capital reserves Surplus reserves Retained profit Total of owners’ equity
Income
I.Balance at the end of last year 506,521,849.00 1,577,392,975.96 98,855,668.75 100,909,661.32 689,527,368.58 2,973,207,523.61
Add: Change of accounting policy - - - - - -
Correcting of previous errors - - - - - -
Other - - - - - -
II. Balance at the beginning of current
506,521,849.00 1,577,392,975.96 98,855,668.75 100,909,661.32 689,527,368.58 2,973,207,523.61
year
III .Changed in the current year - - (15,225,837.94) 3,352,654.32 (217,422.04) (12,090,605.66)
（I）Total comprehensive income - - (15,225,837.94) - 33,526,543.22 18,300,705.28
(II) Investment or decreasing of capital
- - - - - -
by owners
1．Ordinary Shares invested by
- - - - - -
shareholders
2.Amount of shares paid and accounted
- - - - - -
as owners’ equity
3．Other - - - - - -
（III）Profit allotment - - - 3,352,654.32 (33,743,965.26) (30,391,310.94)
1.Providing of surplus reserves - - - 3,352,654.32 (3,352,654.32) -
2 ． Allotment to the owners (or
- - - - (30,391,310.94) (30,391,310.94)
shareholders)
3．Other - - - - - -
(IV) Internal transferring of
- - - - - -
owners’ equity
1. Capitalizing of capital reserves (or to
- - - - - -
capital shares)
2. Capitalizing of surplus reserves (or to
- - - - - -
capital shares)
- 19 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
3．Making up losses by surplus
- - - - - -
reserves.
4．Other comprehensive income carry-
- - - - - -
over retained earnings
5．Other - - - - - -
(V) Special reserves - - - - - -
1. Provided this year - - - - - -
2．Used this term - - - - - -
（VI）Other - - - - - -
IV. Balance at the end of this term 506,521,849.00 1,577,392,975.96 83,629,830.81 104,262,315.64 689,309,946.54 2,961,116,917.95
The notes are integral parts of the financial statements
- 20 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Statement of change in owner’s Equity of the Parent Company(Continued)
In RMB
Year 2022
Items
Other Comprehensive
Share Capital Capital reserves Surplus reserves Retained profit Total of owners’ equity
Income
I.Balance at the end of last year 506,521,849.00 1,577,392,975.96 108,762,538.39 98,245,845.47 690,879,118.40 2,981,802,327.22
Add: Change of accounting policy - - - - - -
Correcting of previous errors - - - - - -
Other - - - - - -
II. Balance at the beginning of current
506,521,849.00 1,577,392,975.96 108,762,538.39 98,245,845.47 690,879,118.40 2,981,802,327.22
year
III .Changed in the current year - - (9,906,869.64) 2,663,815.85 (1,351,749.82) (8,594,803.61)
（I）Total comprehensive income - - (9,906,869.64) - 26,638,158.48 16,731,288.84
(II) Investment or decreasing of capital
- - - - - -
by owners
1．Ordinary Shares invested by
- - - - - -
shareholders
2.Amount of shares paid and accounted
- - - - - -
as owners’ equity
3．Other - - - - - -
（III）Profit allotment - - - 2,663,815.85 (27,989,908.30) (25,326,092.45)
1.Providing of surplus reserves - - - 2,663,815.85 (2,663,815.85) -
2 ． Allotment to the owners (or
- - - - (25,326,092.45) (25,326,092.45)
shareholders)
3．Other - - - - - -
(IV) Internal transferring of
- - - - - -
owners’ equity
1. Capitalizing of capital reserves (or to
- - - - - -
capital shares)
- 21 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
2. Capitalizing of surplus reserves (or to
- - - - - -
capital shares)
3 ． Making up losses by surplus
- - - - - -
reserves.
4．Other comprehensive income carry-
- - - - - -
over retained earnings
5．Other - - - - - -
(V) Special reserves - - - - - -
1. Provided this year - - - - - -
2．Used this term - - - - - -
（VI）Other - - - - - -
IV. Balance at the end of this term 506,521,849.00 1,577,392,975.96 98,855,668.75 100,909,661.32 689,527,368.58 2,973,207,523.61
The notes are integral parts of the financial statements
- 22 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
I. Basic Information of the Company
1.Company overview
Shenzhen Textile (Holdings) Co., Ltd (hereinafter referred to as "the Company") is a company limited by shares
registered in Guangdong Province, formerly known as Shenzhen Textile Industry Company and established in 1984.
The Company was listed on the Shenzhen Stock Exchange in August 1994. The Company publicly issued RMB
ordinary shares (A shares) and domestic listed foreign capital shares (B shares) to the domestic and foreign public
respectively and listed them for trading.
Headquartered in Shenzhen, Guangdong Province, the main business of the Company and its subsidiaries
(hereinafter referred to as "the Group") includes the research and development, production and marketing of
polarizers for liquid crystal display, as well as property management business mainly located in the prosperous
commercial area of Shenzhen and textile and garment business.
2. Scope of consolidated financial statement
The financial statements have been authorized for issuance of Board of Directors of the Company on March 26,2024.
. II. Basis for the preparation of the financial report
（1）Basis for the preparation
The Group implements the accounting standards for enterprises and related regulations promulgated by the
Ministry of Finance. In addition, the Group also discloses relevant financial information in accordance with the No.
15 Compilation Rules for Disclosure of Information by Companies ofIssuing Securities to the Public-General
Provisions for Financial Reporting (2023 Revision).
(2) Continuous operation
The Group evaluated its ability to continue as a going concern for the 12 months from 31 December 2022 and found
no matters or circumstances that raised significant doubts about its ability to continue as a going concern.
Accordingly, the present financial reporthas been prepared on the basis of going concern assumptions.
(3) Bookkeeping basis and pricing principle
The Group's accounting is based on the accrual basis. Except for certain financial instruments-which are measured at
fair value, the financial reportusesthe historical cost as the measurement basis. If the asset is impaired, the
corresponding impairment provision will be made in accordance with the relevant regulations.
Under historical cost measurement, an asset is measured at the fair value of the amount of cash or cash equivalents
paid or the consideration paidat the time of acquisition. Liabilities are measured by the amount of money or assets
actually received as a result of the present obligation is assumed, or the contractual amount of the present obligation
is incurred, or the amount of cash or cash equivalents expected to be paid in the ordinary course of life to repay the
liability.
Fair value is the price that market participants shall have to receive for the sale of an asset or shall to pay for a
transfer of a liability in an orderly transaction that occurs on the measurement date. Whether the fair value is
observable or estimated using valuation techniques, the fair value measured and disclosed in this financial report is
determined on that basis.
For financial assets that use the transaction price as the fair value at the time of initial recognition, and a valuation
technique involving unobservable inputs is used in subsequent measures of fair value, the valuation technique is
corrected during the valuation process so that the initial recognition result determined by the valuation technique is
equal to the transaction price.
Fair value measurement is divided into three levels as to the observability of fair value inputs, and the importance of
such inputs to fair value measurement as a value inputs, and the importance of such inputs to fair value measurement
as a whole:
The first level of input is the unadjusted quotation of the same asset or liability in an active market that can be
obtained at the measurement date.
- 23 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
The second-level input value is the input value that is directly or indirectly observable for the underlying asset or
liability in addition to the first-level input.
The third level input value is the unobservable input value of the underlying asset or liability.
- 24 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
II. Important accounting policies and accounting estimates
1.Statement of compliance with accounting standards for business enterprises
The financial report prepared by the Company complies with the requirements of the Accounting Standards for
Business Enterprises and truly and completely reflects the consolidated and parent financial position of the
Company as of December 31, 2023 and the consolidated and parent operating results, the consolidated and parent
shareholders' equity changes and the consolidated and parent cash flows for 2023.
2. Accounting period
The Group's fiscal year is the Gregorian calendar year, i.e. from January 1 to December 31 of each year.
3.Business cycle
The business cycle is the period from the time an enterprise purchases an asset for processing to the realization of
cash or cash equivalents. The Company's business cycle is 12 months.
4. The base currency of account
RMB is the currency in the main economic environment in which the Company and its domestic subsidiaries
operate, and the Company and its domestic subsidiaries use RMB as the base accounting currency. The overseas
subsidiaries of the Company determine RMB as their base accounting currency according to the currency of the
main economic environment in which they operate. The currency used by the Company in the preparation of this
financial report is RMB.
- 25 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
5.Determination method and selection basis for material criteria
Item
Material criteria
The proportion of individual item exceeds 0.5% of
Receivables for a significant single provision for bad debts
total assets
Important accounts receivable for the recovery or reversal of The proportion of individual item exceeds 0.5% of
bad debt reserves total assets
The proportion of individual item exceeds 0.5% of
Significant prepayments that are more than 1 year old
total assets
Significant accountspayable and/or advance receipts aged
The proportion of individual item exceeds 0.5% of
more than 1 year
total assets
Contract liabilities and other payables
Cash received in connection with significant investment
Amount exceeding RMB 50 million yuan
activities
Payments of cash in connection with significant investment
Amount exceeding RMB 50 million yuan
activities
More than 10% of total assets, or total revenues or
Significant non-wholly owned subsidiary
total profits
Significant joint ventures or associates Net assets account for more than 5%
6. Accounting treatment of business combinations under the common control and under non-common
control
Business combinations are divided into business combinations under common control and business combinations
under non-common control.
6.1 Business combinations under common control
The enterprises participating in the merger are ultimately controlled by the same party or multiple parties before
and after the merger, and the control is not temporary, therefore it is a business combination under the common
control.
Assets and liabilities acquired in a business combination are measured at their carrying value on the consolidated
party at the date of consolidation. The difference between the carrying amount of net assets acquired by the
merging party and the carrying amount of the merger consideration paid is adjusted for the equity premium in the
capital reserve or for retained earnings if the equity premium is insufficient to be offset.
Direct carrying value on the consolidated party at the date of consolidation. The difference between the carrying
amount of net assets acquired by the merging party and the carrying amount of the merger consideration paid is
adjusted for the equity premium in the capital reserve or for retained earnings if the equity premium is insufficient
to be offset.
Direct expenses incurred in connection with the business combination are recognized in profit or loss for the
period when incurred.
6.2 Business combinations and goodwill under non-common control
The enterprises participating in a merger are not ultimately controlled by the same party or multiple parties before
and after the merger, therefore it is a business combination under non-common control.
Consolidation cost is the fair value of assets paid, liabilities incurred or assumed and equity instruments issued to
gain control of the acquired partyby the purchaser. Intermediary fees such as auditing, legal services, valuation
consulting and other related management expenses incurred by the purchaser for the business combination are
recognized in the profit or loss of the period when incurred.
The identifiable assets, liabilities and contingent liabilities of the acquiree that are eligible for recognition acquired by
the purchaser in the merger are measured at fair value at the date of purchase.
The cost of the merger is greater than the difference in the fair value share of the acquiree's identifiable net assets
acquired in the merger, which is recognized as goodwill as an asset and initially measured at cost. If the cost of the
merger is less than the fair value share of the acquiree's identifiable net assets acquired in the merger, the fair value of
the acquired acquiree's identifiable assets, liabilities and contingent liabilities and the measurement of the cost of the
- 26 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
merger are first reviewed, and if the consolidated cost after review is still less than the fair value share of the
acquiree's identifiable net assets share acquired in the merger, which shall be included in profit or loss for the
periodoccurred.
Goodwill resulting from business combinations is presented separately in the consolidated financial statement and
measured at cost less accumulated impairment provisions.
7. Criteria for determining control and preparation method for consolidated financial statement
7.1 Criteria for Determining Control
Control means that the investor has power over the investee, enjoys variable returns by participating in the investee's
related activities, and has the ability to use its power over the investee to influence the amount of its returns. The
Group will reassess the relevant elements involved in the above definition of controls as a result of changes in the
relevant facts and circumstances.
7.2. Methodology for the preparation of consolidated financial statement
The consolidated scope of the consolidated financial statement is determined on a control basis.
The merger of subsidiaries begins when the Group acquires control of the subsidiary and terminates when the
Group loses control of the subsidiary.
For subsidiaries disposed of by the Group, the results of operations and cash flows prior to the date of disposal
(the date of loss of control) have been duly included in the consolidated statement of income and the consolidated
statement of cash flows.
For subsidiaries acquired through a business combination under non-common control, the results of operations
and cash flows from the date of purchase (the date of acquisition of control) have been appropriately included in the
consolidated statement of income and the consolidated statement of cash flows.
For subsidiaries acquired through a business combination under common control, regardless of when the
business combination takes place in any point of the reporting period, the subsidiary shall be deemed to be included
in the scope of the Group's consolidation on the date on which the subsidiary is under the control of the ultimate
controlling party, the results of operations and cash flows from the beginning of the earliest period of the reporting
period are duly included in the consolidated income statement and the consolidated statement of cash flows.
The principal accounting policies and the accounting periods adopted by the subsidiaries are determined in
accordance with the accounting policies and accounting periods uniformly prescribed by the Company.
The impact of the Company's internal transactions with its subsidiaries and between subsidiaries on the
consolidated financial statement is offset at the time of consolidation.
The shares of the subsidiary's ownership interest that are not part of the parent company are shown as minority
interests under the item "minority interests" under the item on shareholders' equityin the consolidated balance sheet.
The shares of the subsidiary's net profit or loss for the period that belongs to minority interests is shown under the
item "minority profit and loss" under the net profit item in the consolidated statement of income.
The minority shareholders’ share of the subsidiary's losses exceeds the minority shareholders’ share of
ownership interest enjoyed in the beginning of the period, and its balance is still offset by the minority shareholders’
equity.
For transactions that purchase minority stakes in a subsidiary or dispose of part of the equity investment without
losing control of the subsidiary, it’s accounted as equity transactions, and the carrying amount of the owner's
interest and minority interest attributable tothe parent company is adjusted to reflect their change in the relevant
interest in the subsidiary. The difference between the adjustment of minority interests and the fair value of the
consideration paid/received is adjusted to the capital reserve, and if the capital reserve is insufficient to offset it,
then it’s adjusted to the retained earnings.
8. Joint venture arrangement
Joint arrangements are divided into commonly-operated ventures and jointly-operated ventures, which are determined in
accordance with the rights and obligations of the joint venture parties in the joint venture arrangement by taking into
account factors such as the structure, legal form and contractual terms of the arrangement. Commonly-operated refers to
a joint arrangement in which the joint venture parties enjoy the assets related to the arrangement and bear the liabilities
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Financial Statements and Auditor's Report
For the year ended December 31,2023
related to the arrangement. The jointly-operated is a joint arrangement in which the joint venture party has rights only to
the net assets of the joint arrangement.
The Group's investments in joint ventures are accounted by using the equity method, please see Note (III) 17.3.2
"Long-term equity investments accounted by the equity method".
9. Standards for determining cash and cash equivalents
Cash refers to cash on hand and deposits that can be used to pay at any time. Cash equivalents refer to
investments held by the Group for a short period (generally within three months from the date of purchase), highly
liquid, easily convertible into a known amount of cash, and with little risk of change in value.
10.Foreign currency transactions and translation of foreign currency statements
10.1 Foreign Currency Business
Foreign currency transactions are initially recognized at an exchange rate similar to the spot exchange rate on the
date of the transaction, and the exchange rate similar to the spot rate on the date of the transaction is determined in a
systematic and reasonable manner.
At the balance sheet date, foreign currency monetary items are converted into RMB using the spot exchange rate
on that date, and the exchange difference arising from the difference between the spot exchange rate on that date and
the spot exchange rate at the time of initial recognition or the day preceding the balance sheet date, except: (1) the
exchange difference of foreign currency special borrowings eligible for capitalization is capitalized during the
capitalization period and included in the cost of the underlying asset; (2) The exchange difference of hedging
instruments for hedging in order to avoid foreign exchange risk is treated according to the hedge accounting method;
The exchange differenceresults from changes in other carrying balances other than amortized cost for monetary
items classified as measured at fair value and changes in which are included in other comprehensive income, it shall
be recognized as profit or loss for the period.
Where the preparation of the consolidated financial statement involves overseas operations, if there are foreign
currency monetary items that substantially constitute net investment in overseas operations, the exchange difference
arising from exchange rate changes is included in the "foreign currency statement translation difference" item
included in other comprehensive income; When disposing of overseas operations, it is included in the profit or loss
of the period of disposal.
Foreign currency non-monetary items measured at historical cost are still measured at the base currency amount
translated at the spot exchange rate on the date of the transaction. Foreign currency non-monetary items measured at
fair value are translated using the spot exchange rate on the fair value determination date, and the difference between
the converted base currency amount and the original accounting currency amount is treated as a change in fair value
(including exchange rate changes) and recognized as profit or loss for the period or recognized as other
comprehensive income.
10.2 Translation of Foreign Currency Financial Statements
For the purpose of preparing consolidated financial statement, foreign currency financial statements for overseas
operations are converted into RMB statements in the following manner: all assets and liabilities in the balance
sheet are converted at the spot exchange rate at the balance sheet date; Shareholders' equity items are converted at
the spot exchange rate at the time of incurrence; All items in the income statement and items reflecting the amount
of profit distribution are converted at an exchange rate similar to the spot exchange rate on the date of the
transaction; The difference between the converted asset items and the total of liability items and shareholders'
equity items is recognized as other comprehensive income and included in shareholders' equity.
Foreign currency cash flows and cash flows of overseas subsidiaries are translated using exchange rates similar to
the spot exchange rate on the occurrence date of cash flow, and the impact amount of exchange rate changes on
cash and cash equivalents is used as a reconciliation item and is shown separately in the statement of cash flows as
"Impact of exchange rate changes on cash and cash equivalents".
The prior-year year-end amounts and the prior-year actual are presented on the basis of the amounts converted
from the prior-year financial statement.
Where the Group losses control of overseas operations due to disposing of all the ownership interests in overseas
operations or the disposal of part of the equity investment or other reasons, the difference in the translation of the
foreign currency statements in the ownership interests attributable to the parent company related to the overseas
operations shown below the items of shareholders' equity in the balance sheet shall be transferred to the profit or
loss of the period of disposal.
Where the proportion of equity interests held in overseas operations decreases due to the disposal of part of the
equity investment or other reasons without lost the control of the overseas operations, the difference in the
translation of foreign currency statements related to the disposal part of the overseas operations shall be attributed
to the minority shareholders' interests and shall not be transferred to the profit or loss of the period. Where
disposing of part of the equity of an overseas operation in an associate or a joint venture, the difference in the
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
translation of foreign currency statements related to the overseas operation shall be transferred to the profit or loss
of the period of disposal according to the proportion of the disposal of the overseas operation.
11.Financial instruments
The Group recognizes a financial asset or financial liability when it becomes a party to a financial instrument
contract.
In the case of the purchase or sale of financial assets in the usual manner, it shall recognize the assets to be received
and the liabilities to be incurred on the transaction date, or derecognize the assets sold on the transaction date.
Financial assets and financial liabilities are measured at fair value at initial recognition. For financial assets and
financial liabilities measured at fair value and changes in which are recorded in profit or loss for the period, the
related transaction costs are recognized directly in profit or loss for the period; For other categories of financial
assets and financial liabilities, the related transaction costs are included in the initial recognition amount. Where the
Group initially recognizes accounts receivable that do not contain a material financing component or do not take
into account the financing component in a contract not older than one year in accordance with No. 14Accounting
Standard for Business Enterprises-Revenue (the "Revenue Standard"), the initial measurement is made at the
transaction price as defined by the revenue standard.
The effective interest rate method refers to the method of calculating the amortized cost of financial assets or
financial liabilities and apportioning interest income or interest expense into each accounting period.
The effective interest rate is the interest rate used to discount the estimated future cash flows of a financial asset or
financial liability over the expected life of the financial asset to the carrying balance of the financial asset or the
amortized cost of the financial liability. In determining the effective interest rate, the expected cash flow is
estimated taking into account all contractual terms of the financial asset or financial liability (such as early
repayment, rollover, call option or other similar option, etc.), without taking into account the expected credit loss.
The amortized cost of a financial asset or financial liability is the amount initially recognized less the principal
repaid, plus or minus the accumulated amortization resulting from the amortization of the difference between the
initial recognition amount and the amount due date using the effective interest rate method, and then deduct the
accumulated provision for losses (for financial assets only).
11.1 Classification, recognition and measurement of financial assets
After initial recognition, the Group conducts subsequent measurements of different classes of financial assets at
amortized cost, measured at fair value and changes in which are recognized in other comprehensive income, or
measured at fair value and changes in which are recorded in profit or loss for the period.
The contractual clauses of a financial asset provide that the cash flows generated on a given date are only the
payment of principal and interest based on the outstanding principal amount, and the Group's business model is
aimed for managing the financial asset is to collect contractual cash flows, then the Group classifies the financial
asset as a financial asset measured at amortized cost. Such financial assets mainly include monetary funds, notes
receivable, accounts receivable and other receivables.
The contractual terms of a financial asset provide that the cash flows generated at a particular date are only the
payment of principal and interest based on the outstanding principal amount, and the Group's business model for
managing the financial asset is aimed at both the receipt of contractual cash flows and the sale of the financial asset,
then the financial asset is classified as a financial asset measured at fair value and the change therein is recognized
in other comprehensive income. Such financial assets with a maturity of more than one year from the date of
acquisition are listed as other debt investments, and if they mature within one year (inclusive) from the balance
sheet date, they are shown as non-current assets maturing within one year; Accounts receivable and notes
receivable classified as measured at fair value and changes in which are recognized in other comprehensive income
at the time of acquisition are shown in receivables financing, and the other acquired with a maturity of one year
(inclusive) are shown in other current assets.
At initial recognition, the Group may irrevocably designate investments in non-tradable equity instruments other
than contingent consideration recognized in business combinations that are under non-common control as financial
assets measured at fair value and changes in which are recognized in other comprehensive income on a single
financial asset basis. Such financial assets are listed as investments in other equity instruments.
Where a financial asset meets any of the following conditions, it indicates that the Group's purpose in holding the
financial asset is transactional:
The purpose of acquiring the underlying financial asset is primarily for the purpose of the recent sale.
The underlying financial assets were part of a centrally managed portfolio of identifiable financial instruments at
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
the time of initial recognition and there was objective evidence of an actual pattern of short-term profits in the
recent.
The underlying financial asset is a derivative instrument, except for derivatives that meet the definition of a
financial guarantee contract and derivatives that are designated as effective hedging instruments.
Financial assets measured at fair value and changes in which are recorded in profit or loss for the period include
financial assets classified as measured at fair value and changes in which are recorded in profit or loss for the
period and financial assets designated as measured at fair value and changes in which are recorded in profit or loss
for the period:
Financial assets that do not qualify as financial assets measured at amortized cost and financial assets measured at
fair value and changes in which are included in other comprehensive income are classified as financial assets
measured at fair value and changes in which are recorded in profit or loss for the period.
At the time of initial recognition, in order to eliminate or significantly reduce accounting mismatches, the Group
may irrevocably designate financial assets as financial assets measured at fair value and changes in which are
recorded in profit or loss for the period.
Financial assets measured at fair value and changes in which are recorded in profit or loss for the period are shown
in trading financial assets, and financial assets with maturity of more than one year (or have an indefinite maturity)
from the balance sheet date and expected to be held for more than one year is shown as other non-current financial
assets
11.1.1 Financial assets measured at amortized cost
Financial assets measured at amortized cost are subsequently measured at amortized cost using the effective
interest rate method, and the gains or losses arising from impairment or derecognition are included in profit or loss
for the period.
The Group recognizes interest income on financial assets measured at amortized cost in accordance with the
effective interest rate method. For financial assets purchased or derived that have incurred credit impairment, the
Group determines interest income based on the amortized cost of the financial asset and the credit-adjusted
effective interest rate from the initial recognition. In addition, the Group determines interest income based on the
carrying balance of financial assets multiplied by the effective interest rate.
11.1.2 Financial assets measured at fair value and changes in which are recorded in other comprehensive income
Impairment losses or gains and interest income calculated using the effective interest rate methodrelated to
financial assets classified as measured at fair value and changes in which are included in other comprehensive
income are recognized in profit or loss for the period, and except that, changes in the fair value of such financial
assets are recognized in other comprehensive income. The amount of the financial asset recognized in profit or loss
for each period is equal to the amount that is recognized in profit or loss for each period as if it had been measured
at amortized cost. When the financial asset is derecognized, the accumulated gain or loss previously recognized in
other comprehensive income is transferred from other comprehensive income and recognized in profit or loss for
the period.
Changes in fair value in investments in non-traded equity instruments designated as measured at fair value and the
change in which are recognized in other comprehensive income are recognized in other comprehensive income,
and when the financial asset is derecognized, the accumulated gain or loss previously recognized in other
comprehensive income is transferred from other comprehensive income to retained earnings. During the period
during which the Group holds the investment in the non-tradable equity instrument, the dividend income is
recognized and recorded in profit or loss for the period when the Group's right to receive dividends has been
established, the economic benefits associated with the dividends are likely to flow into the Group and the amount
of the dividends can be reliably measured.
11.1.3 Financial assets measured at fair value and changes in which are recorded in profit or loss for the period
Financial assets measured at fair value and changes in which are recorded in profit or loss for the period are
subsequently measured at fair value, and gains or losses resulting from changes in fair value and dividends and
interest income related to the financial asset are recorded in profit or loss for the period.
11.2 Impairment of Financial Instruments
The Group performs impairment accounting and recognizes loss provisions for financial assets measured at
amortized cost, financial assets classified as measured at fair value and changes in which are recognized in other
comprehensive income, and lease receivables based on expected credit losses.
The Group measures the loss provision at an amount equivalent to the expected credit loss over the life of notes
receivable and accounts receivable formed by transactions regulated by revenue standards that do not contain a
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
material financing element or do not take into account the financing component of contracts not exceeding one year,
as well as operating leases receivable arising from transactions regulated by No. 21Accounting Standard for
Business Enterprises -Leases.
For other financial instruments, the Group assesses the change in the credit risk of the relevant financial
instruments since initial recognition at each balance sheet date, except for financial assets purchased or derived that
have incurred credit impairment. If the credit risk of the Financial Instrument has increased significantly since the
initial recognition, the Group measures its loss provision by an amount equivalent to the expected credit loss over
the life of the financial instrument; If the credit risk of the financial instrument does not increase significantly since
the initial recognition, the Group measures its loss provision by an amount equivalent to the expected credit loss of
the financial instrument in the next 12 months. Increases or reversals of credit loss provisions are recognized as
impairment losses or gains in profit or loss for the period, except for financial assets classified as measured at fair
value and changes in which are recognized in other comprehensive income. For financial assets classified as
measured at fair value and the change thereof is recorded in other comprehensive income, the Group recognizes a
credit loss provision in other comprehensive income and includes impairment losses or gains in profit or loss for
the period without reducing the carrying amount of the financial asset as shown in the balance sheet.
Where the Group has measured a loss provision in the preceding accounting period by an amount equivalent to the
expected credit loss over the life of the financial instrument, but the financial instrument is no longer subject to a
significant increase in credit risk since the initial recognition at the period balance sheet date, the Group measures
the loss provision for the financial instrument at the period balance sheet date by an amount equivalent to the
expected credit loss in the next 12 months, and the resulting reversal amount for loss provision is recognized as an
impairment gain in profit or loss for the period.
11.2.1 Significant increase in credit risk
Using reasonably and evidence-based forward-looking information available, the Group compares the risk of
default on financial instruments at the balance sheet date with the risk of default on the initial recognition date to
determine whether the credit risk of financial instruments has increased significantly since initial recognition.
In assessing whether credit risk has increased significantly, the Group will consider the following factors:
(1) whether the internal price indicators have changed significantly due to changes in credit risk.
(2) whether the interest rate or other terms of an existing financial instrument have changed significantly (e.g.,
stricter contractual terms, additional collateral or higher yields) if the existing financial instrument is derived or
issued as a new financial instrument at the balance sheet date.
(3) whether there has been a significant change in the external market indicators of the credit risk of the same
financial instrument or similar financial instruments with the same estimated duration. These indicators include:
credit spreads, credit default swap prices for borrowers, the length and extent to which the fair value of financial
assets is less than their amortized cost, and other market information relevant to borrowers (such as changes in the
price of borrowers' debt or equity instruments).
(4) whether there has been a significant change in the external credit rating of the financial instrument in fact or
expectation.
(5) whether the actual or expected internal credit rating of the debtor has been downgraded.
(6) whether there has been an adverse change in business, financial or economic circumstances that is expected to
result in a significant change in the debtor's ability to meet its debt servicing obligations.
(7) whether there has been a significant change in the actual or expected operating results of the debtor.
(8) whether the credit risk of other financial instruments issued by the same debtor has increased significantly.
(9) whether there has been a significant adverse change in the regulatory, economic or technical environment in
which the debtor is located.
(10) whether there has been a significant change in the value of the collateral used as collateral for the debt or in
the quality of the guarantee or credit enhancement provided by a third party. These changes are expected to reduce
the economic incentive for the debtor to repay the loan within the term specified in the contract or affect the
probability of default.
(11) whether there has been a significant change in the economic incentive expected to reduce the borrower's
repayment within the term agreed in the contract.
(12) whether there has been a change in the expectations of the loan contract, including the waiver or amendment
of contractual obligations that may result from the anticipated breach of the contract, the granting of interest-free
periods, interest rate jumps, requests for additional collateral or guarantees, or other changes to the contractual
framework of financial instruments.
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Financial Statements and Auditor's Report
For the year ended December 31,2023
(13) whether there has been a significant change in the debtor's expected performance and repayment behavior.
(14) Whether the Group's credit management methods for financial instruments have changed.
Regardless of whether the credit risk has increased significantly after the above assessment, when the payment of a
financial instrument contract has been overdue for more than (inclusive) 30 days, it indicates that the credit risk of
the financial instrument has increased significantly.
At the balance sheet date, if the Group determines that a financial instrument has only a low credit risk, the Group
assumes that the credit risk of the financial instrument has not increased significantly since its initial recognition. A
financial instrument is considered to have a low credit risk if it has a low risk of default, the borrower's ability to
meet its contractual cash flow obligations in the short term is strong, and even if there are adverse changes in the
economic situation and operating environment over a longer period of time that do not necessarily reduce the
borrower's performance of its contractual cash obligations.
11.2.2 Financial assets that have undergone credit impairment
Where one or more events occur in which the Group expects to adversely affect the future cash flows of a financial
asset, the financial asset becomes a financial asset that has experienced credit impairment. Evidence that credit
impairment of financial assets has occurred includes the following observable information:
（1）significant financial difficulties of the issuer or debtor;
(2)Breach of contract by the debtor, such as default or delay in payment of interest or principal;
(3)The creditor gives the debtor concessions under economic or contractual considerations relating to the debtor's
financial difficulties that would not have been made under any other circumstances;
(4)The debtor is likely to go bankrupt or undergo other financial restructuring;
(5)The financial difficulties of the issuer or debtor that result in the disappearance of an active market for that
financial asset;
(6)Purchase or derive a financial asset at a substantial discount that reflects the fact that a credit loss has occurred.
Based on the Group's internal credit risk management, the Group considers an event of default to have occurred
when the internally advised or externally obtained information indicates that the debtor of the financial instrument
cannot fully pay creditors including the Group (without regard to any security obtained by the Group).
Notwithstanding the above assessment, if a contract payment for a financial instrument is overdue for more than 90
days(inclusive), the Group presumes that the financial instrument has defaulted.
11.2.3 Determination of Expected Credit Loss
The Group uses an impairment matrix on a portfolio basis on notes receivable, accounts receivable and other
receivables to determine credit losses on relevant financial instruments. The Group classifies financial instruments
into different groups based on common risk characteristics. The common credit risk characteristics adopted by the
Group include: type of financial instrument, credit risk rating, type of collateral, date of initial recognition, industry
in which the debtor is in, value of collateral relative to financial assets, etc.
For financial assets and lease receivables, the expected credit loss is the present value of the difference between the
contractual cash flows due to the Group and the cash flows expected to be collected.
The reflection factors of the Group's methodology for measuring expected credit losses on financial instruments
include: an unbiased probability-weighted average amount determined by evaluating a range of possible outcomes;
the time value of money; reasonable and well-founded information about past events, current conditions, and
projections of future economic conditions that can be obtained at the balance sheet date without unnecessary
additional costs or efforts.
11.2.4 Write-down of Financial Assets
Where the Group no longer reasonably expects that the contractual cash flows of financial assets will be recovered
in whole or in part, the carrying balance of the financial assets will be written down directly. Such write-downs
constitute derecognition of the underlying financial assets.
11.3 Transfer of Financial Assets
Financial assets that meet one of the following conditions are derecognized: (1) the contractual right to receive cash
flows from the financial asset is terminated; (2) the financial asset has been transferred and substantially all of the
risks and rewards in the ownership of the financial asset have been transferred to the transferring party; (3) the
financial asset has been transferred, and although the Group has neither transferred nor retained substantially all of
the risks and rewards in the ownership of the financial asset, it has not retained control over the financial asset.
Where the Group neither transfers nor retains substantially all of the risks and rewards in ownership of a financial
asset, and retains control of the financial asset, it will continue to recognize the transferred financial asset to the
extent that it continues to be involved in the transferred financial asset and recognize the relevant liabilities
accordingly. The Group measures the relevant liabilities as follows:
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Where the transferred financial assets are measured at amortized cost, the carrying amount of the relevant liability
is equal to the carrying amount of the financial asset that continues to be involved in the transferred less the
amortized cost of the rights retained by the Group (if the Group retains the relevant rights as a result of the transfer
of financial assets) plus the amortized cost of the obligations assumed by the group (if the group has assumed the
relevant obligations as a result of the transfer of financial assets), and the relevant liabilities are not designated as
financial liabilities measured at fair value and changes in which are recorded in profit or loss for the period.
Where the transferred financial assets are measured at fair value, the carrying amount of the relevant liabilities is
equal to the carrying amount of the financial assets that continue to be involved in the transferred financial assets
less the fair value of the rights retained by the Group (if the Group retains the relevant rights as a result of the
transfer of financial assets) plus the fair value of the obligations assumed by the Group (if the Group has assumed
such obligations as a result of the transfer of financial assets), the fair value of such rights and obligations is the fair
value when measured on an independent basis.
If the overall transfer of financial assets satisfies the conditions for derecognition, the difference between the
carrying amount of the transferred financial assets at the derecognition date and the consideration received as a
result of the transfer of the financial and the sum of the amount corresponding to the derecognition portion of the
accumulated fair value change originally included in other comprehensive income is included in profit or loss for
the period. If the Group transfers financial assets that are investments in non-traded equity instruments designated
as measured at fair value and changes in which are recognized in other comprehensive income, the accrued gains or
losses previously recognized in other comprehensive income are transferred from other comprehensive income and
recorded in retained earnings.
If a partial transfer of financial assets satisfies the conditions for derecognition, the carrying amount of the financial
assets as a whole before the transfer is apportioned between the derecognized portion and the continuing
recognition portion at the respective relative fair value on the transfer date, and the difference between the sum of
the amount of the consideration received in the derecognized portion and the amount corresponding to the
derecognized portion of the accumulated fair value change originally included in other comprehensive income and
the carrying amount of the derecognized portion at the derecognition date is included in profit or loss for the
current period. If the Group transfers financial assets that are investments in non-traded equity instruments
designated as measured at fair value and changes in which are recognized in other comprehensive income, the
accrued gains or losses previously recognized in other comprehensive income are transferred from other
comprehensive income and recorded in retained earnings.
If the conditions for derecognition are not met for the overall transfer of financial assets, the Group continues to
recognize the transferred financial assets as a whole and recognizes the consideration received as a liability.
11.4 Classification of financial liabilities and equity instruments
The Group classifies the financial instruments or their components as financial liabilities or equity instruments at
initial recognition according to the contract terms of the financial instruments issued and their economic essence,
not just in legal form, combined with the definitions of financial liabilities and equity instruments.
11.4.1 Classification, recognition and measurement of financial liabilities
Financial liabilities are divided into financial liabilities measured at fair value and whose changes are included in
current profits and losses at initial recognition and other financial liabilities.
11.4.1.1 Financial liabilities measured at fair value and whose changes are included in the current profits and losses
Financial liabilities measured at fair value and whose changes are included in current profits and losses include
transactional financial liabilities (including derivatives belonging to financial liabilities) and financial liabilities
designated as measured at fair value and whose changes are included in current profits and losses. Except for
derivative financial liabilities which are listed separately, financial liabilities measured at fair value and whose
changes are included in current profits and losses are listed as transactional financial liabilities.
Financial liabilities that meet one of the following conditions, indicate that the purpose of the Group's financial
liabilities is transactional:
The purpose of undertaking relevant financial liabilities is mainly to repurchase in the near future.
The relevant financial liabilities are part of the identifiable financial instrument portfolio under centralized
management at the initial recognition, and there is objective evidence to show the actual short-term profit model in
the near future.
Related financial liabilities are derivatives. Except for derivatives that meet the definition of financial guarantee
contract and derivatives that are designated as effective hedging instruments.
The Group can designate financial liabilities that meet one of the following conditions as financial liabilities
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
measured at fair value and whose changes are included in current profits and losses at initial recognition: (1) The
designation can eliminate or significantly reduce accounting mismatch; (2) According to the risk management or
investment strategy stated in the formal written documents of the Group, the financial liability portfolio or the
portfolio of financial assets and financial liabilities are managed and evaluated on the basis of fair value, and
reported to key management personnel within the Group on this basis; (3) Qualified mixed contracts containing
embedded derivatives.
Transactional financial liabilities are subsequently measured at fair value, and gains or losses caused by changes in
fair value and dividends or interest expenses related to these financial liabilities are included in current profits and
losses.
For financial liabilities designated as being measured at fair value and whose changes are included in the current
profits and losses, the changes in fair value of the financial liabilities caused by changes in the Group's own credit
risk are included in other comprehensive income, and other changes in fair value are included in the current profits
and losses. When the financial liabilities are derecognized, the accumulated change of its fair value caused by the
change of their own credit risk previously included in other comprehensive income is carried forward to retained
income. Dividends or interest expenses related to these financial liabilities are included in the current profits and
losses. If the accounting mismatch in profit and loss will be caused or enlarged by handling the impact of the
changes in credit risk of these financial liabilities in the above way, the Group will include all the gains or losses of
the financial liabilities (including the amount affected by the changes in credit risk) in the current profits and losses.
11.4.1.2 Other financial liabilities
Other financial liabilities, except those caused by the transfer of financial assets that do not meet the conditions for
derecognition or continue to be involved in the transferred financial assets, are classified as financial liabilities
measured in amortized cost and subsequently measured in amortized cost. The gains or losses arising from
derecognition or amortization are included in the current profits and losses.
If the modification or renegotiation of the contract between the Group and the counterparty does not result in the
termination of the recognition of the financial liabilities that are subsequently measured according to amortized
cost, but the cash flow of the contract changes, the Group recalculates the book value of the financial liabilities and
records the relevant gains or losses into the current profits and losses. The recalculated book value of such financial
liabilities is determined by the Group according to the present value of discounted contract cash flow that will be
renegotiated or modified according to the original actual interest rate of the financial liabilities. For all costs or
expenses arising from the modification or renegotiation of the contract, the Group adjusts the book value of the
modified financial liabilities and amortizes them within the remaining term of the modified financial liabilities.
11.4.2 Derecognition of financial liabilities
If all or part of the current obligations of financial liabilities have been discharged, the recognition of financial
liabilities or part thereof shall be terminated. If the Group (the Borrower) and the Lender will sign an agreement to
replace the original financial liabilities by undertaking new financial liabilities, and the contract terms of the new
financial liabilities are substantially different from those of the original financial liabilities, the Group will
derecognize the original financial liabilities and recognize the new financial liabilities at the same time.
If all or part of the financial liabilities are derecognized, the difference between the book value of the derecognized
part and the consideration paid (including the transferred non-cash assets or the new financial liabilities undertaken)
will be included in the current profits and losses.
11.4.3 Equity instruments
Equity instruments refer to contracts that can prove that the Group has residual interests in assets after deducting all
liabilities. The issuance (including refinancing), repurchase, sale or cancellation of equity instruments by the Group
are treated as changes in equity. The Group does not recognize changes in the fair value of equity instruments.
Transaction costs related to equity transactions are deducted from equity.
The distribution of equity instrument holders by the Group is treated as profit distribution, and the stock dividends
paid do not affect the total shareholders' equity.
11.5 Offset of financial assets and financial liabilities
When the Group has the legal right to offset the recognized financial assets and financialliabilities, and this legal
right is currently enforceable, and the Group plans to settle the financial assets on a net basis or realize the financial
assets and pay off the financial liabilities at the same time, the financial assets and financial liabilities are listed in the
balance sheet at the amount after offsetting each other. In addition, financial assets and financial liabilities are listed
separately in the balance sheet and do not offset each other.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
12 .Notes receivable
12.1 Methods for determining and accounting treatment for expected credit lossesof notes receivable
The Group separately assesses the credit risk of notes receivable with significantly different credit risks, including
notes receivable that have not been accepted at maturity and notes receivable that have clear indications that the
acceptor is likely to be unable to fulfill the acceptance obligations, and other notes receivable are accrued for
expected credit losses on a portfolio basis based on The increase or reversal of the provision for expected credit
losses on notes receivable is included in the profit or loss for the current period as a credit impairment loss or gain.
their credit risk characteristics.
12.2 Portfolio types and basis for determining credit loss provisions based on credit risk characteristics
Except for the notes receivable that assess the credit risk individually, the rest of the notes receivable are divided into
different portfolios based on their credit risk characteristics:
Portfolio Category Determining basis
Portfolio 1 Bank acceptance
Portfolio 2 Trade acceptance
13.Account receivable
13.1 Methods for determining expected credit losses and accounting treatment of accounts receivable
The Group uses an impairment matrix to determine the credit losses of accounts receivable on a portfolio basis. The
increase or reversal of the provision for expected credit losses of accounts receivable shall be recognized in profit or
loss for the current period as credit impairment losses or gains.
13.2 The type of portfolio and the basis for determining the provision for credit losses based on the credit risk
characteristics of the portfolio.
The Group classifies accounts receivable into portfolio1 based on common risk characteristics. The common credit
risk characteristics adopted by the Group mainly include the credit tenor and operating conditions of the debtor.
13.3 Calculation method of aging for credit risk characteristics portfolio recognized by aging
The Group uses the aging of accounts receivable as a credit risk characteristic and uses an impairment matrix to
determine its credit losses. Aging is calculated from the date of its initial recognition. If the terms and conditions of
the accounts receivable are modified but do not result in the derecognition of the accounts receivable, the aging
shall be calculated consecutively.
13.4 Determining standard of individual provision according to individual provision for bad debts
The Group assesses credit risk of accounts receivable individually due to its significant differences in credit
riskwith evidence demonstrated greater credit risk.
14. Financing of accounts receivable
14.1 Determination method and accounting treatment method for expected credit loss of accounts receivable
financing
The Group recognizes credit loss provisions for accounts receivable financing in other comprehensive income and
includes credit impairment losses or gains in the current period's profit and loss, without reducing the carrying
amount of accounts receivable financing presented in the balance sheet.
14.2 Judgment criteria for individual provision of credit loss reserves based on individual provision
The Group evaluates the financing of corresponding receivables based on the acceptance bank credit status of bank
acceptance bills and makes provisions for credit losses.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
15.Other accounts receivable
15.1 Methods for determining expected credit losses and accounting treatment of other receivables
The Group determines the credit losses on other receivables on a portfolio basis. The increase or reversal of the
provision for expected credit losses of other receivables is recognized as credit impairment losses or gainsin profit
or loss for the current period.
15.2 Calculation method of aging for credit risk characteristics portfolio recognized by aging
Aging is calculated from the date of its initial recognition. If the terms and conditions of other receivables are
modified but do not result in the derecognition of other receivables, the aging shall be calculated consecutively.
16.Inventory
16.1 Inventory Category, Goods Out Pricing Method, Inventory System, Amortization Method for Low-Value
Consumables and Packaging
16.1.1 Inventory Category
The Group's inventory mainly includes raw materials, products in process, finished products and materials
entrusted for processing. Inventory is initially measured at cost, which includes purchasing cost, processing cost and
other expenses incurred to make inventory reach the current place and use state.
16.1.2 Goods Out Pricing Method
When the inventory is issued, the actual cost of the issued inventory is determined by the weighted mean
method.
16.1.3 Inventory system
The inventory system is perpetual inventory system.
16.1.4 Amortization method of low-value consumables and packaging materials
Turnover materials and low-value consumables are amortized by straight-line method or one-time write-off
method.
16.2 Recognition criteria and accrual method of provision for inventory falling price loss
On the balance sheet date, inventories are measured according to the lower of cost and net realizable value.
When the net realizable value is lower than the cost, the inventory depreciation provision is withdrawn.
Net realizable value refers to the estimated selling price of inventory minus the estimated cost, estimated sales
expenses and related taxes and fees at the time of completion in daily activities. When determining the net realizable
value of inventory, it is based on the conclusive evidence obtained, and the purpose of holding inventory and the
influence of events after the balance sheet date are also considered.
Inventory depreciation provision is drawn according to the difference between the cost of a single inventory
item and its net realizable value.
After the inventory depreciation provision is withdrawn, if the influencing factors of previous write-down of
inventory value have disappeared, resulting in the net realizable value of inventory being higher than its book value,
it will be reversed within the original amount of inventory depreciation provision, and the reversed amount will be
included in the current profits and losses.
17. Long-term equity investment
17.1 Criteria for joint control and important influence
Control means that the investor has the power over the investee, enjoys variable returns by participating in the
related activities of the investee, and has the ability to influence the amount of returns by using the power over the
investee. Joint control refers to the common control of an arrangement according to the relevant agreement, and that
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
the related activities of the arrangement must be unanimously agreed by the participants who share the control rights
before making decisions. Significant influence refers to the power to participate in decision-making on the financial
and operating policies of the investee, but it cannot control or jointly control the formulation of these policies with
other parties. When determining whether the investee can be controlled or exert significant influence, the potential
voting rights factors such as convertible corporate bonds and current executable warrants of the investee held by
investors and other parties have been considered.
17.2 Determination of initial investment cost
For the long-term equity investment obtained by business merger under the same control, the initial investment
cost of the long-term equity investment shall be the share of the book value of the owners' equity of the merged party
in the consolidated financial statements of the final controlling party on the merger date. The capital reserve shall be
adjusted for the difference between the initial investment cost of long-term equity investment and the book value of
cash paid, non-cash assets transferred and debts undertaken; If the capital reserve is insufficient to be offset, the
retained income shall be adjusted. If equity securities are issued as the merger consideration, the initial investment
cost of long-term equity investment shall be the share of the book value of the owners' equity of the merged party in
the consolidated financial statements of the final controlling party on the merger date, the share capital shall be the
total face value of issued shares, and the capital reserve shall be adjusted according to the difference between the
initial investment cost of long-term equity investment and the total face value of the issued shares; If the capital
reserve is insufficient to be offset, the retained income shall be adjusted.
For the long-term equity investment obtained from the business merger not under the same control, the initial
investment cost of the long-term equity investment shall be the merger cost on the purchase date.
Intermediary expenses such as audit, legal services, evaluation and consultation and other related management
expenses incurred by the merging party or the purchaser for business merger are included in the current profits and
losses when incurred.
Long-term equity investment obtained by other means except the long-term equity investment formed by
business merger shall be initially measured at cost. If the additional investment can exert a significant influence or
implement joint control which however does not constitute control on the investee, the long-term equity investment
cost is the sum of the fair value of the original equity investment determined in accordance with the Accounting
Standards for Business Enterprises No.22-Recognition and Measurement of Financial Instruments plus the new
investment cost.
17.3 Subsequent measurement and profit and loss recognition method
17.3.1 Long-term equity investment calculated by cost method
The company's financial statements use the cost method to calculate the long-term equity investment in
subsidiaries. Subsidiaries refer to the invested entities over which the Group can exercise control.
Long-term equity investment accounted by cost method is measured at the initial investment cost. Add or
recover investment to adjust the cost of long-term equity investment. The current investment income is recognized
according to the cash dividend or profit declared by the investee.
17.3.2 Long-term equity investment calculated by equity method
The Group's investment in associated enterprises and joint ventures is accounted for by the equity method. An
associated enterprise refers to the investee over which the Group can exert significant influence, and a joint venture
refers to a joint venture arrangement in which the Group has rights only over the net assets of the arrangement.
When accounting by equity method, if the initial investment cost of long-term equity investment is greater than
the fair value share of the identifiable net assets of the investee, the initial investment cost of long-term equity
investment will not be adjusted; If the initial investment cost is less than the fair value share of the identifiable net
assets of the investee, the difference shall be included in the current profits and losses, and the cost of long-term
equity investment shall be adjusted.
When accounting by the equity method, the investment income and other comprehensive income are recognized
respectively according to the share of the net profit and loss and other comprehensive income realized by the
investee, and the book value of long-term equity investment is adjusted; The share is calculated according to the
profit or cash dividend declared by the investee, and the book value of long-term equity investment is reduced
accordingly; For other changes in the owners' equity of the investee except the net profit and loss, other
comprehensive income and profit distribution, the book value of the long-term equity investment shall be adjusted
and included in the capital reserve. When recognizing the share of the net profit and loss of the investee, the net
profit of the investee shall be adjusted and recognized based on the fair value of the identifiable assets of the investee
at the time of investment. If the accounting policies and accounting periods adopted by the investee are inconsistent
with those of the Company, the financial statements of the investee shall be adjusted according to the accounting
policies and accounting periods of the Company, so as to recognize the investment income and other comprehensive
income. For the transactions between the Group and the associated enterprises and joint ventures, if the assets
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
invested or sold do not constitute business, the unrealized internal transaction gains and losses shall be offset by the
portion belonging to the Group according to the proportion enjoyed, and the investment gains and losses shall be
recognized on this basis. However, the unrealized internal transaction losses between the Group and the investee
belong to the impairment losses of the transferred assets and shall not be offset.
When recognizing the share of the net loss of the investee, the book value of the long-term equity investment
and other long-term rights and interests that substantially constitute the net investment of the investee shall be
written down to zero. In addition, if the Group is obligated to bear additional losses to the investee, the estimated
liabilities will be recognized according to the expected obligations and included in the current investment losses. If
the investee realizes the net profit in the future, the Group will resume the recognition of the income share after the
income share makes up for the unrecognized loss share.
17.4 Disposal of long-term equity investment
When disposing of long-term equity investment, the difference between its book value and the actual purchase
price is included in the current profits and losses. For the long-term equity investment accounted by the equity
method, if the remaining equity after disposal is still accounted by the equity method, other comprehensive income
originally accounted by the equity method shall be accounted for on the same basis as the direct disposal of related
assets or liabilities by the investee; Owners' equity recognized by changes in other owners' equity of the investee
except net profit and loss, other comprehensive income and profit distribution shall be carried forward to current
profits and losses in proportion. If the long-term equity investment accounted for by the cost method is still
accounted for by the cost method after disposal, the other comprehensive income recognized by the equity method
accounting or the recognition of financial instruments and accounting standards before gaining control of the
investee shall be accounted for on the same basis as the direct disposal of related assets or liabilities by the investee;
Changes in owners' equity other than net profit and loss, other comprehensive income and profit distribution in the
net assets of the investee recognized by using the equity method are carried forward to the current profits and losses
in proportion.
If the Group loses control of the investee due to the disposal of part of its equity investment, if the remaining
equity after disposal can exercise joint control or exert significant influence on the investee in the preparation of
individual financial statements, it shall be accounted for by the equity method instead, and the remaining equity shall
be treated as if it were adjusted by the equity method at the time of acquisition; If the remaining equity after disposal
cannot be jointly controlled or exert significant influence on the investee, it shall be accounted for according to the
relevant provisions of the standards for the recognition and measurement of financial instruments, and the difference
between its fair value and book value on the date of control loss shall be included in the current profits and losses.
For other comprehensive income recognized by the Group before it gains control of the investee, when it loses
control of the investee, it shall be treated on the same basis as the direct disposal of related assets or liabilities by the
investee. Changes in owners' equity in the net assets of the investee, except net profit and loss, other comprehensive
income and profit distribution, shall be carried forward to current profits and losses when it loses control of the
investee. If the remaining equity after disposal is accounted by the equity method, other comprehensive income and
other owners' equity will be carried forward in proportion; If the remaining equity after disposal is changed to
accounting treatment according to the recognition and measurement standards of financial instruments, all other
comprehensive income and other owners' equity will be carried forward.
If the Group loses joint control or significant influence on the investee due to the disposal of some equity
investments, the remaining equity after disposal shall be accounted for according to the recognition and
measurement standards of financial instruments, and the difference between its fair value and book value on the date
of joint control loss or significant influence shall be included in the current profits and losses. Other comprehensive
income recognized by the original equity investment due to accounting by the equity method shall be accounted for
on the same basis as the direct disposal of relevant assets or liabilities by the investee when the equity method is
terminated. All the owners' equity recognized by the investee due to changes in other owners' equity except net profit
and loss, other comprehensive income and profit distribution shall be carried forward to the current investment
income when the equity method is terminated.
The Group disposes of the equity investment in its subsidiaries step by step through multiple transactions until it
loses control. If the above transactions belong to a package transaction, each transaction will be treated as a
transaction that disposes of the equity investment in its subsidiaries and loses control. Before losing control, the
difference between the price of each disposal and the book value of the long-term equity investment corresponding
to the disposed equity will be recognized as other comprehensive income, and then carried forward to the current
profits and losses when it loses control.
Provision forinventory falling price loss is generally made on the basis of a single inventory item.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
18. Investment real estate
Investment real estate refers to real estate held to earn rent or capital appreciation, or both, including rented
houses and buildings.
Investment real estate is initially measured at cost. Subsequent expenditures related to investment real estate
are included in the cost of investment real estate if the economic benefits related to the asset are likely to flow in and
the cost can be measured reliably. Other subsequent expenditures are included in the current profits and losses when
incurred.
The Group adopts a cost model for subsequent measurement of investment properties, and adopts the average life
method to provide depreciation over the useful life. The depreciation methods, depreciation periods, estimated
residual value rates and annual depreciation rates for various types of investment real estate are as follows:
Depreciation period Annual Depreciation
Category Residual value rate (%)
(years) Rate (%)
Houses, buildings 10-40 0.00-4.00 2.40-10.00
When the investment real estate is disposed of, or permanently withdrawn from use, and it is not expected to
obtain economic benefits from its disposal, the recognition of the investment real estate will be terminated.
The difference between the disposal income from the sale, transfer, scrapping or damage of investment real
estate after deducting its book value and related taxes is included in the current profits and losses.
19. Fixed assets
19.1 Recognition conditions
Fixed assets refer to tangible assets held for producing goods, providing services, leasing or management, with
a service life of more than one fiscal year. Fixed assets are recognized only when the economic benefits related to
them are likely to flow into the Group and their costs can be measured reliably. Fixed assets are initially measured at
cost.
Subsequent expenditures related to fixed assets shall be included in the cost of fixed assets if the economic
benefits related to the fixed assets are likely to flow in and the cost can be measured reliably, and the book value of
the replaced part shall be derecognized. Other subsequent expenditures are included in the current profits and losses
when incurred.
19.2 Depreciation method
Fixed assets shall be depreciated within their service life by using the life-average method from the month
following the scheduled serviceable state. The depreciation methods, service life, estimated net salvage and annual
depreciation rate of various fixed assets are as follows:
Estimated net salvage Annual depreciation
Category Depreciation life (year)
rate (%) rate (%)
Houses and buildings 10-40 0.00-4.00 2.40-10.00
Machinery equipment 10-14 4.00 6.86-9.60
Transportation equipment 8 4.00 12.00
Electronic equipment and others 5 4.00 19.20
Estimated net salvage refers to the amount that the Group currently obtains from the disposal of fixed assets after
deducting the estimated disposal expenses, assuming that the expected service life of the fixed assets has expired and
is in the expected state at the end of the service life.
19.3 Other instructions
When the fixed assets are disposed of or it is expected that no economic benefits can be generated through the
use or disposal, the fixed assets is derecognized. The difference between the disposal income from the sale, transfer,
scrapping or damage of fix assets after deducting its book value and related taxes is included in the current profits and
losses.
At least at the end of the year, the Group will review the service life, estimated net salvage and depreciation
method of fixed assets, and if there is any change, it will be treated as a change in accounting estimate.
20. Construction in progress
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
The construction in progress is measured according to the actual cost, which includes various project expenditures
incurred during the construction period, capitalized borrowing costs before the project reaches the scheduled
serviceable state and other related expenses. No depreciation is allowed for construction in progress.
Construction in progress is carried forward as a fixed asset when it reaches the intended usable state. The standards
and timing points for the carry-forward of various types of projects under construction into fixed assets are as follows:
The time point at
which it is carried
Category The criteria for carrying forward to fixed assets
forward to a fixed
asset
The equipment has been accepted by asset management personnel and
user personnel and meets one or more of the following conditions
according to the actual situation:
(1) Relevant equipment and other supporting facilities have been
Installation of machinery and It has reached the
installed;
equipment intended usable state
(2) The equipment can maintain normal and stable operation for a
period of time after debugging;
(3) The production equipment can stably produce qualified products for
a period of time.
21. Borrowing costs
Borrowing costs that can be directly attributed to the purchase, construction or production of assets that meet
the capitalization conditions will be capitalized when the asset expenditure has occurred, the borrowing costs have
occurred, and the necessary purchase, construction or production activities to make the assets reach the
predetermined serviceable or saleable state have begun; Capitalization shall stop when the assets that meet the
capitalization conditions purchased, constructed or produced reach the predetermined serviceable state or saleable
state. The remaining borrowing costs are recognized as expenses in the current period.
22. Intangible assets
22.1 Useful life and the basis for its determination, estimates, amortization method or review procedure
Intangible assets include land use rights, software and patent rights.
Intangible assets are initially measured at cost. Intangible assets with limited service life shall be amortized by
straight-line method in equal installments within their expected service life from the time they are available for use.
Intangible assets with uncertain service life shall not be amortized. The amortization method, service life and
estimated net salvage of various intangible assets are as follows:
Amortization Estimated net
Category Service life (year)
method salvage rate (%)
Straight-line
Land use right 50(Legal Right to Use) -
method
Straight-line 5(The useful life is determined by the period of time that is
Software -
method expected to bring economic benefits to the company)
Straight-line 15(The useful life is determined by the period of time that
Patent -
method is expected to bring economic benefits to the company)
At the end of the period, the service life and amortization method of intangible assets with limited service life
shall be reviewed and adjusted if necessary.
For the impairment test of intangible assets, please refer to Note (III) 22 "Impairment of Long-term Assets" for
details.
22.2 Post-employment benefits are all defined contribution plan.
Expenditure in the research stage is included in the current profits and losses when incurred.
Expenditures in the development stage are recognized as intangible assets if they meet the following conditions
at the same time. Expenditures in the development stage that cannot meet the following conditions are included in the
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
current profits and losses:
(1) It is technically feasible to complete the intangible assets so that they can be used or sold;
(2) Having the intention to complete the intangible assets and use or sell them;
(3) The ways in which intangible assets generate economic benefits, including the ability to prove that the
products produced by using the intangible assets exist in the market or the intangible assets themselves exist in the
market, and the intangible assets will be used internally, which can prove their usefulness;
(4) Having sufficient technical, financial and other resources to support the development of the intangible assets,
and having the ability to use or sell the intangible assets;
(5) Expenditure attributable to the development stage of the intangible assets can be reliably measured.
If it is impossible to distinguish between research stage expenditure and development stage expenditure, all the
R&D expenditures incurred shall be included in the current profits and losses. The cost of intangible assets formed by
internal development activities only includes the total expenditure from the time when the capitalization conditions
are met to the time when the intangible assets reach the intended use, and the expenditure that has been expensed into
profit and loss before the capitalization conditions are met in the development process will not be adjusted.
23. Long-term asset impairment
On each balance sheet date, the Group checks whether there are signs that long-term equity investment,
investment real estate measured by cost method, fixed assets, construction in progress, right-to-use assets and
intangible assets with definite service life may be impaired. If these assets show signs of impairment, the recoverable
amount is estimated. Intangible assets with uncertain service life and intangible assets that have not yet reached the
serviceable state are tested for impairment every year, regardless of whether with signs of impairment.
Estimating the recoverable amount of an asset is based on a single asset. If it is difficult to estimate the
recoverable amount of a single asset, the recoverable amount of the asset group is determined based on the asset group
to which the asset belongs. The recoverable amount is the higher of the net amount of the fair value of the asset or
asset group minus the disposal expenses or the present value of its expected future cash flow.
If the recoverable amount of an asset is lower than its book value, the asset impairment provision shall be
accrued according to the difference and included in the current profits and losses.
Goodwill shall be tested for impairment at least at the end of each year. When testing the impairment of
goodwill, it shall be conducted in combination with the related asset group or asset group portfolio. That is, from the
purchase date, the book value of goodwill is allocated to the asset group or asset group portfolio that can benefit from
the synergistic effect of business merger in a reasonable way. If the recoverable amount of the asset group or asset
group portfolio containing the allocated goodwill is lower than its book value, the corresponding impairment loss will
be recognized. The amount of impairment loss will firstly deduct the book value of goodwill allocated to the asset
group or asset group portfolio, and then deduct the book value of other assets according to the proportion of the book
value of assets other than goodwill in the asset group or asset group portfolio.
Once the above-mentioned asset impairment losses are recognized, they will not be reversed in future accounting
periods.
24. Long-term deferred expenses
Long-term deferred expenses refer to the expenses that have occurred but should be borne by the current period
and subsequent periods with an amortization period of more than one year. Long-term deferred expenses shall be
amortized evenly by stages during the expected benefit period.
25. Contractual liabilities
Contractual liabilities refer to the obligation of the Group to transfer goods or services to customers for
consideration received or receivable from customers. Contract assets and liabilities under the same contract are listed
on a net basis.
26. Employee Remuneration
26.1 Accounting treatment method of short-term Remuneration
During the accounting period when employees provide services for the Group, the Group recognizes the actual
short-term remuneration as a liability, and records it into the current profits and losses or related asset costs. The
employee welfare expenses incurred by the Group are included in the current profits and losses or related asset costs
according to the actual amount when actually incurred. If employee welfare expenses are non-monetary benefits, they
shall be measured at fair value.
The social insurance premiums such as medical insurance premium, work injury insurance premium and
maternity insurance premium and housing provident fund paid by the Group for employees, as well as the trade union
funds and employee education funds withdrawn by the Group according to regulations, shall be calculated according
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
to the stipulated accrual basis and accrual ratio during the accounting period when employees provide services for the
Group to determine the employee compensation amount, and recognize the corresponding liabilities, and be included
in the current profits and losses or related asset costs.
26.2 Accounting treatment of post-employment benefits
Post-employment benefits are all defined contribution plans.
During the accounting period when employees provide services for the Group, the amount payable calculated
according to the set deposit plan is recognized as a liability, and included in the current profits and losses or related
asset costs.
26.3 Accounting treatment of dismissal benefits
If the Group provides dismissal benefits to employees, the employee compensation liabilities arising from the
dismissal benefits shall be recognized at the earlier of the following two dates, and included in the current profits and
losses: when the Group cannot unilaterally withdraw the dismissal benefits provided by the plan to terminate labor
relations or the proposal to cut back; When the Group recognizes the costs or expenses related to the reorganization
involving the payment of dismissal benefits.
27. Estimated liabilities
When the obligation related to contingencies such as customer return are the current obligations undertaken by the
Group, and the fulfillment of this obligation is likely to lead to the outflow of economic benefits, and the amount of this
obligation can be measured reliably, it is recognized as estimated liabilities.
On the balance sheet date, considering the risk, uncertainty and time value of money related to contingencies, the
estimated liabilities are measured according to the best estimate of the expenditure required to fulfill the relevant
current obligations. If the time value of money is significant, the best estimate is determined by the discounted amount
of expected future cash outflow.
28.Revenue
28.1 Accounting policy used for measurement and revenue recognition disclosure according to type of business
The Group has fulfilled its contractual obligation, that is, when the customer obtains the control right of the
relevant goods or services, the income will be recognized according to the transaction price allocated to the
performance obligation. Performance obligation refers to the commitment of the Group to transfer clearly
distinguishable goods or services to customers in the contract. Transaction price refers to the amount of consideration
that the Group is expected to receive due to the transfer of goods or services to customers, which however, does not
include the money received on behalf of third parties and the money that the Group expects to return to customers.
The Group evaluates the contract on the start date of the contract, identifies the individual performance obligations
contained in the contract, and determines whether each individual performance obligation is performed within a certain
period of time or at a certain point of time. If one of the following conditions is met, it belongs to the performance
obligation within a certain period of time, and the Group recognizes the income within a certain period of time
according to the performance progress: (1) The customer obtains and consumes the economic benefits brought by the
performance of the Group; (2) The customer can control the goods under construction during the performance of the
Group; (3) The goods produced by the Group during the performance of the contract have irreplaceable purposes, and
the Group has the right to collect money for the accumulated performance part completed so far during the whole
contract period. Otherwise, the Group recognizes income at the point when the customer obtains control over the
relevant goods or services.
Transaction price refers to the amount of consideration that the Group expects to be entitled to receive as a result of the
transfer of goods or services to the customer, but does not include payments received on behalf of a third party and
amounts expected to be refunded to the customers by the Group. In determining the transaction price, the Group takes
into account the impact of factors such as variable consideration, significant financing elements in the contract, non-
cash consideration, consideration payable to customers, etc.
If the contract contains two or more performance obligations, the Group will allocate the transaction price to each
individual performance obligation on the contract start date according to the relative proportion of the separate selling
price of the goods or services promised by each individual performance obligation. However, if there is conclusive
evidence that the contract discount or variable consideration is only related to one or more (but not all) performance
obligations in the contract, the Group will allocate the contract discount or variable consideration to one or more related
performance obligations. Separate selling price refers to the price at which the Group sells goods or services to
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
customers separately. If the separate selling price cannot be directly observed, the Group comprehensively considers all
relevant information that can be reasonably obtained, and estimates the separate selling price by using observable input
values to the maximum extent.
For sales with return clauses, when the customer obtains the control right of the relevant goods, the Group
recognizes the income according to the amount of consideration expected to be charged due to the transfer of goods to
the customer (that is, excluding the amount expected to be refunded due to sales return), and recognizes the liabilities
according to the amount expected to be refunded due to sales return; At the same time, according to the book value of
the expected returned goods at the time of transfer, the balance after deducting the expected cost of recovering the
goods (including the loss of the value of the returned goods) is recognized as an asset, and the net carry-over cost of the
above assets is deducted according to the book value of the transferred goods at the time of transfer.
For sales with quality assurance clauses, if the quality assurance provides a separate service in addition to assuring
customers that the goods or services sold meet the established standards, the quality assurance constitutes a single
performance obligation. Otherwise, the Group shall handle the quality assurance responsibility in accordance with the
Accounting Standards for Business Enterprises No.13-Contingencies.
According to whether the Group has control over the goods or services before transferring them to customers, the
Group judges whether it is the main responsible person or the agent when engaging in transactions. If the Group can
control the goods or services before transferring them to customers, the Group is the main responsible person, and the
income is recognized according to the total consideration received or receivable; Otherwise, the Group, as an agent,
recognizes income according to the expected amount of commission or handling fee, which is determined according to
the net amount of the total consideration received or receivable after deducting the price payable to other interested
parties.
If the Group receives the payment for the sale of goods or services from customers in advance, it will first
recognize the payment as a liability, and then change it to income when the relevant performance obligations are
fulfilled. When the advance payment of the Group does not need to be returned, and the customer may give up all or
part of its contractual rights, if the Group is expected to be entitled to the amount related to the contractual rights given
up by the customer, the above amount will be recognized as income in proportion according to the mode of the
customer's exercise of contractual rights; Otherwise, the Group will only convert the relevant balance of the above
liabilities into income when it is extremely unlikely that the customer will demand to perform the remaining
performance obligations.
Please refer to Note (III) 30.2.2 "The Group as a lessor records the operating leasing business" for the accounting
policy of the Group's income recognition in property leasing.
29. Government subsidies
Government subsidies refer to the monetary assets and non-monetary assets obtained by the Group from the
government free of charge. Government subsidies are recognized when they can meet the conditions attached to
government subsidies and can be received.
If government subsidies are monetary assets, they shall be measured according to the amount received or
receivable.
29.1 Judgment basis and accounting treatment method of government subsidies related to assets
As long-term assets can be formed in the production line subsidies and equipment subsidies of the Group's
government subsidies, these government subsidies are government subsidies related to assets.
Government subsidies related to assets are recognized as deferred income, and are included in the current profits
and losses in installments according to the straight-line method within the service life of the related assets.
29.2 Judgment basis and accounting treatment method of government subsidies related to income
As the Group's government subsidies, such as industry development support funds, enterprise development
support funds and tax subsidies, cannot form long-term assets, these government subsidies are government subsidies
related to income.
Government subsidies related to income, if used to compensate related costs and losses in future periods, will be
recognized as deferred income, and are included in the current profits and losses during the period when related costs
or expenses are recognized; if used to compensate the related costs and losses that have occurred, will be directly
included in the current profits and losses.
Government subsidies related to the daily activities of the Group are included in other income according to the
nature of economic business. Government subsidies unrelated to the daily activities of the Group are included in non-
operating income.
When the confirmed government subsidy needs to be returned, if there is a relevant deferred revenue balance, the
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
relevant deferred income book balance will be offset, and the excess will be included in the current profits and losses;
If there is no relevant deferred income, it will be directly included in the current profits and losses.
30.Lease
Lease refers to a contract in which the lessor transfers the right to use assets to the lessee for consideration within
a certain period of time.
On the commencement date of the contract, the Group evaluates whether the contract is a lease or contains a
lease. Unless the terms and conditions of the contract change, the Group will not re-evaluate whether the contract is a
lease or contains a lease.
30.1 The Group as the lessee
30.1.1 Split of lease
If the contract contains one or more leased and non-leased parts at the same time, the Group will split each
separate leased and non-leased part and allocate the contract consideration according to the relative proportion of the
sum of the separate prices of each leased part and the non-leased part.
30.1.2 Right-to-use assets
Except for short-term leases, the Group recognizes the right-to-use assets on the start date of lease term. The
start date of lease term refers to the start date when the lessor provides the leased assets for the use of the Group. The
right-to-use assets is initially measured according to the cost. The cost includes:
Initial measurement amount of lease liabilities;
For the lease payment paid on or before the start date of the lease term, if there are lease incentives, deduct the
amount related to the lease incentives enjoyed;
Initial direct expenses incurred by the Group;
The estimated costs incurred by the Group for dismantling and removing the leased assets, restoring the premises
where the leased assets are located or restoring the leased assets to the state agreed in the lease clauses.
The Group refers to the depreciation provisions in Accounting Standards for Business Enterprises No.4-Fixed
Assets, and accrues depreciation for right-to-use assets. If the Group can reasonably determine that it has acquired the
ownership of the leased assets at the expiration of the lease term, the right-to-use assets will be depreciated within the
remaining service life of the leased assets. If it cannot be reasonably determined that the ownership of the leased assets
can be obtained at the expiration of the lease term, depreciation shall be accrued during the lease term or the remaining
service life of the leased assets, whichever is shorter.
According to the Accounting Standards for Business Enterprises No.8-Impairment of Assets, the Group determines
whether the right-to-use assets have been impaired, and carries out accounting treatment for the identified impairment
losses.
30.1.3Lease liabilities
Except for short-term leases, the Group initially measures the lease liabilities on the start date of lease term
according to the present value of the unpaid lease payment on that date. When calculating the present value of the lease
payment, the Group uses the lease interest rate as the discount rate. If the lease interest rate cannot be determined, the
incremental loan interest rate is used as the discount rate.
Lease payment refers to the amount paid by the Group to the lessor related to the right to use the leased assets
during the lease term, including:
Fixed payment amount and substantial fixed payment amount. If there is lease incentive, the relevant amount of
lease incentive shall be deducted;
Variable lease payment amount depending on index or ratio;
The exercise price of the option reasonably determined by the Group to be exercised;
The amount to be paid to terminate the lease when the lease term reflects that the Group will exercise the option;
The amount expected to be paid according to the residual value of the guarantee provided by the Group.
After the start of the lease term, the Group calculates the interest expense of the lease liabilities in each period of
the lease term at a fixed periodic interest rate, and includes it in the current profits and losses or related asset costs.
After the commencement of the lease term, if the following circumstances occur, the Group will re-measure the
lease liabilities and adjust the corresponding right-to-use assets. If the book value of the right-to-use assets has been
reduced to zero, but the lease liabilities still need to be further reduced, the Group will include the difference in the
current profits and losses:
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
If the lease term changes or the evaluation result of the purchase option changes, the Group will re-measure the
lease liabilities according to the present value calculated by the changed lease payment amount and the revised discount
rate;
If the estimated payable amount according to the guarantee residual value or the index or proportion used to
determine the lease payment changes, the Group will re-measure the lease liabilities according to the present value
calculated by the changed lease payment amount and the original discount rate.
30.1.4 As the judgment basis and accounting treatment method for the lessee to simplify the treatment of the
short-term lease
For the short-term lease of some factories and some rented warehouses, the Group chooses not to recognize the
right-to-use assets and lease liabilities. Short-term lease refers to the lease that does not exceed 12 months and does not
include the option to purchase on the start date of the lease term. The Group will charge the lease payment for short-
term lease to the current profits and losses or related asset costs in accordance with the straight-line method in each
period of the lease term.
30.1.5 Lease change
If the lease changes and the following conditions are met at the same time, the Group will carry out accounting
treatment on the lease change as a separate lease:
The lease change expands the lease scope by increasing the right to use one or more leased assets;
The increased consideration is equivalent to the individual price of the expanded part of the lease scope adjusted
according to the contract situation.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
If the lease change is not accounted for as a separate lease, on the effective date of the lease change, the Group
will re-allocate the consideration of the changed contract, re-determine the lease term, and re-measure the lease
liabilities according to the present value calculated by the changed lease payment and the revised discount rate.
If the lease scope is reduced or the lease term is shortened due to lease change, the Group shall correspondingly
reduce the book value of the right-to-use assets, and include the related gains or losses of partial or full termination of
lease in the current profits and losses. If other lease changes lead to the re-measurement of lease liabilities, the Group
will adjust the book value of the right-to-use assets accordingly.
30.2 The Group as the lessor
30.2.1 Split of lease
If the contract contains both leased and non-leased parts, the Group will allocate the contract consideration
according to the provisions of the Accounting Standards for Business Enterprises Revenues on transaction price
allocation, and the basis of allocation is the separate prices of the leased part and the non-leased part.
30.2.2 Classification and accounting treatment for rental housing leases
A lease that essentially transfers almost all the risks and rewards related to the ownership of the leased assets is a
financial lease. Other leases except financing lease are operating leases.
30.2.2.1 The Group as a lessor records the operating lease business
During each period of the lease term, the Group adopts the straight-line method to recognize the lease receipts
from operating lease as rental income. The initial direct expenses incurred by the Group in connection with operating
leases are capitalized when incurred, apportioned on the same basis as rental income recognition during the lease term,
and included in current profits and losses in installments.
The variable lease receipts related to operating leases obtained by the Group, which are not included in the lease
receipts, are included in the current profits and losses when actually incurred.
30.2.3 Lease change
If the operating lease is changed, the Group will carry out accounting treatment on it as a new lease from the
effective date of the change, and the lease receipts received in advance or receivable related to the lease before the
change will be regarded as the receipts of the new lease.
31. Deferred income tax assets/Deferred income tax liabilities
Income tax expenses include current income tax and deferred income tax.
31.1 Current income tax
On the balance sheet date, the current income tax liabilities (or assets) formed in the current and previous periods
shall be measured by the expected income tax payable (or refunded) calculated in accordance with the provisions of the
tax law.
31.2 Deferred income tax assets and deferred income tax liabilities
For the difference between the book values of some assets and liabilities and their tax basis, and the temporary
difference between the book values of items that are not recognized as assets and liabilities but can be determined in
tax basis according to the provisions of the tax law and tax basis, the balance sheet liability method is adopted to
recognize deferred income tax assets and deferred income tax liabilities.
In general, all temporary differences are recognized as related deferred income tax. However, for deductible
temporary differences, the Group recognizes related deferred income tax assets to the extent that it is likely to obtain
taxable income to offset the deductible temporary differences. In addition, for the temporary differences related to the
initial recognition of goodwill and the initial recognition of assets or liabilities arising from transactions that are neither
business merger nor affect accounting profits and taxable income (or deductible losses), the relevant deferred income
tax assets or liabilities are not recognized.
For deductible losses and tax deductions that can be carried forward to future years, the corresponding deferred
income tax assets are recognized to the extent that it is likely to obtain future taxable income for deducting deductible
losses and tax deductions.
The Group recognizes deferred income tax liabilities arising from taxable temporary differences related to
investments in subsidiaries, associated enterprises and joint ventures, unless the Group can control the time when the
temporary differences are reversed, and the temporary differences are unlikely to be reversed in the foreseeable future.
For deductible temporary differences related to the investments of subsidiaries, associated enterprises and joint
ventures, the Group recognizes the deferred income tax assets only when the temporary differences are likely to be
reversed in the foreseeable future and the taxable income used to offset the deductible temporary differences is likely to
be obtained in the future.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
On the balance sheet date, deferred income tax assets and deferred income tax liabilities shall be measured
according to the applicable tax rate during the expected recovery of related assets or settlement of related liabilities.
Except that the current income tax and deferred income tax related to transactions and events directly included in
other comprehensive income or shareholders' equity are included in other comprehensive income or shareholders'
equity, and the deferred income tax arising from business merger adjusts the book value of goodwill, the remaining
current income tax and deferred income tax expenses or gains are included in the current profits and losses.
On the balance sheet date, the book value of deferred income tax assets shall be rechecked. If it is probable that
sufficient taxable income will not be obtained in the future to offset the benefits of deferred income tax assets, the book
value of deferred income tax assets shall be written down. When sufficient taxable income is likely to be obtained, the
amount written down will be reversed.
31.3 Offset of income tax
When the Group has the legal right to settle on a net basis and intends to settle on a net basis or acquire assets and
pay off liabilities at the same time, the Group's current income tax assets and current income tax liabilities are
presented on an offset net basis.
When the taxpayer has the legal right to settle the current income tax assets and liabilities on a net basis, and the
deferred income tax assets and liabilities are related to the income tax levied by the same tax collection department on
the same taxpayer or to different taxpayers, but in the future, the taxpayers involved intend to settle the current income
tax assets and liabilities on a net basis, or acquire assets and pay off liabilities at the same time, the Group's deferred
income tax assets and liabilities are presented on an offset net basis.
32. Changes in important accounting policies and accounting estimates, and correction of previous errors
32.1 Changes in significant accounting policy
On November30, 2022, the Ministry of Finance (MOF) issued Interpretation No. 16 of Accounting Standards for
Business Enterprises ("Interpretation No. 16"), clarifying that the accounting treatment of deferred income tax related
to assets and liabilities arising from a single transaction is not subject to the initial recognition exemption.
Interpretation No. 16 revises the scope of the initial recognition exemption of deferred income tax in Accounting
Standard for Business Enterprises No. 18-Income Tax, clarifying that Accounting Standard for Business Enterprises
No. 18-Income Tax-provisions regarding exemption from the initial recognition of deferred tax liabilities and deferred
tax assetsdoes not apply to individual transaction that is not a business combination and the transaction does not affect
neither the accounting profit nor the taxable income (or deductible loss) at the time of the transaction occurs, and the
assets and liabilities initially recognized result in the same amount of taxable temporary differences to the deductible
temporary differences . The regulations will come into force on January 1, 2023 and can be implemented in advance.
After assessment, the Group considers that the adoption of this regulation will not have a significant impact on the
Group's financial statement.
32.2 Significant Changes in Accounting Estimates
There are no significant changes in the Group's accounting estimates during the year.
IV. Taxes
1. Main tax categories and tax rates
Tax category Tax basis Tax rate
The output tax for domestic sales is
The balance after deducting the deductible input tax calculated according to 13%, 9%, 6% and
from the output tax; The tax calculation method of 5% of the sales amount calculated
VAT
"exemption, offset and refund" is applied to sales of according to relevant tax regulations, and
export products the tax rebate rate for export products is
13%
Urban maintenance and
Payable turnover tax 7%
construction tax
Surcharge for education Payable turnover tax 3%
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Local education
Payable turnover tax 2%
surcharge
Business income tax Payable turnover tax 25%、20%、15%、8.25%
Residual value or rental income after deducting 30%
Property tax 1.2%
from the original value of property at one time
The disclosure statement if there are taxpayers with different enterprise income tax rates
Name of taxpayer Income tax rate
The Company 25%
Shenzhen Shenfang Property Management Co., Ltd. 25%
Shenzhen Shengjinlian Technology Co., Ltd. 25%
Shenzhen Beauty Century Garment Co., Ltd. 20% (Note 1)
Shenzhen Lisi Industrial Co., Ltd. 20% (Note 1)
Shenzhen Shenfang Sungang Property Management Co., Ltd. 20% (Note 1)
Shenzhen Huaqiang Hotel 20% (Note 1)
Shengtou（HK）Co., Ltd. 8.25% ( Note 2)
Shenzhen SAPO Photoelectric Co., Ltd. 15% (Note 3)
Note 1: See Notes (IV), 2 (2) for details.
Note 2: According to the Tax Ordinance of Hong Kong, Hong Kong companies applied the two-tier system of
profits tax , and the first profit of HK$ 2 million will be calculated and paid at 8.25%, and the profits generated
thereafter will be calculated at 16.5%.
Note 3: See Notes (IV), 2(1) for details.
2. Tax preference
(1) In 2022, SAPO Photoelectric, a subsidiary of the Company, was jointly recognized as a high-tech enterprise by
Shenzhen Science and Technology Innovation Committee, Shenzhen Finance Bureau and Shenzhen Tax Service,
State Taxation Administration, respectively, with a certification period of 3 years, and the certificate numbers of
GR202244204504 respectively. It shall apply the preferential tax policies for high-tech enterprises within three years
after it is recognized as a high-tech enterprise, and pay enterprise income tax at the rate of 15% after being filed by
the competent tax bureau.
(2) The Company's subsidiaries Shenzhen Beauty Century Garment Co., Ltd., Shenzhen Huaqiang Hotel Co., Ltd.,
Shenzhen Lisi Industrial Development Co., Ltd. and Shenzhen Shenfang Sungang Property Management Co., Ltd. are
qualified small and low-profit enterprises, and according to the Announcement of the State Administration of Taxation
of the Ministry of Finance on Further Implementing the Preferential Income Tax Policies for Small and Micro
Enterprises (No. 13 of 2022) and the announcement of the State Administration of Taxation of the Ministry of Finance
on the preferential income tax policies for small and micro enterprises and individual industrial and commercial
households (No. 6 of 2023),the part of the annual taxable income of small and low-profit enterprises not exceeding
RMB 3 million will be reduced to include in the taxable income by 25%, and the enterprise income tax will be paid at
the rate of 20%.
(3) In accordance with the relevant provisions of the Notice of the State Administration of Taxation of the General
Administration of Customs of Ministry of Finance on Import Tax Policies for Supporting the Development of the New
Display Device Industry (No. 19[2021]Cai Guan Shui ), SAPO Photoelectric , a subsidiary of the Company, meets the
relevant conditions and enjoys the policy of exemption from import duties for related products from January 1, 2021 to
December 31, 2030.
(4)According to the relevant provisions of the Announcement of the State Administration of Taxation of the Ministry
of Finance on Clarifying the Policies for VAT Reduction and Exemption for Small-scale VAT Taxpayers
(Announcement No. 1 [2023] of the State Administration of Taxation of the Ministry of Finance), SAPO Photoelectric ,
a subsidiary of the Company, meets the relevant conditions and is eligible to enjoy the policy for taxpayers of the
production service industry to offset the tax payable for the period from January 1, 2023 to December 31, 2023in
accordance with the policy of 5% addition to the current period's deductible input tax amount to offset tax payable.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
V. Notes of consolidated financial statement
1.Monetary Capital
In RMB
Items Year-end balance Year-beginning balance
Cash at hand 1,710.40 3,980.56
RMB 1,651.50 3,980.56
HKD 58.90 -
Bank deposit( Note 1) 462,967,619.54 874,795,302.32
RMB 396,264,667.05 853,053,825.65
USD 62,535,102.56 17,490,003.77
Yen 3,440,280.17 4,200,382.59
HKD 727,569.76 51,090.31
Other monetary capital(Note 2)： 9,305,118.06 116,990,685.31
RMB 9,305,118.06 116,929,425.84
Yen - 60,972.46
USD - 287.01
Total 472,274,448.00 991,789,968.19
Including : The total amount of deposit abroad - -
Note 1: Bank deposits include demand deposits and 7-day call deposit interest of RMB1,548,872.61.
Note 2: As of December 31, 2023, the Group's other monetary funds include RMB3,400,000.00 of funds whose use is
restricted due to account freezing and RMB5,905,118.06 of bill margin.
2. Transactional financial assets
In RMB
Balance at the end of this Balance at the end of last
Items
year year
Financial assets measured at fair value and whose changes are
821,946,114.68 319,605,448.44
included in the current profits and losses
Including: money funds and structured deposits 821,946,114.68 319,605,448.44
3. Notes receivable
(1) Notes receivable listed by category
In RMB
Balance at the end of this Balance at the end of last
Items
year year
Bank acceptance 50,963,943.01 74,619,100.26
(2) On December 31, 2023, the Group had no pledged bills receivable.
(3) On December 31, 2023, the notes receivable that have been endorsed or discounted by the Group and have not
yet matured on the balance sheet date
In RMB
Amount to be derecognized Amount not derecognized at the
Items
at the end of this year end of this year
Bank acceptance - 42,665,954.11
(4) By accrual of bad debt provision
In RMB
Balance at the end of this year Balance at the end of last year
Bad debt Bad debt
Book balance Book balance
provision provision
Accr Accr
Category Pro Book
ual Propo ual Book value
port value
Amount Amount prop Amount rtion Amount prop
ion
ortio (%) ortio
(%)
n n
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
(%) (%)
With bad debt provision
- - - - - - - - - -
accrual on single item
with single minor
amount but withdrawal 50,963,94 100. 50,963,94 74,619,100. 100.0 74,619,100.2
- - - -
single item bad debt 3.01 00 3.01 26 0 6
provision
50,963,94 100. 50,963,94 74,619,100. 100.0 74,619,100.2
Bank acceptance bill - - - -
3.01 00 3.01 26 0 6
50,963,94 100. 50,963,94 74,619,100. 100.0 74,619,100.2
Total - / - /
3.01 00 3.01 26 0 6
(5) On December 31, 2023, the Group had no bills receivable actually written off.
4. Account receivable
1. (1)Disclosure by aging
In RMB
Aging Balance at the end of this year Balance at the end of last year
Within 1 year 848,526,236.04 670,780,300.16
1-2 years 1,640,043.18 614,645.76
2-3 years 618,907.34 -
Over 3 years 12,911,211.29 12,883,224.42
Total 863,696,397.85 684,278,170.34
(2) Classified disclosure by credit loss provision accrual method
On December 31, 2023, the credit risk and credit loss provision of the accounts receivable of the above portfolio
were as follows:
In RMB
Balance at the end of this year
Book balance Bad debt provision
Category Proportion Accrual proportion Book value
Amount Amount
(%) (%)
Account receivable that withdrawal bad
71,687,951.26 8.30 27,464,002.48 38.31 44,223,948.78
debt provision by single item
Account receivable withdrawal bad debt
792,008,446.59 91.70 16,097,561.42 775,910,885.17
provision by portfolio
Including：Portfolio 1 779,372,185.30 90.24 15,882,600.54 2.04 763,489,584.76
Portfolio 2 12,636,261.29 1.46 214,960.88 1.70 12,421,300.41
Total 863,696,397.85 100.00 43,561,563.90 820,134,833.95
In RMB
Amount at year-begin
Book balance Bad debt provision
Category Proportion Accrual proportion Book value
Amount Amount
(%) (%)
Account receivable that withdrawal bad
74,770,706.00 10.93 28,457,163.32 38.06 46,313,542.68
debt provision by single item
Account receivable withdrawal bad debt
609,507,464.34 89.07 19,237,537.09 590,269,927.25
provision by portfolio
Including：Portfolio 1 591,168,603.26 86.39 18,295,605.12 3.09 572,872,998.14
Portfolio 2 18,338,861.08 2.68 941,931.97 5.14 17,396,929.11
Total 684,278,170.34 100.00 47,694,700.41 636,583,469.93
As of December 31, 2023, the Company has no accounts receivable with significant individual provision for bad
debts.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
As of December 31, 2023, the credit risk and bad debt provision for Portfolio 1 accounts receivable are as follows:
In RMB
Balance at the end of the year
Category )Expected average Provision for bad
Book balance Book value
loss ratio (%) debts
During the credit period 1.87 687,200,006.06 12,850,250.59 674,349,755.47
1-30 days overdue 2.49 88,368,765.06 2,204,379.13 86,164,385.93
31-60 days overdue 21.77 3,803,414.18 827,970.82 2,975,443.36
Total 779,372,185.30 15,882,600.54 763,489,584.76
As ofDecember 31, 2023, the credit risk and bad debt provision of Portfolio 2 accounts receivableare as follows:
In RMB
Balance at the end of the year
Ageing Expected average Provision for bad
Book balance Book value
loss ratio (%) debts
Within 1 year 1.55 12,569,011.29 194,785.88 12,374,225.41
2-3 years 30.00 67,250.00 20,175.00 47,075.00
Total 12,636,261.29 214,960.88 12,421,300.41
As o fDecember 31, 2023, the provision for bad debts is made based on the general model of expected credit losses.
In RMB
Stage 1 Stage 3
Bad Debt Reserves Expected credit losses over Expected credit losses for the entire Total
the next 12 months duration (credit impairment occurred)
Balance as at January 1, 2023 34,269,017.23 13,425,683.18 47,694,700.41
Balance as at January 1, 2023 in current - - -
-- Reversal to the II stage (125,323.83) - -
-- Reversal to the I stage - - -
Provision in Current Year 10,785,115.69 2,857,008.27 13,642,123.96
Reversal in Current Year (17,775,260.47) - (17,775,260.47)
Conversion in Current Year - - -
Write off in Current Year - - -
Other change - - -
Balance as at 31 Dec. 2023 27,153,548.62 16,408,015.28 43,561,563.90
(3) Provision for bad debts
In RMB
Amount of change this year
Balance at Write-off Balance at the
Category the beginning Recovery or or Other end of this
Accrual
of this year reversal cancellatio changes year
n
Provision for bad debts 47,694,700.41 13,642,123.96 (17,775,260.47) - - 43,561,563.90
There is no bad debt provision recovered or reversed with amounts significant during the year.
（4） There are no accounts receivable actually written off during the year.
（5）Top 5 of the closing balance of the accounts receivable collected according to the arrears party
In RMB
Name Balance in year-end Proportion(%) Bad debt provision
Client 1 157,318,095.40 18.21 3,255,038.13
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Client 2 124,972,436.40 14.47 2,437,300.46
Client 3 105,546,202.49 12.22 1,985,018.81
Client 4 62,902,335.60 7.28 1,242,469.89
Client 5 60,181,476.77 6.97 1,117,846.56
Total 510,920,546.66 59.15 10,037,673.85
5.Receivable financing
(1) Presentation of financings receivable classifications
In RMB
Balance at the end of the
Item Balance at the end of the year
previous year
Bank acceptance bill 22,839,459.13 54,413,796.91
The Group considers that the bank acceptance bills held by the Group have a high credit rating and do not have
significant credit risks, thus no provision for bad debts has been made.
(2) On December 31, 2023, the Group had no pledged receivable financing.
(3) On December 31, 2023, the receivable financing that have been endorsed or discounted by the Group and have not
yet matured on the balance sheet date
In RMB
Items Balance at the end of this year Balance at the end of last year
Bank acceptance bill 59,520,699.22 -
(4) On December 31, 2023,There are no Receivable financing actually written off during the year.
6.Prepayments
(1) List by aging analysis:
In RMB
Balance at the end of this year Balance at the end of last year
Aging
Amount Proportion % Amount Proportion %
Within 1 year 16,927,119.84 86.81 16,690,766.68 90.75
1-2 years 969,677.39 4.97 1,700,677.99 9.25
2-3 years 1,603,089.57 8.22 - -
Total 19,499,886.80 100.00 18,391,444.67 100.00
On December 31, 2023, the Group had no prepayments with an age of more than one year and a significant amount.
(2) Prepayments of the top five ending balances by prepayment object
The total amount of the top five year-end balances collected by prepayment objects is RMB 13,857,835.22,
accounting for 71.07% of the total year-end balances of prepayments.
7. Other receivables
(1) Disclosure by age
In RMB
Balance at the end of this Balance at the end of
Balance at the end of this year
year last year
Within 1 year 1,860,613.92 9,677,505.85
1-2 years 548,779.55 822,689.31
2-3 years 690,301.34 329,051.11
Over 3 years 18,115,521.40 18,154,298.53
Total 21,215,216.21 28,983,544.80
Less: Bad debt provision 17,994,930.79 18,397,569.42
Book value 3,220,285.42 10,585,975.38
- 52 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
(2) Disclosure by payment nature
In RMB
Book balance at the end Book balance at the
Payment nature
of this year end of last year
Current payment 15,350,589.97 16,330,801.03
Deposit and security deposit 2,000,722.80 2,801,300.29
Export rebate 710,026.13 1,023,715.60
Reserve funds and employee loans 577,183.94 580,028.97
Freeze funds - 6,559,327.26
Other 2,576,693.37 1,688,371.65
Total 21,215,216.21 28,983,544.80
(3) Provision for bad debts
As ofDecember 31, 2023, the provision for bad debts is made based on the general model of expected credit losses.
In RMB
Stage 1 Stage 2 Stage 3
Expected credit
Expected credit Expected credit loss losses for the entire
Bad Debt Reserves Total
losses over the next over life (no credit duration (credit
12 months impairment) impairment
occurred)
Balance as at January 1, 2023 494,588.28 198,890.09 17,704,091.05 18,397,569.42
Balance as at January 1, 2023 in current - - - -
——Transfer to stage II (28,089.18) 28,089.18 - -
——Transfer to stage III - (106,906.07) 106,906.07 -
-- Reversal to the II stage - - - -
-- Reversal to the I stage - - - -
Provision in Current Year 671.40 158,326.45 7,224.50 166,222.35
Reversal in Current Year (393,251.53) (10,103.39) (165,506.06) (568,860.98)
Conversion in Current Year - - - -
Write off in Current Year - - - -
Other change - - - -
Balance as at 31 Dec. 2023 73,918.97 268,296.26 17,652,715.56 17,994,930.79
As ofDecember 31, 2023, the provision for bad debts is made based on the credit risk characteristics portfolio.
In RMB
Balance at the end of the year
Stage Expected average loss
Book balance Provision for losses Book value
ratio (%)
Other receivables for which provision
for credit losses is made based on the 84.82 21,215,216.21 17,994,930.79 3,220,285.42
credit risk characteristics portfolio
As of December 31, 2023, the credit risk and bad debt provision for other receivables are as follows:
In RMB
Balance at the end of the year
Aging of accounts
Book balance Provision for losses Book value 账面价值
Within 1 year 3.97 1,860,613.92 73,918.97 1,786,694.95
1-2 years 9.23 548,779.55 50,646.56 498,132.99
2-3 years 31.53 690,301.34 217,649.70 472,651.64
Over 3 years 97.45 18,115,521.40 17,652,715.56 462,805.84
Total 21,215,216.21 17,994,930.79 3,220,285.42
- 53 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
(4) Provision for bad debts
：
In RMB
Change amount for the year
Balance at the Balance at
Transfer
Category beginning of Recovery or Other the end of
Accrual or write
the year reversal changes the year
off
Expected credit loss over the entire 18,397,569.42 - - 17,994,930.
166,222.35 (568,860.98)
duration 79
18,397,569.42 - - 17,994,930.
Total 166,222.35 (568,860.98)
79
(5) There are no other accounts receivable actually written off during the year.
(6) The top five of the year-end balance of other receivables categorized by the debtor
In RMB
Proportion of
total balance Balance of
Balance at the of other The nature of the provision for
Other receivables Ageing
end of the year receivables at amount bad debts at the
the end of the end of the year
year (%)
The total amount of other Account current
Within 1 year,
receivables with the top five 16,287,801.03 76.77 receivables of 15,246,651.03
Over 3 years
balances at the end of the year external units
8. Inventories
（1）Category of Inventory
In RMB
Closing book balance Opening book balance
Provision for Provision for
Items
Book balance inventory Book value Book balance inventory Book value
impairment impairment
Raw materials 403,031,948.06 7,506,047.48 395,525,900.58 291,062,812.80 48,809,720.50 242,253,092.30
Processing products 309,068,674.96 64,610,590.25 244,458,084.71 258,881,779.59 41,882,202.00 216,999,577.59
Semi-finished 137,596,740.37 43,501,540.31 94,095,200.06 183,723,885.96 92,381,073.63 91,342,812.33
Commissioned
2,406,793.65 93,806.73 2,312,986.92 9,016,668.25 1,164,501.70 7,852,166.55
materials
Total 852,104,157.04 115,711,984.77 736,392,172.27 742,685,146.60 184,237,497.83 558,447,648.77
Note: The carrying balance of polarizer inventory is RMB838,447,375.38, and the corresponding provision for
price decline is RMB107,290,039.96.
（2）Inventory falling price reserves
In RMB
Increased in current period Decreased in current period
Reversed or Closing
Items Opening balance
Accrual collected Write-off Other balance
amount
Raw materials 48,809,720.50 1,768,514.83 - 43,072,187.85 - 7,506,047.48
Processing products 64,610,590.2
41,882,202.00 46,991,687.69 - 24,263,299.44 -
5
105,484,567.7 154,364,101.0 43,501,540.3
Semi-finished 92,381,073.63 - -
6 8 1
Commissioned
1,164,501.70 93,806.73 - 1,164,501.70 - 93,806.73
materials
154,338,577.0 222,864,090.0 115,711,984.
Total 184,237,497.83 - -
1 7 77
- 54 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
The specific basis for determining the net realizable value of inventories and the reasons for the provision for the
inventories price decline reversed or resold during the year:
The reason for the
reversal or resale of
The specific basis for determining the net realizable the provision for
Items
value inventory price
decline in the current
year
The net realizable value is determined by the
estimated selling price of the relevant finished
Raw materials, work-in-progress product, and Get used or sold in the
product, less the estimated costs to be incurred at
consignment materials year
completion, and less the estimated selling expenses
and the relevant taxes
The net realizable value of the inventory is
Finished products determined by the estimated selling price minus the Sold in the year
estimated selling expenses and related taxes
(3) On December 31, 2023, there was no amount in the inventory balance for guarantee and no amount for capitalization
of borrowing costs.
9. Other current assets
In RMN
Balance at the end of this Balance at the end of
Items
year last year
VAT to be deducted and input tax to be certified 27,399,897.46 26,077,404.45
Advance payment of income tax 47,034.59 11,654.12
Receivable return cost 33,326,525.34 43,446,472.67
Total 60,773,457.39 69,535,531.24
10. Long-term equity investment
In RMB
Increase /decrease
Profits and
Cash Closing
Addi Decr losses on Withdra
bonus Closin balance
tiona ease investment Other Change wal of
Opening or g of
Investees l in s compre s in impair Othe
balance profits balanc impairme
inves inve Recognize hensive other ment r
announ e nt
tmen stme d under the income equity provisio
ced to provision
t nt equity n
issue
method
I. Joint ventures
Shenzhen Guanhua 122,37
129,506,271. (7,135,777
Printing & Dyeing Co., - - - - - - - 0,494. -
76 .68)
Ltd. 08
122,37
129,506,271. (7,135,777
Subtotal - - - - - - - 0,494. -
76 .68)
08
2. Affiliated Company
Shenzhen Changlianfa
3,358,
Printing & dyeing 3,105,796.55 - - 252,320.54 - - - - - -
117.09
Company
Hongkong Yehui (15,526.75 99,168. 1,953,
1,869,767.43 - - - - - - -
) 85 409.53
International Co., Ltd.
99,168. 5,311,
Subtotal 4,975,563.98 - - 236,793.79 - - - - -
85 526.62
134,481,835. (6,898,983 99,168. 127,68
Total - - - - - - -
74 .89) 85 2,020.
- 55 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Increase /decrease
Profits and
Cash Closing
Addi Decr losses on Withdra
bonus Closin balance
tiona ease investment Other Change wal of
Opening or g of
Investees l in s compre s in impair Othe
balance profits balanc impairme
inves inve Recognize hensive other ment r
announ e nt
tmen stme d under the income equity provisio
ced to provision
t nt equity n
issue
method
70
- 56 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
11. Other equity instruments investment
(1) Investment in other equity instruments
In RMB
Changes in the current year
Gains Reason designated
included in as being measured
Balance at Dividend Gains accrued Losses accrued
Additi Decrea other at fair value and
the end of income to other to other
Items onal se in comprehen Closing balance change being
the previous recognized comprehensive comprehensive
invest invest sive included in other
year during the year income income
ment ment income comprehensive
during the income
year
Planned to be held
Union Development Co., 125,753,939. (15,296,239.
- - - - 110,457,700.00 208,000.00 107,857,700.00 - by the Group for a
Ltd. 39 39)
long time.
Planned to be held
Shenzhen Dailishi 23,637,000.0 (5,895,100.0
- - - - 17,741,900.00 1,037,735.85 15,182,043.74 - by the Group for a
Underwear Co., Ltd. 0 0)
long time.
Planned to be held
Shenzhen South Textile 16,059,440.8 (1,256,040.8
- - - - 14,803,400.00 814,848.27 13,303,400.00 - by the Group for a
Co., Ltd. 8 8)
long time.
Planned to be held
Shenzhen Xinfang
2,227,903.00 - - 757,997.00 - - 2,985,900.00 148,000.00 2,461,900.00 - by the Group for a
Knitting Co., Ltd.
long time.
Jintian Industry Planned to be held
- - - - - - - - - (14,831,681.50) by the Group for a
（Group）Co., Ltd.
long time.
167,678,283. (22,980,045.
Total - - 757,997.00 - 145,988,900.00 2,208,584.12 138,805,043.74 (14,831,681.50) /
27 07)
(2) Statement of the circumstances in which there is a derecognition during the year
As of December 31, 2023, there has been no derecognition of investments in other equity instruments.
- 57 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
12. Investment real estate
(1) Investment real estate adopted the cost measurement mode
In RMB
Items House, Building
I. Original price
1. Balance at period-beginning 328,128,815.41
2.Increase in the current period 22,238,626.99
(1)Outsourcing 644,437.82
(2) Transferred from Fixed assets 21,594,189.17
3.Decreased amount of the period -
（1）Dispose -
（2）Other out -
4. Balance at period-end 350,367,442.40
II.Accumulated amortization
1.Opening balance 201,812,980.65
2.Increased amount of the period 22,951,254.57
(1) Withdrawal 9,117,671.12
(2)Transferred from Fixed assets 13,833,583.45
3.Decreased amount of the period -
（1）Dispose -
（2）Other out -
4. Balance at period-end 224,764,235.22
III. Impairment provision
1. Balance at period-beginning -
2.Increased amount of the period -
(1) Withdrawal -
3.Decreased amount of the period -
（1）Dispose -
4. Balance at period-end -
IV. Book value
1.Book value at period -end 125,603,207.18
2.Book value at period-beginning 126,315,834.76
（2）Investment real estate without certificate of ownership
In RMB
Items Book balance Reason
Unable to apply for warrants
Houses and Building 12,944,151.87
due to historical reasons
- 58 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
13. Fixed assets
(1) List of fixed assets
In RMB
Houses & Machinery
Items Transportations Other equipment Total
buildings equipment
I. Original price
1.Opening balance 742,709,971.36 2,655,871,126.91 15,875,027.26 50,483,511.70 3,464,939,637.23
2.Increased amount of the period 6,625,073.63 58,968,661.84 1,224,757.32 1,058,285.96 67,876,778.75
(1) Purchase 375,978.84 12,004,429.74 946,881.22 1,058,285.96 14,385,575.76
(2) Transferred from constructi
- 46,964,232.10 277,876.10 - 47,242,108.20
on in progress
(3)Other changes 6,249,094.79 - - - 6,249,094.79
3.Decreased amount of the period 21,655,211.05 3,405,884.77 8,888.71 7,002,175.11 32,072,159.64
（1）Disposal - 2,272,154.22 8,888.71 753,080.32 3,034,123.25
(2)Transferred from Real estate
21,594,189.17 - - - 21,594,189.17
investment
(3)Other changes 61,021.88 1,133,730.55 - 6,249,094.79 7,443,847.22
4. Balance at period-end 727,679,833.94 2,711,433,903.98 17,090,895.87 44,539,622.55 3,500,744,256.34
II. Accumulated depreciation
1.Opening balance 173,190,869.37 986,203,419.91 5,871,266.55 34,223,428.40 1,199,488,984.23
2.Increased amount of the period 30,063,009.36 195,106,408.71 2,005,472.53 5,841,471.09 233,016,361.69
(1) Withdrawal 23,813,914.57 195,106,408.71 2,005,472.53 5,841,471.09 226,767,266.90
(2) )Other changes 6,249,094.79 - - - 6,249,094.79
3.Decreased amount of the period 13,833,583.45 2,177,192.99 7,124.50 6,972,131.93 22,990,032.87
（1）Disposal - 2,177,192.99 7,124.50 723,037.14 2,907,354.63
(2)Transferred from Real estate
13,833,583.45 - - - 13,833,583.45
investment
(3)Other changes - - - 6,249,094.79 6,249,094.79
4.Closing balance 189,420,295.28 1,179,132,635.63 7,869,614.58 33,092,767.56 1,409,515,313.05
III. Impairment provision
1.Opening balance - 25,120,608.21 - 108,388.43 25,228,996.64
2.Increase in the reporting period 9,820,261.26 - 6,126.41 145,183.36 9,971,571.03
（1）Withdrawal - - - - -
(2) Other changes 9,820,261.26 - 6,126.41 145,183.36 9,971,571.03
3.Decrease in
- 9,971,571.03 - 6,291.08 9,977,862.11
the reporting period
（1）Disposal - - - 6,291.08 6,291.08
(2) Other changes - 9,971,571.03 - - 9,971,571.03
4. Closing balance 9,820,261.26 15,149,037.18 6,126.41 247,280.71 25,222,705.56
IV. Book value
1.Book value of the period-end 528,439,277.40 1,517,152,231.17 9,215,154.88 11,199,574.28 2,066,006,237.73
2.Book value of the period-begin 569,519,101.99 1,644,547,098.79 10,003,760.71 16,151,694.87 2,240,221,656.36
(2) Fixed assets without certificate of title completed
In RMB
Items Book Value Reason
Unable to apply for
Houses and Building 11,193,085.07 warrants due to historical
reasons
(3) Mortgaged and secured fixed assets
As of December 31, 2023, the Group's fixed assets mortgaged by bank loans are detailed in Notes (V), 21 "Assets with
restricted ownership or use right":
- 59 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
14. Construction in progress
14.1 Summary of projects under construction
In RMB
Items Year-end balance Year-beginning balance
Construction in progress 31,307,060.74 38,061,619.60
14.2 List of construction in progress
In RMB
Year-end balance Year-beginning balance
Items Book balance Provision for Book value Book balance Provision for Book value
devaluation devaluation
Installation of machines
31,307,060.74 - 31,307,060.74 38,061,619.60 - 38,061,619.60
and equipment
15. Right to use assets
In RMB
Items Houses and Building
I. Original price
1.Opening balance 28,914,047.83
2.Increased amount of the period 11,048,317.88
(1)Newly increased 11,048,317.88
3.Decreased amount of the period 6,511,563.48
(1) Termination of lease 6,511,563.48
4. Balance at period-end 33,450,802.23
II. Accumulated depreciation
1.Opening balance 13,548,653.95
2.Increased amount of the period 8,257,857.90
(1) Withdrawal 8,257,857.90
3.Decreased amount of the period 355,176.19
(1) Termination of lease 355,176.19
4.Closing balance 21,451,335.66
III. Impairment provision
1.Opening balance -
2.Increase in the reporting period -
（1）Withdrawal -
3.Decrease in the reporting period -
4. Closing balance -
IV. Book value
1.Book value of the period-end 11,999,466.57
2.Book value of the period-begin 15,365,393.88
16. Intangible assets
(1) Information
In RMB
Items Land use right Software Patent right Total
I. Original price
1. Balance at period-beginning 48,258,239.00 22,336,546.33 11,825,200.00 82,419,985.33
2.Increase in the current period - 263,523.53 - 263,523.53
(1) Purchase - 263,523.53 - 263,523.53
3.Decreased amount of the period - - - -
4. Balance at period-end 48,258,239.00 22,600,069.86 11,825,200.00 82,683,508.86
- 60 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
II.Accumulated amortization
1. Balance at period-beginning 15,274,148.35 11,128,065.03 11,825,200.00 38,227,413.38
2. Increase in the current period 891,565.32 4,000,107.36 - 4,891,672.68
(1) Withdrawal 891,565.32 4,000,107.36 - 4,891,672.68
3.Decreased amount of the period - - - -
4. Balance at period-end 16,165,713.67 15,128,172.39 11,825,200.00 43,119,086.06
III. Impairment provision
1. Balance at period-beginning - - - -
2. Increase in the current period - - - -
3.Decreased amount of the period - - - -
4. Balance at period-end - - - -
4. Book value
1.Book value at period -end 32,092,525.33 7,471,897.47 - 39,564,422.80
2.Book value at period-beginning 32,984,090.65 11,208,481.30 - 44,192,571.95
As of December 31, 2023, the Group's intangible assets mortgaged by bank loans are detailed in Notes (V),21
"Assets with restricted ownership or use right".
17. Goodwill
(1) Original book value of goodwill
In RMB
Name of the investee or matters that form
Balance at the end Balance at the end
goodwill Increase this year Decrease this year
of last year of this year
SAPO Photoelectric 9,614,758.55 - - 9,614,758.55
Shenzhen Beauty Century Garment Co.,
2,167,341.21 - - 2,167,341.21
Ltd.
Total 11,782,099.76 - - 11,782,099.76
(2) Goodwill impairment provision
In RMB
Name of the investee or matters that form
Balance at the end Balance at the end
goodwill Increase this year Decrease this year
of last year of this year
SAPO Photoelectric 9,614,758.55 - - 9,614,758.55
Shenzhen Beauty Century Garment Co., Ltd. 2,167,341.21 - - 2,167,341.21
Total 11,782,099.76 - - 11,782,099.76
18. Long-term deferred expenses
In RMB
Balance at the Increased amount Amortized Other reduction Balance at the
Items
end of last year this year amount this year amount end of this year
Decoration and facilities
4,470,957.79 1,218,440.63 2,160,430.42 25,307.06 3,503,660.94
renovation fee
19. Deferred income tax assets/Deferred income tax liabilities
(1) Uncompensated deferred income tax assets
In RMB
Balance in year-end Balance in year-begin
Items Deductible Deductible
Deferred income Deferred income
temporary temporary
tax assets tax assets
difference difference
- 61 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Balance in year-end Balance in year-begin
Items Deductible Deductible
Deferred income Deferred income
temporary temporary
tax assets tax assets
difference difference
Credit loss provision 59,994,128.15 10,538,054.68 65,076,915.43 11,372,802.27
Asset impairment provision 132,512,745.52 19,876,911.83 206,115,717.20 30,917,357.58
Unrealized profit from internal transactions 2,145,963.47 321,894.52 2,235,077.97 335,261.70
Employee compensation payable 4,173,800.00 1,043,450.00 9,397,730.55 2,143,607.14
Deferred income 96,647,256.82 14,497,088.52 116,768,810.33 17,515,321.55
Deductible loss 127,769,387.40 19,165,408.11 90,052,078.73 13,397,964.96
Changes in fair value of investment in other
14,831,681.50 3,707,920.38 14,831,681.50 3,707,920.38
equity instruments
Lease liabilities 12,177,572.68 1,826,635.90 15,365,393.88 2,304,809.08
Total 450,252,535.54 70,977,363.94 519,843,405.59 81,695,044.66
According to the Group's profit forecast results for the future period, the Group believes that it is likely to obtain
sufficient taxable income in the future period to make use of the above deductible temporary differences and deductible
losses, so relevant deferred income tax assets are recognized.
(2)Details of the un-recognized deferred income tax liabilities
In RMB
Closing balance Opening balance
Deductible Deductible
Items Deferred income Deferred income
temporary temporary
tax liabilities tax liabilities
difference difference
The difference between the initial recognition
cost of long-term equity investment and tax 62,083,693.36 15,520,923.34 62,083,693.36 15,520,923.34
basis
Changes in fair value of investment in other
138,805,043.74 34,701,260.94 160,494,427.01 40,123,606.76
equity instruments
Rent receivable 10,108,726.81 2,527,181.70 7,584,635.96 1,896,158.99
Use right assets 11,999,466.57 1,799,919.99 15,365,393.88 2,304,809.08
Total 222,996,930.48 54,549,285.97 245,528,150.21 59,845,498.17
(3) Deferred income tax assets or liabilities listed by net amount after off-set
In RMB
End balance of Trade-off between Opening balance
Trade-off between
deferred income the deferred of deferred income
the deferred
Items tax assets or income tax assets tax assets or
income tax assets
liabilities after off- and liabilities at liabilities after off-
and liabilities
set period-begin set
Deferred income tax assets (10,371,998.52) 60,605,365.42 (11,871,230.37) 69,823,814.29
Deferred income tax assets (10,371,998.52) 44,177,287.45 (11,871,230.37) 47,974,267.80
(4)Details of income tax assets not recognized
In RMB
Items Balance in year-end Balance in year-begin
Deductible temporary difference 14,740,965.97 5,742,636.02
Deductible loss 442,263,671.30 464,226,095.10
Total 457,004,637.27 469,968,731.12
(5)Deductible losses of the un-recognized deferred income tax asset will expire in the following years
In RMB
Year Balance in year-end Balance at the end of last year
2024 69,053,143.67 79,132,962.34
2025 - 16,680,938.23
- 62 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
2026 53,989,578.07 128,597,715.91
2027 10,067,397.50 12,155,889.69
2028 39,988,583.76 22,463,907.95
2029 129,732,249.98 129,766,788.98
2030 75,352,814.24 75,427,892.00
2031 - -
2032 - -
2033 64,079,904.08 -
Total 442,263,671.30 464,226,095.10
20 .Other non-current assets
In RMB
Balance in year-end Balance in year-begin
Items Book balance Provision for Book value Book balance Provision for Book value
devaluation devaluation
Prepayment for
engineering and 3,757,334.44 - 3,757,334.44 16,792,930.20 - 16,792,930.20
equipment
Investment funds to be
25,760,086.27 - 25,760,086.27 25,760,086.27 - 25,760,086.27
liquidated
Total 29,517,420.71 - 29,517,420.71 42,553,016.47 - 42,553,016.47
- 63 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
21. Assets with restricted ownership or right of use
End of the year End of the previous year
Items Restricted
Book balance Book value Restricted type Restricted circumstances Book balance Book value Restricted circumstances
circumstances
Account Freezing and
Restricted right Account Freezing and Restricted right
Monetary funds 9,305,118.06 9,305,118.06 116,990,685.31 116,990,685.31 Time Deposit
of use Margin of use
Certificates
Restricted right The endorsement of the Restricted right The endorsement of the
Notes receivable 42,665,954.11 42,665,954.11 48,387,401.67 48,387,401.67
of use note is not terminated of use note is not terminated
Restricted right
Other receivables - - / / 6,559,327.26 6,559,327.26 Account Freezing
of use
Restricted right Restricted right
Fixed asset 572,261,261.14 454,185,881.22 Mortgage 572,261,261.14 470,366,658.55 Mortgage
of use of use
Restricted right Restricted right
Intangible asset 44,770,083.00 32,092,525.33 Mortgage 44,770,083.00 32,984,090.65 Mortgage
of use of use
Total 669,002,416.31 538,249,478.72 / / 788,968,758.38 675,288,163.44 / /
- 64 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
22. Short-term borrowings
In RMB
Items Balance in year-end Balance in year-begin
Credit loans 8,000,000.00 7,000,000.00
23.Notes payable
In RMB
Items Balance in year-end Balance in year-begin
Bank acceptance Bill 31,049,291.49 -
The Group has no notes payable due and unpaid at the end of the year.
24. Accounts payable
In RMB
Items Balance in year-end Balance in year-begin
Payment for goods 386,767,637.00 304,916,368.65
Service charge 13,817,610.72 11,386,158.86
Loyalities 2,207,166.50 4,609,134.50
Subcontracting payment 4,584,423.60 3,970,214.14
Others 1,171,298.42 2,167,997.55
Total 408,548,136.24 327,049,873.70
On December 31, 2023, the Group had no significant accounts payable with an aging of more than one year.
25.Advance account
In RMB
Items Balance in year-end Balance in year-begin
Rent and other 1,450,096.30 1,393,344.99
On December 31, 2023, the Group had no significant accounts payable with an aging of more than one year.
26.Contract liabilities
In RMB
Items Balance in year-end Balance in year-begin
Goods 1,436,943.34 4,274,109.40
On December 31, 2023, the Group had no significant contract liabilities with an aging of more than one year.
- 65 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
27.Payable Employee wage
(1) List of Payroll payable
In RMB
Balance in year- Increase in this Payable in this Balance in year-
Items
begin period period end
Short-term compensation 60,940,432.90 223,391,192.84 230,478,544.09 53,853,081.65
Post-employment benefits -
- 17,698,860.49 17,698,860.49 -
defined contribution plans
Dismissal benefits 226,012.00 8,460,265.33 6,102,196.89 2,584,080.44
Total 61,166,444.90 249,550,318.66 254,279,601.47 56,437,162.09
（2）Short-term remuneration
In RMB
Balance in year- Increase in this Decrease in this Balance in year-
Items
begin period period end
Wages, bonuses, allowances and subsidies 57,472,981.87 196,563,582.14 203,551,752.29 50,484,811.72
Employee welfare 29,185.44 10,196,697.74 10,225,883.18 -
Social insurance premiums - 3,800,816.39 3,800,816.39 -
Including：Medical insurance - 3,098,787.68 3,098,787.68 -
Maternity insurance - 296,157.78 296,157.78 -
Work injury insurance - 405,870.93 405,870.93 -
Public reserves for housing 202,391.00 8,005,658.59 8,208,049.59 -
Union funds and staff education fee 3,235,874.59 4,824,437.98 4,692,042.64 3,368,269.93
Total 60,940,432.90 223,391,192.84 230,478,544.09 53,853,081.65
（3）Defined contribution plans listed
In RMB
Balance in year- Increase in this Decrease in this Balance in year-
Items
begin period period end
Basic old-age insurance premiums - 14,207,148.80 14,207,148.80 -
Unemployment insurance - 3,194,871.82 3,194,871.82 -
Annuity payment - 296,839.87 296,839.87 -
Total - 17,698,860.49 17,698,860.49 -
The Group participates in pension insurance and unemployment insurance plans established by government
agencies according to regulations, and according to the plans, the Group pays fees to these plans according to the
prescribed standards. In addition to the above-mentioned monthly deposit fees, the Group will no longer assume further
payment obligations. The corresponding expenses are included in the current profits and losses or the related asset costs
when incurred.
This year, the Group shall pay RMB 14,207,148.80 and RMB 296,839.87(2022: RMB 13,593,639.21 and
RMB303,261.11) to the pension insurance and unemployment insurance plans respectively. As of December 31, 2023,
the Group has fully paid the amount of pension insurance and unemployment insurance plans payable during the
reporting period.
- 66 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
28.Tax Payable
In RMB
Items Balance in year-end Balance in year-begin
Enterprise Income tax 2,080,849.81 4,655,525.64
Individual Income tax 1,080,628.82 1,847,004.45
VAT 582,961.29 1,740,677.77
Other 596,455.22 654,104.65
Total 4,340,895.14 8,897,312.51
29.Other payable
(1) Other payables listed according to the payment nature
In RMB
Items Balance in year-end Balance in year-begin
Engineering equipment payment 67,176,881.34 83,337,092.31
Current payment 56,444,481.12 53,102,831.34
Deposit and security deposit 48,208,919.61 45,628,573.39
Others 12,698,062.48 15,276,958.33
Total 184,528,344.55 197,345,455.37
(2) On December 31, 2023, the Group had no significant other payable with an aging of more than one year.
30. Non-current liabilities due within 1 year
In RMB
Balance at the end of this Balance at the end of last
Items
year year
Long-term loans due within one year(Note(V).32) 102,612,497.53 97,182,080.19
Lease liabilities due within one year(Note(V).、33) 5,490,255.46 7,001,358.03
Total 108,102,752.99 104,183,438.22
31.Other current liabilities
In RMB
Balance at the end of this Balance at the end of last
Items
year year
Endorsed and unexpired acceptance bill 42,665,954.11 48,387,401.67
Return payable 37,244,449.90 44,558,340.11
To be rescheduled 172,073.21 -
Total 80,082,477.22 92,945,741.78
- 67 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
32. Long-term loans
In RMB
Balance at the end of this Balance at the end of last
Items Interest rate interval
year year
Guaranteed loan (note) 608,190,812.09 704,603,665.19 3.96-4.41%
Total 608,190,812.09 704,603,665.19
Less: Long-term loans due within one year 102,612,497.53 97,182,080.19
Less: Long-term loans due after one year 505,578,314.56 607,421,585.00
Note: SAPO Photoelectric, a subsidiary of the Company, mortgaged its real estate rights such as the factory
building, and the Company and Hangzhou Jinjiang Group Co., Ltd. provided 60% and 40% joint guarantee for the loan
respectively.
33. Lease liabilities
In RMB
Balance at the end of this Balance at the end of last
Items
year year
Lease liabilities 12,177,572.68 15,630,030.74
Subtotal 12,177,572.68 15,630,030.74
Less: Lease liabilities due within one year 5,490,255.46 7,001,358.03
Lease liabilities becoming due after one year 6,687,317.22 8,628,672.71
The Group's lease liabilities are analysed by the maturity of the undiscounted remaining contractual obligations as
follows:
In RMB
Within 1 More than 5
1 to 3 months 3 to 12 months 1 to 5 years Total
month years
Balance at the end of
513,149.55 2,012,582.22 3,284,024.84 5,822,333.46 1,672,592.08 13,304,682.15
the year
Balance at the end of
1,075,350.63 2,330,382.48 4,884,203.14 6,111,983.10 2,819,512.65 17,221,432.00
the previous year
34. Deferred income
In RMB
Balance at the end Balance at the end Reason
Items Increase this year Decrease this year
of last year of this year
Received the
Government subsidies 117,814,796.10 4,278,925.00 24,607,734.21 97,485,986.89 government
subsidies
35.Stock capital
In RMB
Changed（+，-）
Year-beginning Capitaliza Balance in
Items Issuance of Bonus
balance tion of Other Subtotal year-end
new share shares
public
reserve
Total of capital shares 506,521,849.00 - - - - - 506,521,849.00
- 68 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
36. Capital reserves
In RMB
Year-beginning Increase in the current Decrease in the Year-end balance
Items
balance period current period
Share premium 1,826,482,608.54 - - 1,826,482,608.54
Other capital reserves 135,117,216.09 - - 135,117,216.09
Total 1,961,599,824.63 - - 1,961,599,824.63
37. Other comprehensive income
In RMB
Amount of current period
Less
：
Less ：
Prior
Amount
period
transfer
includ
red into
ed in
profit
other
and loss After-
compo
in the tax
Amount site After-tax
Year- current Less ： attribut
incurred incom attribute Year-end
Items beginning period Income e to
before e to the balance
balance that tax minorit
income transfe parent
recogni expenses y
tax r to company
zed into shareho
retaine lder
other
d
compre
incom
hensive
e in
income
the
in prior
curren
period
t
period
I. Other comprehensive income that
108,584,3 (21,689,3 (5,422,34 (16,267,0 92,317,30
cannot be reclassified into profit or - - -
44.77 83.27) 5.82) 37.45) 7.32
loss
1. Changes in fair value of
108,584,3 (21,689,3 (5,422,34 (16,267,0 92,317,30
investment in other equity - - -
44.77 83.27) 5.82) 37.45) 7.32
instruments
II. Other comprehensive income to 1,012,264 396,902.3 277,808.9 119,093 1,290,073
- - -
be reclassified into profit or loss .54 5 5 .40 .49
1. Changes in fair value of (178,640. 297,733.5 178,640.1 119,093
- - - -
receivables financing 10) 0 0 .40
2. Translation difference of foreign 1,190,904 1,290,073
99,168.85 - - - 99,168.85 -
currency financial statements .64 .49
Total of other comprehensive 109,596,6 (21,292,4 (5,422,34 (15,989,2 119,093 93,607,38
- -
income 09.31 80.92) 5.82) 28.50) .40 0.81
38. Special reserves
In RMB
Year-beginning Increase in the current Decrease in the Year-end balance
Items
balance period current period
Statutory surplus reserve 100,909,661.32 3,352,654.32 - 104,262,315.64
39. Retained profits
In RMB
- 69 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Items Amount of current period Amount of previous period
Undistributed profit at the end of last year before adjustment 170,636,610.95 125,317,336.31
Total undistributed profits adjusted at the beginning of the
- -
year
Adjusted undistributed profit at the beginning of the year 170,636,610.95 125,317,336.31
Add: Net profit attributable to shareholders of parent
79,268,250.45 73,309,182.94
company this year
Less: Withdrawal of statutory surplus reserve 3,352,654.32 2,663,815.85
Distribution of common stock dividends ( 30,391,310.94 25,326,092.45
Year end undistributed profit 216,160,896.14 170,636,610.95
Note: According to the resolution of the General Meeting of Shareholders on May 26, 2023, the Company distributed a
cash dividend of RMB 0.6 (including tax) for every 10 shares, totally RMB30,391,310.94 (including tax) based on the
share capital of 506,521,849 shares as of December 31, 2022.
40. Operating income and operating cost
(1) Operating income and operating cost
In RMB
Amount incurred this year Amount incurred last year
Items
Income Cost Income Cost
Main business 3,031,175,008.58 2,560,743,931.49 2,802,203,439.94 2,373,407,000.36
Other business 48,503,366.87 887,913.04 35,784,824.42 598,896.07
Total 3,079,678,375.45 2,561,631,844.53 2,837,988,264.36 2,374,005,896.43
(2) Main business classified by product
In RMB
Amount incurred this year Amount incurred last year
Product type
Main business income Main business cost Main business income Main business cost
Polarizer sales 2,885,625,542.77 2,499,416,729.45 2,693,787,636.62 2,317,793,097.44
Property leasing and
145,549,465.81 61,327,202.04 108,415,803.32 55,613,902.92
management
Total 3,031,175,008.58 2,560,743,931.49 2,802,203,439.94 2,373,407,000.36
(3) Main business classified by region
InRMB
Amount incurred this year Amount incurred last year
Main business region
Main business income Main business cost Main business income Main business cost
Domestic 2,914,588,072.35 2,464,223,583.43 2,686,847,406.83 2,278,271,215.01
Overseas 116,586,936.23 96,520,348.06 115,356,033.11 95,135,785.35
Total 3,031,175,008.58 2,560,743,931.49 2,802,203,439.94 2,373,407,000.36
(4) Description of performance obligations
The Group's goods sales are mainly the production and sales of polarizer and textile-related goods. For goods sold
to customers, the Group recognizes income when the control of the goods is transferred, that is, when the goods are
delivered to the designated place of the other party and signed by the other party. Since the delivery of goods to
customers represents the right to unconditionally receive the contract consideration, the maturity of the money only
depends on the passage of time, so the Group recognizes a receivable when the goods are delivered to professional
customers. When the customer prepays the payment, the Group recognizes the transaction amount received as a
contractual liability until the goods are delivered to the customer.
The Group provides property and leasing services to customers, which is a performance obligation to be fulfilled within
a certain period of time. The Group recognizes income in the process of providing property and leasing services. For
property services, the Group recognizes revenue in the course of providing property services, and for leasing services,
the Group apportions the total rental amount on a straight-line basis throughout the lease term without deducting the
rent-free period and recognize rental income.
(5) Description of allocation to remaining performance obligations
- 70 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
On December 31, 2023, the amount of contractual liabilities corresponding to the performance obligations that the
Group has signed but has not yet fulfilled or has not yet fully fulfilled is RMB 1,436,943.34, and the income will be
recognized when the customer obtains the control of the goods.
41. Taxes and surcharges
In RMB
Amount incurred this Amount incurred last
Items
year year
Property tax 6,184,638.83 5,213,976.28
Urban maintenance and construction tax 555,230.22 366,211.93
Surcharge for education 400,403.17 237,396.39
Other taxes 2,153,350.91 2,089,542.31
Total 9,293,623.13 7,907,126.91
42. Sales expenses
In RMB
Amount incurred this Amount incurred last
Items
year year
Employee compensation 17,089,203.74 18,560,229.96
Sales service charge 10,639,607.95 10,661,049.94
Business entertainment 972,733.63 2,214,489.62
Others 5,494,125.29 4,526,759.83
Total 34,195,670.61 35,962,529.35
43. Management cost
In RMB
Amount incurred this Amount incurred last
Items
year year
Employee compensation 90,991,755.13 83,952,597.31
Depreciation cost 11,118,057.18 12,258,281.68
Professional service fee 8,841,449.74 7,197,534.84
Amortization of intangible assets 4,891,672.68 5,082,893.36
Property leasing and utilities 4,086,627.39 5,252,212.15
Business entertainment 1,439,231.97 1,557,382.87
Others 13,002,616.44 13,088,038.08
Total 134,371,410.53 128,388,940.29
44. R&D expenses
In RMB
Amount incurred this Amount incurred last
Items
year year
Employee compensation 14,827,264.16 16,349,423.75
Material consumption 85,216,243.35 58,840,560.48
Depreciation cost 3,389,328.35 3,518,432.27
Others 1,220,205.06 1,811,739.04
Total 104,653,040.92 80,520,155.54
Note: The Group has no R&D project development expenditure that meets the conditions for capitalization.
- 71 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
45. Financial expenses
In RMB
Items Amount incurred this year Amount incurred last year
Interest expense (note) 27,339,804.17 31,131,112.38
Less: capitalized interest expense - -
Less: interest income 12,947,471.64 8,327,248.75
Exchange difference 4,332,702.63 (14,569,863.53)
Handling fees and others 5,674,466.00 4,709,606.47
Total 24,399,501.16 12,943,606.57
Note: The interest expense on lease liabilities in 2023 is RMB431,636.06.
46. Other income
In RMB
Amount incurred in the Amount incurred in the
Sources of other income
current period previous period
Transfer-in of deferred income 22,107,734.21 16,401,222.05
Industry development support funds (Note 1) 11,049,910.96 6,384,733.03
Enterprise development support funds (Note 2) 553,455.00 2,062,888.38
Tax subsidy 16,881,612.68 1,262,440.33
Others 147,651.06 238,927.10
Total 50,740,363.91 26,350,210.89
Note 1: The industry development support funds mainly include the subsidy for the incentive project for industrial
enterprises to expand production capacity, the first batch of key new material industry support projects of the
Shenzhen Municipal Bureau of Industry and Information Technology in 2023, the special fund project for economic
development in Pingshan District, and the subsidy for the emerging industry support plan (new materials) of the
Bureau of Industry and Information Technology.
Note 2: The enterprise development support funds mainly include the R&D subsidy for enterprises of the Shenzhen
Science and Technology Innovation Commission, and the subsidy fund for the improvement of atmospheric
environment quality of the Shenzhen Municipal Bureau of Ecology and Environment.
47. Investment income
In RMB
Items Amount incurred this year Amount incurred last year
Long-term equity investment income calculated by equity method (6,898,983.89) 1,307,639.15
Investment income of transactional financial assets during the holding
15,519,035.33 15,457,585.05
period
Dividend income from investment in other equity instruments during the
2,208,584.12 2,618,127.67
holding period
Total 10,828,635.56 19,383,351.87
48. Income from changes in fair value
In RMB
Sources of income from changes in fair value Amount incurred this year Amount incurred last year
Transactional financial assets 2,151,780.82 -
- 72 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
49. Credit impairment gain (loss)
In RMB
Amount incurred this Amount incurred last
Items
year year
Impairment loss of notes receivable - 365,055.74
Gain (loss) from impairment of accounts receivable 4,133,136.51 (11,584,551.67)
Gain (loss) from impairment of other receivables 402,638.63 6,600,942.84
Total 4,535,775.14 (4,618,553.09)
50. Asset impairment gain (loss)
In RMB
Amount incurred this Amount incurred last
Items
year year
Inventory depreciation loss (126,089,709.42) (183,706,022.57)
Impairment loss of fixed assets - (18,867,443.27)
Total (126,089,709.42) (202,573,465.84)
51. Asset disposal income
In RMB
Amount incurred this Amount incurred last
Items
year year
Gains & losses on foreign investment in fixed assets 1.72 31,264.60
52. Non-Operation income
In RMB
Items Amount of current Amount of previous Recorded in the amount
period period of the non-recurring
gains and losses
Non-current asset Disposition loss 768,398.45 6,334,444.97 768,398.45
Compensation expenses 252,000.00 - 252,000.00
Insurance expenses 193,275.48 7,652,845.40 193,275.48
Other 236,205.33 1,005,792.20 236,205.33
Total 1,449,879.26 14,993,082.57 1,449,879.26
53.Non-current expenses
In RMB
Amount of current Amount of previous The amount of non-
Items
period period operating gains & lossed
Non-current asset Disposition loss 115,541.99 26,020.82 115,541.99
Compensation expenses 7,926,787.08 7,248,331.74 7,926,787.08
Fine expenses 42,319.72 778.86 42,319.72
Other 121,152.72 201,926.05 121,152.72
Total 8,205,801.51 7,477,057.47 8,205,801.51
- 73 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
54.Income tax expenses
(1)Income tax expenses
In RMB
Amount of current period Amount of previous
Items
period
Current income tax expense 8,563,917.13 4,043,680.11
Deferred income tax expense 10,843,814.34 (71,486,803.63)
Total 19,407,731.47 (67,443,123.52)
(2)Reconciliation of account profit and income tax expenses
In RMB
Amount of current Amount of previous
Items
period period
Total profits 146,544,210.05 44,348,842.80
Current income tax expense accounted by tax and relevant
36,636,052.51 11,087,210.70
regulations
Influence of different tax rates applied by some subsidiaries (14,393,929.80) (2,715,451.54)
The impact of non-taxable income (1,126,262.45) (2,483,588.11)
Non-deductible costs, expenses and losses 2,293,874.74 771,675.89
Tax impact by the unrecognized deductible losses and deductible temporary
(25,587.79) (66,704,686.87)
differences in previous years
The tax impact of the deductible loss and the deductible temporary difference
10,154,045.89 2,931,982.20
is not recognized
The tax rate adjustment leads to a change in the balance of deferred income
(21,128.84) -
tax assets / liabilities at the beginning of the period
ax impact of research and development fee plus deduction (13,995,916.51) (10,330,265.79)
Other (113,416.28) -
Income tax expenses 19,407,731.47 (67,443,123.52)
55. Supplementary information to cash flow statement
(1) Cash related to operating activities
Other cash received relevant to operating activities
In RMB
Amount of current Amount of previous
Items
period period
Letter of Credit Deposit 37,450,879.69 167,866,753.31
Interest income 18,578,870.77 8,067,195.21
Government Subsidy 16,029,942.02 33,703,713.84
Current account 15,217,631.42 8,658,637.60
Total 87,277,323.90 218,296,299.96
Other cash paid related to operating activities
In RMB
Amount of current Amount of previous
Items
period period
Payment of credit deposit 34,639,361.27 25,106,708.19
Cash 71,894,532.84 87,642,432.49
Current account and other 10,910,080.05 9,199,351.73
Total 117,443,974.16 121,948,492.41
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
(2) Cash related to investment activities
Cash received related to other investment activities
In RMB
Amount of current Amount of previous
Items
period period
Structured deposits 950,000,000.00 430,000,000.00
Fixed deposit 245,000,000.00 753,000,000.00
Currency fund and others 259,000,000.00 133,000,000.00
Total 1,454,000,000.00 1,316,000,000.00
Payments of cash in connection with significant investment activities
In RMB
Amount of current Amount of previous
Items
period period
Structured deposits 1,400,000,000.00 480,000,000.00
Currency fund 290,500,000.00 436,064,713.28
Fixed deposit 150,000,000.00 224,368,658.21
Total 1,840,500,000.00 1,140,433,371.49
Cash received in connection with significant investment activities
In RMB
In RMB
Amount of current Amount of previous
Items
period period
Structured deposits, financial products, 1,454,000,000.00 1,316,000,000.00
Cash paid related to other investment activities
In RMB
Amount of current period Amount of previous
Items
period
Structured deposits, financial products, 1,840,500,000.00 1,140,433,371.49
(3)Cash related to financing activities
Cash paid related with financing activities
In RMB
Amount of current period Amount of previous
Items
period
Lease payment 8,776,024.71 9,144,572.43
Changes in various liabilities arising from fund-raising activities
In RMB
Balance at the Increase in the year Decrease in the year
Balance at the
Item end of the Changes in Non-cash Non-cash
Changes in cash end of the year
previous year cash changes changes
Short-term borrowing 7,000,000.00 8,000,000.00 - 7,000,000.00 - 8,000,000.00
Long-term borrowing 704,603,665.19 - 26,908,168.11 123,321,021.21 - 608,190,812.09
Lease liabilities 15,630,030.74 - 5,323,566.65 8,776,024.71 - 12,177,572.68
Total 727,233,695.93 8,000,000.00 32,231,734.76 139,097,045.92 - 628,368,384.77
Note: Long-term borrowings and lease liabilities include those that are due within one year.
(4) The Group does not present cash flow on a net basis
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
(5) The Group does not have any major activities or financial impacts that do not involve cash receipts and expenditures
for the current period but affect the financial position of the enterprise or may affect the cash flow of the enterprise in the
future.
56. Supplement Information for cash flow statement
（1）Supplement Information for cash flow statement
In RMB
Amount of current Amount of previous
Items
period period
I. Adjusting net profit to cash flow from operating activities
Net profit 127,136,478.58 111,791,966.32
Add: asset impairment provision 126,089,709.42 202,573,465.84
Credit loss preparation (4,535,775.14) 4,618,553.09
Depreciation of fixed assets and investment property 235,884,938.02 256,562,100.50
Depreciation of right-of-use assets 8,257,857.90 9,007,666.58
Amortization of intangible assets 4,891,672.68 5,082,893.36
Amortization of Long-term deferred expenses 2,160,430.42 1,819,286.52
Loss on disposal of fixed assets, intangible assets and other long-term
(1.72) (31,264.60)
deferred assets
Fixed assets scrap loss 113,290.32 26,020.82
Loss on fair value changes (2,151,780.82) -
Financial cost 26,883,671.86 29,183,633.15
Loss on investment (10,828,635.56) (19,383,351.87)
Decrease of deferred income tax assets 9,218,448.87 (66,115,217.51)
Increased of deferred income tax liabilities 1,625,365.47 (5,371,586.12)
Decrease of inventories (304,034,232.92) 1,248,186.40
Decease of operating receivables (126,515,773.08) (81,468,525.61)
Increased of operating Payable 90,571,075.50 40,694,723.73
Net cash flows arising from operating activities 184,766,739.80 490,238,550.60
II. Significant investment and financing activities that without cash flows:
End balance of cash equivalents 461,420,457.33 874,474,834.46
Less: Beginning balance of cash equivalents 874,474,834.46 302,408,433.72
Net increase of cash and cash equivalent (413,054,377.13) 572,066,400.74
(2) Component of cash and cash equivalents
In RMB
Items Year-end balance Year-beginning balance
I. Cash 461,420,457.33 874,474,834.46
Including：Cash at hand 1,710.40 3,980.56
Demand bank deposit 461,418,746.93 874,470,853.90
Demand other monetary funds - -
II.Cash equivalents - -
III. Balance of cash and cash equivalents at the period end 461,420,457.33 874,474,834.46
(3) During the reporting period, the Group does not have any presentation for those with restricted scope of use but still
presented as cash and cash equivalents.
- 76 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
(4) Monetary funds that are not cash or cash equivalents
In RMB
Amount incurred in the Amount incurred in the
Item Reason
year previous year
Cannot be used for
Bill margin 5,905,118.06 -
payment at any time
Cannot be used for
Current interest and 7-day call deposit interest 1,548,872.61 324,448.42
payment at any time
The principal and interest of certificates of Cannot be used for
- 115,719,927.09
deposit maturing more than three months payment at any time
Other 3,400,000.00 1,270,758.22 Account freezing
Total 10,853,990.67 117,315,133.73 /
57. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
Closing foreign currency Closing convert to RMB
Items Exchange rate
balance balance
Monetary funds 66,703,011.39
Including：USD 8,829,274.51 7.0827 62,535,102.56
Yen 68,513,734.89 0.0502 3,440,280.17
HKD 802,927.17 0.9062 727,628.66
Account receivable 28,289,108.51
Including：USD 3,958,508.14 7.0827 28,036,925.61
HKD 278,280.00 0.9062 252,182.90
Other receivable 498,404.86
Including：USD 70,369.33 7.0827 498,404.86
Account payable 319,354,807.51
Including：USD 4,335,058.95 7.0827 30,703,922.03
Yen 5,747,765,566.00 0.0502 288,612,552.37
HKD 42,300.00 0.9062 38,333.11
Other payable 6,587,005.74
Including：USD 860,536.00 7.0827 6,094,918.33
Yen 9,800,000.20 0.0502 492,087.41
58.Leasing
(1) As a lessee
The Group has leased a number of assets, including houses and buildings, with lease terms ranging from 1 to 10
years. The above-mentioned right-of-use assets cannot be used for the purpose of loan mortgage, guarantee, etc.
The Group does not have variable lease payments that are not included in the measurement of lease liabilities.
Lease expenses for simplified short-term leases: Simplified short-term lease expenses included in profit or loss for
the current period amounted to RMB558,957.38 (previous year: RMB653,461.86).
The total lease-related cash outflow for the year is RMB9,334,982.09 (previous year: RMB9,798,034.29).
(2) As a lessor
Operating lease as a lessor
In RMB
Thereinto: Income related to
variable lease payments that
Item Lease income
are not included in lease
receipts
- 77 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Thereinto: Income related to
variable lease payments that
Item Lease income
are not included in lease
receipts
Houses and buildings 97,558,143.88 -
The Group's operating leases with it as lessor are related to premises and buildings with lease terms ranging from 1
to 15 years.
The income related to operating leases for the year is RMB97,558,143.88 (previous year: RMB67,804,574.63), of
which the income related to variable lease payments that are not included in lease receipts is RMB0 (previous year:
RMB0).
In RMB
Undiscounted lease receipts
Item Amount incurred in the
Amount incurred in the year
previous year
1st year after the balance sheet date 74,399,477.80 65,239,408.94
2nd year after the balance sheet date 54,475,653.29 49,608,649.57
3rd year after the balance sheet date 44,564,404.34 40,071,243.84
4th year after the balance sheet date 29,708,115.33 33,797,303.21
5th year after the balance sheet date 9,346,233.32 22,595,837.83
Subsequent years 7,327,310.40 5,527,129.80
The total amount of undiscounted lease receipts 219,821,194.48 216,839,573.19
(VI) R&D expenditures
（1） Presented by nature of expenses
In RMB
Amount incurred in the
Items Amount incurred in the year
previous year
Employee remuneration 14,827,264.16 16,349,423.75
Material consumption 85,216,243.35 58,840,560.48
Depreciation 3,389,328.35 3,518,432.27
Others 1,220,205.06 1,811,739.04
Total 104,653,040.92 80,520,155.54
Thereinto: Expensed R&D expenditures 104,653,040.92 80,520,155.54
Capitalized R&D expenditures - -
(2) The Group has no R&D project development expenditure eligible for capitalization.
(3) The Group has no significant outsourced R&D projects under development.
(VII) Change in the scope of consolidation
Shenzhen Shengjinlian Technology Co., Ltd. was deregistered on December 13, 2023, and other than that, the scope
of the Group's consolidation has not changed.
Note: Shenzhen Shengjinlian Technology Co., Ltd. was cancelled on December 13, 2023.
- 78 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
(VIII). Equity in other subjects
1. Equity in subsidiaries
(1) Composition of the enterprise group
Shareholding Acqui
Main
Registered ratio % sition
Subsidiary name place of Place of registration Business nature
address Indire metho
business Direct
ct d
Establ
Shenzhen Lishi Industry 100.0
Shenzhen RMB 2,360,000.00 Shenzhen Property leasing - ishme
Development Co., Ltd 0
nt
Establ
100.0
Shenzhen Huaqiang Hotel Shenzhen RMB 10,005,300.00 Shenzhen Property leasing - ishme
0
nt
Establ
Shenzhen Shenfang Real Property 100.0
Shenzhen RMB 1,600,400.00 Shenzhen - ishme
Estate Management Co., Ltd. management 0
nt
Establ
Shenzhen Beauty Century Textile production 100.0
Shenzhen RMB 13,000,000.00 Shenzhen - ishme
Garment Co., Ltd. and sales 0
nt
Shenzhen Shenfang Sungang Establ
Property 100.0
Real Estate Management Co., Shenzhen RMB 1,000,000.00 Shenzhen - ishme
management 0
Ltd. nt
RMB Polarizer Acqui
SAPO Photoelectric Shenzhen Shenzhen 60.00 -
583,333,333.00 production and sale sition
Shengtou (Hongkong) Establ
HKD 100.0
Co.,Ltd. Hongkong Hongkong Polarizer sales - ishme
10,000.00 0
nt
Polarizer Establ
Shenzhen Shengjinlian 100.0
Shenzhen RMB 1,000,000.00 Shenzhen production and sale, - ishme
Technology Co., Ltd. 0
etc. nt
Note: Shenzhen Shengjinlian Technology Co., Ltd. was cancelled on December 13, 2023.
(2) Important non-wholly-owned subsidiaries
In RMB
Profit and loss
Dividends declared to Balance of minority
Minority shareholding attributable to minority
Subsidiary name minority shareholders equity at the end of the
ratio shareholders in the
in the current period period
current period
Shenzhen SAPO Photoelectric
40.00% 47,868,228.13 - 1,229,765,091.74
Co., Ltd.
(3) Major financial information of important non-wholly-owned subsidiaries
In RMB
SAPO Photoelectric
Items Year-end balance/Amount Balance of the end of last
incurred this year year / amount of last year
Current assets 2,224,998,868.32 1,936,541,263.47
Non-current assets 2,215,651,449.74 2,419,432,602.01
Total assets 4,440,650,318.06 4,355,973,865.48
- 79 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
SAPO Photoelectric
Items Year-end balance/Amount Balance of the end of last
incurred this year year / amount of last year
Current liabilities 762,685,435.65 674,071,107.48
Non-current liabilities 608,912,888.60 732,819,068.02
Total liabilities 1,371,598,324.25 1,406,890,175.50
Operating income 2,944,147,907.27 2,735,055,209.89
Net profit 119,670,570.33 96,206,958.45
Total comprehensive income 119,968,303.83 95,909,224.95
Cash flow from operating activities 168,163,478.05 484,437,283.64
2 Equity in joint venture arrangements or joint ventures
Summary financial information of unimportant joint ventures and associated enterprises
In RMB
Year-end balance/Amount Balance of the end of last
Items
incurred this year year / amount of last year
Joint ventures Associated enterprise
Total book value of investment 122,370,494.08 129,506,271.76
Total of the following items calculated by shareholding ratio
-Net profit(Loss) (7,135,777.68) 1,292,045.22
-Other comprehensive income - -
-Total comprehensive income (7,135,777.68) 1,292,045.22
Associated enterprise
Total book value of investment 5,311,526.62 4,975,563.98
Total of the following items calculated by shareholding ratio
-Net profit 236,793.79 15,593.93
-Other comprehensive income 99,168.85 151,869.82
-Total comprehensive income 335,962.64 167,463.75
(IX) Government subsidies
(1) As of December 31, 2023, the Group does not have any government subsidies recognized on the basis of receivables.
(2) Liabilities involving government subsidies
In RMB
The amount of
The amount of The amount of Asset-
The number at the non-operating The number
new subsidy other income Other changes related/
Liability item beginning of the income at the end of
added in the included in the during the year Earnings
year included in the the year
current year current year related
current year
16,107,734.2 (2,500,000.00 97,485,986.8 Asset-
Deferred income 111,814,796.10 4,278,925.00 -
1 ) 9 related
Income -
Deferred income 6,000,000.00 - - 6,000,000.00 - -
related
22,107,734.2 (2,500,000.00 97,485,986.8
Total 117,814,796.10 4,278,925.00 - /
1 ) 9
(3) Government subsidies included in profit or loss for the current period
In RMB
Amount incurred in the Amount incurred in the
Subsidy Items
year previous year
Other income 33,711,100.17 24,848,843.46
- 80 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
X. Risks related to financial instruments
The Group's main financial instruments include monetary funds, transactional financial assets, notes receivable,
accounts receivable, accounts receivable financing, other receivables, other equity instruments investment, short-term
loans, accounts payable, other payables, other current liabilities, long-term loans and lease liabilities, etc. At the end of
this year, the financial instruments held by the Group are as follows. See Note (V) for details. The risks associated with
these financial instruments and the risk management policies adopted by the Group to reduce these risks are as follows.
The management of the Group manages and monitors these risk exposures to ensure that the above risks are controlled
within a limited range.
In RMB
Amount incurred in the
Items Amount incurred in the year
previous year
Financial assets
Measured at fair value, with its changes included in current profits and
losses
Transactional financial assets 821,946,114.68 319,605,448.44
Measured at fair value, with its changes included in other
comprehensive income
Receivable financing 22,839,459.13 54,413,796.91
Investment in other equity instruments 145,988,900.00 167,678,283.27
Measured in amortized cost
Monetary funds 472,274,448.00 991,789,968.19
Note receivable 50,963,943.01 74,619,100.26
Accounts receivable 820,134,833.95 636,583,469.93
Other receivables 3,219,287.77 10,288,124.02
Financial liabilities
Measured in amortized cost
Short-term loan 8,000,000.00 7,000,000.00
Notes payable 31,049,291.49 -
Accounts payable 408,548,136.24 327,049,873.70
Other payables 184,528,344.55 197,345,455.37
Other current liabilities 42,665,954.11 92,945,741.78
Long-term loans 608,190,812.09 704,603,665.19
The Group uses sensitivity analysis technology to analyze the possible impact of reasonable and possible changes
in risk variables on current profits and losses and shareholders' equity. Because any risk variable rarely changes in
isolation, and the correlation between variables will have a great impact on the final amount of a risk variable change,
the following contents are carried out under the assumption that each variable change is independent.
1. Risk management objectives, policies and procedures, and changes occurred during the year
The Group's goal in risk management is to strike a proper balance between risks and benefits, reduce the negative
impact of risks on the Group's operating performance to the lowest level, and maximize the interests of shareholders
and other equity investors. Based on this risk management goal, the basic strategy of the Group's risk management is to
identify and analyze all kinds of risks faced by the Group, establish an appropriate risk tolerance bottom line and
conduct risk management, and timely and reliably supervise all kinds of risks to control the risks within a limited range.
1.1 Market risk
1.1.1 Foreign exchange risk
Foreign exchange risk refers to the risk of losses caused by exchange rate changes. The Group's foreign exchange
risks are mainly related to US dollars, Japanese yen, Hong Kong dollars and euros. Except for some import purchases
and export sales of the Group's companies located in Chinese mainland which are mainly settled in US dollars,
Japanese yen, Hong Kong dollars and Euros, other major business activities of the Group are settled in RMB.
As of 31 December 2023, the Group's assets and liabilities were all RMB balances, except for the monetary items
- 81 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
in foreign currencies mentioned in Notes (V), (57). The foreign exchange risks arising from the assets and liabilities
with foreign currency balances (converted into RMB) described in the table below may have an impact on the Group's
operating results.
In RMB
Balance at the end of this year
Assets Liabilities
Items
USD 91,070,433.03 36,798,840.36
Yen 3,440,280.17 289,104,639.78
HKD 979,811.56 38,333.11
The Group pays close attention to the impact of exchange rate changes on the Group's foreign exchange risk. At
present, the Group has not taken any measures to avoid foreign exchange risks.
Sensitivity analysis of foreign exchange risk
Sensitivity analysis of foreign exchange risk assumes that all net investment hedging and cash flow hedging of
overseas operations are highly effective.
On the basis of the above assumptions, with other variables unchanged, the pre-tax impact of possible reasonable
exchange rate changes on current profits and losses and shareholders' equity is as follows:
In RMB
This year Last Year
Impact on Impact on
Changes in exchange
Items Impact on profits shareholders' Impact on profits shareholders'
rate
equity equity
All foreign Appreciation of RMB
(11,522,564.42) (11,522,564.42) (10,266,787.69) (10,266,787.69)
currencies by 5%
All foreign Depreciation of RMB
11,522,564.42 11,522,564.42 10,266,787.69 10,266,787.69
currencies by 5%
1.1.2. Interest rate risk - risk of cash flow change
The Company's risk of cash flow changes of financial instruments caused by interest rate changes is mainly related
to bank loans with floating interest rate. The Group continues to pay close attention to the impact of interest rate changes
on the Group's interest rate risk. The Group's policy is to maintain floating interest rates on these loans, and there is no
interest rate swap arrangement at present.
Sensitivity analysis of interest rate risk
With other variables unchanged, the pre-tax impact of possible reasonable interest rate changes on current profits
and losses and shareholders' equity is as follows:
In RMB
This year Last Year
Impact on Impact on
Interest rate
Items Impact on profits shareholders' Impact on profits shareholders'
change
equity equity
Floating-rate loan Increase by 1% (6,154,214.55) (6,154,214.55) (7,108,088.43) (7,108,088.43)
Floating-rate loan Decrease by 1% 6,154,214.55 6,154,214.55 7,108,088.43 7,108,088.43
1.2. Credit risk
On December 31, 2023, the largest credit risk exposure that may cause the Group's financial losses mainly came
from the loss of the Group's financial assets caused by the failure of the other party to the contract, including monetary
funds, transactional financial assets, notes receivable, accounts receivable, receivables financing and other receivables.
On the balance sheet date, the book value of the Group's financial assets has represented its maximum credit risk
exposure.
In order to reduce the credit risk, the Group arranges special personnel to determine the credit limit, conduct credit
approval and implement other monitoring procedures to ensure that necessary measures are taken to recover overdue
debts. In addition, the Group reviews the recovery of financial assets on each balance sheet date to ensure that sufficient
credit loss provision has been made for relevant financial assets. Therefore, the management of the Group believes that
the credit risk assumed by the Group has been greatly reduced.
The Group's monetary funds are deposited in banks with high credit ratings, so the monetary funds only have low
- 82 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
credit risk.
On December 31, 2023, the balance of accounts receivable of the Group to the top five customers was
RMB510,920,546.66, accounting for 59.16% of the balance of accounts receivable of the Group. In addition, the Group
has no other significant credit risk exposure concentrated in a single financial asset or financial asset portfolio with
similar characteristics.
1.3 Liquidity risk
When managing liquidity risk, the Group maintains sufficient cash and cash equivalents as deemed by the
management and monitors them to meet the Group's business needs and reduce the impact of cash flow fluctuations. The
management of the Group monitors the use of bank loans and ensures compliance with the loan agreement.
On December 31, 2023, the Group's unused comprehensive bank credit line was RMB 111,896.00.
The financial liabilities held by the Group are analyzed according to the maturity of the undiscounted remaining
contractual obligations as follows:
In RMB
Item Within 1 year 1-5 years Over 5 years Total
Short-term loan 8,202,908.33 - - 8,202,908.33
Notes payable 31,049,291.49 - - 31,049,291.49
Accounts payable 408,548,136.24 - - 408,548,136.24
Other payables 184,528,344.55 - - 184,528,344.55
Other current liabilities 42,665,954.11 - - 42,665,954.11
Long-term loans 121,051,052.09 543,134,195.76 - 664,185,247.85
Lease liabilities 5,809,756.61 5,822,333.46 1,672,592.08 13,304,682.15
2. Transfer of financial assets
2.1Classification of transfer methods
In RMB
The amount of Derecognitio
The nature of the The basis for determining the situation of
Transfer method financial assets n
transferred financial assets derecognition
transferred information
After the accounts receivable are factored,
the factoring institution has no right to
Derecognitio recover from the company, and it can be
Factoring Accounts receivable 634,780,309.98
n determined that the main risks and rewards
of the accounts receivable have been
transferred, so the recognition is terminated.
Since the credit risk and deferred payment
risk of banker's acceptance bill in
financingsreceivable are very small, and the
Outstanding banker's
interest rate risk related to the bill has been
acceptance bill that is Derecognitio
Endorsement transfer 59,520,699.22 transferred to the bank, it can be
classified as financings n
determinedthat the main risks and rewards
receivable
on the ownership of the note have been
transferred, so the recognition is
derecognized.
Unexpired banker's Non-
Endorsement transfer acceptance bill classified 42,665,954.11 derecognitio Not eligible for derecognition
as bills receivable n
Total / 736,966,963.31
2.2 Financial assets that have been derecognized as a result of transfer
In RMB
Method for the The amount of the Gains or losses
Item financial assets financial asset related to
transferred derecognized derecognition
Endorsement
Financings receivable 59,520,699.22 -
transfer
Accounts receivable Factoring 634,780,309.98 -
Total / 694,301,009.20 -
- 83 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
2.3 Transferred financial assets that continue to be involved
In RMB
Amount of assets Amount of liability
Asset transfer resulting from arising from
Item
method continued continued
involvement involvement
Transfer by
Notes receivable - 42,665,954.11
endorsement
Total / - 42,665,954.11
XI. Disclosure of fair value
1. Ending fair value of assets and liabilities measured at fair value
In RMB
Year-end fair value
Fair value Fair value Fair value
Items
measurement of measurement of measurement of Total
Level 1 Level 2 Level 3
Measured at fair value continuously
(I) Transactional financial assets - 821,946,114.68 - 821,946,114.68
(II) Receivable financing - - 22,839,459.13 22,839,459.13
(III) Investment in other equity instruments - - 145,988,900.00 145,988,900.00
Total assets continuously measured at fair value - 821,946,114.68 168,828,359.13 990,774,473.81
2. For Level 2 items measured at fair value continuously and non-continuously, the valuation techniques and
qualitative and quantitative information of important parameters are adopted
In RMB
Fair value at the end of
Items this year Valuation technique Input value
Discounted cash flow
Transactional financial assets 821,946,114.68 Expected yield
technique
3. For Level 3 items measured at fair value continuously and non-continuously, the valuation techniques and
qualitative and quantitative information of important parameters are adopted
In RMB
Fair value at the end of
Items this year Valuation technique Input value
Discounted cash flow
Receivable financing 22,839,459.13 Discount rate
technique
Comparison of listed P/B ratio of similar listed
companies companies
Comparable income
Investment in other equity instruments 145,988,900.00 Market price
method
Statement adjustment
Book value
method
4. Fair value of financial assets and financial liabilities not measured at fair value
Financial assets and liabilities not measured at fair value mainly include monetary funds, notes receivable, accounts
receivable, other receivables, short-term loans, accounts payable, other payables, long-term loans and lease liabilities.
The management of the Group believes that the book values of financial assets and financial liabilities measured in
amortized cost in the financial statements are close to their fair values.
- 84 -
Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
XII. Related parties and related party transactions
1. Information about the parent company of the Enterprise.
Shareholding ratio Percentage of
Registered of the parent voting rights of the
Name of parent company Place of registration Business nature capital company to the parent company to
(RMB '0,000) Company % the Company %
Equity
18/F, Investment
investment,
Shenzhen Investment Holdings Co., Building, Shennan
real estate 3,235,900.00 46.21 46.21
Ltd Road, Futian
development,
District, Shenzhen
etc
Description of the parent company of the Enterprise
The parent company of the Company is a wholly state-owned company approved and authorized by the Shenzhen
Municipal Government, and exercises the investor function for the state-owned enterprises within the authorized scope
according to law.
During the reporting period, the changes in the registered capital of the parent company are as follows:
In RMB 10,000
Balance at the end of this
Balance at the end of last year Increase this year Decrease this year
year
2,850,900.00 385,000.00 - 3,235,900.00
2. Information on subsidiaries of the Enterprise
Please refer to Notes (VII), 1 for details of the subsidiaries of the Enterprise.
3. Information on joint ventures and associated enterprises of the Enterprise
See Notes (VII), 2 for details of the important joint ventures or associated enterprises of the Enterprise.
4. Information on other related parties
Names of other related parties Relationship between other related parties and the Enterprise
The Company's shareholding company and the chairman of
Shenzhen Xinfang Knitting Co., Ltd.
the company are the employees of the Group
The Company's shareholding company and the chairman of
Shenzhen Dailishi Underwear Co., Ltd.
the company are the employees of the Group
Minority shareholder of SAPO Photoelectric , a subsidiary of
Hengmei Optoelectronics Co., Ltd the Company, one of whose directors is a supervisor of SAPO
Photoelectric
A subsidiary of Shenzhen Investment Holdings Limited, the
Shenzhen Shentou Property Development Co.Ltd
parent company of the Company
A subsidiary of Shenzhen Investment Holdings Limited, the
Shenzhen Investment Building Hotel Co., Ltd.
parent company of the Company
A subsidiary of Shenzhen Investment Holdings Limited, the
Shenzhen Investment Building Property Management Co., Ltd.
parent company of the Company
A subsidiary of Shenzhen Investment Holdings Limited, the
Shenzhen SGE Longyan Energy Technology Co., Ltd.
parent company of the Company
5. Related party transactions
(1) Procurement of goods/acceptance of services
Content of related party Amount incurred this Amount incurred last
Related party
transaction year year
Hengmei Optoelectronics Co., Ltd Optical film materials 4,540,435.30 -
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
and processing
Shenzhen SGE Longyan Energy Technology Co.,
Purchasing electricity 1,075,289.19 -
Ltd.
Shenzhen Guanhua Printing & Dyeing Co., Ltd. Interest expenses 16,237.39 6,601.33
Total 5,631,961.88 6,601.33
(2) Sale of goods
In RMB
Content of related party Amount incurred this Amount incurred last
Related party
transaction year year
Hengmei Optoelectronics Co., Ltd Polarizer 4,744,631.12 -
Shenzhen Shentou Property Development Co.Ltd Textile 65,634.51 -
Shenzhen Investment Building Hotel Co., Ltd. Textile 163,729.20 -
Shenzhen Investment Building Property
Textile 35,522.12 -
Management Co., Ltd.
Shenzhen Investment Holdings Co., Ltd Textile 15,371.68 -
Shenzhen Guanhua Printing & Dyeing Co., Ltd. Textile - 8,849.56
Total 5,024,888.63 8,849.56
(3) Lending of related party funds
In RMB
Related party Borrowing amount Start date Due date Description
Lending
The annual lending
Shenzhen Guanhua Printing & Dyeing Co., Ltd. 3,806,454.17 2019.07.30 2024.07.31
rate is 0.30%
(4) Rewards for the key management personnel
In RMB
Amount of current Amount of previous
Rewards for the key management personnel Items
period period
Rewards for the key management personnel 8,557,258.00 11,966,067.00
6. Receivables and payables of related parties
（1）Receivables
In RMB
Amount at year end Amount at year beginning
Name Related party Balance of Balance of Balance of Bad debt
Book Book Book Provision
Other Account Shenzhen Dailishi
1,100,000.00 58,850.00 1,100,000.00 58,850.00
receivable Underwear Co., Ltd.
Other Account Shenzhen Guanhua Printing
41,325.00 - - -
receivable & Dyeing Co., Ltd.
Total 1,141,325.00 58,850.00 1,100,000.00 58,850.00
（2）Payables
In RMB
Name Related party Amount at year end Amount at year
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
beginning
Other payable Yehui International Co.,Ltd. 1,124,656.60 1,124,656.60
Other payable Shenzhen Changlianfa Printing & dyeing Co., Ltd. 2,023,699.95 2,023,699.95
Other payable Shenzhen Guanhua Printing & dyeing Co., Ltd. 3,811,272.20 3,806,454.17
Other payable Shenzhen Xinfang Knitting Co., Ltd. 244,789.85 244,789.85
Other payable Shenzhen Investment Holdings Co., Ltd 485,189.00 643,987.04
Total 7,689,607.60 7,843,587.61
XIII. Commitments and contingencies
1. Important commitments
(1) Capital commitment
In RMB
Amount at the end of this Amount at the end of last
Items
year year
Contracted but not recognized in the financial statements
Commitment to purchase and build long-term assets 2,413,823.52 3,761,094.00
2. Contingencies
As of December 31, 2023, the Group has no pending litigation, external guarantees and other contingencies that shall be
disclosed.
XIV. Matters after the balance sheet date
1. Profit distribution after the balance sheet date
On March 26, 2024, the Board of Directors of the Company convened and adopted the profit distribution plan for
2023. Based on the total number of shares entitled to profit distribution of 506,521,849 shares on December 31, 2023,
the Company distributed RMB0.65 in cash (including tax) for every 10 shares, with a total cash dividend of RMB
32,923,920.19 元. The profit distribution plan has yet to be approved by the General Meeting of Shareholders of the
Company.
In RMB
Items Amount
Profits or dividends to be distributed 32,923,920.19
Profits or dividends declared after deliberation and approval
XV. Other important matters
1. Segment information
(1) Determination basis and accounting policy of reporting segment
According to the Group's internal organizational structure, management requirements and internal reporting system,
the Group's business operations are divided into three business segments, and the management of the Group regularly
evaluates the operating results of these segments to determine the allocation of resources and evaluate the performance.
On the basis of operating segments, the Group has identified the following three reporting segments: polarizer business,
property leasing business and textile business.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
The information reported by each segment is disclosed according to the accounting policies and measurement
standards adopted by each segment when reporting to the management, and these measurement bases are consistent with
those used when preparing financial statements
(2) Financial information of reporting segment
In RMB
This year or the end of this
Polarizer Property leasing Offset Total
year
Operating income:
External transaction income 2,885,625,542.77 194,052,832.68 - 3,079,678,375.45
Inter-segment transaction
- 5,228,270.79 (5,228,270.79) -
income
Total operating income of
2,885,625,542.77 199,281,103.47 (5,228,270.79) 3,079,678,375.45
segment
Operating expenses (note) 2,740,034,558.58 133,409,869.35 (4,899,337.05) 2,868,545,090.88
Operating profit 127,113,090.17 36,505,509.79 (10,318,467.66) 153,300,132.30
Net profit 111,017,342.91 26,450,970.51 (10,331,834.84) 127,136,478.58
Total assets of segment 4,439,757,297.25 3,223,473,385.00 (2,013,408,318.81) 5,649,822,363.44
Total liabilities of segment 1,363,903,983.44 219,428,207.11 (45,427,185.07) 1,537,905,005.48
Note: This item includes operating costs, taxes and surcharges, management costs, R&D expenses, sales expenses and
financial expenses.
2. Other important transactions and matters that have an impact on investors' decisions
(1) Major asset restructuring
On December 30, 2022, the "Proposal on the Purchase of Assets by Issuing Shares and Paying Cash and Raising
Matching Funds Namely the Related Party Transaction Plan" was deliberated and approved in the 19th meeting of the
8th session of the board of directors of the Company, in which the Company intends to purchase 100% of the shares of
Hengmei Optoelectronics Co., Ltd. held by 17 companies including Chimei Materials and Haosheng (Danyang) by
issuing shares and paying cash. The cash consideration for this transaction is intended to be paid by the Company
through self-raised funds such as M&A loans and raising matching funds, and the Company intends to raise matching
funds from no more than 35 qualified specific investors through non-public issuance of shares. The total amount of
matching funds raised shall not exceed 100% of the transaction price of the assets to be purchased by issuing shares,
and the number of shares issued shall not exceed 30% of the total share capital of the listed company after the
completion of the purchase of assets by issuing shares.
On November 17, 2023, the "Proposal on Shenzhen Textile (Holdings) Co., Ltd.’s Issuance of Shares and Payment of
Cash to Purchase Assets and Raise Matching Funds Namely the Related Party Transaction Plan (Revised Draft) and its
Summary" wasdeliberated and approved in the 25th meeting of the 8th session of the Board of Directors of the
Company, the original counterparty Hangzhou Rencheng Trading Partnership (Limited Partnership) will no longer
participate in this transaction, and add the new counterparty Kunshan Guochuang Investment Group Co., Ltd., and the
underlying assets will still be the 100% equity of the target company. Meanwhile, the transaction plan will be adjusted
in accordance with the relevant system rules for the full implementation of the stock issuance registration system
issued by the China Securities Regulatory Commission.
The transaction will not result in a change of control of the Company, and the actual controller of the Company before
and after the transaction is the State-owned Assets Supervision and Administration Commission of the Shenzhen
Municipal People's Government. As of the date of approval of the financial report, the transaction still needs to obtain
relevant approvals, filing and other procedures, the audit, evaluation, due diligence and other work involved in the
transaction are still in progress, and after the completion of the relevant work, the Company will once more convene
ameeting of the board of directors to consider the relevant matters of the transaction.
(2) Real estate that has not yet been disposed of by Shenzhen Xieli Automobile Enterprise Co., Ltd. (hereinafter referred
to as "Shenzhen Xieli").
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Shenzhen Xieli, a sino-foreign joint venture invested and established by the Company and Hong Kong Xieli
Maintenance Company (hereinafter referred to as "Hong Kong Xieli"), was cancelled by the Shenzhen Municipal
Administration for Market Regulation in March 2020, but there are still three properties under the name of Shenzhen
Xieli that need to be disposed of through consultation between the shareholders of both parties. In July 2020, the
Company filed an administrative act in the People's Court of Yantian District, Shenzhen, Guangdong Province to revoke
the cancellation of Shenzhen Xieli approved by the Shenzhen Municipal Administration for Market Regulation.
In December 2022, the People's Court of Yantian District, Shenzhen, Guangdong Province, rendered a judgment of first
instance for retrial, revoking the administrative act of approving the cancellation of Shenzhen Xieli. In January 2023, the
third party of the original trial, Hong Kong Xie-li, appealed to the Intermediate People's Court of Shenzhen, Guangdong
Province, and later ruled that the appeal should be withdrawn by Hong Kong Xie-Li due to Hong KongXie-Li's failure to
pay the case acceptance fee in advancement schedule, and retrial of first instance judgment took effect on March 22,
2023.
XVI. Notes on main items of parent company's financial statements
1. Accounts receivable
(1) Disclosure by age
In RMB
Amount at the end of this Amount at the end of last
Aging
year year
Within 1 year 10,190,859.62 13,871,107.36
1-2 years - 2,485,076.00
2-3 years 2,485,076.00 -
Total 12,675,935.62 16,356,183.36
(2) Classified disclosure by credit loss provision accrual method
In RMB
Balance at the end of this year
Book balance Bad debt provision
Category
Accrual proportion Book value
Amount Proportion (%) Amount
(%)
Account receivable that withdrawal
- - - - -
bad debt provision by single item
Account receivable withdrawal bad debt
12,675,935.62 100.00 4,311.97 0.03 12,671,623.65
provision by portfolio
Total 12,675,935.62 100.00 4,311.97 / 12,671,623.65
In RMB
Amount at year-begin
Book balance Bad debt provision
Category Proportion Accrual proportion Book value
Amount Amount
(%) (%)
Account receivable that withdrawal bad
- - - - -
debt provision by single item
Account receivable withdrawal bad debt
16,356,183.36 100.00 713,159.25 4.36 15,643,024.11
provision by portfolio
Total 16,356,183.36 100.00 713,159.25 / 15,643,024.11
As of December 31, 2023, the credit risk and bad debt provision for Portfolio 1 accounts receivable are as
follows:
In RMB
Balance at the end of the year
Category )Expected average Provision for bad
Book balance Book value
loss ratio (%) debts
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Within 1 year 0.04 10,190,859.62 4,311.97 10,186,547.65
2-3 years - 2,485,076.00 - 2,485,076.00
Total / 12,675,935.62 4,311.97 12,671,623.65
As ofDecember 31, 2023, the credit risk and bad debt provision of Portfolio 2 accounts receivableare as follows:
In RMB
Stage 1 Stage 2 Stage 3
Expected credit
Expected credit Expected credit losses for the entire
Bad Debt Reserves Total
losses over the loss over life (no duration (credit
next 12 months credit impairment) impairment
occurred)
Balance as at January 1, 2023 713,159.25 - - 713,159.25
Balance as at January 1, 2023 in current - - - -
——Transfer to stage II - - - -
——Transfer to stage III - - - -
-- Reversal to the II stage - - - -
-- Reversal to the I stage - - - -
Provision in Current Year - - - -
Reversal in Current Year (708,847.28) - - (708,847.28)
Conversion in Current Year - - - -
Write off in Current Year - - - -
Other change - - - -
Balance as at 31 Dec. 2023 4,311.97 - - 4,311.97
(3) Provision for bad debts
In RMB
Balance at Amount of change this year Balance at the
Category the beginning Recovery Write-off or Other end of this
Accrual
of this year or reversal cancellation changes year
Provision for bad debts 713,159.25 - 708,847.28 - - 4,311.97
Total 713,159.25 - 708,847.28 - - 4,311.97
There is no bad debt provision recovered or reversed with amounts significant during the year.
（4）There are no accounts receivable actually written off during the year.
（5）Top 5 of the closing balance of the accounts receivable collected according to the arrears party
In RMB
Name Balance in year-end Proportion(%) Bad debt provision
Total accounts receivable of the top five balances on December 31,
12,652,340.62 99.81 3,073.24
2023
2.Other receivable
(1) Disclosure by aging
In RMB
Balance at the end of this Balance at the end of last
Aging
year year
Within 1 year 1,683,810.52 3,408,892.46
1-2 years 2,213,073.28 10,707,995.02
2-3 years 10,100,800.01 -
Over 3 years 15,279,395.10 15,279,395.10
Total 29,277,078.91 29,396,282.58
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Less: Bad debt provision 15,263,525.96 15,263,525.96
book value 14,013,552.95 14,132,756.62
(2) Disclosure by payment nature
In RMB
Book balance at the end Book balance at the end
Payment nature
of this year of last year
Deposit and security deposit 10,000.00 10,000.00
External unit transactions 15,349,339.97 15,349,339.97
Related party transactions within the consolidation scope 12,553,241.09 12,980,241.09
Others 1,364,497.85 1,056,701.52
Total 29,277,078.91 29,396,282.58
(3) Accrual of credit loss provision
As ofDecember 31, 2023, the provision for bad debts is made based on the general model of expected credit losses.
In RMB
Stage 1 Stage 2 Stage 3
Expected credit
Expected credit Expected credit losses for the
Bad Debt Reserves Total
losses over the loss over life (no entire duration
next 12 months credit impairment) (credit impairment
occurred)
Balance as at January 1, 2023 59,301.12 3,018.92 15,201,205.92 15,263,525.96
Balance as at January 1, 2023 in current
——Transfer to stage II (442.69) 442.69 - -
——Transfer to stage III - - - -
-- Reversal to the II stage - - - -
-- Reversal to the I stage - - - -
Provision in Current Year - 5,529.83 - 5,529.83
Reversal in Current Year (5,529.83) - - (5,529.83)
Conversion in Current Year - - - -
Write off in Current Year - - - -
Other change - - - -
Balance as at 31 Dec. 2023 53,328.60 8,991.44 15,201,205.92 15,263,525.96
As ofDecember 31, 2023, Accrual of credit loss provision
In RMB
Year-end amount
Stage Expected average
Book balance Loss provision Book value
loss rate (%)
Other receivables for which credit loss provision
is made according to the combination of credit 52.13 29,277,078.91 15,263,525.96 14,013,552.95
risk characteristics
As of December 31, 2023, the credit risk and bad debt provision for other receivables are as follows:
Year-end amount
账龄 Expected average
Book balance Loss provision Book value
loss rate (%)
Within 1 year 3.17 1,683,810.52 53,328.60 1,630,481.92
1-2 years 0.04 2,213,073.28 902.24 2,212,171.04
2-3 years 0.08 10,100,800.01 8,089.20 10,092,710.81
Over 3 years 99.49 15,279,395.10 15,201,205.92 78,189.18
Total 29,277,078.91 15,263,525.96 14,013,552.95
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
(4) Changes in bad debt provisions
In RMB
Balance at the Change amount for the year
Balance at the
Category beginning of the Recovery or Transfer or Other
Accrual end of the year
year reversal write off changes
Bad debt provisions 15,263,525.96 5,529.83 (5,529.83) - - 15,263,525.96
(5) There are no other accounts receivable actually written off during the year.
(6) Top five companies with year-end balance of other receivables collected by the defaulting party
In RMB
Proportion of total
Year-end
Year-end year-end balance of
balance of
balance of other receivables
Unit name Payment nature Aging credit loss
other (%)
provision
receivables
Current
payment
Total other receivables of the receivable Within 1 year, 1-2
14,266,189.9
top five balances on December between 27,860,581.06 years, 2-3 years, 95.16
7
31, 2023 companies and Over 3 years
internal current
payment
3. Long-term equity investment
In RMB
Closing balance Opening balance
Items Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Investments in 1,976,433,419. 1,959,850,790. 1,974,532,127. 1,957,949,498.
16,582,629.30 16,582,629.30
subsidiaries 39 09 39 09
Investments in joint
122,370,494.08 - 122,370,494.08 129,506,271.76 - 129,506,271.76
ventures
Investments in
5,311,526.62 - 5,311,526.62 4,975,563.98 - 4,975,563.98
associates company
2,104,115,440. 2,087,532,810. 2,109,013,963. 2,092,431,333.
Total 16,582,629.30 16,582,629.30
09 79 13 83
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
（1）Investment to the subsidiary
In RMB
Withdrawn
Closing balance of
Name Opening balance Add investment Decreased investment Closing balance impairment
impairment provision
provision
SAPO Photoelectric 1,924,663,070.03 - - - 1,924,663,070.03 14,415,288.09
Shenzhen Lisi Industrial Development
8,073,388.25 - - - 8,073,388.25 -
Co., Ltd.
Shenzhen Beauty Century Garment Co.,
18,765,507.55 1,901,292.00 - - 20,666,799.55 2,167,341.21
Ltd.
Shenzhen Huaqiang Hotel 15,489,351.08 - - - 15,489,351.08 -
Shenzhen Shenfang Real Estate
1,713,186.55 - - - 1,713,186.55 -
Management Co., Ltd.
Shenzhen Shenfang Sungang Real Estate
5,827,623.93 - - - 5,827,623.93 -
Management Co., Ltd.
Total 1,974,532,127.39 1,901,292.00 - - 1,976,433,419.39 16,582,629.30
（2）Investment to joint ventures and associated enterprises
In RMB
Increase /decrease in reporting period
Equity Closing
Adjustment
method Declaration balance of
Opening of other Other Withdrawn Chosing
Name Add Decreased affirmative of cash impairme
balance comprehen equity impairment Other balance
investment investment profit and dividends nt
sive changes provision
loss on or profit provision
income
investments
I. Joint ventures
Shenzhen Guanhua
129,506,271.7 (7,135,777.6 122,370,494.0
Printing & Dyeing Co., - - - - - - - -
6 8) 8
Ltd.
129,506,271.7 (7,135,777.6 122,370,494.0
Subtotal - - - - - - - -
6 8) 8
II. Associated enterprises
Shenzhen Changlianfa
Printing and dyeing 3,105,796.55 - - 252,320.54 - - - - - 3,358,117.09 -
Company
Yehui International Co.,
1,869,767.43 - - (15,526.75) 99,168.85 - - - - 1,953,409.53 -
Ltd.
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
Subtotal 4,975,563.98 - - 236,793.79 99,168.85 - - - - 5,311,526.62 -
134,481,835.7 (6,898,983.8 127,682,020.7
Total - - 99,168.85 - - - - -
4 9) 0
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Shenzhen Textile(Holdings) Co., Ltd.
Financial Statements and Auditor's Report
For the year ended December 31,2023
4.Business income and Business cost
(1）Business income and Business cost
In RMB
Amount of current period Amount of previous period
Items
Business income Business cost Business income Business cost
Income from Main Business 77,822,508.75 9,822,306.53 56,046,883.88 9,544,956.96
(2) Main business income and main business cost classified by product
In RMB
Amount incurred this year Amount incurred last year
Product
Main business income Main business cost Main business income Main business cost
Property leasing 77,822,508.75 9,822,306.53 56,046,883.88 9,544,956.96
(3) Main business income and main business cost classified by area
In RMB
Amount incurred this year Amount incurred last year
Area
Main business income Main business cost Main business income Main business cost
Domestic 77,822,508.75 9,822,306.53 56,046,883.88 9,544,956.96
5.Investment income
In RMB
Items Amount of current Amount of previous
period period
Income from long-term equity investment measured by adopting the equity method (6,898,983.89) 1,307,639.15
Income from long-term equity investment measured by adopting the cost method 9,989,533.92 -
Investment income of trading financial assets during the holding period 14,816,230.07 15,748,625.37
Dividend income earned during investment holdings in other equity instruments 1,393,735.85 1,599,735.85
Tota 19,300,515.95 18,656,000.37
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Shenzhen Textile(Holdings) Co., Ltd.
Supplementary information
For the year ended December 31,2023
1. Particulars about current non-recurring gains and loss
In accordance with the provisions of the No. 1Explanatory Announcement on Information Disclosure of Companies
Offering Securities to the Public-Non-Recurring Profit and Loss (Revised in 2023) (hereinafter referred to as the " No.
1Explanatory Announcement") issued by the China Securities Regulatory Commission, the Group's non-recurring profit
and loss for 2023 is as follows:
In RMB
Items Amount
Non-current asset disposal gain/loss(including the write-off part for which assets impairment
provision is made)
1.72
Government subsidy recognized in current gain and loss(excluding those closely related to
the Company’s business and granted under the state’s policies)
19,927,836.02
Losses/gains from changes of fair values occurred in holding trading financial assets and
trading financial liabilities, and investment income obtaining from the disposal of trading
2,151,780.82
financial assets, trading financial liability and financial assets available-for-sale, excluded
effective hedging business relevant with normal operations of the Company
Reversal of the account receivable depreciation reserves subject to separate impairment test 15,031,480.15
Other non-business income and expenditures other than the above (6,755,922.25)
Total non-recurring gains and losses 30,355,176.46
Less :Influenced amount of income tax 3,478,333.83
Net non-recurring gains and losses 26,876,842.63
Influenced amount of minor shareholders’ equity (after tax) 9,937,259.91
Non-recurring gains or losses attributable to the common shareholders of the Company 16,939,582.72
Note: According to No. 1Explanatory Announcement, the impact on the Group's net non-recurring profit and loss in
2022 is RMB13,006,395.30, and the impact on the non-recurring profit or loss attributable to ordinary shareholders of
the Company is RMB7,803,837.18.
2. Return on net asset and earnings per share
This statement of return on net assets and earnings per share is prepared by the Group in accordance with the Rules for
Information Disclosure of Companies Issuing Securities to the Public No. 9- Calculation and Disclosure of Return on
Equity and Earnings per Share (revised in 2010) issued by China Securities Regulatory Commission.
In RMB
Earnings per share
Weighted average
Profit of report period Basic earnings per Diluted earnings per
returns equity(%)
share share
Net profit attributable to the Common stock shareholders
2.77 0.16 0.16
of Company.
Net profit attributable to the Common stock shareholders
2.17 0.12 0.12
of Company after deducting of non-recurring gain/loss.
The Board of Directors of Shenzhen Textile (Holdings) Co., Ltd.
March 28, 2024
