CHANGHONG MEILING CO.,LTD. Annual Report 2018
长虹美菱股份有限公司
CHANGHONG MEILING CO., LTD.
二〇一八年年度报告
Annual Report 2018
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section I. Important Notice, Contents and Paraphrase
Board of Directors, Supervisory Committee, all directors, supervisors and senior executives of
Changhong Meiling Co., Ltd. (hereinafter referred to as the Company) hereby confirm that there are
no any fictitious statements, misleading statements, or important omissions carried in this report,
and shall take all responsibilities, individual and/or joint, for the reality, accuracy and completion of
the whole contents.
Mr. Li Wei, Chairman of the Company, Mr. Pang Haitao, person in charge of accounting work
and Mr. Luo Bo, person in charge of accounting organ (accountant in charge) hereby confirm that
the Financial Report of 2018 Annual Report is authentic, accurate and complete.
The Company did not have directors, supervisors and senior executives of the Company could
not guarantee the reality, accuracy and completion of the whole contents or have objections.
All the directors attended the board meeting on deliberating the Report on site and by
communication.
Modified audit opinions notes
□ Applicable √ Not applicable
Shine Wing Certified Public Accountants Co., Ltd. (LLP) issued standard unqualified Auditors’
Report for the Company’s Financial Report of 2018.
Major defects in internal control
□ Applicable √Not applicable
The Company had no major defects in internal control in the reporting period.
Risk warning of concerning the forward-looking statements with future planning involved in
annual report
√ Applicable □Not applicable
Concerning the forward-looking statements with future planning involved in the Report, they
do not constitute a substantial commitment for investors, investors and the person concerned should
maintain adequate risk awareness, furthermore, differences between the plans, forecast and
commitments should be comprehended. Investors are advised to exercise caution of investment
risks.
Investors are advised to read the full text of annual report, and pay particular attention to the
following risk factors.
More details about the possible risks and countermeasures in the operation of the Company are
described in the report “IX. Prospects for the future development of the company” of “Section IV.
Analysis and discussion of the operation”, investors are advised to read the relevant content.
Securities Times, China Securities Journal, Hong Kong Commercial Daily and Juchao Website
(www.cninfo.com.cn) are the media for information disclosure for year of 2019 that appointed by
the Company. All public information under the name of the Company disclosed on the above said
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
media and website shall prevail, and investors are advised to exercise caution.
Does the Company need to comply with disclosure requirements of the special industry: no
Profit distribution pre-plan or capitalizing of common reserves pre-plan deliberated by the
Board in the reporting period
√ Applicable □ Not applicable
Whether has capitalizing of common reserves carried out
□Yes √ No
The profit distribution plan for year of 2018, that deliberated and approved by 20th session of
the 9th BOD was: take total shares of 1,044,597,881 shares as base dated 31 December 2018,
distributed 0.6 Yuan (tax included) bonus in cash for every 10-share hold by all shareholders, no
share bonus issued and no capitalizing of common reserves carried out.
Directors and senior executives of the Company respectively signed Written Confirmation
Opinions for 2018 Annual Report.
Supervisory Committee of the Company formed Written Examination Opinions for 2018
Annual Report.
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Contents
Section I. Important Notice, Contents and Paraphrase ................................................................. 1
Section II Company Profile and Main Financial Indexes .............................................................. 5
Section III. Summary of Company Business ................................................................................. 12
Section IV. Discussion and Analysis of the Operation .................................................................. 21
Section V. Important Events............................................................................................................ 59
Section VI. Changes in shares and particular about shareholders............................................ 162
Section VII. Preferred Stock ......................................................................................................... 172
Section VIII. Particular about Directors, Supervisors, Senior Executives and Employees .... 173
Section IX. Corporate Governance .............................................................................................. 189
Section X. Corporate Bond ........................................................................................................... 205
Section XI. Financial Report ......................................................................................................... 206
Section XII. Documents available for Reference ......................................................................... 367
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Paraphrase
Items Refers to Contents
Company, The Company, Meiling
Refers to CHANGHONG MEILING CO.,LTD.
Electric or Changhong Meiling
Sichuan Changhong or controlling
Refers to Sichuan Changhong Electric Co., Ltd.
shareholder
Sichuan Changhong Electronics Holding Group Co.,
Changhong Group Refers to
Ltd.
Hong Kong Changhong Refers to CHANGHONG (HK) TRADING LIMITED
Meiling Group Refers to Hefei Meiling Group Holdings Limited
Industry Investment Group Refers to Hefei Industry Investment Holding (Group) Co., Ltd.
Shine Wing Refers to Shine Wing Certified Public Accountants (LLP)
Changhong Air-conditioner Refers to Sichuan Changhong Air-conditioner Co., Ltd.
Zhongke Meiling Refers to Zhongke Meiling Cryogenic Technology Co., Ltd.
Jiangxi Meiling Refers to Jiangxi Meiling Electric Appliance Co., Ltd.
Changhong Ridian Refers to Guangdong Changhong Ridian Technology Co., Ltd.
Zhongshan Changhong Refers to Zhongshan Changhong Electric Co., LTD
Changmei Technology Refers to Changmei Technology Co., Ltd.
Changhong Huayi Compressor Refers to Changhong Huayi Compressor Co., Ltd.
Meiling CANDY Refers to Meiling CANDY Washing Machine Co., Ltd.
CSRC Refers to China Securities Regulatory Commission
China Securities Regulatory Commission, Anhui
Anhui Securities Bureau Refers to
Province Securities Regulatory Bureau
SSE Refers to Shenzhen Stock Exchange
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section II Company Profile and Main Financial Indexes
I. Company profile
MEILINGDIANQI,
Short form of the stock Stock code 000521, 200521
WANMEILING-B
Short form of the Stock after
Changhong Meiling, Hongmeiling B
changed (if applicable)
Stock exchange for listing Shenzhen Stock Exchange
Name of the Company (in
长虹美菱股份有限公司
Chinese)
Short form of the Company (in
长虹美菱
Chinese)
Foreign name of the Company
CHANGHONG MEILING CO.,LTD.
(if applicable)
Abbr. of English name of the
CHML
Company (if applicable)
Legal representative Li Wei
Registrations add. No. 2163, Lianhua Road, Economic and Technology Development Zone, Hefei
Code for registrations add 230601
Offices add. No. 2163, Lianhua Road, Economic and Technology Development Zone, Hefei
Codes for office add. 230601
Website http://www.meiling.com
E-mail info@meiling.com
II. Person/Way to contact
Secretary of the Board Rep. of security affairs
Name Li Xia Zhu Wenjie
No. 2163, Lianhua Road, Economic and No. 2163, Lianhua Road, Economic and
Contact add.
Technology Development Zone, Hefei Technology Development Zone, Hefei
Tel. 0551-62219021 0551-62219021
Fax. 0551-62219021 0551-62219021
e-mail lixia@meiling.com wenjie.zhu@meiling.com
III. Information disclosure and preparation place
Newspaper appointed for information Securities Times, China Securities Journal, Hong Kong
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
disclosure Commercial Daily
Website for annual report publish appointed by
Juchao website: http://www.cninfo.com.cn
CSRC
Room of secretary of the Board, 2/F , administrative center,
Preparation place for annual report
Office building of the Company
IV. Registration changes of the Company
Organization code Uniform social credit code: 9134000014918555XK
Changes of main business since
No changes
listing (if applicable)
1. In October 1993, after initial listing, controlling shareholder of the
Company-- Hefei Meiling Industrial Corp. (renamed as Hefei Meiling Group
Co., dated 23 May 1994), executing controlling rights of the Company and
management right of the state-owned assets on behalf of Hefei State-owned
Assets Management Office, named at that time;
2. From November 1997 to May 2003, controlling shareholder of the
Company was Hefei Meiling Group Holding Co., Ltd. (established base on
former Meiling Group Co.,, “Meiling Group” for short), an enterprise solely
owned by the State; mainly operating the state-owned capital in authorized
from State-owned Assets Management Commission of Hefei City, ensuring
the maintenance and appreciation of state-owned assets;
3. On 29 May 2003, Meiling Group entered into “Equity Transfer
Agreement” with Shunde GreenKel Enterprise Development Co., ltd.
(“GreenKel”), the 82,852,683 state-owned shares held by the Company was
transfer to GreenKel. After transferring, GreenKel comes to the first largest
Previous changes for controlling shareholder of the Company.
shareholders (if applicable) 4. According to the spirit of “Bulletin of Treatment Opinions on GreenKel
Company purchasing State-owned Assets Shares of Listed Company”
(GZFCQ[2006] No.: 44) jointly issued from SASAC and Ministry of Finance
in April 2006, Meiling Group took back the Meiling Electric 82,852,683
shares from GreenKel by procedures, which has been transferred. In
September 2006, relevant equity transfer agreement signed between the
Meiling Group and GreenKel is invalid, which was confirmed by the
“Award” ((2006) HZZ No.: 104) issued from arbitration commission of
Hefei; the state-owned legal person’s 82,852,683 shares, held by GreenKel,
should return to Meiling Electric, and relevant equity consideration will pay
to GreenKel by Meiling Group . On 29 December 2006, the 82,852,683
shares of Meiling Electric were transfer to Meiling Group by GreenKel, and
Meiling Group becomes the controlling shareholder of Meiling Electric
again.
5. On 18 May 2006 and 11 January 2007, Meiling Group entered into
“Equity Transfer Agreement of Meiling Electric” and “Supplementary
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Agreement of Equity Transfer of Meiling Electric” respectively with Sichuan
Changhong and Changhong Group, among the 123,396,375 shares held by
Meiling Group, 82,852,683 shares were transferred respectively to Sichuan
Changhong and Changhong Group according to the transfer way regulated in
agreement; of this transferring, 45,000,000 shares (10.88% of total share
capital of the Company) were transferred to Sichuan Changhong, the first
largest shareholder of the Company while 37,852,683 shares (9.15% of total
share capital of the Company) were transferred to Changhong Group, the
third largest shareholder of the Company.
6. On 29 October 2008, Changhong Group and Sichuan Changhong entered
into “Equity Transfer Agreement of Hefei Meiling Co., Ltd.”, the 32,078,846
restricted circulations A shares of Meiling Electric held by Changhong Group
were transferred by agreement to Sichuan Changhong. On 23 December
2008, the aforesaid equity transfer was approved by “Reply on Matters of
Equity held by State-owned Shareholders of Hefei Meiling Co., Ltd.”
(GZCQ(2008) No.: 1413) from SASAC; on 21 January 2009, the aforesaid
transfer was registered for ownership transfer in Shenzhen Branch of China
Securities Depository and Clearing Corporation Limited. With this, the first
majority shareholder of the Company comes to Sichuan Changhong.
7. Ended as 31 December 2018, Sichuan Changhong and its concerted action
Changhong HK totally holds 279,200,104 shares of the Company, a 26.73%
in total share capital of the Company; Sichuan Changhong directly holds
246,301,524 A-share of the Company, a 23.58% in total share capital of the
Company while Changhong HK holds circulation B-share of the Company
amounting as 32,898,580 shares, a 3.15% in total share capital of the
Company.
8. Ended as 27 March 2019, Sichuan Changhong and its concerted action
Changhong HK totally holds 281,832,434 shares of the Company, a 26.98%
in total share capital of the Company; Sichuan Changhong directly holds
248,457,724 A-share of the Company, a 23.79% in total share capital of the
Company while Changhong HK holds circulation B-share of the Company
amounting as 33,374,710 shares, a 3.19% in total share capital of the
Company.
V. Other relevant information
(I) CPA engaged by the Company
Name of CPA Shine Wing Certified Public Accountants (LLP)
8/F, Block A, Fu Hua Mansion No.8 Chao Yang Men Bei da jie, Dong Cheng
Offices add. for CPA
District, Beijing, P.R.C
Signing Accountants Li Xifu, Xia Cuiqiong
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
(II) Sponsor engaged by the Company for performing continuous supervision duties in
reporting period
□ Applicable √ Not applicable
(III) Financial consultant engaged by the Company for performing continuous supervision
duties in reporting period
□ Applicable √ Not applicable
VI. Main accounting data and financial indexes
Whether it has retroactive adjustment or re-statement on previous accounting data
□ Yes √ No
Changes over last
2018 2017 2016
year
Operating income (RMB) 17,490,174,950.01 16,797,436,757.36 4.12% 12,526,710,867.49
Net profit attributable to
shareholders of the listed 38,658,256.97 32,473,204.92 19.05% 220,216,680.96
company (RMB)
Net profit attributable to
shareholders of the listed
company after deducting -3,142,791.01 -97,705,959.02 96.78% 158,461,015.10
non-recurring gains and losses
(RMB)
Net cash flow arising from
-220,560,615.36 -551,501,994.74 60.01% 985,390,895.63
operating activities (RMB)
Basic earnings per share
0.0370 0.0311 18.97% 0.2717
(RMB/Share)
Diluted earnings per share
0.0370 0.0311 18.97% 0.2717
(RMB/Share)
Weighted average ROE 0.13 percent point
0.77% 0.64% 5.77%
increase
Changes over end
End of 2018 End of 2017 End of 2016
of last year
Total assets (RMB) 15,561,810,184.54 15,961,511,966.81 -2.50% 12,507,567,310.84
Net assets attributable to
shareholder of listed company 5,015,730,486.57 5,051,066,095.31 -0.70% 5,095,160,291.91
(RMB)
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
The cause of the accounting policy change and accounting error correction
□ Applicable √ Not applicable
Whether have corporate bonds or not
□Yes √ No
VII. Accounting data difference under domestic and foreign accounting standards
(I) Difference of the net profit and net assets disclosed in financial report, under both IAS (International
Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles)
□ Applicable √ Not applicable
The Company has no difference of the net profit and net assets disclosed in financial report, under both IAS
(International Accounting Standards) and Chinese GAAP (Generally Accepted Accounting Principles) in reporting
period.
(II) Difference of the net profit and net assets disclosed in financial report, under both foreign accounting rules
and Chinese GAAP (Generally Accepted Accounting Principles)
√ Applicable □ Not applicable
In RMB
Net profit attributable to shareholders of Net assets attributable to shareholders of
listed company listed company
Amount in this Amount at Amount at
Amount in last period
period period-end period-begin
Chinese GAAP 38,658,256.97 32,473,204.92 5,015,730,486.57 5,051,066,095.31
Items and amount adjusted by foreign accounting rules
Foreign accounting rules 38,658,256.97 32,473,204.92 5,015,730,486.57 5,051,066,095.31
The Company had no difference of the net profit or net assets disclosed in financial report, under either foreign
accounting rules or Chinese GAAP (Generally Accepted Accounting Principles) in the period.
(III) Reasons for the differences of accounting data under accounting rules in and out of China
√ Applicable □ Not applicable
The “Notice of Relevant Issues of Audit for Company with Domestically Foreign Shares Offering” was issued
from CSRC dated 12 September 2007, since the day issuing, cancel the previous “dual audit” requirement for
companies who offering domestically listed foreign shares (B-share enterprise) while engaging securities practice
qualification CPA for auditing. The Company did not compile financial report under foreign accounting rules
since 2007, the financial report of the Company is complying on the “Accounting Standard for Business
Enterprise” in China, and therefore, there are no differences of accounting data under accounting rules in and out
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
of China at period-end.
VIII. Quarterly main financial index
In RMB
1st Q 2nd Q 3rd Q 4th Q
Operating income 4,245,506,565.60 5,026,003,004.07 3,977,110,177.70 4,241,555,202.64
Net profit attributable to
shareholders of the listed 56,261,852.68 -5,577,620.95 14,954,274.39 -26,980,249.15
company
Net profit attributable to
shareholders of the listed
23,011,689.73 -29,611,791.56 -5,122,046.17 8,579,356.99
company after deducting
non-recurring gains and losses
Net cash flow arising from
-771,375,311.87 931,864,672.93 80,738,009.49 -461,787,985.91
operating activities
Whether there are significant differences between the above-mentioned financial index or its total number and the
relevant financial index disclosed in the company’s quarterly report and semi-annual report
□Yes √ No
IX. Items and amounts of non-recurring profit (gains)/losses
√ Applicable □ Not applicable
In RMB
Item 2018 2017 2016 Note
Gains/losses from the disposal of
See “Income from assets
non-current asset (including the write-off 787,721.32 -8,203,782.90 9,265,320.01
disposal”
that accrued for impairment of assets)
Governmental subsidy reckoned into ”See “Other income” and
current gains/losses (not including the “Non-operation income”
subsidy enjoyed in quota or ration 90,401,997.63 68,403,702.36 41,152,549.66
according to national standards, which are
closely relevant to enterprise’s business)
Gains and losses arising from contingent ”See “Non-operation
proceedings irrelevant to normal operation -13,050,649.33 expenditure”
of the Company
Held transaction financial asset,
gains/losses of changes of fair values from
See “Gains/losses from
transaction financial liabilities, and
-18,928,688.87 92,846,391.02 11,500,963.72 change of fair value” and
investment gains from disposal of
“Investment income”
transaction financial asset, transaction
financial liabilities and financial asset
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
available for sales, exclude the effective
hedging business relevant with normal
operations of the Company
Switch-back of provision of impairment of See “Account
account receivable which are treated with 2,543,553.45 receivable/Other
separate depreciation test receivable”
Other non-operating income and
See “Non-operation
expenditure except for the aforementioned -2,614,761.68 2,680,908.22 4,948,619.55
income & expenditure”
ones
Gains/losses items qualified definition of
3,798,660.03 See “Investment income”
the non-recurring gains/losses
Less: impact on income tax 16,236,806.66 24,087,520.95 8,534,266.32
Impact on minority shareholders’
1,101,317.88 1,460,533.81 376,180.79
equity (post-tax)
Total 41,801,047.98 130,179,163.94 61,755,665.86 --
Concerning the extraordinary profit (gain)/loss defined by Q&A Announcement No.1 on Information Disclosure
for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss, and the items defined as
recurring profit (gain)/loss according to the lists of extraordinary profit (gain)/loss in Q&A Announcement No.1 on
Information Disclosure for Companies Offering Their Securities to the Public --- Extraordinary Profit/loss,
explain reasons
□ Applicable √ Not applicable
The Company has no items defined as recurring profit (gain)/loss according to the lists of extraordinary profit
(gain)/loss in Q&A Announcement No.1 on Information Disclosure for Companies Offering Their Securities to the
Public --- Extraordinary Profit/loss, in the period.
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section III. Summary of Company Business
I. Main businesses of the company in the reporting period
Does the Company need to comply with disclosure requirements of the special industry?
□Yes √ No
(I) Main businesses of the Company
The company is one of China's major electric appliance manufacturers, possesses four major domestic
manufacturing bases in Hefei, Mianyang, Jingdezhen and Zhongshan, and two overseas manufacturing bases in
Indonesia and Pakistan. Currently, we have completed the industry layout of white electricity basically, covering
the full product line including refrigerator, washing machine, air conditioner, kitchen and bath, small household
appliances and others, at the same time, the company enters into the bio-medical and other new industrial fields
with certain achievements made.
Over the past 30 years, the Company has always been adhering to the "independent innovation, created in China",
and always focus on refrigeration industry without stop, elaborately building the core competitiveness of
enterprises by technological innovation and product innovation. The company has set up the first RoHS public
testing center in Anhui Province, the state-level enterprise technology center and the top-end R & D team, so that
Meiling can continue to achieve breakthrough results in the variable frequency, intelligence, refreshment,
thin-wall, energy-saving, forced air cooling, deep cooling and other fields. In recent years, the company has won
three national-level honors such as the Smart Refrigerator Intelligent Manufacturing Pilot Demonstration Project,
the National Green Factory, and the National Industrial Design Center. At the same time, a number of Meiling
products entered the national green product list and won numerous domestic and international innovation awards,
which once again highlighted the capabilities and strengthen of intelligent innovation technologies of Meiling
Intelligent Manufacturing and Meiling brand.
In recent years, driven by the industry transformation and upgrades and consumption upgrades, the Company has
adhered to the strategy of smart and variable frequency products, promoted the Company’s products to transform
and upgrade to become intelligent and high-end and comprehensively enhanced the competitiveness of products in
the industry by grasping the opportunities of “refreshment”, “thin-wall” and energy efficiency upgrades and
effectively resolving the pain points of customers. Under the guidance of the “intelligent” strategy, in 2014, the
Company has released the industry-leading CHiQ series of smart refrigerators and air-conditioning products; in
2016, the Company took the lead in launching the industry’s “Smart Home Eco-system Project” and launched the
second-generation of CHiQ’s - “Space Smart” refrigerator and CHiQ smart air housekeeper system; In 2018, the
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
company released the CHiQ third-generation refrigerator equipped with artificial intelligence and automatic door
technology and CHiQ5 air-conditioning products, which realized the continuous implementation of the company’s
intelligent strategy. At the same time, for the younger consumers, the company released the youth refrigerator. In
addition, in order to return to the essence of “retaining freshness” of refrigerators, the company launched the “M
Fresh Life” series of refrigerators equipped with water molecule activation and preservation technology in 2017,
and developed comprehensive thin GLS integration technology based on the upgrade of water molecule activation
and preservation technology, in February 2019, the company has released the M Fresh Life comprehensive thin
series products with thin body, thin box and thin door, the thin wall technology realized the productization and
marketization.In order to seize the opportunity of energy efficiency upgrades and consumption upgrades, since the
Company launched the “All People Change for Variable Frequency” campaign in 2015, the share of variable
frequency products has continued to increase due to its advantages in the application of variable frequency
technology. The above mentioned release and listing products have upgrade the product structure of the Company,
which has become not only a new starting point for the Company to transform to the high-end consumer market,
but also a concrete measure for the Company’s continuous improvement of product quality, taste and brand.
Facing the future, the Company will further improve the home internet layout, accelerate the intelligentization of
home appliances, form a dual-growth engine of “hardware + services”, drive the transformation and upgrading of
the Company’s profitability model, investigate the new value-added service models for home appliance
enterprises, meet new competition pattern in the industry, and achieve its own sustainable and stable development
under the guidance of the core values of “professionalism and shared development”. Meanwhile, based on the
“Smart Home Eco-system Project” and the existing products, the company will enhance the R&D, manufacturing,
sales and cooperative capabilities of integrated white goods so as to provide users with a complete set of smart
white goods system solutions.
In reporting period, main income of the Company coming from refrigerator (freezer), air conditioner, washing
machine, small home appliances and kitchen & toilet products etc., total amounting to 16,147.8573 million Yuan,
a 92.33% of the operating income.
(II) Conditions of the industry the company involved
The home appliance industry is experiencing its renewal period, industry competition intensified and brand
concentration gets further improve. With the upgrading of consumption structure and ideas, the period of
upgrading tuns to be high-end oriented and intelligent oriented. Meanwhile, with the development of urbanization
and the improvement of living standards, the age of quality consumption has coming, the new consumer groups
pay more attention to high-quality, intelligent and healthy environmental protection products. The appliance
industry facing severe challenges and opportunities for development in 2018, mainly have follow presentations:
1.refrigerator industry
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
The popularity degree of refrigerators in domestic households is relatively high, and the national policy has
basically ended the privilege period of the refrigerator industry, meanwhile, affected by the real estate market
regulation policy, the new demand for refrigerators has slowed down. All View Cloud (AVC) omnichannel data
showed that the retail sales of the refrigerator market in 2018 was 96.8 billion yuan, an increase of 3.2% on a
year-on-year basis, and the retail volume was 32.99 million units, a decrease of 2.3% on a year-on-year basis, and
the growth trend showed a growth in the first and second quarters and a decline in the third and fourth quarters.
Despite the sluggish market demand, the product innovation in the refrigerator market has never stopped. The
products in 2018 have been further optimized on the basis of differentiated door, free embedding and
fresh-keeping functions, and the product development trend has moved towards functionalization, detailing and
elaboration. The competition has intensified in the high-end market. In 2018, the domestic refrigerator market has
accelerated its consumption upgrades. Major brands have launched brand-named fresh-keeping products to
develop the high-end markets, the competitive advantage of refrigerator market is rapidly inclining to the
premium brands, and the Matthew Effect is growing. At the same time, the upgrade of refrigerator consumption in
the primary and secondary markets is rapidly transmitting to the third-tier and fourth-tier markets, and the market
potential is shifting to the third- and fourth-tier markets. At the same time, the market is also divided and grading,
and the era of consumer grading is coming.
2. Industry situation of air conditioning products
After more than two consecutive years of high growth, in 2018, affected by the trade friction between China and
the United States, coupled with the slowdown in domestic economic growth, the anxiety has been spreading and
deepening, and the domestic air-conditioning market has entered a downward cycle, the industrial competition has
intensified. At the beginning in the second half of 2018, the average price increase of air conditioners slowed
down noticeably, and the average price of most air conditioners began to decline.
Under the unfavorable macro environment in economy and real estate, household air conditioners still achieved
positive growth throughout the year, and the retail scale exceeded 200 billion yuan. All View Cloud (AVC)
omnichannel data showed that the retail volume of the air-conditioning market in 2018 was about 57.03 million
sets, an increase of 1.6% on a year-on-year basis. Under the background of consumption upgrade and industrial
structure upgrade, the retail sales were 201 billion yuan, an increase of 4.1% on a year-on-year basis. In terms of
market growth trend, the retail sales in the first half of the year increased by 15.5%. In the peak season in July, the
market growth rate was sharply affected by temperature and rainfall, with a decline for four consecutive months.
In November, the decline was stopped by the big sales, the air conditioning market had a tendency of “first high
then low” throughout the year. In the product mix, in addition to frequency conversion and artistic design,
energy-saving products are the focus of structural upgrading of the air-conditioning industry this year. From the
perspective of market research and analysis, the potential demand for energy-saving products by potential users in
the future is obviously improving.
3. Industry situation of washing machine
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
The competition in the washing machine market in 2018 was still very intense. The industry centralization pattern
was further stabilized, and the upgrading trend of each subdivision type structure was obvious. The roller washing
and drying machine increased rapidly, and the products have been developing towards roller, large volume,
frequency conversion and intelligence. All View Cloud (AVC) omnichannel data showed that the retail sales of the
washing machine market in 2018 were 74.5 billion yuan, a rise of 3.7% on a year-on-year basis. The washing
machine market has shifted from the incremental market to the stock market, and the upgrade has become the
industry-driven engine. The washing and drying integration and the large washing capacity have become the two
main directions for upgrading in 2018.
Generally speaking, in the context of the weak recovery of the world economy and the new normal of China’s
economic development, China’s economic situation in 2018 was generally stable and made steady progress. But
the home appliance industry was in a state of stagflation, due to factors such as further strengthening of the
industry’s brand concentration, rising raw material and logistics costs, upgrading of consumer demand structure,
and cross-border impact of internet enterprises, the industry was facing accelerated reshuffles, and challenges such
as oligopolistic competition, product and business model transformation and upgrading. Therefore, in the era of
quality consumption, high end and intelligence have become the inevitable choice for the development of the
home appliance industry.
II. Major changes in main assets
(i) Major changes in main assets
Major assets Note of major changes
Equity assets Losses from joint venture in the period
Mainly due to the increase in the transfer of the company’s construction in
Fixed assets
progress during the period.
Intangible assets No major changes
Construction in progress have more investment by parent company and
Construction in progress
subsidiary Changhong Air-conditioner in the period
(ii) Main overseas assets
√ Applicable □ Not applicable
Reaso Whether
Foreign assets
n for Operat exist
Control measure to ensure the security accounted for
Content of assets the Asset size Location ion Income (RMB) significant
of assets net assets of
format mode impairment
the Company
ion risk (Y/N)
60% equity of Invest Details of risks control measures have
US$ 7.803
Changhong Ruba ment Pakistan Sales been disclosed by the Company by way -2,342,851.01 0.64% N
million
Trading establi of announcement on appointed media
15
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Company shmen (No. 2011-028, No. 2011-032, No.
t 2014-023, No. 2014-026, No. 2016-027,
No. 2016-032, No. 2017-053 and No.
2017-059) on 28 May 2011, 19 April
2014, 25 March 2016 and 10 August
2017
Details of risks control measures have
40% equity of Invest been disclosed by the Company by way
Changhong Ruba ment of announcement on appointed media
US$ 6.9761 Manuf
Electric establi Pakistan (No. 2011-028, No. 2011-032, No. -15,129,056.84 0.18% N
million acture
Company(Private shmen 2014-023, No. 2014-026, No. 2017-053
)Ltd. t and No. 2017-059) on 28 May 2011, 19
April 2014 and 10 August 2017
100% equity of Invest Details of risks control measures have
KELAPA
CHANGHONG ment been disclosed by the Company by way
US$ 6 GADING,
MEILING establi Sales of announcement on appointed media -6,452,403.34 0.48% N
million JKT,
ELECTRIC shmen (No. 2016-027 and No. 2016-033) on 25
Indonesia
INDONESIA. PT t March 2016
Other notes N/A
III. Core Competitiveness Analysis
Does the Company need to comply with disclosure requirements of the special industry?
□Yes √ No
1. Brand capacity
The Company is one of the famous home appliances manufacturers in the PRC, owns several product lines such
as refrigerator, freezing box and air conditioner. Meiling trademark is listed as one of the most valuable brands in
the PRC, well-known trademark in China; the trademark “Athena” in refrigerator, freezer (services) of the
Company was recognized as the famous mark in Anhui Province. The Company released CHiQ intelligent first
and second generation refrigerator, AC and intelligent air steward in succession since 2014. And creating a
high-end intelligent brand image around the plan of “Wisdom Home Ecosystem” for opening a white intelligence
era. While in order to enhance the brand image and further expand the market influence of the brand, the company
held a conference for "New LOGO release and offline of the 10th million set of frequency conversion products" in
October 2015, comprehensively updated LOGO " ", and launched the new brand proposition of
"Meiling, let the good come". Along with the release of new LOGO, Meiling will also implement a brand strategy
of "Good Trilogy", including the direct sensory experience of “experience the good", the spirit soul enjoyment of
“enjoy the good”, and the lifestyle faith of “believe in the good”. Moreover, under the boost of consumption
upgrades, in November 2017, the Company launches a “M -Fresh” refrigeration with the “water molecules
16
CHANGHONG MEILING CO.,LTD. Annual Report 2018
activating technology”, return to essence of the refrigerator and set off the revolution of fresh-keeping in industry;
In October 2018, the M Fresh Life voice intelligent refrigerator equipped with full voice interaction technology
was launched. At the same time, CHiQ5 air conditioners integrated with three core functions of listening sound for
person recognition, voice positioning and listening sound for speed adjustment were released. In November 2018,
the company’s world-first youth refrigerator further enhanced the company’s younger brand image; in February
2019, the company released the “M Fresh Life” comprehensive thin series products, continuing to inherit the
brand effect of M Fresh Life.
Reshaping brand ability through continuous upgrading of products, Meiling will realize a young, international and
professional brand image. Through gradual construction of the ideas of Wonderful Start Point, Wonderful Life
Circle and Wonderful Ecology Circle, Meiling has become a people-oriented artist specializing in white
appliances, a smarter scientific expert and a more reliable house keeper.
2．Product capacity
In more than 30 years, the Company has been focusing on the refrigeration industry, has developed a variety of
different types of refrigerator products, including three serial produces as “MELNG 美菱, CHiQ and Athena”.
Mainly include the “M Fresh Life” series fresh-keeping refrigerators equipped with water molecule activation and
fresh-keeping technology, Jingdong smart large-screen 570 series refrigerators, CHiQ series high-end intelligent
refrigerators and air conditioners, 0.1-degree double-precision variable frequency refrigerators, European
540-wide series air-cooled products, 106DTB series freezer with new appearance and thin door, YC-365L
low-temperature & medical refrigerator and so on; in particular, the “M-Fresh Life” series fresh-keeping
refrigerators that the Company has latest released return to the essence of the refrigerator; on the basis of
upgrading the water molecule activation and preservation technology, the company developed a comprehensive
thin GLS integration technology to realize the M Fresh Life comprehensive thin series products with thin body,
thin box and thin door.
The Company owned advanced development and quality assurance systems, passed management system
certification of ISO9001 and ISO14001. The products of the Company have good quality and reliable capacities.
As for technology development, the Company has a national-standard technology center, and vigorously invest in
basic technology research; and in the field of intelligence, air cooling, refreshment, frequency conversion,
thin-wall, energy-saving and copious cooling, we has an advance core technology that leading the industry. As for
product development, combine the R&D results and consumption upgrading demand, the Company renewal its
outline of product planning and development for the year, products structure is escalating. Putting more efforts on
the middle & high-end products in field of air patenting, large-size, frequency conversion, intelligence,
refreshment and thin-wall, developing core products with competitive, the product has obvious upgrade in
structures.
As for the air conditioning products, the Company adheres to the technical strategy by taking intelligence and
17
CHANGHONG MEILING CO.,LTD. Annual Report 2018
variable frequency as the core, intensively studies the human state perception technology and intelligent
interactive technology, focuses on completing the research and development of intelligent voice recognition
technology and productization, successively releases the CHiQ serial air conditioner and CHiQ smart air
housekeeper based on "human state perception" technology. The frequency conversion technology focuses on the
comfort and energy saving of air conditioners, puts priority on the fourth generation technology platform
development of precision temperature control which takes PMV comfort control model as the core, and the
company has successively released the frequency conversion and energy-saving leading, comfortable and
energy-saving series products.
In terms of washing machine, the Company has actively developed the core technology of Meiling washing
machines, upgraded its product lineup, continuously laid out the large-scale washing and drying integration, and
innovated the era of drum-type healthy washing. The Company has developed and launched a series of drum-type
washing machines, including Meiling520 Zhenrui washing and drying series front loading washing machines and
Meiling vortex full-automatic drum-type washing machine series with light luxury gold appearance, large capacity
and high efficient washing and drying technology, a number of patented technologies, and high efficient and
environmental protection and energy saving configuration, especially the XQB80-19BPLQ1 and
MB80-19PZLGX series variable frequency washing machines use DD (direct drive) variable frequency motor
which provides more precise control, less energy loss, less noise, and longer life. Benefiting from the advanced
application of swirling waterfall washing technology, washing solution residue are reduced greatly, rinsing are
more and more neat and tidy with clothing wash in protection
In terms of kitchen and small appliance products, the Company has taken the concept of “smart kitchen” as
the mainline, focus on creation of eco-chain of “water ecological appliances”. Eyes on the core business to create
competitive industries, and achieved a full coverage of kitchen and bath and household appliances.Under the
guidance of the Company’s intelligence and variable frequency product strategy, the Company has developed and
released EQ21 series intelligent kitchen ventilator with integration of intelligent control, smoke and stove linkage,
and large air volume, tankless integrated water purifier, cloud intelligent remote control series intelligent electric
water heaters and intelligent gas water heaters, as well as the kitchen ventilator with DC inverter technology, and
the CHiQ intelligent smoke machine as well as the Internet of Things of the kitchen ventilator supporting Wi-Fi.
In addition, with the advent of the Company's independently developed plasma-disinfected dishwasher, the
dishwasher category has enjoyed core technologies in the segmented industries.
In terms of cryogenic products, we strengthened system innovation and rapidly enhanced our core
competitiveness by focusing on life science, wisdom cold chain and family health. The company continued to
increase investment in research and development of cryogenic products and promoted the upgrade of technology
and products.The Company’s existing ultra low freezer, plasma blaster freezer, blood bank refrigerator, medical
18
CHANGHONG MEILING CO.,LTD. Annual Report 2018
refrigerator, combined refrigerator & freezer and medical freezer and other biomedical products have been widely
used in medical and health, disease control and epidemic prevention, blood systems, research institutes,
bio-pharmaceutical, genetic engineering and life sciences and other fields. Especially in ultra low products, the
Company has the -40 °C ~ -164 °C ultra-low freezer storage tank with the largest volume, the widest temperature
zone, and mute design in the world.
The Company insisting on the two products strategy as intelligence and frequency conversion, with follow-up
R&D of the intelligence and frequency conversion, promoting products of the Company leading in high-end
products; meanwhile, the company improves the manufacturing efficiency and product quality and enhances
product competitiveness by comprehensively implementing intelligent upgrading and rebuilding to all production
lines.
3．Operation capacity
The Company conducted benchmark management to improve its basic management level. In specific, efficiency
enhancement has been made in areas of personnel, money and materials, trying to continuously enhance the
internal management. A performance review and sharing system has been established with clear target and
quantity index based on performance and layered incentive sharing system, thus to inspire the internal production
capacity. Under the mainline of value chain management, the Company continued to carry out value creation and
improve its competitiveness. Its ability to prevent risks has been also strengthened through continuous
improvement of internal control system.
4．Marketing ability
The company has established a relatively complete sales network and service system, of which, the domestic sales
channels emphasizing online and offline collaboration and integration, benefit from the systematic construction
and promotion of business operation mode, the pace of business this year constantly tends to be benign; we has a
balanced development in chain, wholesale, e-commerce and other channels, and the product competitiveness has
been improved; meanwhile, the overseas market has been strengthened by increasing the investments in overseas
marketing organizations, research and development bases and production bases, cooperate with
internationally-known home appliance brand business and dealer, optimized the client structure and improve
product structure, the company has been actively develop the overseas market, and the products have been
exported to more than 130 countries and regions.
In 2018, as the company’s star flagship machine, “M Fresh Life” series refrigerators established Meiling’s unique
fresh-keeping image and reputation in the industry by “one hundred stores sealed up for safekeeping”, “ten
thousand endorsement”, “new product launch event” and other promotional activities. The company powerfully
made the “M Fresh Life Phenomenon” through the close cooperation of technology, marketing and market and the
diversified channels of communication, and the brand activity was significantly improved. In addition, the free
trial at Jingdong and Tmall, and the “free trial by thousands of people” activities, and the food storage comparison
19
CHANGHONG MEILING CO.,LTD. Annual Report 2018
of “keeping the roses fresh for 33 days” shaped the high-end brand image of Meiling. In order to allow more users
to enjoy the quality experience brought by the company’s “M Fresh Life” series refrigerators, the company
launched the activity of “M Fresh Life is Free of Charge if Belgium Takes the Crown”, which not only won high
recognition of consumers and greatly enhanced the brand vitality of the company, but also further deepened the
competitiveness of the “M Fresh Life” series products and expanded the influence of the company’s high-end
products.
20
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section IV. Discussion and Analysis of the Operation
I. Introduction
In 2018, the national economy continued to operate in a reasonable range, achieved an overall
stability and made steady progress. At the same time, the economic operation also made changes in
steady progress, and the external environment was complicated and severe, and the economy was
facing downward pressure. 2018 was the 40th anniversary of the reform and opening up policy. In
the past 40 years, China’s household electrical appliance industry has achieved many achievements
with the vigorous development of China’s industry. However, due to the influence of macro
environment and its own development cycle, coupled with multiple negative factors such as the
tightening of real estate market, the upgrading of consumption structure, and the flat demand, the
performance of the home appliance market in 2018 was not satisfactory, the growth rate of
traditional home appliances such as refrigerators and washing machines obviously slowed down.
2018 , Facing the weak global economic recovery, the great fluctuations in raw materials and parts
prices, the tightening of money market liquidity, and the sluggish demand in the home appliance
market, the company had many difficulties in reform, innovation and transformation. Under the
leadership of the board of directors and the joint efforts of all employees, the company adhered to
the business policy of “product leadership, marketing transformation, efficiency improvement, team
activation”, and promoted all important work of the company with a high degree of professionalism
and sense of responsibility. In 2018, in response to the shortcomings and problems in the
development process, the company targeted at the difficulties and pressures faced by the industry,
and adopted targeted countermeasures under the leadership of the board of directors, promoting
development by solving problems and solving problems by development, and achieved continuous
improvement in product structure and steady progress in operation. At the same time, the company
firmly grasped the mainstream of consumption upgrades and adhered to technological innovation,
which significantly improved the product structure transformation and upgrading of the company.
II. Main Business Analysis
(i) Overview
21
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Shows no difference with the summary disclosed in Report of the Board of Director
□Yes √No
1. Introduction
Under the background that the growth of refrigerator market bore great pressure in 2018, the
domestic sales growth rate of the company’s refrigerator industry was ahead of the industry growth
rate; market share continued to rise, and industry status has been significantly improved; product
structure has been improved obviously; new channels have developed rapidly; and freezer product
lines have risen on a year-on-year basis; the quality of operations in overseas markets has increased
significantly. The air-conditioning industry overcame many adverse effects such as the market and
the weather to achieve growth. The washing machine industry has already had product research and
development capabilities, and the products have been serialized. The washing machine factory
completed the phase I project and started working successfully, laying a foundation for the
competitiveness promotion and sustainable development of the later products. Small household
appliances, biomedical and other businesses have risen abruptly based on their accumulated
strength, and the business synchronization achieved rapid growth.
In 2018, refrigerator and freezer business achieved revenue of approximately RMB 8.168 billion,
9.42% increased on a y-o-y basis; air-conditioning business achieved revenue of approximately
RMB 6.777 billion, 3.26% down y-o-y; washing machine business achieve revenue around RMB
0.514 billion, with year-on-year decline of 27.19 %; other business of kitchen & toilet products and
small home and Refrigeration accessories appliance have revenue approximately as RMB 1.000
billion with 19.34% up y-o-y. At the same time, revenue from exportation gains RMB 37.10 billion,
a y-o-y decrease of 3.41%.
2. Progress of the company's development strategy and business plan during the reporting
period
During the reporting period, in accordance with the development strategy and operating principles
of “product leading, marketing transformation, efficiency enhancement and team activation” in
2018, the company has deployed the annual business plan, arranged the production and
management, and carried out the following activities:
(1) Product leading
Along with the overall sluggish home appliance market, the trend of quality consumption upgrading
became obvious, and the high-end transformation has become the key for major enterprises to get
22
CHANGHONG MEILING CO.,LTD. Annual Report 2018
out of the predicament. The company adhered to taking the needs of users as the starting point, and
carefully built the core competitiveness of enterprises with technological innovation and product
innovation to accelerate product upgrades. During the reporting period, the company carried out
product upgrades around the two major product strategies of intelligence and frequency conversion,
took breakthroughs in fresh-keeping, thin wall and energy efficiency upgrades, thereby
comprehensively enhanced the competitiveness of products and further strengthened the advantages
of frequency conversion differentiation. In terms of technical research, the company adhered to the
basic research and upgrade of core technology, maintained the existing technological advantages,
expanded the innovation and upgrade in technological field, achieved differentiated breakthroughs,
and launched high-end products to lead the industry’s wind vane.
In 2018, through the in-depth development of “M Fresh Life Series” and “Ultra-thin Wall
Refrigerator”, the company launched a number of M Fresh Life refrigerators, one M Fresh Life
freezer, and five full thin wall products for trial production during the year, of which the research
and development, manufacturing, supply chain and marketing were all highly efficient. In 2018, the
company carried out the food storage comparison of M Fresh Life “keeping the roses fresh for 33
days”, in order to allow more users to enjoy the quality experience brought by the company’s “M
Fresh Life” series refrigerators, the company launched the activity of “M Fresh Life is Free of
Charge if Belgium Takes the Crown”. In addition, in terms of air conditioning, intelligent and
inverter air conditioner products played a leading role, and the application of the fourth generation
technology of precise temperature control significantly improved the air conditioning comfort and
greatly enhanced the user perception. Q3Ts cabinet that adopted the industry’s first artificial
intelligence image recognition, gesture recognition and other technologies not only won many
awards in the industry, but also had outstanding market performance. Q5K cabinet adopted the new
appearance with original seam-inspired wind design and equipped with the latest super-level fourth
generation precision control technology platform to achieve the micro-seam comfort wind effect
and enhance the user’s comfortable experience.
In February 2019, the company released the “M Fresh Life” comprehensive thin series products.
The company’s “M Fresh Life” comprehensive thin series products continued to inherit the brand
effect of “M Fresh Life”, the comprehensive thin products was positioned as the “M Fresh Life”
high-end series, and through the comprehensive upgrading of product technology, quality and
performance and the upgrading of water molecule activation fresh-keeping technology, the
company has developed a comprehensive thin GLS integration technology to achieve a thin body, a
thin box and a thin door. In order to allow consumers to enjoy the higher quality experience, the
23
CHANGHONG MEILING CO.,LTD. Annual Report 2018
company is accelerating the “three promotions” action of quality, taste and brand so as to inject new
vitality into the high-end consumer market.
In addition, the company improved the quality of high-end products through the establishment of
high-end product quality refinement standards and evaluation indicators, and achieved an overall
upgrade of products through the continuous propulsion of “five -ization and two easy” project and
the “quality, taste and brand” promotion project.
(2) Marketing transformation
Domestic marketing: market performance of vary products are meets the anticipation basically
through the e-commerce transformation, value transformation, channel transformation, and
organizational transformation of traditional business.
The company’s domestic sales of refrigerators, freezers, and washing machines outperformed the
industry market, the product structure of refrigerators (freezers), air conditioners and washing
machine has been optimized and upgraded, and the market position has been further consolidated
and upgraded. CMM’s data showed that the retail sales of refrigerator industry declined by 5.57%
on a year-on-year basis, but the retail sales of the company’s refrigerator declined by 4.20% on a
year-on-year basis; the retail sales of freezer industry declined by 0.63% on a year-on-year basis,
and the retail sales of the company’s freezer rose by 12.01% on a year-on-year basis; the retail sales
of air-conditioner industry declined by 3.66% on a year-on-year basis, and the retail sales of the
company’s air conditioner declined by 11.56% on a year-on-year basis; the retail sales of washing
machine industry declined by 3.38% on a year-on-year basis, but the retail sales of the company’s
washing machine rose by 4.26% on a year-on-year basis. At the same time, CMM’s data showed
that the market share of the company’s refrigerator retail sales reached 8.99%, an increase of 0.17%
on a year-on-year basis; the market share of freezer retail sales reached 10.53%, an increase of
1.24% on a year-on-year basis; the market share of the air conditioning and washing machine retail
sales was basically the same as that of the same period of last year.
Overseas marketing: Through the transformation from pursuing scale to pursuing both scale and
profit, the transformation from traditional business model to emerging business model, and the
transformation from order driving to market driving, the product structure has been gradually
improved, and the proportion of overseas air-cooled refrigerators has 56% growth on a y-o-y basis,
management quality promoted greatly, the proportion of medium and high-end air-conditioning
24
CHANGHONG MEILING CO.,LTD. Annual Report 2018
products is also increasing, and the profitability of export products is improving significantly.
(3) Efficiency enhancement
The company’s comprehensive competitiveness in terms of the market unit price, quality
improvement and efficiency improvement has been promoted by taking bench-marking
management activities as the starting point, and the manufacturing efficiency has been improved by
promoting the “less people project”. In terms of cost reduction, significant achievements have been
made through design cost reduction, process cost reduction, and procurement cost reduction. In the
first half of the year, the company also carried out the special investigation and management
activities to manage the “leakage and venting”, and improved the efficiency through management
improvement and project improvement, and improved the organizational efficiency by promoting
the construction of “responsibility” system.
(4) Team activation
Inspire the business teams’ vitality through the innovative incentive mechanism design; continue to
publicize, train, propagate and guide the corporate culture, precipitate the corporate culture, and
promote the organizational atmosphere.
As a whole, in 2018, under the background that quality consumption was brought about by
intensifying competition, consumption upgrades, and renewal demand, the industry has set off a
wave of product upgrades, and the high-end market has gradually become the main battlefield of
competition. In this regard, the company firmly grasped the main line of business development,
focused on the 13th five-year development planning route through the joint efforts of all Meiling
people, and achieved the company’s steady improvement through the core technology and product
traction, by strengthening the mechanism management innovation, and vigorously activating the
internal team. At the same time, the product sales outperformed the market, the product structure
was upgraded obviously, and the proportion of frequency conversion and intelligent products
continued to increase, especially the release of “M Fresh Life” series refrigerators set off a wave of
fresh-keeping technology in the industry and led the industry fresh-keeping revolution. As an
important product for the company’s transformation to the high-end consumer market, “M Fresh
Life” series refrigerators not only enhanced the company’s high-end brand image, but also further
promoted the upgrading of the product structure of the company’s refrigerator (freezer).
25
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(ii) Revenue and cost
1. Constitute of operation revenue
In RMB
2018 2017
Increase/decr
Ratio in operation Ratio in operation
Amount Amount ease y-o-y
revenue revenue
Total operation
17,490,174,950.01 100% 16,797,436,757.36 100% 4.12%
revenue
According to industries
Manufacture of
household 16,458,650,756.15 94.10% 16,013,327,582.28 95.33% 2.78%
appliances
Other business 1,031,524,193.86 5.90% 784,109,175.08 4.67% 31.55%
According to products
Refrigerator,
8,167,773,533.33 46.70% 7,464,503,149.31 44.44% 9.42%
freezer
Air-conditioning 6,777,093,389.43 38.75% 7,005,144,650.67 41.70% -3.26%
Washing
513,917,450.54 2.94% 705,875,802.77 4.20% -27.19%
machine
Small appliance
and kitchen & 689,072,966.20 3.94% 536,291,620.64 3.19% 28.49%
toilet
Other products 310,793,416.65 1.77% 301,512,358.89 1.80% 3.08%
Other business 1,031,524,193.86 5.90% 784,109,175.08 4.67% 31.55%
According to region
Domestic 13,768,743,643.18 78.72% 12,941,622,221.55 77.05% 6.39%
Foreign 3,721,431,306.83 21.28% 3,855,814,535.81 22.95% -3.49%
2. About the industries, products, or regions accounting for over 10% of the company’s operating income or
operating profit
√ Applicable □ Not applicable
Whether the company needs to comply with the disclosure requirements of the particular industry
□ Yes √ No
In RMB
Gross Increase/decreas Increase/decrea Increase/decrea
Operating revenue Operating cost
profit ratio e of operating se of operating se of gross
26
CHANGHONG MEILING CO.,LTD. Annual Report 2018
revenue y-o-y cost y-o-y profit ratio
y-o-y
According to industries
Manufacture of
household 16,458,650,756.15 13,273,395,942.04 19.35% 2.78% 1.38% 1.11%
appliances
According to products
Refrigerator,
8,167,773,533.33 6,390,896,089.57 21.75% 9.42% 5.77% 2.70%
freezer
Air-conditioning 6,777,093,389.43 5,636,463,273.39 16.83% -3.26% -2.26% -0.84%
Small appliance
and kitchen & 689,072,966.20 583,308,199.41 15.35% 28.49% 27.73% 0.50%
toilet
According to region
Domestic 12,748,897,296.29 9,988,923,192.37 21.65% 4.74% 5.53% -0.59%
Foreign 3,709,753,459.86 3,284,472,749.67 11.46% -3.41% -9.45% 5.89%
Under circumstances of adjustment in reporting period for statistic scope of main business data, adjusted main
business based on latest one year’s scope of period-end
□ Applicable √ Not applicable
3. Income from physical sales larger than income from labors
√ Yes □ No
Increase/decrease
Industries Item Unit 2018 2017
y-o-y
10 thousand
Sales volume 1,606.40 1,508.66 6.48%
pieces/set
Manufacture of
household 10 thousand
Production 1,581.94 1,547.89 2.20%
appliances pieces/set
industry
10 thousand
Inventory 145.39 169.85 -14.40%
pieces/set
Reasons for y-o-y relevant data with over 30% changes
□ Applicable √ Not applicable
4. Fulfillment of the company’s signed significant sales contracts up to this reporting period
□ Applicable √ Not applicable
5. Constitute of operation cost
Industry classification
27
CHANGHONG MEILING CO.,LTD. Annual Report 2018
In RMB
2018 2017
Increase/de
Ratio in Ratio in
Industries Item crease
Amount operation Amount operation
y-o-y
cost cost
Manufacture of
household Raw material 12,224,876,343.70 92.10% 12,170,622,123.33 92.96% -0.86%
appliances
Note: nil
6. Whether the changes in the scope of consolidation in Reporting Period
√ Yes □ No
More details can be seen in the report “VII. Changes in the scope of the merger” and “VIII. Interests in other
entities” of “Section XI Financial Report”
7. Major changes or adjustment in business, product or service of the Company in Reporting Period
□ Applicable √ Not applicable
8. Major sales and main suppliers
(1) Major sales client of the Company
Total top five clients in sales (RMB) 4,913,712,759.11
Proportion in total annual sales volume for top five clients 28.09%
Proportion of the related parties’ sales in total annual sales
15.81%
volume for top five clients
Information of top five clients of the Company
Serial Name Sales (RMB) Proportion in total annual sales
1 Client I 2,547,232,568.77 14.56%
2 Client II 1,170,731,664.10 6.69%
3 Client III 579,359,172.39 3.31%
4 Client IV 397,714,147.65 2.28%
5 Client V 218,675,206.20 1.25%
Total -- 4,913,712,759.11 28.09%
Other situation of main clients
□ Applicable √ Not applicable
(2) Main suppliers of the Company
28
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Total purchase amount from top five suppliers (RMB) 3,076,496,670.06
Proportion in total annual purchase amount for top five
24.09%
suppliers
Proportion of related party’s purchase in total annual purchase
14.15%
amount for top five suppliers
Information of top five suppliers of the Company
Serial Name Sales (RMB) Proportion in total annual purchase
1 Supplier I 733,653,149.28 5.75%
2 Supplier II 662,814,025.83 5.19%
3 Supplier III 606,625,874.31 4.75%
4 Supplier IV 537,900,775.75 4.21%
5 Supplier V 535,502,844.89 4.19%
Total -- 3,076,496,670.06 24.09%
Other notes of main suppliers of the Company
□ Applicable √ Not applicable
(iii) Expenses
In RMB
Increase/decreas
2018 2017 Note of major changes
e y-o-y
Sales expense increase with the
Sales expense 2,576,277,169.86 2,434,337,059.85 5.83%
more sales scale in the period
Administrative
317,917,548.03 285,953,969.91 11.18% -
expense
Exchange gains increased in the
Financial expense -39,305,608.74 -33,648,833.18 -16.81%
period
Mote investment in R&D in the
R&D expense 235,299,398.06 210,977,773.13 11.53%
period
Taxable income in the period
Income tax expense -533,886.62 20,520,373.53 -102.60%
decline
(iv) Investment in R&D
√ Applicable □ Not applicable
In 2018, the Company continues to insisted on the upgrade of fundamental research on core technology in
technical research, maintained its technological advantages, expanded the innovation and upgrade in the
technological field, made breakthroughs in differentiation, continued to promote product upgrades, and led the
development orientation in the industry.
29
CHANGHONG MEILING CO.,LTD. Annual Report 2018
In terms of the refrigerator, the Company focused on its technology planning and core technology for technology
development, and carried out the research on human-computer interaction techniques, food refreshment
technology, energy saving and mute technology, wide rotation speed variable frequency technology, air duct
design technology, and vacuum insulation technology, etc. The “M Fresh Life” series refrigerator with the
Company’s original “water molecules activation and preservation technology” lifted a preservation revolution in
refrigerator industry, greatly promoted the market shares, brand influence and reputation of the high-end products;
in addition, in order to realize the high-end transformation, technological innovation and industry leading by
advancing the follow-up research, popularization, and technology updates of intelligent and variable frequency
products, the Company intensified the advance of research and development of a new generation of CHiQ
products, continued to vigorously promote 0.1 ℃ variable frequency series refrigerator and realize the continuous
increase in proportion of intelligent and variable frequency refrigerators and variable frequency freezer. The
release of new generation of CHiQ with auto-door are cause great concern in industry and market.Accelerate the
popularity of small and medium-sized air-cooled refrigerators, and the proportion of air-cooled refrigerators
continues to rise rapidly. The completion of the research of comprehensive thin technology and series of products
will further enhance the brand image and accelerate the transition to the high end.
In air conditioning, according to the strategic planning of holistic intelligent air ecosystem, the Company core
with the technical strategic as intelligence and frequency conversion, carrying out variable frequency control in
depth, CFD&CAE simulation, intelligent voice, and basic core ability construction as recognition and interaction
etc. Focus on user perception and user experience, and create the super-energy-saving, super-comfortable and
super-quiet health air conditioner based on the application of the fourth-generation
intelligent comfort and precision temperature control technology platform controlled by PMV in batch products;
make major breakthroughs in the improvement of the air duct sound quality of air-conditioner indoor unit and the
expansion sound of plastic parts, and enhance the brand competitiveness; the product’s working performance in
the harsh environment is on the advanced level of the industry, and the improvement effect is obvious; take the
lead in carrying out the research and application of the voiceprint recognition function of intelligent voice in the
industry, and greatly improve the product image; the Xiaomi and Smartmi OEM frequency conversion outboard
motor products have begun mass production and come onto the market.
In terms of biomedical, Zhongke Meiling, a new three board listed subsidiary of the company, continuously
increased its R&D investment. During the reporting period, the 5 series freezer platform products equipped with
the brand new control system were launched in batches; the self-developed explosion-proof refrigerators obtained
the explosion-proof medical freezer certification; the new vaccine storage solution was designed to ensure the
temperature uniformity and stability in the freezer and guarantee the supervision of vaccine; the intelligent
wireless monitoring and Android screen control system platform thoroughly got through the technical bottleneck
of product end cloud integration; many life science and laboratory products entered the pre-development stage,
such as clean workbench, biological safety cabinet and so on.
R&D investment of the Company
30
CHANGHONG MEILING CO.,LTD. Annual Report 2018
2018 2017 Change ratio
Number of R&D (people) 1,649 1570 5.03%
1.23 percentage points
Ratio of number of R&D 15.52% 14.29%
up
R&D investment (Yuan) 821,742,728.27 761,572,843.03 7.90%
R&D investment accounted for 0.17 percentage points
4.70% 4.53%
R&D income up
R&D investment capitalization
152,448,558.04 116,704,686.42 30.63%
(Yuan)
Capitalization R&D investment 3.23 percentage points
18.55% 15.32%
accounted for R&D investment up
The reason of great changes in the proportion of total R&D investment accounted for operation income than last
year
□ Applicable √ Not applicable
Reason for the great change in R&D investment capitalization rate and rational description
√Applicable □ Not applicable
The company carried out product upgrades around product strategies of fresh keeping,
intelligence and variable frequency, and accelerated the layout of new products, which further
consolidated and promoted the market position. During the reporting period, the company increased
investment in the refrigerator (freezer), air-conditioning technology research and the high
value-added new product development, especially the investment in thin-wall technology and its
application, long-term fresh keeping technology (water molecule activation and fresh keeping
technology, etc.), variable frequency technology development and intelligent product technology
development, resulting in a significant increase in the amount of R&D investment capitalization
during the reporting period compared to the previous year.
(v) Cash flow
In RMB
Item 2018 2017 Y-o-y changes
Subtotal of cash in-flow from
16,778,361,372.57 14,940,892,460.66 12.30%
operation activity
Subtotal of cash out-flow from
16,998,921,987.93 15,492,394,455.40 9.72%
operation activity
Net cash flow from operation
-220,560,615.36 -551,501,994.74 60.01%
activity
Subtotal of cash in-flow from
3,668,508,401.66 5,451,591,320.85 -32.71%
investment activity
31
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Subtotal of cash out-flow from
4,623,429,604.21 4,960,940,585.00 -6.80%
investment activity
Net cash flow from investment
-954,921,202.55 490,650,735.85 -294.62%
activity
Subtotal of cash in-flow from
3,213,434,868.63 2,880,194,862.03 11.57%
financing activity
Subtotal of cash out-flow from
2,646,463,305.11 1,673,559,914.76 58.13%
financing activity
Net cash flow from financing
566,971,563.52 1,206,634,947.27 -53.01%
activity
Net increased amount of cash and
-605,122,582.46 1,103,667,350.63 -154.83%
cash equivalent
Main reasons for y-o-y major changes in aspect of relevant data
√ Applicable □ Not applicable
The net cash flow arising from operation activities in 2018 amounted as -221 million Yuan,
increased 331 million Yuan over that of last year’s -552 million Yuan, a 60.01% goes up, mainly
because on a y-o-y basis, the cash received from goods sales and offering labor service in the period
increased over that of cash paid for purchasing goods and accepting labor service.
The large change in net cash flow from investing activities was mainly due to the year-on-year
decrease in net cash recovered from the entrusted money management of the company during the
period.
The large change in net cash flow from financing activities was mainly due to the year-on-year
increase in cash paid by the company for repayment of debts during the period.
Reasons of major difference between the cash flow of operation activity in report period and net profit of
the Company
√ Applicable □ Not applicable
Mainly due to the decrease in inventory and operating payables at the end of the reporting
period compared to the beginning of the year.
III. Analysis of the non-main business
□ Applicable □ Not applicable
In RMB
Ratio in Whether be
Amount total Note sustainable
profit (Y/N)
Investment income 3,931,358.68 11.45% - N
32
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Gains/losses from Losses from the fair value of forward foreign
-45,949,257.12 -133.80% N
fair value changes exchange contract changed in the period
The accrual of inventory falling price reserves
Asset impairment 39,253,891.46 114.30% N
increased in the period
Non-operation
6,486,445.70 18.89% - N
income
Non-operation Penalty payable and relocation expenditure in
21,268,525.58 61.93% N
expenditure the period
IV. Assets and liability
(i) Major changes of assets composition
In RMB
End of 2018 End of 2017
Ratio in Ratio
Ratio in Notes of major changes
Amount total Amount changes
total assets
assets
Entrusted investment
Monetary fund 4,596,077,557.40 29.53% 5,283,081,788.04 33.10% -3.57%
increased in the period
Account
1,670,988,644.76 10.74% 1,780,416,509.02 11.15% -0.41% No major changes
receivable
Inventory turnover speed up
Inventory 2,174,436,573.67 13.97% 2,918,100,650.27 18.28% -4.31%
in the period
Investment real estate from
Investment real
46,846,507.41 0.30% 9,569,711.72 0.06% 0.24% subsidiary increased in the
estate
period
Long-term
Losses from joint venture in
equity 61,869,440.55 0.40% 90,534,671.92 0.57% -0.17%
the period
investment
Mainly due to the increase
in the transfer of the
Fix assets 1,733,957,012.14 11.14% 1,515,302,743.61 9.49% 1.65%
company’s construction in
progress during the period.
Construction in progress
have more investment by
Construction in
464,558,352.60 2.99% 174,857,717.15 1.10% 1.89% parent company and
progress
subsidiary Changhong
Air-conditioner in the period
Short-term loans of parent
Short-term
2,336,373,929.62 15.01% 1,631,206,000.00 10.22% 4.79% company increased in the
loans
period
33
CHANGHONG MEILING CO.,LTD. Annual Report 2018
The long-term loans due
within one year was
Long-term
1,920,000.00 0.01% 253,160,000.00 1.59% -1.58% re-classified as
loans
“Non-current liability due
within one year”
(ii) Assets and liability measured by fair value
√ Applicable □ Not applicable
In RMB
Devaluatio Amount
Changes of fair Accumulative Amount
Amount at the n of of
value changes of fair of sale in Amount at end
Items beginning withdrawi purchase
gains/losses in value reckoned the of the period
period ng in the in the
this period into equity period
period period
Financial assets
1. Financial assets
measured by fair
value and whose
change is recorded
in current gains 15,646,731.48 -6,393,095.89 9,253,635.59
and losses
(excluding
derivative
financial assets)
Subtotal of
15,646,731.48 -6,393,095.89 9,253,635.59
financial assets
Total 15,646,731.48 -6,393,095.89 9,253,635.59
Financial liabilities 16,034,000.00 39,552,666.70 55,586,666.70
Whether there have major changes on measurement attributes for main assets of the Company in report period or
not
□Yes √ No
(iii) Assets right restricted ended as reporting period
Ended as the reporting period, the Company has no major assets been closed down, detain, freeze or pledge and
guarantee
V. Investment
(i) Overall situation
√ Applicable □ Not applicable
34
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Investment in the same period of last
Investment in the reporting (RMB) Changes
year ( RMB)
46,004,000.00 992,441,301.50 -95.36%
(ii) The major equity investment obtained in the reporting period
√ Applicable □ Not applicable
35
CHANGHONG MEILING CO.,LTD. Annual Report 2018
In RMB
Metho Capita Term Type Wheth Date of
Expect Index of disclosure (if
Invested d of Amount of Sharehold l of of Status as of the Current investment er disclosure (if
Principal business Partners ed
company invest investment ing source invest produc balance sheet date profit and loss litigati applicable
return applicable
ment s ment ts on )
)
Meiling Washi Invested 15 million
R&D, sales and after-sale services of Capita Not
CANDY Self-o ng Yuan during the Juchao Website:
washing machines; own and operate all l Candy Hoover 20 app
Washing 90,000,000 60% wned machi period and totally 60 -4,061,254.55 N 2017-3-30 http://www.cninfo.co
types of goods and technology import invest Group S.r.l years lica
Machine capital ne, million Yuan m.cn(No.: 2017-010）
& export business ment ble
Co., Ltd. etc. invested acculturate
Development, production and sales of
computer hardware & software,
technology development, production
and sales of internet of Things
equipment, development and
maintenance of E-commerce software,
information service, technical transfer Juchao Website:
Capita Management Fresh Invested Not
Changmei and services of the internet, domestic Self-o 2016-1-8; http://www.cninfo.co
l team of 20 online Capital of app
Technology AD designing, production, agencies 48,128,000 96.256% wned -17,209,628.36 N 2016-11-26; m.cn(No.: 2016-002,
invest Changmei years retailer 15.704 million Yuan lica
Co., Ltd. and release, sales of prepackaged food, capital 2017-11-10 No.: 2016-068, No.:
ment Technology s in the period 报 ble
dairy products, general merchandise, 2017-088）
alcohol, beverage and agricultural
products, crop planting, self-support
goods and technology import and
export business(Except for items
prohibited or restricted by laws and
regulations)
Hongyuan Production and sales of the system and Capita 25,500,000 51% Self-o Ever Source Long-t Groun Invested capital of Not -5,795,344.98 N 2015-4-18 Juchao Website:
36
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Ground parts of ground energy heat & cold l wned Science & erm d 15.3 million Yuan app http://www.cninfo.co
Energy integrated machine, sales of home invest capital Technology energy during the period lica m.cn(No.: 2015-016）
Heat appliance, raw material of home ment Development heat & and completed the ble
appliance and parts Group Co., cold contribution amount
Pump
Ltd. integra
Tech. Co.
ted
Ltd.
machi
ne
Total -- -- 163,628,000 -- -- -- -- -- -- -- -27,066,227.89 -- -- --
(iii) The major non-equity investment doing in the reporting period
√ Applicable □ Not applicable
In RMB
Industry Reasons for
Accrued
Invest Fixed involved Accrued Actual not Reaching
Investment Amount Capita Realized Income
ment Investm in Investment Amount Anticipated the Planned Disclosed Disclosed Index (if
Project Name in this Reporting l Project Schedule up to the End of
Metho ents or Investm up to the End of Income Schedule and Date (if any) any)
Period Source Reporting
d not ent Reporting Period Anticipated
Period
Projects Income
Intelligent Completed an
production line Home intelligent
for one million applianc production line
Self-o Juchao Website:
sets of Self-b e The project completed and come for one million
Yes 72,386,347.52 156,797,364.00 wned - Not applicable 2017-3-14 www.cninfo.com.cn(N
eco-friendly and uilt manufac into service sets of
capital o.: 2017-006)
energy-saving turing eco-friendly and
refrigerators industry energy-saving
(note 1) refrigerators
Production base Self-b Yes Home 59,037,970.14 198,573,870.14 Self-o The company The Project is under Not applicable 2017-3-30; Juchao Website:
37
CHANGHONG MEILING CO.,LTD. Annual Report 2018
for two million uilt applianc wned successfully bade for the plant, of production planning during 2017-4-14 www.cninfo.com.cn(N
sets of automatic e capital fice building and land use rights capacity of 2 the reporting o.: 2017-010, No.:
washing manufac under the name of Anhui Dongw million sets period, no 2017-024)
machine (note 2) turing ei Solar Technology Co., Ltd. fro of automatic income yet.
industry m the judicial sale with its own washing
funds of RMB134, 585,900; curre machine
ntly, the phase I project (annual shall be
output of 0.5 million sets of auto formed after
matic washing machine for one s this project
hit)has came into production being put
into
operation
Total -- -- -- 131,424,317.66 355,371,234.14 -- -- -- -- --
Note 1: In order to meet the increasing market demands, make up for the insufficient capacity, enhance the operating efficiency of the company's production line, and further promote the
company's intelligent manufacturing process, the 28th session of the 8th Board of Directors approved and agreed the company’s subsidiary Jiangxi Meiling Electric Appliance Co., Ltd.
(Hereinafter referred to as “Jiangxi Meiling”) to invest RMB 209,600,000 to intelligent production line for one million sets of eco-friendly and energy-saving refrigerators. See details on
“Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn that the company disclosed in the form of announcement (Announcement No.
2017-006) on March 14, 2017. Recently, main construction has completed on 20 December 2017 and will put into production at end of 2017, the project has completed and came into service so
far.
Note 2: According to the company's strategic development plan, combined with the company's business needs, and in order to make up for the insufficient research and manufacturing capacity
of washing machine industry so as to meet the market demands, the 29 th session of the 8th Board of Directors approved and agreed the company’s to invest no more than RMB 371,210,000 in
the construction of the production base for two million sets of automatic washing machine. In addition, the 29th session of the 8th Board of Directors approved and agreed the company to
successfully bid for the plant and office building (covering an area of 86,087.65 square meters) and land use rights (covering an area of 116,233.61 square meters) under the name of Anhui
Dongwei by public auction organized by the court with its own funds of RMB134,585,900, and use the plant and land as the washing machine production base for construction. See details on
“Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn that the company disclosed in the form of announcement (Announcement No.
2017-010, No. 2017-024) on March 30, 2017 and April 14, 2017. Ownership transfer of relevant land use right and property licence has completed.Currently, the phase I project (annual output
of 0.5 million sets of automatic washing machine for one shit) has came into production officially
38
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(iv) Financial assets investment
1. Securities investment
□ Applicable √ Not applicable
2. Derivative investment
√ Applicable □ Not applicable
In 10 thousand Yuan
Amount of Ratio of
reserve for investment
Relate Whether Amount
Investment Amount sales in devaluation Investment amount at Actual
d related Initial purchased in
Operator Type Start date End date amount at the reporting of amount at period-end in net gains/losses in
relatio trade or investment the reporting
period-begin period withdrawing period-end assets of the period
nship not period
(if Company at
applicable) period-end
Forward
Financial foreign 23 December
N/A No 367,218.32 14 June 2017 210,705.91 482,036.08 547,658.54 - 149,739.86 29.85% -4,656.41
institution exchange 2019
contract
Total 367,218.32 -- -- 210,705.91 482,036.08 547,658.54 - 149,739.86 29.85% -4,656.41
Capital resource(if applicable) Self-owned capital
Lawsuit involved (if applicable) Not applicable
Disclosure date for approval from the Board
30 March 2018
for investment of derivatives (if applicable)
Disclosure date for approval from board of
shareholders for investment of derivatives (if 11 May 2018
applicable)
39
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Risk analysis:
1. Market risk: domestic and international economic situation changes may lead to exchange rate fluctuations, forward foreign exchange transactions are under
certain market risk. Forward foreign exchange business is aiming to reducing impact on corporate profits by foreign exchange settlement and sale prices, exchange
rate fluctuations. The Company will follow up the exchange fluctuation, on the basis of target rate determined from the business, relying on the research of the
foreign currency exchange rates, combined with prediction of consignments, and burdening ability to price variations due to exchange rate fluctuations, then
determine the plan of forward foreign exchange contracts, and make dynamic management to the business, to ensure reasonable profit level.
2. Liquidity risk: all foreign exchange transactions are based on a reasonable estimate of the future import and export business, to meet the requirements of the trade
Risk analysis and controlling measures for
authenticity. In addition, forward foreign exchange transactions are processed with bank credit, will not affect liquidity of company funds.
derivatives holdings in the Period (including
3. Bank default risk: if cooperative banks collapse within the contract time, the Company will not be able to transact the original foreign exchange contracts with
but not limited to market risk, liquidity risk,
contract price, which leads the risk of income uncertainty. So the Company chose Bank of China, Agricultural Bank of China, Industrial and Commercial Bank of
credit risks, operation risk and law risks etc.)
China, China Construction Bank and other chines e-funded banks with a joint-stock system as Everbright and Industrial Bank, as well as the foreign-funded banks as
UOB, Oversea Chinese Bank and the Bank of East Asia etc. to conduct the trading of foreign exchange capital. These banks share a solid strength and management
whose failure and the risk of loss may bring to the Company is very low.
4. Operational risk: improper operation of the person in charge of forward foreign exchange transactions may cause related risk also. The Company has formulated
related management system which defines the operation process and responsibility to prevent and control risks.
5. The legal risks: unclear terms based in contract signed with banks for related transactions may lead legal risks when forward foreign exchange transactions are
processing. The Company will strengthen legal review, and choose good bank to carry out this kind of business as to risk control.
Invested derivative products have changes in The Company determines fair value in accordance with the Chapter VII “Determination of Fair Value” carried in the Accounting Standards for Business Enterprises
market price or fair value in the Period, as for No.22 - Recognition and Measurement of Financial Instruments. Fair-value is basically obtained according to prices offered by bank and other pricing services. While
analysis of the fair value of derivatives, fair-value of derivatives is mainly obtained according to the balance between prices given by outstanding contracts and forward prices given by contracts signed
disclosed specific applied methods and during the reporting period with bank. The differences are identified as trading financial assets and liabilities. During the reporting period, forward foreign exchange
correlation assumption and parameter setting contracts and losses of the Company is RMB -46,564,100.
Specific principle of the accounting policy
and calculation for derivatives in the Period
Not applicable
compared with last period in aspect of major
changes
Upon inspection, the independent directors of the Company believes that: during the reporting period, the Company carried out its foreign exchange forward deals in
Special opinion on derivative investment and
strict compliance with the standardized operation guidelines for listed issuer on main board (2015 amended) issued by Shenzhen Stock Exchange, the Articles of
risk control by independent directors
Association, Authorization Management of the Company, Management System in relating to Foreign Exchange Forward Deals of Hefei Meiling Co., Ltd., and these
40
CHANGHONG MEILING CO.,LTD. Annual Report 2018
deals were conducted within the authorization scope under general meeting and board meeting. The Company conducts no foreign exchange transactions on the
purpose of getting profit only, all of the forward foreign exchange transactions are operates based on normal operating and production, which is relying on specific
business operations with purpose of avoiding the preventing the risks in exchange rate. The forward foreign exchange fund transaction benefit a lot in avoiding the
exchange rate risks in import and exports business and thus met its requirement for operation development. There was no speculative operation, no break of relevant
rules and regulations and relevant business was conducted under corresponding decision-making procedures. Interests of the Company and entire shareholders,
especially minority shareholders, were not prejudiced.
(v) Application of raised proceeds
√ Applicable □ Not applicable
1. Overall application of raised proceeds
√ Applicable □ Not applicable
In 10 thousand Yuan
Total raised Cumulative Ratio of
Total raised capital capital has raised capitals cumulative Total accumulative Usage of the retained raised Raised capitals idle
Total accumulative
Year Way Total raised capitals used purpose of uses has purpose of raised capitals raised capitals capitals and what is expected for more than two
raised capitals used
in Period changed in uses changed has purpose of unused to invested with those capitals years
Period in total uses changed
The raised funds that the
Company has not run out will
Non-public continue to complete the
2016 offering of 154,073.272276 20,349.247113 71,151.385865 0 0 0% 92,025.292981 corresponding investment as --
A-shares planned. At the same time,
according to the planning for
equity investment projects, it’s
41
CHANGHONG MEILING CO.,LTD. Annual Report 2018
agreed the Company to use
the idle raised funds of no
more than RMB 940 million
(The amount can be rolled
over) to invest in the
principal-protected financial
products after being approved
by the Company’s board of
directors, board of
supervisors, and the
resolutions of shareholders’
meeting, and after the
independent directors issuing
agreed independent opinions
and sponsor agencies issuing
unanimous verification
opinions. The remaining funds
are deposited in the
designated raised capital
account.
Total -- 154,073.272276 20,349.247113 71,151.385865 0 0 0% 92,025.292981 --
Explanation on General usage of raised capital
Being deliberated and approved by 1st extraordinary shareholders meeting of 2016 and 17th session of 8th BOD, and verified by the Reply on Private Placement of Hefei Meiling Co., Ltd. (CSRC XK [2016] No.1396)
issued from CSRC, the Company successfully offering 280,858,676 shares (A-stock) to 7 qualified investors, including Sichuan Changhong Electric Co., Ltd. (hereinafter referred as to Sichuan Changhong), with price
of 5.59 Yuan/Share and face value of 1.00 Yuan. According to the Verification Report XYZH/2016CDA40272 issued by Shine Wing Certified Public Accountants (LLP), total raised fund amounting to
1,569,999,998.84 Yuan, less vary issuance changes (tax included) 29,267,276.08 Yuan, raised fund amounts to 1,540,732,722.76 Yuan.
Ended as 31 December 2018, actually fund of raised used accumulative amounted as 711,513,858.65 Yuan in total, balance of the account for fund raised counted as 920,252,929.81 Yuan (including interest income
accumulative amounted as 10,924,322.94 Yuan and income from financial product at expiration 79,962,401.75 Yuan)
The Company accumulative used the fund raised amounted as 711,513,858.65 Yuan, the use of purpose including: intelligent construction has 123,057,203.64 Yuan in used; R&D ability for intelligence and new
42
CHANGHONG MEILING CO.,LTD. Annual Report 2018
products for intelligent household appliance has 272,575,391.24 Yuan in used; smart life project totally used 45,001,200.00 Yuan; used in current fund supplementary counted as 270,880,063.77 Yuan (including saving
interest of 147,341.01 Yuan)
2. Situation of committed project of raised proceed
√ Applicable □ Not applicable
In 10 thousand Yuan
Change the Investment
Cumulative Achieved
Committed investment project (Y/N) progress till Date of reach a Benefit Major changes of
Total raised-fund Investment after Invested in the investment amount expected
projects and over-raised (including end of predetermined state of achieved in project feasibility
commitment adjustment (1) period till end of benefits
fund investment partially period-end (3) use the Period (Y/N)
Period-end (2) (Y/N)
changed) ＝(2)/(1)
Committed investment project
Intelligent
manufacturing (Hefei)
project: end of
Construction of intelligent Not
N 39,100.00 39,100.00 4036.739920 12,305.720364 31.47% December of 2021, -- N
manufacturing project applicable
construction project of
freezer intelligent : end
of December of 2021
Construction of intelligent
R&D capability and new
End of December of Not
products development of N 55,900.00 55,900.00 14,962.471193 27,257.539124 48.76% -- N
2021 applicable
the intelligent appliance
technology
Not
Intelligent life project N 32,000.00 32,000.00 1,350.036000 4,500.120000 14.06% April 2021 -- N
applicable
Supplementary the floating Not
N 27,073.272276 27,073.272276 0 27,088.006377 100.05% -- -- N
capital applicable
43
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Subtotal of committed
-- 154,073.272276 154,073.272276 20,349.247113 71,151.385865 46.18% -- -- -- --
investment project
Investment of the over-raised fund
No over-raised fund in the Period
Payment of bank loans (if
-- -- -- -- --
applicable)
Supplementary the floating
-- -- -- -- --
capital (if applicable)
Subtotal of over-raised fund
-- -- -- -- -- --
investment
Total -- 154,073.272276 154,073.272276 20,349.247113 71,151.385865 46.18% -- -- -- --
1. In the "intelligent manufacturing construction project":
(1）the planning construction period of "intelligent manufacturing (Hefei) project" is 3 years, during the reporting period, phase I and phase II has
completed in construction, phase III till in process, the original estimated completion time has expired.Therefore, in accordance with the actual situation of
the company’s fund-raising project, in order to regulate the use of raised funds, the resolution of the 20 th meeting of the ninth session of the board of
directors and the 11th meeting of the ninth session of the board of supervisors of the company passed and agreed the company to postpone the date that the
project achieves the scheduled serviceable condition to the end of December 2021. At the same time, the company’s independent directors have issued
independent opinions of consent, and the company’s sponsor institution Shenwan Hongyuan issued a unanimous verification opinion.
(2) The planned construction period of “newly increasing 600,000 sets of medium and large-capacity environmental protection and energy-saving freezer
Conditions and reasons of failure to meet schedule or predicted
intelligent production line construction project” is one year. In accordance with the actual situation of the company’s fund raising project, in order to
income (by specific projects)
regulate the use of raised funds, the resolution of the 14th meeting of the ninth session of the board of directors and the 16th meeting of the ninth session of
the board of supervisors andthe 20th meeting of the ninth session of the board of directors and the 11th meeting of the ninth session of the board of
supervisors of the company passed and agreed the company to postpone the date that the project achieves the scheduled serviceable condition to the end of
December 2021. Meanwhile, independent directors have issued an agreed independent opinion and sponsor agencies -Shenwan Hongyuan issued a
verification opinions without objection.
2. “Intelligent R&D ability building projects and new product development projects for intelligent home appliances”: is three years, the construction of
Inspection & Testing Center Building and fire control acceptance were completed, and came into service so far; completed the development and marketing
of intelligent second-generation products, and the intelligent third-generation products has also completed the trial production in small batches; other
44
CHANGHONG MEILING CO.,LTD. Annual Report 2018
projects are being implemented. The original completion time has expired. Therefore, combine with actual condition, and with purpose of standardize the
fund-raised, after approved by the resolution of 20th session of 9th BOD and 11th session of 9th Supervisory Committee, the Company agreed to postponed
the time for using in normal status to end of December of 2021. Meanwhile, independent directors have issued an agreed independent opinion and sponsor
agencies -Shenwan Hongyuan issued a verification opinions without objection.
3. As the implementation subject of the Company’s “Intelligent Life Project”, Changmei Technology was established in April 2016. At present, Changmei
Technology owns the online platform of the fresh e-commerce brand “ifoodtube”, the main business model is organic integration of fresh e-commerce and
intelligent retail equipment, providing users with online and offline integrated fresh products and services. Currently, the project is in normal operation.
4. Up to end of the period, investment in “Supplementary the floating capital” has over 100%, mainly due to the saving interest in fund raised used in the
project
Presentation on the major changes in project feasibility Not applicable
Use progress of the raised-fund and purpose Not applicable
Changes of the site for raised-fund investment projects Not applicable
Adjustment of the raised-fund investment projects Not applicable
Applicable
Ended as 31 October 2016, the Company contributed self-raised fund 63,984,738.91 Yuan for the raised-fund investment project, the money has replaced
as 63,984,738.91Yuan. Shine Wing CPA (LLP) made a special audit for pre-investment and carried out an Assurance Report on Invested Self-raised fund to
the Raised-fund Investment Before Hand (XYZH/2016CD40285) (hereinafter referred as to Assurance Report). Replacement are as:
In 10 thousand Yuan
Up-front cost and replace of the raised-fund investment projects Commitment
Investment of self-raised
Raised-fund Total capital for Amount
fund invested till end of 31
investment project investment raised-fund replaced
October 2016
project
Construction of
intelligent 39,870.65 39,100.00 2,545.41 2,545.41
manufacturing project
Construction of
intelligent R&D 55,900.00 55,900.00 2,053.06 2,053.06
capability and new
products development
45
CHANGHONG MEILING CO.,LTD. Annual Report 2018
of the intelligent
appliance technology
Intelligent life project 32,076.00 32,000.00 1,800.00 1,800.00
Total 127,846.65 127,000.00 6,398.47 6,398.47
The replacement has been deliberated and approved by the 27th session of 8th BOD and 14th session of 8th supervisory committee, independent directors are
proposed an agreeable independent opinion, and sponsor institution carried out a verification opinion without objection.
Supplement working capital temporary with idle raised-fund Not applicable
Balance and reasons of the implementation of raised-fund Not applicable
The raised-fund have not been used will continues to invested on the raised-fund projects in above mentioned table. Meanwhile, according to the
raised-fund investment plan, and been approved by the Board, the Board of supervisors and shareholder general meeting, agreeable independent opinion
from independent directors and with the verification opinion without objection issued by sponsor institution, it’s agreed the Company to use the idle raised
Use of funds and fund allocation for un-used raised-fund
fund of no more than 940 million Yuan (the amount can be rolled over) to invest in principal-protected financial products, the remaining funds are deposit
in the designated raised capital account.
Use of the raised-fund has no changes till recently.
Use of raised-fund and problems or other condition in As for the relevant information of raised-fund disclosed, there is no any disclosure information that released without timely, true-ness, accurate and
disclosure complete. The savings, usage, management and disclosure of the raised-fund have no violation conditions been found.
3. The changed project of raised proceeds
□ Applicable √ Not applicable
No changes of raised proceeds in the Period.
VI. Sales of major assets and equity
(i) Sales of major assets
□ Applicable √ Not applicable
No major assets are sold in the period
46
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(ii) Sales of major equity
□ Applicable √ Not applicable
VII. Analysis of main holding company and stock-jointly companies
√ Applicable □ Not applicable
(i) Particular about main subsidiaries and stock-jointly companies net profit over 10%
In RMB
Company name Type Main business Register capital Total assets Net Assets Operating revenue Operating profit Net profit
Research and development,
Zhongke Meiling
manufacturing and sales of
Cryogenic Technology Subsidiary 68,640,300 276,297,653.60 137,326,070.00 185,678,757.29 16,618,467.30 15,463,119.14
ultra-low temperature
Co., Ltd.
freezer
Jiangxi Meiling Electric Manufacturing of
Subsidiary 50,000,000 593,270,713.67 92,855,531.17 990,771,504.41 1,756,673.53 1,758,273.53
Appliance Co., Ltd. refrigeration and freezer
Mianyang Meiling Manufacturing of
Subsidiary 100,000,000 136,991,742.10 116,984,982.19 264,249,893.04 4,829,802.29 4,460,507.35
Refrigeration Co., Ltd. refrigeration and freezer
Sichuan Changhong R&D, manufacturing and
Air-conditioner Co., Subsidiary domestic sales of 850,000,000 3,469,780,862.70 1,372,026,736.77 5,310,863,142.78 38,046,716.29 32,830,567.02
Ltd. air-conditioner
R&D, manufacturing and
Zhongshan Changhong
Subsidiary domestic sales of 184,000,000 907,674,237.23 50,064,623.27 1,985,947,420.54 -99,211,221.55 -96,864,675.58
Electric Co., LTD
air-conditioner
Hefei Meiling
Electronic Appliance Subsidiary Sales of white goods 55,000,000 69,442,167.29 -143,584,392.78 899,743,787.81 70,225,896.29 70,203,256.97
Marketing Co., Ltd.
Hefei Meiling Group
Subsidiary Sales of white goods 80,000,000 450,701,273.04 -125,294,119.02 3,500,114,587.76 -71,498,105.87 -71,978,091.38
Holdings Limited
47
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Changmei Technology E-business of agricultural
Subsidiary 50,000,000 20,530,817.84 11,139,793.68 26,839,141.37 -18,069,100.45 -17,947,299.32
Co., Ltd. products and fresh
R&D, manufacturing and
Guangdong Changhong sales of kitchen and toilet
Ridian Technology Co., Subsidiary products, small home 83,000,000 367,232,026.98 136,012,120.14 525,992,095.11 16,307,329.39 15,367,774.29
Ltd. appliances and water
purifier
Meiling CANDY
R&D and sales of washing
Washing Machine Co., Subsidiary 150,000,000 209,111,952.29 91,144,192.11 468,389,142.46 -5,134,249.55 -6,768,757.59
machine
Ltd.
48
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(ii) Notes of holding and shareholding companies
√ Applicable □ Not applicable
The method of obtaining and handling The influence to the whole production and
Company Name
subsidiaries during the report period performance
Minor effect on the overall production and
Zhongshan Hongyou Electric Co.,Ltd. Clearing off
operation and performance of the company
Wuhu Meiling Electronic Appliance Minor effect on the overall production and
Clearing off
Marketing Co., Ltd. operation and performance of the company
Shijiazhuang Meiling Electronic Minor effect on the overall production and
Clearing off
Appliance Marketing Co., Ltd operation and performance of the company
Kunming Meiling Electronic Appliance Minor effect on the overall production and
Clearing off
Marketing Co., Ltd operation and performance of the company
Jingzhou Meiling Electronic Appliance Minor effect on the overall production and
Clearing off
Marketing Co., Ltd operation and performance of the company
Harbin Meiling Electronic Appliance Minor effect on the overall production and
Clearing off
Marketing Co., Ltd operation and performance of the company
Guiyang Meiling Electronic Appliance Minor effect on the overall production and
Clearing off
Marketing Co., Ltd operation and performance of the company
Chongqing Meiling Electronic Minor effect on the overall production and
Clearing off
Appliance Marketing Co., Ltd operation and performance of the company
Nantong Meiling Electronic Appliance Minor effect on the overall production and
Clearing off
Marketing Co., Ltd operation and performance of the company
Shenyang Meiling Electronic Minor effect on the overall production and
Clearing off
Appliance Marketing Co., Ltd operation and performance of the company
Changchun Meiling Electronic Minor effect on the overall production and
Clearing off
Appliance Marketing Co., Ltd operation and performance of the company
(iii) Notes of holding and shareholding companies
The Company has no major holding and stock-jointly enterprise should be disclosed in the period
VIII. Structured vehicle controlled by the Company
□ Applicable √ Not applicable
IX. Future Development Prospects
(i) Competition pattern and development trend
Affected by the macro environment and its own development cycle, China’s home appliance market is facing
weak growth and is in a critical period of transformation and upgrading. In addition, Sino-US trade friction brings
many uncertainties. Simultaneously, there are opportunities in danger, it’s necessary to seize the opportunities
still existing in the transformation and upgrading stage of home appliance industry. The innovative technology
49
CHANGHONG MEILING CO.,LTD. Annual Report 2018
that is constantly iterating in the home appliance industry will provide driving forces for the benign development
of the entire industry. The era of barbaric expansion in China’s home appliance market has passed, it is necessary
to shift from extensive management to refined operation and focus on quality and efficiency so that the company
can stand erect in tomorrow’s market competition.
1. Macro environment analysis
(1) Social environment and demand trend
Social environment: The population growth in developed countries is sluggish, the retail volume will remain
stable, the retail sales will increase with product upgrades, and the product structure will be further upgraded. The
global economy has entered a recovery cycle, and the consumption upgrade brought about by economic
development has further accelerated. As the aging of population intensifies, people will pay more and more
attention to health.
Demand trend: The product structure continues to be optimized, and the quality upgrade continues to drive the
market’s high-end development. With the rapid development of smart technology and the continuous upgrading of
consumption, home appliance technology presents diversification new trends such as “large”, “beauty”, “health”,
“comfort”, “energy saving”, “intelligence”, “integration” and “full house”, and so on.
(2) Market potential
The economy of developing countries is gradually growing, home appliances are entering the stage of
popularization, and emerging countries will grow at a high speed, it is expected that the demand for imports will
increase in the short term. E-commerce continues to develop at a high speed, and the impacts on the traditional
retail industry are gradually spreading, and the purchasing behavior of consumers will have further changes. With
the rise of self-owned brands, the living space of agents and traders has been further compressed. The acceleration
of urbanization has provided sustained demand for the growth of the home appliance industry. The two-child
policy and real estate regulation brought about market opportunities. The new retail market moves forward and
leads to the transformation of home appliance channels, channel sinking, new department store formats, digital
stores, and brand experience pavilions, which have become the new direction for the current home appliance
channel transformation.
2. Refrigerator (freezer) industry
The home appliance industry will bid farewell to low-price competition and gradually return to rational value
competition, and the industry market competition pattern will further intensify. With the withdrawal of the
national inclusive policy, and the formulation and introduction of new policies still take time, the industry growth
is weak. All View Cloud (AVC) predicts that the refrigerator market will have a retail volume of 31.64 million
units in 2019, a decline of 3.3% on a year-on-year basis, and the retail sales will reach 95.4 billion yuan, a decline
of 0.4% a year-on-year basis. The possibility that the joining of internet brands may trigger the price war and the
slowdown in price structure upgrade brought about by the release of cost pressure are the important potential
factors for a small negative growth in retail sales.
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Despite the lack of industry demand, in the context of the industry structural transformation and upgrading and the
product upgrading, with the rise of medium- and high-end consumer groups, especially the full release of quality,
high-end and fashion technology demands, the home appliance industry is welcoming a new round of
consumption upgrade, the coming of quality consumption era will promote the transformation and upgrade of the
industry to high end and intelligence, and the competition in the home appliance market dominated by “quality
and new products”, will become clear and definite. The refrigerator industry is rapidly developing towards fresh
keeping, air cooling, frequency conversion, intelligence, and large volume. In a market where both structure and
quality are upgrading, it is crucial to grasp the direction of industry development needs. The demand trend of
refrigerators in the future will be based on the product upgrades in the third- and fourth-tier markets and on the
high-end consumption in the first- and second-tier markets.
3. Air conditioning industry
The dominant pattern of the three major brands in the air-conditioning industry has not changed, the duopoly
situation has become more apparent, and the brand concentration has increased again. The second- and third-tier
brands face greater pressure. Driven by the e-commerce platform channel sinking and network wholesale model,
the omni-channel business model has become a new outlet for brand manufacturers to open up the integrative
development of online and offline channels. Under the trend of consumption grading, high-end brands and
high-end products have found a breakthrough in differentiated development, and have also become an important
driving force for the development of high-end products and high-end brands of air-conditioning manufacturers.
In 2019, the air-conditioning market will continue to bear pressure. In the first half of the year, the market will
continue the declining trend in the second half of 2018, and the market will return to a stable development stage.
Under the background of consumption upgrading, the upgrading of industrial structure will continue to drive the
industry price to rise, All View Cloud (AVC) predicts that the retail volume of the air-conditioning market in 2019
will be 55.9 million sets, a decline of 2.0% on a year-on-year basis, and the retail sales will reach 201.4 billion
yuan, a rise of 0.2% on a year-on-year basis.
4. Washing machine industry
The washing machine market has entered the period of stock upgrade, the market demand power is mainly
upgrading and updating, and the demand in washing machine market is slowing down and also facing the pressure
of slowing down. From the perspective of growth momentum, the washing and drying and the large capacity are
leading the update and upgrade, at the same time, healthy washing and differentiated products will also become an
upgrade trend.
(ii) Development strategy
1. Vision
Be a leading brand in China, World Class and respectable household appliance enterprise.
2. Strategic thought
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
In 2011, the board of directors of the company proposed the strategic guiding thoughts of "Meiling Dream" and
"Double Three Strategy", and upgraded the original "Double Three Strategy" to "Double Three One Core
Strategy", Double Three refers to three core strategies which are product strategy, talent strategy, and cost
leadership strategy and three significant strategies which are market strategy, brand strategy, and
internationalization strategy, One Core refers to intelligentization.
In the next few years, the company will stand correctly, accurately and firmly in the industry, market and
reformation, continue to promote the six innovations so that the company shall step forward to the direction of
"Meiling Dream", and strive to create another Meiling by 2020.
3. Strategic thinking and targets
By "two insists", "two adheres" and "two transformations" (i.e. insist on product doctrine and technology driven,
insist on cultural development and institutional innovation; adhere to domestic and overseas markets, adhere to
talent and brand strategy; transform from single to diversification, transform from B2C to 020 and C2B), the
company has strive to achieved the annual revenue of 20 billion Yuan by 2020. Details include: the first is to
create another Meiling in scale, i.e. to achieve the annual sales revenue of 20 billion Yuan, at the same time, the
company’s refrigerator and freezer have become the industry leader in intelligence, frequency conversion, fresh
keeping and thin wall; the air-conditioner has become the industry leader in intelligence and frequency conversion;
the washing machines have become the leading brand in the industry with excellent quality, exquisite
workmanship and healthy care; the small household appliances have become the leader of smart kitchens and a
leading brand of “Water Eco-Home Appliances”. The market share of the main products of refrigerator and freezer
and air conditioners has increased significantly. Washing machine products, kitchen and bathroom products and
small household electrical appliances have become the new main products of Meiling, and drive the
transformation and upgrading of the company’s profit model through the layout of emerging businesses such as
fresh e-commerce and biomedical services.
(iii) Business plan
1. Business objective
In the face of downward pressure on the macro economy, fierce competition among brands in the home appliance
industry and rising raw material prices, in 2019, under the leadership of the board of directors, the company will
strive to achieve double growth in operating income and net profit, with a focus on improving profitability.
2. Operating principles
The Company’s operating principles in 2018 are ”product leading, marketing transformation, efficiency
enhancement and team activation"
Product leading: Adhere to “productism” and continue to focus on product development. Continuously improve
the market performance and competitiveness of products. The Company has satisfied the needs of product
52
CHANGHONG MEILING CO.,LTD. Annual Report 2018
upgrades, consumption upgrades, and high-end breakthroughs through the promotion of quality, taste, and brand.
Meanwhile, the company has achieved the products’ easy manufacturing and easy maintenance through the
platformization and serialization of products and the standardization, generalization, and modularization of parts,
that is “five -ization and two easy”, as well as the digital transformation of digital factories, digital processes and
digital supply chain, and escorted the “product leadership” by creating the “first-class manufacturing”. In 2019,
the company will continue to adhere to intelligent and variable frequency strategies, and firmly grasp the depth
development and iterative products of “M Fresh Life Series” and “Ultra Thin Wall Refrigerator”, continue to
promote the development of smart products and variable frequency, M Fresh Life refrigerator and freezer, and
large-capacity refrigerators, focus on high-end products and super-hot products, mainly promote “M Fresh Life”
refrigerators, all thin-walled new products, and develop e-commerce channels for “M Fresh Life” products, full
thin-walled CHiQ high-end series products, create differentiated flagship products, and achieve product
serialization, make breakthroughs in the market and business models, and continue to increase the proportion of
variable frequency, intelligence, and fresh keeping, and the differentiated competition level.
Marketing transformation:
Digitalization is the core of the traditional marketing business transformation, reconstruct the three major systems
by digitalization, namely, establishing a marketing management system with terminal retail as the core,
establishing a value management system with retail price as the core, and establishing an operation management
system with customer’s business inventory as the core. At the same time, in the domestic market, on the one hand,
the value transformation is realized by adjusting the structure, raising the average price and increasing the share.
On the other hand, the same regional price and the online and offline integrated price system is implemented by
strengthening the overall channel linkage, promoting the online and offline integration, improving the profitability
of the e-commerce channel. Focus on the users, fully optimize the product array, focus on creating high-quality
products and super-hot products; promote the traditional channel e-commerce transformation work nationwide.
In addition, in the overseas market, further increase the product development and planning of mid- and high-end
refrigerators, promote the sales structure, improve the average sales price, put through the value chain as oversea
factories, R&D and sales, and increase the profitability; transform from the single pursuit of scale to the pursuit of
both scale and profit, from the order driving to market driving and from foreign trade thinking to marketing
thinking; gradually increase the team and product investments in brand, and promote the construction of overseas
own brands.
Efficiency enhancement: Establish a chain-wide operational excellence concept, and promote projects such as
“intelligent manufacturing”, “B2C business marketing transformation”, and “supply chain procurement
management reform” to form a systematic synergy. On the one hand, the organization efficiency can be improved
by promoting the manufacturing delivery, shortening the quality response cycle, and improving the process
efficiency. On the other hand, continue to carry out the objectives of “triple effect” promotion, cost control,
53
CHANGHONG MEILING CO.,LTD. Annual Report 2018
increasing revenue and reducing costs and formulate and implement measures to optimize resource allocation and
fully activate resource potential by exploring the cost potential, strengthening the process control, reducing the
internal consumption, and generating revenue. Finally, further strengthen the implementation of terminal services,
continuously reduce its own inventory and commercial inventory scale, promote the rapid turnover of real estate
business, and continue to implement the operational net cash flow improvement measures; establish a reversal
mechanism to enhance the initiative of industry units to improve efficiency; continue to improve decision-making
efficiency.
Team activation: The company will continue to vigorously strengthen the construction of professional and
technical personnel, promote the "Yangquan Plan", select and train key post successors, build a team of
company-level experts, and improve the construction of talent pool. We will implement the “creating and sharing
together” incentive mechanism, optimize the existing compensation system, and explore and establish more
flexible and open incentive and restraint policies in the medium and long-term incentives and profit sharing to
further activate the team’s vitality.
3. Market strategy
(1) Refrigerator (freezer)
Tightly around the management policy, continue to adhere to the intelligence and frequency two core product
strategy; speed up the development and upgrading of a new generation of intelligent product, implement the
company's intelligent strategy, and enhance the proportion of high-end products.Vigorously invest in basic
technology research and product upgrading, continue to carry out intelligence, frequency, forced air cooling,
refreshment, thin-wall and other technical researches, maintain technology-leading in the industry, promote the
company's product structure to upgrade to high end and intelligence, and drive the company's industrial
transformation and upgrading; at the same time, giving great impetus to enhancing the three-qualities, five -ization
and two easy and first-class manufacturing, comprehensively improve the efficiency and quality, reduce the
product costs and enhance the product competitiveness. In domestic and overseas market, realize the
transformation of marketing around value, strengthen the domestic sales channel capacity building, strengthen the
online and offline synergy, and increase the competitiveness. Domestically accelerate O2O integration, implement
channel transformation; focus on core customers overseas, expand self-owned brand business; comprehensively
put talent strategy on team building, and provide sufficient talent for development.
The domestic market takes frequency leading, intelligent pilot, multi-door becoming stronger, back to back getting
bigger, air-cooling jump start as the thinking, makes reasonable planning, promote the products’ combination
ability, and enhance the domestic sales capacity by adjusting the product structure. Regarding the channel,
enhance the offline terminal sales ability through the price management, promotion management, user experience
management and other means, at the same time, enhance the online sales ability by creating e-commerce hot
54
CHANGHONG MEILING CO.,LTD. Annual Report 2018
products, enhancing after-sales service experience, and collaborative operations among all product lines and other
means.
In overseas markets, on the one hand, strengthen the market research, market planning and market promotion
capabilities; continuously adjust the product mix, transform from low end, low cost, low value to middle end,
middle price, and middle value; while also pull through the overseas factories, R&D, sales and the
full-value-chain, reduce the manufacturing costs, reduce the logistics costs, improve the human performance and
material efficiency and enhance the overall competitiveness of overseas products; export the semi-knocked down
business through technology and process, and achieve the local production in overseas. On the other hand,
gradually increase the team and product investments in brand, and promote the construction of overseas own
brands, realize the local marketing of self-owned brands in overseas, and increase the brand added value.
(2) Air conditioning
At home, center on the user experience, accelerate the promotion of “quality, brand and taste”, strengthen the
transformation of basic research applications, develop key core technologies and capabilities, grasp industry
trends, create quality products, improve product competitiveness, and form industrial overall competitiveness by
rapidly building the central air-conditioning capabilities. Take the fighter oriented to create elite teams; promote
the “intelligent R&D” and “intelligent manufacturing” by taking the entire industry chain as the starting point.
Follow the trend of channel innovation, adjust the model, and strengthen the retail; follow the dualization trend of
consumption, adjust the structure, and improve the efficiency; follow the trend of industrial adjustment, seek
transformation and development. Furthermore, the air conditioning industry will seize the opportunities of coal to
electricity and home appliances energy-saving leader policy, improve product layout, and promote enterprise
transformation.
(3) Washing machine
Implement the quality priority and differentiated product strategies. Adhere to the quality leadership strategy,
become the medium- and high-end washing machine brand with first-class quality, create autonomous appearance
and functional selling points; lay out the medium- and high-end products, form a series of products; take product
differentiation as a breakthrough, quickly deploy automatic washing machine product line, and rapidly form the
self-production ability at the same time.
(4) Kitchen and bath, small household appliances
Based on kitchen and bath, develop purified water business and build core business. Take the concept of “smart
kitchen” as the main line, and created the smart kitchen; meanwhile, focus on creating an ecological chain of
“water ecological home appliances”. Respectively focus on core business to create advantageous industries, and
achieve multi-product line linkage development, highlight the leading advantage of intelligent products. Adhere to
55
CHANGHONG MEILING CO.,LTD. Annual Report 2018
the brand road, adhere to productism, adhere to the terminal image, create smart kitchen, and take intelligent and
wall-mounted stoves as the entry point to achieve the business growth of kitchen and bathroom, and small
appliances.
(5) Bio-medical care
Under the guidance of the development strategy of “relevant diversification based on biomedical field”, the
Company continues to focus on life sciences, smart cold chain, and family health businesses. Life science:
increase technical research and reserves, and upgrade the products from the second generation to the fourth
generation; make multi-channel and all-round marketing promotion, and expand the company’s industry
popularity. Family health: center on the crossing field of “medical health” and “personal care health” to enrich
products. Smart cold chain: based on cold storage engineering and leasing business, gradually cut into the cold
chain transportation market.
The above business plan and business objectives do not represent the listed company’s profit forecast of 2019,
whether it can be achieved depends on the changes in market condition, the efforts of management team and other
factors, there are a lot of uncertainties, investors should pay special attention to it.
(iv) Possible risks and countermeasures
In 2019, the competition in the home appliance market will become more intense, and the survival environment
for enterprises will be even worse. In the future, the Company will face serious risks such as the severe industrial
situation, the intensified competition, the labor shortage, and the rise of raw material prices, transportation costs
and human resource costs, the new business models and the impact of internet age.
1. Impact of intensifying industry competition and declining broader market
China's home appliance industry is a complete competing industry, there are many domestic and foreign-funded
household appliances manufacturers providing products with a higher degree of homogenization and fierce
competition. With the withdrawal of national preferential policy, the industry broader market continues to decline,
the industry enters into aggressive growth from large-scale growth, the industry brand concentration further
strengthens, and the competition among the brands shows a new situation of oligarchy and giant competition. In
recent years, the transformation and upgrading of the industry have been speeding up, and the competition for new
energy efficiency in the industry has been normalized. Whoever can faster and more accurately grasp the
opportunity of new energy efficiency switching will be able to enhance the competitiveness of products to a
greater extent. If you can't accurately judge and follow the market dynamics of the industry, you may be
eliminated.
2. Impact of cross-border Internet industry and challenges of new business model
With the arrival of Internet era and artificial intelligence era, the Internet enterprises continue to cross boarder and
swarm into intelligent home fields, which intensifies competition in the industry, subversive changes may occur at
any time, and traditional household appliance enterprises are facing serious challenges. At the same time, under
the impact of Internet economy and new business model, the home appliance manufacturers are actively
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
promoting the transformation, new business model and new products emerge one after another in the home
appliance industry, the development of intelligent home appliances changes quickly, if unable to make rapid
response or catch up with the development trend, it may be easily replaced or even completely subverted. New
rules of the game bring strong sense of crisis and sense of urgency to the enterprises.
3. Pressure of raw material price rising and transportation costs rising
Influence by the supply-side reform and product structure adjustment, price of raw materials goes up dramatically;
at the same time, the transportation costs greatly rise due to logistics industry’s governance to “three excesses”. It
is expected that the raw material price and logistics transportation costs will continue to run at high prices in 2019,
but the end product selling price will be unchanged or will be difficult to digest the impact of rising raw materials
prices, logistics costs and other key resource costs, which will bring greater operating pressure to the company
and further affect the company's profitability.
4. Human resources risk
Household appliance industry is an industry with relatively intensive capital, technology, and labor. With the
gradual expansion of the company's business scope and scale, and the arrival of intelligent home appliances and
the impact of Internet, the company will greatly increase the demands for high-level management personnel,
technical personnel, and innovative talents, talent introduction becomes one of the key points for human resources
management, if it cannot effectively enhance the company's attraction to high-quality talents from various aspects,
the company's future development will be subject to constraints. At the same time, in its intelligent manufacturing
transformation period, the company needs higher requirements to the technical capacity and professional quality
of workers at the production line, the improvement for the company's product quality will be influenced if the
comprehensive quality of workers at the production line can not be enhanced. In addition, with the increase in
orders, the demand for workers at the production line is increasing, but affected by the supply and demand in labor
market and the continuous rising labor costs, the company's cost pressure will be further enlarged.
In view of the above risks, and combined with industry trend of 2019 and the insufficient in 2018, the Company
will carry out follow works in 2019:
1. Sales
Continue to enhance the product market position, pay close attention to the changes in retail market share and
e-commerce market share; continue to launch new products, adjust structure, raise average price, and enlarge the
scale; continue to enhance new channels, strengthen the synergy with the home appliances related to controlling
shareholders, expand the branches of Changmei Life House; rigidly control the price, strictly control the terminal
price, and reduce price loss; dig potential and reduce fees, strictly control the site cost investment, strengthen the
optimization for low-efficiency stores, and strengthen the audit of booth production standards; improve
e-commerce organization, and continue to strengthen e-commerce products, prices, product rendering, product
footprint, online retail, spot goods rate, etc.; in overseas markets, actively respond to the impact of RMB exchange
rate and bulk raw materials fluctuations, improve the proportion of air-cooling and variable frequency products by
57
CHANGHONG MEILING CO.,LTD. Annual Report 2018
optimizing product structure and customer structure, complete the maintenance, development and layout of key
customers and key markets, and guarantee and improve the scale of overseas sales.
2. Technology and quality
Continue to carry out technical research on intelligence, frequency conversion, air cooling, fresh keeping, thin
wall, etc., actively promote the development of new products, and implement projects such as “high-end product
refinement”, “five -ization and two easy” and “increasing revenue and reducing costs” to maintain the company’s
industry leading position in technology and quality.
3. Supply chain and manufacturing
Pay attention to the fluctuation of bulk materials, continue to promote procurement, reduce costs and increase
revenue; pay attention to fund operation efficiency, improve the turnover rate of receivables and inventory;
continue to implement “first-class manufacturing”, “less people engineering” and “smart production” to
comprehensively improve efficiency and quality, reduce product costs and enhance the company’s product
competitiveness.
X. Reception of research, communication and interview
(i) In the report period, reception of research, communication and interview
√ Applicable □ Not applicable
Time Way Type Basic situation index of investigation
http://irm.cninfo.com.cn/ircs/ssgs/companyIrmF
12 July 2018 Field research Institute
orSzse.do?stockcode=000521
http://irm.cninfo.com.cn/ircs/ssgs/companyIrmF
24 Aug. 2018 Field research Institute
orSzse.do?stockcode=000521
http://irm.cninfo.com.cn/ircs/ssgs/companyIrmF
28 Dec. 2018 Field research Institute
orSzse.do?stockcode=000521
Reception (times) 3
Number of hospitality 5
Number of individual reception 0
Number of other reception N/A
Disclosed, released or let out major
No
undisclosed information
58
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section V. Important Events
I. Profit distribution plan of common stock and capitalizing of common reserves plan
(i) Formulation, Implementation and Adjustment of common stock Profit Distribution Policy Especially
Cash Dividend policy during the Reporting Period
√ Applicable □ Not applicable
During the reporting period, the company has strictly executed the profit distribution policy in accordance with
the " Articles of Association", the formulation and implementation of the company's cash dividend policy are in
line with the provisions of "Articles of Association" and the requirements of the resolutions of shareholders'
meeting, the dividends standards and proportion have been definite and clear, relevant decision-making
procedures and mechanisms have been complete, the responsibilities of independent directors have been clear and
have played its due role, minority shareholders have had the opportunities to fully express their views and
aspirations, and the legitimate interests of minority shareholders have been maintained.
In the reporting period, the Company implemented Profit distribution plan for year of 2017, that is, distribute 0.6
Yuan (tax included) in cash for every 10 shares held by all shareholders of the Company based on total share
capital 1,044,597,881 shares dated 31 December 2017 (including 881,733,881 shares of A-share and 162,864,000
shares of B-share), cash dividend of 62,675,872.86 Yuan was distributed in total.
Special explanation on cash dividend policy
Satisfy regulations of General Meeting or requirement
Y
of Article of Association (Y/N):
Well-defined and clearly dividend standards and
Y
proportion (Y/N):
Completed relevant decision-making process and
Y
mechanism (Y/N):
Independent directors perform duties completely and
Y
play a proper role (Y/N):
Minority shareholders have opportunity to express
opinions and demands totally and their legal rights are Y
fully protected (Y/N):
Condition and procedures are compliance and
transparent while the cash bonus policy adjusted or Y
changed (Y/N):
59
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(ii) Profit distribution plan (pre-plan) of common stock and capitalizing of common reserves
plan (pre-plan) in latest three years (including the reporting period)
1. Profit distribution plan for year of 2016
Distribute 0.6 Yuan (tax included) in cash for every 10 shares held by all shareholders of the Company based on
total share capital 1,044,597,881 shares dated 31 December 2016, cash dividend of 62,675,872.86 Yuan was
distributed in total.
2. Profit distribution plan for year of 2017
Distribute 0.6 Yuan (tax included) in cash for every 10 shares held by all shareholders of the Company based on
total share capital 1,044,597,881 shares dated 31 December 2017, cash dividend of 62,675,872.86 Yuan was
distributed in total.
3. Profit distribution plan for year of 2018
Distribute 0.6 Yuan (tax included) in cash for every 10 shares held by all shareholders of the Company based on
total share capital 1,044,597,881 shares dated 31 December 2018, cash dividend of 62,675,872.86 Yuan was
distributed in total.
The pre-plan had been deliberated and approved by the board of directors, and it need to be submitted the annual
shareholders’ general meeting of 2018 for its consideration.
(iii) Cash dividend of common stock in latest three years (including the reporting period)
In RMB
Ratio of the cash
Ratio of the cash Ratio of the total cash
Net profit Proportion bonus by other ways
bonus in net profit bonus (other ways
attributable to for cash in net profit
attributable to included) in net profit
Year common stock bonus by attributable to
Amount for common stock Total cash bonus attributable to
for shareholders of other common stock
cash bonus (tax shareholders of (including other common stock
bonus listed company in ways(i.e. shareholders of
included) listed company ways) shareholders of listed
shares consolidation share listed company
contained in company contained in
statement for buy-backs contained in
consolidation consolidation
bonus year ) consolidation
statement statement
statement
2018 62,675,872.86 38,658,256.97 162.13% - - 62,675,872.86 162.13%
2017 62,675,872.86 32,473,204.92 193.01% - - 62,675,872.86 193.01%
2016 62,675,872.86 220,216,680.96 28.46% - - 62,675,872.86 28.46%
(iv) The Company gains profits in reporting period and the retained profit of common stock shareholders
provided by parent company is positive but no plan of cash dividend proposed of common stock
□ Applicable √ Not applicable
II. Profit distribution plan and capitalizing of common reserves plan for the Period
√ Applicable □ Not applicable
60
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Bonus shares for every 10-share (Share) 0
Dividends for every 10-share (RMB) (Tax
0.6
included)
Shares added for every 10-share base
0
(Share)
Equity base of distribution plan (Share) 1,044,597,881
Total cash dividend (RMB) (Tax included) 62,675,872.86
Proportion for cash bonus by other ways(i.e.
0
share buy-backs)
Total cash bonus (including other ways) 62,675,872.86
Distributable profits (RMB) 904,232,582.87
Ratio of cash dividend（including other
100%
ways） in total profit distribution
Cash dividend
Distribute 0.6 Yuan (tax included) in cash for every 10 shares held by all shareholders of the Company based on
total share capital 1,044,597,881 shares dated 31 December 2018, cash dividend of 62,675,872.86 Yuan was
distributed in total.
Detail explanation on profit distribution or capitalization from capital public reserve
For year of 2018, the individual statement of the parent company show net profit of 96,445,731.69 Yuan,
according to the auditing from ShinWing CPA (LLP). In accordance with relevant regulations, the retained profit
at beginning of the year amounted as 893,442,648.28 Yuan, deducted the 2017 profit distributed
62,675,872.86 Yuan and after extract for statutory surplus reserve 9,644,573.17 Yuan, the retained profit in
individual statement of the parent company cumulative counted as 917,567,933.94 Yuan at end of 2018. In
addition, for year of 2018, the net profit attributable to owners of parent company amounted as 38,658,256.97
Yuan, the retained profit for end of the 2018 counted as 904,232,582.87 Yuan.
Pursuit to relevant rules and regulation of Article of Association, and considering the interest of shareholders and
long-term development needs of the Company, Board of Directors agrees that, based on total share capital
1,044,597,881 of the Company dated 31 December 2018, distributed 0.6 Yuan (tax included) in cash for every 10
shares held by shareholders, totally 62,675,872.86 Yuan distributed in total(tax included). Total share capital of
the Company has no changes after distribution, the retained profit of the parent company amounted as
854,892,061.08Yuan, rests of the retained profit will carry-over for distribute in later years.
This plan has been considered and passed by the board of directors, and needs to be submitted to 2018 annual
general meeting of the company for deliberation.
III. Implementation of commitment
(i) Commitments that the actual controller, shareholders, related party, the buyer and the
company have fulfilled during the reporting period and have not yet fulfilled by the end of
reporting period
61
CHANGHONG MEILING CO.,LTD. Annual Report 2018
√ Applicable □ Not applicable
62
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Commitment Implemen
Commitment Content Date Term
party tation
1. The acquirer shall not engage in refrigerator business or
activity which competes or will compete with business of Strictly
Valid for long
Hefei Meiling Co., Ltd. (hereinafter referred to as the implemen
term
“Meiling Electric ”),or that which has interest conflict with ted
Meiling Electrical Appliances.
About committed and
Sichuan 2. The acquirer promises to apply shareholders’ right on a Strictly
Commitments promised in order to Valid for long
Changhong legal and reasonable manner and shall not take any action to implemen
made in prevent horizontal term
Electric Co., limit or affect the normal operation of Meiling Electric. ted
acquisition competition in the
Ltd.(hereinafter 12 June 2007
report or Acquisition Report of 3. For any opportunity to engage in competing business, the
referred to as
equity change Hefei Meiling Co., acquirer will advise Meiling Electric in written for engaging
“Sichuan such business or not. If Meiling Electrical Appliances gives
report Ltd.
Changhong ”） no clear written reply as to whether engaging the competing Strictly
Valid for long
business or not within 20 days after receipt of the aforesaid implemen
term
letter, it shall be deemed that it will not engage in such ted
business. The acquirer will only engage in non-competing
business provided that Meiling Electric confirms not to or is
deemed to not engage in such non-competing business.
1. It will not engage in such business or activity that
competes with or has interest conflict with that of Meiling
Commitment Commitment Electric except for the action taken for sake of Meiling
made during regarding to reducing Electric as required by Meiling Electrical Appliances. Strictly
Sichuan Valid for long
the and preventing 2. The Company promises to apply shareholders’ right on a 24 June 2010 implemen
Changhong term
non-public competition with legal and reasonable manner and shall not take any action to ted
offer of 2010 Meiling Electric limit or affect the normal operation of Meiling Electric
3. In case that Meiling Electric expects, on the basis of its
existing business, to expand its operation scope into the
63
CHANGHONG MEILING CO.,LTD. Annual Report 2018
business which the Company has already operated, the
Company agrees to grant priority acquisition right to Meiling
Electric regarding such business if the same conditions are
met, provided that the Company is still the controlling
shareholder or actual controller of Meiling Electric
1. Measures will be adopted to prevent continued related
transaction with Meiling Electric: as to the related transaction
that can not be prevented, it will sign related transaction
agreement with Meiling Electric under the market principles
of “equally paid and mutual benefit”, and fairly determined
Commitment the transaction price according to the market prevailing
regarding to reducing standards. Strictly
Valid for long
and standardizing 24 June 2010 implemen
2. Perform the necessary obligations to make related term
related transaction ted
directors and related shareholder abstain from voting
with Meiling Electric
according to relevant regulation, and observe legal procedure
for approving related transaction and information disclosure
obligations.
3. Promise not to hurt legal interests of Meiling Electric and
other shareholders through related transaction.
Commit to authorized Changhong Air-conditioner and Zhongshan Air-conditioner Strictly
Valid for long
Electric Co., Ltd. (hereinafter referred to as the “Zhongshan Changhong ”) to use 6 Nov. 2010 implemen
term
“Changhong” trademark and relevant patents for free. ted
1. Commit to disclose periodic reports on a truthful, accurate, complete, fair and
prompt manner, to disclose all the information that have important influences over Strictly
Valid for long
The Company investors, to accept supervision under the CSRC and Shenzhen Stock Exchange. 7 Jan. 2011 implemen
term
2. Commit to make public clarification in respect of such information that is released ted
from any public media and may result in misleading influences on stock price once
64
CHANGHONG MEILING CO.,LTD. Annual Report 2018
the Company is aware of such information.
3. The directors, supervisors, senior management and core technicians of the
Company will accept opinions and criticism from the social public, and they will not
trade the Company’s securities, directly or indirectly, with any inside information
and other illegal methods. The Company promises that the documents submitted to
Shenzhen Stock Exchange exist no false statement or material omission, and no
relevant information will be disclosed during the application for listing without prior
content from Shenzhen Stock Exchange.
1. Since the property transfer didn’t involve the buildings and land currently used by
Strictly
Changhong Air-conditioner, Sichuan Changhong commits, upon the completion of Valid for long
implemen
equity transfer, to continue to lease such assets to Changhong Air-conditioner at term
ted
Commitment market price.
made in 2. After completion of this property transfer, Sichuan Changhong commits to manage
transfer of air Sichuan to prevent new related transaction with Meiling Electric. For those which can not be
10 Dec. 2009
conditioning Changhong prevented, Sichuan Changhong commits to determine the transaction price based on
Strictly
assets market accepted methods, so as to ensure fairness of related transaction and Valid for long
implemen
property protection of the interest of Meiling Electric term
ted
3. Sichuan Changhong commits that it will not engage in air conditioning and
refrigerator business or activity which competes or will compete with business of
Meiling Electric, or that which has interest conflict with Meiling Electric
Commitments Some of the 1. Make promise not to reduce the shares of Meiling bought in every year during 15 Aug.2013
Complete
by Annual Directors, implementation of the performance incentive fund via any market ways in the later 3 July 2014 Three years after
d
performance supervisors and first year, which was allowed to be reduced by 50% according to the laws and 21 July 2015 current shares
incentive senior regulations in the second year, and the remaining 50% was allowed to be reduced in purchased Implemen
fund, executives of the third year in accordance with the laws and regulations. 20 June 2017
ting
65
CHANGHONG MEILING CO.,LTD. Annual Report 2018
incentive the Company as From the date
2. The directors, supervisors and senior management promised to manage in
objects while well as other when annual
accordance with the relevant management approaches in accordance with the
purchasing incentive incentive fund
"Company Law", "Securities Law" and "The Company’s shares held by the
stock of the objects plan deliberated
directors, supervisors and senior management of the listed company and its change 15 Aug. 2013
Company and approved by Strictly
management rules", as objects of annual performance incentive fund of Meiling, 3 July 2014
with general meeting implemen
including but not limited to: during his tenure, the shares transferred each year shall 21 July 2015
performance to 6 moths after ted
not exceed 25% of the total number of shares held of the Company; shall not sell the 20 June 2017
incentive director,
shares of the Company within six months after bought it or purchase again six
funds and supervisor and
months after sold it; shall not transfer the shares held within six months after
owned fund senior executives
Dismission.
resigned
Sichuan 1. Based on market conditions and as allowed by laws and rules, multiple measures
Changhong were adopted adequately to increase shareholding of Meiling Electric, so as to
Electric Co., demonstrate its firm confidence on the PRC economy and Meiling Electric with its
Commitments Ltd.and persons actual actions, maintain sound development of capital market and promote recovery
Strictly
of not to acting in of healthy market Valid for long
9 July 2015 implemen
reducing the concert term
ted
shares CHANGHONG 2. Continued to support operation and development of listed company as always and
(HK) promoted the achievement of Meiling Electric. It is committed to bringing steady
TRADING and real return to investors.
LIMITED
14 October 2016
Commitment Sichuan Shares are not transfer within thirty-six (36) months since end of the private Implemen
6 March 2016 to 14 October
made during Changhong placement ting
2019
the
non-public Directors and Commitment on 1. I hereby undertake not to deliver interests to other entities Till the
Implemen
offer in 2016 senior compensation of or individuals without consideration or at unfair conditions, 23 Feb. 2016 completion of
ting
executives of immediate dilution of nor to prejudice the Company’s interests by other means. projects invested
66
CHANGHONG MEILING CO.,LTD. Annual Report 2018
the Company return arising from 2. I hereby undertake to restrain my role related consumption with the proceeds
non-public issuance of behaviors. from this
shares non-public
3. I hereby undertake not to conduct any investment and
issuance of
consumption which is not related to performance of duties
shares
with utilization of any company assets.
4. I hereby undertake that the remuneration system
determined by the board of directors or the remuneration and
examination committee be linked to implementation of the
compensation of return measures.
5. In case that the Company adopts share based incentive
plan in future, I hereby undertake that the exercise conditions
of the incentive plan to be announced by the Company be
linked to implementation of the compensation of return
measures.
6. For the period from the date of this commitment to the
date of completion of this non-public issuance of shares, if
the CSRC makes other new regulatory requirements on
compensation of return measures and the commitment
thereof, and in case that the above commitments cannot
satisfy these new requirements from the CSRC, I hereby
undertake to issue supplementary commitment in compliance
with the latest CSRC requirements.
As one of the principals responsible for compensation of
return measures, I, in case of break of the above
commitments or refuse to perform the above commitments,
agree to receive relevant punishment or to adopt relevant
administration measures according to the systems, rules and
regulations of the CSRC and Shenzhen Stock Exchange.
67
CHANGHONG MEILING CO.,LTD. Annual Report 2018
1. Promise to truly, accurately, completely, fairly and timely publish periodic reports,
disclose all information that has significant impacts on the investors, and accept the
supervision and management of China Securities Regulatory Commission and the
Shenzhen Stock Exchange.
2. Make commitments that the Company will publicly clarify in time after knowing
Strictly
any information on any public communications media that may cause misleading Valid for long
The Company 12 Oct. 2016 implemen
influence on the stock price term
ted
3. The Company’s directors, supervisors and senior executives will listen carefully to
the opinions and criticisms of the public and never use any acquired inside
information and other improper means to directly or indirectly engage in the trading
activities of the Company's stock.
Perform the commitment promptly or
√ Yes □ No
not
If the commitments is not fulfilled on
time, shall explain the specify reason Not applicable
and the next work plan
Note: for the commitments completed and exemption for implementing in above mentioned table, the Company will not disclose in next ordinary report
68
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(ii) Concerning assets or project of the Company, which has profit forecast, and reporting
period still in forecasting period, explain reasons of reaching the original profit forecast
□ Applicable √ Not applicable
IV. Non-operational fund occupation from controlling shareholders and its related party
□ Applicable √ Not applicable
No non-operational fund occupation from controlling shareholders and its related party in period.
Disclosure date for specific approval opinion on fund occupation from CPA: 29 March 2019
Disclosure index for specific approval opinion on fund occupation from CPA: Juchao website:
www.cninfo.com.cn-- Specific Explanation on Non-operating capital occupation and Other related funds for year
of 2018 of Changhong Meiling Co., Ltd.
V. Explanation from Board of Directors, Supervisory Committee and Independent Directors
(if applicable) for “Qualified Opinion” that issued by CPA
□ Applicable √ Not applicable
VI. Particulars about the changes in aspect of accounting policy, estimates and calculation
method compared with the financial report of last year
√ Applicable □ Not applicable
Found more details in 35. Change of major accounting policy and estimation under IV. Major
accounting policy and estimation carried in the Section XI. Financial Report
VII. Major accounting errors within reporting period that needs retrospective restatement
□ Applicable √ Not applicable
No major accounting errors within reporting period that needs retrospective restatement for the
Company in the period.
VIII. Compare with last year’s financial report; explain changes in consolidation statement’s
scope
√ Applicable □ Not applicable
The Company’s consolidated financial statement included 47 subsidiaries including Sichuan
Changhong Air-conditioner Co., Ltd., Zhongshan Changhong Electric Co., LTD and Zhongke
Meiling Cryogenic Technology Co., Ltd. Etc.As compared to previous year, subsidiary Zhongshan
Hongyou Electric Co.,Ltd, Shijiazhuang Meiling Electronic Appliance Marketing Co., Ltd, Guiyang
Meiling Electronic Appliance Marketing Co., Ltd, Kunming Meiling Electronic Appliance
69
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Marketing Co., Ltd, Chongqing Meiling Electronic Appliance Marketing Co., Ltd, Wuhu Meiling
Electronic Appliance Marketing Co., Ltd., Changchun Meiling Electronic Appliance Marketing Co.,
Ltd, Jingzhou Meiling Electronic Appliance Marketing Co., Ltd, Nantong Meiling Electronic
Appliance Marketing Co., Ltd, Harbin Meiling Electronic Appliance Marketing Co., Ltd and
Shenyang Meiling Electronic Appliance Marketing Co., Ltd were excluded due to liquidation.
More details can be seen in the report “VIII. Changes in the scope of the merger” and “XIII.
Interests in other entities” of “Section XI Financial Report”
IX. Appointment and non-reappointment (dismissal) of CPA
(i) Accounting firm appointed
Shine Wing Certified Public Accountants
Name of domestic accounting firm
(LLP)
Remuneration for domestic accounting firm (in 10 thousand
125
Yuan)
Continuous life of auditing service for domestic accounting firm 10- Year
Name of domestic CPA Li Xifu, Xia Cuiqiong
Continuous life of auditing service for domestic CPA Li Xifu (2 years), Xia Cuiqiong (4 years)
Name of foreign accounting firm (if applicable) N/A
Remuneration for foreign accounting firm (10 thousand Yuan)
N/A
(if applicable)
Continuous life of auditing service for foreign accounting firm
N/A
(if applicable)
Name of foreign CPA (if applicable) N/A
Continuous life of auditing service for foreign CPA (if
-
applicable)
(ii) Re-appointed accounting firms in this period
□Yes √ No
(iii) Appointment of internal control auditing accounting firm, financial consultant or sponsor
√ Applicable □ Not applicable
In reporting period, Shine wing Certified Public Accountants (LLP) was appointed as audit institute of internal
control for the Company, auditing charge for internal control amounting as RMB 250,000 yuan.
X. Particular about suspended and delisting after annual report disclosed
□ Applicable √ Not applicable
XI. Bankruptcy reorganization
70
CHANGHONG MEILING CO.,LTD. Annual Report 2018
□ Applicable √ Not applicable
No bankruptcy reorganization for the Company in reporting period
XII. Significant lawsuits and arbitration of the Company
□ Applicable √ Not applicable
(i) No significant lawsuits or arbitration occurred in the reporting period.
(ii) Some other significant lawsuits and arbitration in the reporting period.
To maintain the independence and integrity of "Meiling" trademark and trade name, the Company carried out
serials of lawsuits, attribution and administration suits with “Meiling” trademark and corporate name concerned,
please found more in 2014 first quarter report, 2014 semi-annual report, the 2014 annual report disclosed
respectively on April 19, 2014, August 12, 2014, and March 26, 2014 for the relevant progress. Up to now, the
company has stopped the infringement enterprises using “Meiling” trade name, i.e. the infringement of company
name and unfair competition behavior, through litigation and administrative complaints.
At present, only the kitchen ventilator, cooker, water heater, water purifiers and household electrical appliances
manufactured and sold by the Company and its wholly-owned subsidiary - Hefei Meiling Group Holdings Limited
and Guangdong Changhong Ridian Technology Co., Ltd. are the company's regular products, any other small
household appliances using same or similar trademark as our company or using the trade name similar to the
Company’s name are the Company’s products. In view of the infringement to the Company’s trademark and trade
name, false propaganda and unfair competition in the market, the Company has carried out many ways including
administrative reports, criminal investigation and civil litigation to fight against infringement and counterfeiting
behavior in the whole country.
XIII. Penalty and rectification
□ Applicable √ Not applicable
No penalty and rectification for the Company in reporting period.
XIV. Integrity of the company and its controlling shareholders and actual controllers
□ Applicable √ Not applicable
During the reporting period, the Company and the controlling shareholders and the actual controllers have had
good reputation, and there is no large amount due unliquidated debt sentenced by the court.
XV. Implementation of the company’s stock incentive plan, employee stock ownership plan or
other employee incentives
71
CHANGHONG MEILING CO.,LTD. Annual Report 2018
√ Applicable □ Not applicable
Implementation for annual performance incentive fund
On August 9, 2012 and August 28, 2012, the Company considers the adoption of "Hefei Meiling annual
performance incentive fund implementation plan" (hereinafter referred to as "" stimulus "") on the 16th meeting of
the 7th board of directors and the 2012-second provisional shareholders meeting. Details were disclosed on
information disclosure media appointed by the Company as "Securities Times", "Chinese Securities Daily",
"Hong Kong Commercial Daily" and the Juchao network (www.cninfo.com.cn) on August 10, 2012 and August
29 in the form of announcement (No.: 2012-028, No.:2012-035).
1. Implementation about 2012, 2013, 2014 and 2016 performance incentive fund provision and distribution
plan
See details in "Implementation of the company's annual incentive fund" in "XI Implementation of the company's
stock incentive plan, employee stock ownership plan, or other employee incentive measures" in "Section V
Important Events" of the company's "2018 Semi-Annual Report" disclosed on 15 August 2018
According to the provisions of the Incentive Plan and the commitment of all incentive targets, the purchase of the
Company’s stock will not be reduced by any market means in the first year from the date of purchase, of which
50% can be reduced according to laws and regulations after the second year, and of which the remaining 50% can
be reduced according to laws and regulations after the third year. In addition, the incentive targets who are also the
company’s directors, supervisors and senior executives should at the same time promise to follow the Company
Law, Securities Law, and the Company’s Shares Held by the Directors, Supervisors and Senior Executives of
Listed Companies and Its Changes Management Rules and other related management methods to regulate the
operation.
Up to the end of this reporting period, the company's stock purchased by some 2012 annual performance incentive
objects (non-directors, supervisors and senior management), 2013 annual performance incentive objects
(non-directors, supervisors and senior management), the 2014 annual performance incentive objects
(non-directors, supervisors and senior management) with their granted 2012 annual performance incentive funds
and own funds and 2013 & 2014 annual performance incentive funds and own funds have been fully released for
trading; details of the share reduction for the above mentioned objects see below; if the holding period of the
company’s shares which are purchased by the 2016 annual performance incentive targets with their awarded 2016
annual performance incentive funds and their own funds is less than two years, all shares purchased by the
incentive targets will be locked in accordance with their commitments. The Company’s shares purchased by the
current directors, supervisors and senior executives among the performance incentive targets due to the
implementation of the 2012, 2013, 2014 and 2016 annual performance incentive plans have not reduced the
shareholdings.
72
CHANGHONG MEILING CO.,LTD. Annual Report 2018
2. Shareholding and reducing of performance incentive objects of the Company
Ended as 31 December 2018, shares hold by all incentive objects amounting to 11,797,430 shares, a 1.1294 % in
total share capital of the Company, including 10,107,537 A-share, a 0.9676% in total share capital and 1,689,893
B-share, a 0.1618% in total share capital of the Company. Other grantees of the 2012, 2013, 2014 and 2016
incentive plan (not being directors, supervisors and senior management) have reduced holding of 4,716,385 in
aggregate, accounting for about 0.4515% of the total share capital and 582,377 shares are reduced in the reporting
period.
XVI. Major related transaction
(i) Related transaction with routine operation concerned
√ Applicable □ Not applicable
1. Related transaction with routine operation concerned
73
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Whethe
Trading r over
Related limit the Available
Related Proportio
Type of transaction Clearing
Ser Content of transaction n in approved approve similar Date of
Related Relations related Pricing amount form for
related price (in 10 similar Index of disclosure
ial party hip transacti principle (in 10 (in 10 d related market disclosure
transaction thousand transactio
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Yuan) ns (%) thousand limited price
Yuan)
Yuan) or not
(Y/N)
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Changhong shareholde ty Marketing exchange, 2018; 11 m.cn)No.: 2018-005、
1 discharge 33,040.87 33,040.87 2.59% 57,000 No -
Electric r and purchase price Bank May; 15 May; 2018-008、2018-029、
tube, plate
Co., Ltd. ultimate d acceptance 11 Dec. 2018-047、2018-052、
and plastic
controller 2018-071、2018-073
pieces etc.
Other
enterprise
control 30 March Juchao
Changhong under the Commodi Spot 2018, 11 May Website(www.cninfo.co
Huayi same ty Compressor Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
2 53,248.03 53,248.03 4.17% 60,000 No -
Compresso controlling purchase etc. price Bank May , 11 2018-008、2018-029、
r Co., Ltd. shareholde d acceptance December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Commodi Plastic Spot 30 March Juchao
Marketing
3 Changhong enterprise ty products 73,348.73 73,348.73 5.75% 110,000 No exchange, - 2018, 11 May Website(www.cninfo.co
price
Mold control purchase etc. bank and 2018, 15 m.cn)No.: 2018-005、
74
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Plastic under the d commercial May , 11 2018-008、2018-029、
Tech. Co., same acceptance December 2018-047、2018-052、
Ltd. controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Door shell, Spot
Sichuan under the Commodi 2018, 11 May Website(www.cninfo.co
baseboard, exchange,
Changhong same ty Marketing 2018, 15 m.cn)No.: 2018-005、
4 holder, 30,669.97 30,669.97 2.40% 62,000 No bank and -
Jijia Fine controlling purchase price May , 11 2018-008、2018-029、
Sheet metal commercial
Co., Ltd. shareholde d December 2018-047、2018-052、
parts acceptance
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan Spot
under the Commodi 2018, 11 May Website(www.cninfo.co
Changhong Packing exchange,
same ty Marketing 2018, 15 m.cn)No.: 2018-005、
5 Package case, printed 10,413.66 10,413.66 0.82% 22,000 No bank and -
controlling purchase price May , 11 2018-008、2018-029、
Printing matter etc. commercial
shareholde d December 2018-047、2018-052、
Co., Ltd. acceptance
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Commodi Printed Spot 30 March Juchao
Marketing
6 Changhong enterprise ty boards and 6,325.00 6,325.00 0.50% 24,000 No exchange, - 2018, 11 May Website(www.cninfo.co
price
Precision control purchase assemblies bank and 2018, 15 m.cn)No.: 2018-005、
75
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Electronics under the d etc. commercial May , 11 2018-008、2018-029、
Tech. Co., same acceptance December 2018-047、2018-052、
Ltd. controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the Commodi 2018, 11 May Website(www.cninfo.co
New same ty Marketing Spot 2018, 15 m.cn)No.: 2018-005、
7 Battery 4.18 4.18 0.00% 5,200 No -
Energy controlling purchase price exchange May , 11 2018-008、2018-029、
Technolog shareholde d December 2018-047、2018-052、
y Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
under the Commodi Spot 2018, 11 May Website(www.cninfo.co
081 Power
same ty Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
8 Electronic transformer 184.39 184.39 0.01% 5,200 No -
controlling purchase price Bank May , 11 2018-008、2018-029、
Group etc.
shareholde d acceptance December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Guangdon Other Commodi Spot 30 March Juchao
Foam pieces Marketing
9 g enterprise ty 423.80 423.80 0.03% 5,200 No exchange, - 2018, 11 May Website(www.cninfo.co
etc. price
Changhong control purchase bank and 2018, 15 m.cn)No.: 2018-005、
76
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Electronics under the d commercial May , 11 2018-008、2018-029、
Co., Ltd. same acceptance December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the Commodi Junction Spot 2018, 11 May Website(www.cninfo.co
Intelligent same ty plate, Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
10 47.03 47.03 0.00% 5,200 No -
Manufactu controlling purchase sprocket price Bank May , 11 2018-008、2018-029、
ring Tech. shareholde d shaft etc. acceptance December 2018-047、2018-052、
Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the Commodi 2018, 11 May Website(www.cninfo.co
Jiahong same ty Marketing Spot 2018, 15 m.cn)No.: 2018-005、
11 Food 17.65 17.65 0.00% 5,200 No -
Industrial controlling purchase price exchange May , 11 2018-008、2018-029、
Co., Ltd. shareholde d December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Commodi 30 March Juchao
Electronic Marketing Spot
12 Zhiyijia enterprise ty 20.78 20.78 0.00% 5,200 No - 2018, 11 May Website(www.cninfo.co
products price exchange
Network control purchase 2018, 15 m.cn)No.: 2018-005、
77
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Technolog under the d May , 11 2018-008、2018-029、
y Co., Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan PCB, Spot
under the Commodi 2018, 11 May Website(www.cninfo.co
Changhong remote exchange,
same ty Marketing 2018, 15 m.cn)No.: 2018-005、
13 Electronic control, 2,885.43 2,885.43 0.23% 7,000 No bank and -
controlling purchase price May , 11 2018-008、2018-029、
Products transformer, commercial
shareholde d December 2018-047、2018-052、
Co., Ltd. etc acceptance
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the Commodi 2018, 11 May Website(www.cninfo.co
Changhong
same ty Marketing Spot 2018, 15 m.cn)No.: 2018-005、
14 Property Exit slip 0.04 0.04 0.00% 5,200 No -
controlling purchase price exchange May , 11 2018-008、2018-029、
Service
shareholde d December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Commodi Internet Spot 30 March Juchao
Marketing
15 Ailian enterprise ty module, 1,167.16 1,167.16 0.09% 5,200 No exchange, - 2018, 11 May Website(www.cninfo.co
price
Science & control purchase control bank and 2018, 15 m.cn)No.: 2018-005、
78
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Technolog under the d panel etc. commercial May , 11 2018-008、2018-029、
y Co., Ltd. same acceptance December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Hunan
under the Commodi Spot 2018, 11 May Website(www.cninfo.co
Grand-Pro
same ty Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
16 Intelligent V-BOT 230.21 230.21 0.02% 650 No -
controlling purchase price Bank May , 11 2018-008、2018-029、
Tech.
shareholde d acceptance December 2018-047、2018-052、
Company
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the Commodi Spot 2018, 11 May Website(www.cninfo.co
Power line,
Aichuang same ty Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
17 control 5,211.18 5,211.18 0.41% 5,200 No -
Technolog controlling purchase price Bank May , 11 2018-008、2018-029、
panel etc.
y Co., Ltd. shareholde d acceptance December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Commodi 30 March Juchao
Marketing Spot
18 Changhong enterprise ty Robot 2.58 2.58 0.00% 5,200 No - 2018, 11 May Website(www.cninfo.co
price exchange
Communic control purchase 2018, 15 m.cn)No.: 2018-005、
79
CHANGHONG MEILING CO.,LTD. Annual Report 2018
ation Tech. under the d May , 11 2018-008、2018-029、
Co., Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan Display
under the Commodi 2018, 11 May Website(www.cninfo.co
Changhong panel
same ty Marketing Spot 2018, 15 m.cn)No.: 2018-005、
19 Electronic splicing 4.74 4.74 0.00% 5,200 No -
controlling purchase price exchange May , 11 2018-008、2018-029、
System screen
shareholde d December 2018-047、2018-052、
Co., Ltd. system
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Accept
Electronics same Regular bus Marketing Spot 2018, 15 m.cn)No.: 2018-005、
20 the 92.16 92.16 0.05% 9,000 No -
Holding controlling fee price exchange May , 11 2018-008、2018-029、
services
Group Co., shareholde December 2018-047、2018-052、
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Controllin Accept Information Spot 30 March Juchao
Marketing
21 Changhong g the system 2,325.74 2,325.74 1.23% 5,000 No exchange, - 2018, 11 May Website(www.cninfo.co
price
Electric shareholde services services, Bank 2018, 15 m.cn)No.: 2018-005、
80
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Co., Ltd. r and repair fees, acceptance May , 11 2018-008、2018-029、
ultimate shared December 2018-047、2018-052、
controller service fees 2018 2018-071、2018-073
Other
enterprise
control 30 March Juchao
Sichuan Spot
under the Transportati 2018, 11 May Website(www.cninfo.co
Changhong Accept exchange,
same on, storage, Marketing 2018, 15 m.cn)No.: 2018-005、
22 Minsheng the 53,790.08 53,790.08 28.35% 71,000 No bank and -
controlling loading and price May , 11 2018-008、2018-029、
Logistics services commercial
shareholde unloading December 2018-047、2018-052、
Co., LTD acceptance
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Accept
Mold same Processing Marketing Spot 2018, 15 m.cn)No.: 2018-005、
23 the 16.59 16.59 0.01% 5,000 No -
Plastic controlling charges etc. price exchange May , 11 2018-008、2018-029、
services
Tech. Co., shareholde December 2018-047、2018-052、
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other
30 March Juchao
Service enterprise After-sale Spot
2018, 11 May Website(www.cninfo.co
Exp. control Accept and exchange,
Marketing 2018, 15 m.cn)No.: 2018-005、
24 Appliance under the the installation 19,496.07 19,496.07 10.27% 25,000 No bank and -
price May , 11 2018-008、2018-029、
Service same services maintenance commercial
December 2018-047、2018-052、
Chain Co., controlling , etc. acceptance
2018 2018-071、2018-073
Ltd. shareholde
81
CHANGHONG MEILING CO.,LTD. Annual Report 2018
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Accept
Hongxin same Software Marketing Spot 2018, 15 m.cn)No.: 2018-005、
25 the 113.02 113.02 0.06% 5,000 No -
Software controlling usage fee price exchange May , 11 2018-008、2018-029、
services
Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Guangdon
under the Service fee 2018, 11 May Website(www.cninfo.co
g Accept
same for Marketing Spot 2018, 15 m.cn)No.: 2018-005、
26 Changhong the 103.24 103.24 0.05% 5,000 No -
controlling network price exchange May , 11 2018-008、2018-029、
Electronics services
shareholde service December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
30 March Juchao
enterprise
Sichuan Maintenanc 2018, 11 May Website(www.cninfo.co
control Accept
Jiahong e costs and Marketing Spot 2018, 15 m.cn)No.: 2018-005、
27 under the the 21.97 21.97 0.01% 9,000 No -
Industrial business price exchange May , 11 2018-008、2018-029、
same services
Co., Ltd. activity fee December 2018-047、2018-052、
controlling
2018 2018-071、2018-073
shareholde
82
CHANGHONG MEILING CO.,LTD. Annual Report 2018
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong Accept
same Business Marketing Spot 2018, 15 m.cn)No.: 2018-005、
28 Internation the 38.86 38.86 0.02% 9,000 No -
controlling activity fee price exchange May , 11 2018-008、2018-029、
al Hotel services
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Accept
Internation same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
29 the Ticket fee 87.00 87.00 0.05% 9,000 No -
al Travel controlling price exchange May , 11 2018-008、2018-029、
services
Service shareholde December 2018-047、2018-052、
Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
30 March Juchao
Sichuan enterprise Property
2018, 11 May Website(www.cninfo.co
Changhong control Accept managemen
Marketing Spot 2018, 15 m.cn)No.: 2018-005、
30 Property under the the t fee and 83.66 83.66 0.04% 9,000 No -
price exchange May , 11 2018-008、2018-029、
Service same services maintenance
December 2018-047、2018-052、
Co., Ltd. controlling fee
2018 2018-071、2018-073
shareholde
83
CHANGHONG MEILING CO.,LTD. Annual Report 2018
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Accept Laboratory
Hongwei same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
31 the technical 51.87 51.87 0.03% 5,000 No -
Technolog controlling price exchange May , 11 2018-008、2018-029、
services service fee
y Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Zhiyijia Accept
same Platform Marketing Spot 2018, 15 m.cn)No.: 2018-005、
32 Network the 740.93 740.93 0.39% 5,000 No -
controlling licensing price exchange May , 11 2018-008、2018-029、
Technolog services
shareholde December 2018-047、2018-052、
y Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
30 March Juchao
Sichuan enterprise
2018, 11 May Website(www.cninfo.co
Changhong control Accept
Communica Marketing Spot 2018, 15 m.cn)No.: 2018-005、
33 Network under the the 7.87 7.87 0.00% 5,000 No -
tion fee price exchange May , 11 2018-008、2018-029、
Technolog same services
December 2018-047、2018-052、
y Co., Ltd. controlling
2018 2018-071、2018-073
shareholde
84
CHANGHONG MEILING CO.,LTD. Annual Report 2018
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Accept
Intelligent same Installation Marketing Spot 2018, 15 m.cn)No.: 2018-005、
34 the 590.08 590.08 0.31% 9,000 No -
Manufactu controlling cost price exchange May , 11 2018-008、2018-029、
services
ring Tech. shareholde December 2018-047、2018-052、
Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
Sichuan enterprise
Changhong control 30 March Juchao
Gerun under the 2018, 11 May Website(www.cninfo.co
Accept
Environme same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
35 the Eco fees 11.56 11.56 0.01% 5,000 No -
ntal controlling price exchange May , 11 2018-008、2018-029、
services
Protection shareholde December 2018-047、2018-052、
Tech. Co., r and 2018 2018-071、2018-073
Ltd. ultimate
controller
Other
Sichuan 30 March Juchao
enterprise
Changhong 2018, 11 May Website(www.cninfo.co
control Accept
Jiahua Marketing Spot 2018, 15 m.cn)No.: 2018-005、
36 under the the Network fee 0.60 0.60 0.00% 5,000 No -
Informatio price exchange May , 11 2018-008、2018-029、
same services
n Products December 2018-047、2018-052、
controlling
Co., Ltd. 2018 2018-071、2018-073
shareholde
85
CHANGHONG MEILING CO.,LTD. Annual Report 2018
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
BVCH under the 2018, 11 May Website(www.cninfo.co
Accept
Optronics same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
37 the HR service 6.79 6.79 0.00% 5,000 No -
(Sichuan) controlling price exchange May , 11 2018-008、2018-029、
services
Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong Accept
same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
38 Electronic the HR service 38.86 38.86 0.02% 5,000 No -
controlling price exchange May , 11 2018-008、2018-029、
Products services
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Controllin 30 March Juchao
Sichuan g 2018, 11 May Website(www.cninfo.co
Purchase Water,
Changhong shareholde Marketing Spot 2018, 15 m.cn)No.: 2018-005、
39 fuel and electricity 2,026.44 2,026.44 0.16% 57,000 No -
Electric r and price exchange May , 11 2018-008、2018-029、
power and gas
Co., Ltd. ultimate December 2018-047、2018-052、
controller 2018 2018-071、2018-073
86
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other
enterprise
control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Purchase
Huayi same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
40 fuel and Steam 72.04 72.04 0.01% 130 No -
Compresso controlling price exchange May , 11 2018-008、2018-029、
power
r Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Guangdon
under the 2018, 11 May Website(www.cninfo.co
g Purchase Water,
same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
41 Changhong fuel and electricity 168.04 168.04 0.01% 5,200 No -
controlling price exchange May , 11 2018-008、2018-029、
Electronics power etc.
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Hefei
control 30 March Juchao
Changhong
under the 2018, 11 May Website(www.cninfo.co
New Purchase
same Electricity Marketing Spot 2018, 15 m.cn)No.: 2018-005、
42 Energy fuel and 37.75 37.75 0.00% 5,200 No -
controlling fee price exchange May , 11 2018-008、2018-029、
Science & power
shareholde December 2018-047、2018-052、
Technolog
r and 2018 2018-071、2018-073
y Co., Ltd.
ultimate
controller
87
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong Purchase
same Electricity Marketing Spot 2018, 15 m.cn)No.: 2018-005、
43 Property fuel and 5.07 5.07 0.00% 5,200 No -
controlling fee price exchange May , 11 2018-008、2018-029、
Service power
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Controllin 30 March Juchao
Air-conditio
Sichuan g Spot 2018, 11 May Website(www.cninfo.co
ner, small
Changhong shareholde Sales of Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
44 appliances 5,163.23 5,163.23 0.30% 32,000 No -
Electric r and goods price Bank May , 11 2018-008、2018-029、
and fresh
Co., Ltd. ultimate acceptance December 2018-047、2018-052、
etc.
controller 2018 2018-071、2018-073
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the Fresh, 2018, 11 May Website(www.cninfo.co
Electronics same Sales of air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
45 148.96 148.96 0.01% 9,500 No -
Holding controlling goods ner and price exchange May , 11 2018-008、2018-029、
Group Co., shareholde refrigerator December 2018-047、2018-052、
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Color board Spot 30 March Juchao
Changhong enterprise Sales of and door Marketing exchange, 2018, 11 May Website(www.cninfo.co
46 5,847.80 5,847.80 0.33% 12,000 No -
Jijia Fine control goods shell price Bank 2018, 15 m.cn)No.: 2018-005、
Co., Ltd. under the component acceptance May , 11 2018-008、2018-029、
88
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Color
Changhong under the Spot 2018, 11 May Website(www.cninfo.co
Masterbatch
Mold same Sales of Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
47 , plastic 19,906.13 19,906.13 1.14% 23,000 No -
Plastic controlling goods price Bank May , 11 2018-008、2018-029、
particle and
Tech. Co., shareholde acceptance December 2018-047、2018-052、
AC etc.
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Air-conditio
Lejiayi under the Spot 2018, 11 May Website(www.cninfo.co
ner,
Chain same Sales of Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
48 refrigerator 2,324.80 2,324.80 0.13% 15,000 No -
Manageme controlling goods price Bank May , 11 2018-008、2018-029、
and washing
nt Co., Ltd. shareholde acceptance December 2018-047、2018-052、
machine etc.
r and 2018 2018-071、2018-073
ultimate
controller
PT.CHAN Other 30 March Juchao
GHONGE enterprise Sales of Refrigerator Marketing Spot 2018, 11 May Website(www.cninfo.co
49 711.24 711.24 0.04% 15,000 No -
LECTRICI control goods and freezer price exchange 2018, 15 m.cn)No.: 2018-005、
NDONESI under the May , 11 2018-008、2018-029、
89
CHANGHONG MEILING CO.,LTD. Annual Report 2018
A same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
CHANGH under the 2018, 11 May Website(www.cninfo.co
ONG(HK) same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
50 21,867.52 21,867.52 1.25% 120,000 No -
TRADING controlling goods ner price exchange May , 11 2018-008、2018-029、
LIMITED shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
CHANGH
under the 2018, 11 May Website(www.cninfo.co
ONGELE
same Sales of Refrigerator Marketing Spot 2018, 15 m.cn)No.: 2018-005、
51 CTRIC(A 2,557.96 2,557.96 0.15% 15,000 No -
controlling goods , freezer price exchange May , 11 2018-008、2018-029、
USTRALI
shareholde December 2018-047、2018-052、
A)
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Hongwei enterprise Sales of Marketing Spot 2018, 11 May Website(www.cninfo.co
52 Fresh etc. 17.24 17.24 0.00% 15,000 No -
Technolog control goods price exchange 2018, 15 m.cn)No.: 2018-005、
y Co., Ltd. under the May , 11 2018-008、2018-029、
90
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
53 Device 19.10 19.10 0.00% 15,000 No -
controlling goods ner, fresh price exchange May , 11 2018-008、2018-029、
Tech. Co.,
shareholde December 2018-047、2018-052、
Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan Refrigerator
under the Spot 2018, 11 May Website(www.cninfo.co
Changhong , washing
same Sales of Marketing exchange, 2018, 15 m.cn)No.:2018-005、
54 Minsheng machine, 252.69 252.69 0.01% 15,000 No -
controlling goods price Bank May , 11 2018-008、2018-029、
Logistics Air-conditio
shareholde acceptance December 2018-047、2018-052、
Co., LTD ner
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Spot 30 March Juchao
Service enterprise Sales of Maintenanc Marketing exchange, 2018, 11 May Website(www.cninfo.co
55 1,443.58 1,443.58 0.08% 15,000 No -
Exp. control goods e parts etc. price Bank 2018, 15 m.cn)No.: 2018-005、
Appliance under the acceptance May , 11 2018-008、2018-029、
91
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Service same December 2018-047、2018-052、
Chain Co., controlling 2018 2018-071、2018-073
Ltd. shareholde
r and
ultimate
controller
Other
Sichuan enterprise
Changhong control 30 March Juchao
Gerun under the 2018, 11 May Website(www.cninfo.co
Environme same Sales of Waste Marketing Spot 2018, 15 m.cn)No.: 2018-005、
56 1,585.49 1,585.49 0.09% 9,500 No -
ntal controlling goods materials price exchange May , 11 2018-008、2018-029、
Protection shareholde December 2018-047、2018-052、
Tech. Co., r and 2018 2018-071、2018-073
Ltd. ultimate
controller
Other
enterprise
control 30 March Juchao
Hefei under the Air-conditio Spot 2018, 11 May Website(www.cninfo.co
Changhong same Sales of ner, Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
57 205.04 205.04 0.01% 15,000 No -
Industrial controlling goods refrigerator price Bank May , 11 2018-008、2018-029、
Co., Ltd. shareholde etc. acceptance December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Huafeng enterprise Sales of Marketing Spot 2018, 11 May Website(www.cninfo.co
58 Fresh 29.84 29.84 0.00% 9,500 No -
Corp. control goods price exchange 2018, 15 m.cn)No.: 2018-005、
Group under the May , 11 2018-008、2018-029、
92
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control Refrigerator 30 March Juchao
Sichuan Spot
under the and freezer, 2018, 11 May Website(www.cninfo.co
Zhiyijia exchange,
same Sales of washing Marketing 2018, 15 m.cn)No.: 2018-005、
59 Network 254,723.26 254,723.26 14.56% 420,000 No bank and -
controlling goods machine, price May , 11 2018-008、2018-029、
Technolog commercial
shareholde air-conditio December 2018-047、2018-052、
y Co., Ltd. acceptance
r and ner etc. 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Changhong same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
60 112.08 112.08 0.01% 15,000 No -
Property controlling goods ner price exchange May , 11 2018-008、2018-029、
Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Changhong enterprise Sales of Marketing Spot 2018, 11 May Website(www.cninfo.co
61 Fresh 29.41 29.41 0.00% 15,000 No -
Network control goods price exchange 2018, 15 m.cn)No.: 2018-005、
Technolog under the May , 11 2018-008、2018-029、
93
CHANGHONG MEILING CO.,LTD. Annual Report 2018
y Co., Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Chengdu
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
62 Electronic Fresh 0.12 0.12 0.00% 15,000 No -
controlling goods price exchange May , 11 2018-008、2018-029、
Technolog
shareholde December 2018-047、2018-052、
y Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Wisdom same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
63 Fresh 1.02 1.02 0.00% 15,000 No -
Health controlling goods price exchange May , 11 2018-008、2018-029、
Tech. Co., shareholde December 2018-047、2018-052、
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Changhong enterprise Sales of Air-conditio Marketing Spot 2018, 11 May Website(www.cninfo.co
64 2.71 2.71 0.00% 9,500 No -
Property control goods ner, fresh price exchange 2018, 15 m.cn)No.: 2018-005、
Service under the May , 11 2018-008、2018-029、
94
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Co., Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Guangdon
under the 2018, 11 May Website(www.cninfo.co
g
same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
65 Changhong 298.73 298.73 0.02% 15,000 No -
controlling goods ner etc. price exchange May , 11 2018-008、2018-029、
Electronics
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Huanyu same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
66 16.84 16.84 0.00% 9,500 No -
Industrial controlling goods ner, fresh price exchange May , 11 2018-008、2018-029、
Co. Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Changhong enterprise Sales of Marketing Spot 2018, 11 May Website(www.cninfo.co
67 Fresh 0.14 0.14 0.00% 9,500 No -
Xinrui control goods price exchange 2018, 15 m.cn)No.: 2018-005、
Tech. Co. under the May , 11 2018-008、2018-029、
95
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Intelligent same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
68 52.65 52.65 0.00% 9,500 No -
Manufactu controlling goods ner, fresh price exchange May , 11 2018-008、2018-029、
ring Tech. shareholde December 2018-047、2018-052、
Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Mianyang control 30 March Juchao
Technolog under the 2018, 11 May Website(www.cninfo.co
y Town same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
69 Fresh 0.26 0.26 0.00% 15,000 No -
Big Data controlling goods price exchange May , 11 2018-008、2018-029、
Technolog shareholde December 2018-047、2018-052、
y Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
BVCH Other 30 March Juchao
Optronics enterprise Sales of Marketing Spot 2018, 11 May Website(www.cninfo.co
70 Fresh 3.35 3.35 0.00% 15,000 No -
(Sichuan) control goods price exchange 2018, 15 m.cn)No.: 2018-005、
Co., Ltd. under the May , 11 2018-008、2018-029、
96
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
71 Electronic Fresh 27.04 27.04 0.00% 15,000 No -
controlling goods price exchange May , 11 2018-008、2018-029、
Products
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
72 Group Fresh 5.72 5.72 0.00% 9,500 No -
controlling goods price exchange May , 11 2018-008、2018-029、
Finance
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Changhong Other 30 March Juchao
Air-conditio
Huayi enterprise Sales of Marketing Spot 2018, 11 May Website(www.cninfo.co
73 ner, R&D 62.05 62.05 0.00% 15,000 No -
Compresso control goods price exchange 2018, 15 m.cn)No.: 2018-005、
service
r Co., Ltd. under the May , 11 2018-008、2018-029、
97
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
74 Package Fresh 7.93 7.93 0.00% 15,000 No -
controlling goods price exchange May , 11 2018-008、2018-029、
Printing
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
75 Power 10.64 10.64 0.00% 15,000 No -
controlling goods ner price exchange May , 11 2018-008、2018-029、
Source
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Changhong enterprise Sales of Air-conditio Marketing Spot 2018, 11 May Website(www.cninfo.co
76 59.29 59.29 0.00% 9,500 No -
Education control goods ner, fresh price exchange 2018, 15 m.cn)No.: 2018-005、
Technolog under the May , 11 2018-008、2018-029、
98
CHANGHONG MEILING CO.,LTD. Annual Report 2018
y Co., Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
under the 2018, 11 May Website(www.cninfo.co
081
same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
77 Electronic 434.53 434.53 0.02% 15,000 No -
controlling goods ner price exchange May , 11 2018-008、2018-029、
Group
shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
GuangYua control Air-conditio 30 March Juchao
n under the ner, 2018, 11 May Website(www.cninfo.co
Changhong same Sales of refrigerator, Marketing Spot 2018, 15 m.cn)No.: 2018-005、
78 160.00 160.00 0.01% 15,000 No -
Electronic controlling goods freezer, price exchange May , 11 2018-008、2018-029、
Technolog shareholde washing December 2018-047、2018-052、
y Co., Ltd. r and machine etc. 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Ailian enterprise Sales of Air-conditio Marketing Spot 2018, 11 May Website(www.cninfo.co
79 27.80 27.80 0.00% 9,500 No -
Science & control goods ner, fresh price exchange 2018, 15 m.cn)No.: 2018-005、
Technolog under the May , 11 2018-008、2018-029、
99
CHANGHONG MEILING CO.,LTD. Annual Report 2018
y Co., Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
80 Venture Fresh 0.20 0.20 0.00% 15,000 No -
controlling goods price exchange May , 11 2018-008、2018-029、
Investment
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Guangyuan under the 2018, 11 May Website(www.cninfo.co
Hongcheng same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
81 14.68 14.68 0.00% 9,500 No -
Industrial controlling goods ner price exchange May , 11 2018-008、2018-029、
Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Changhong enterprise Sales of Marketing Spot 2018, 11 May Website(www.cninfo.co
82 Fresh 2.45 2.45 0.00% 15,000 No -
Energy control goods price exchange 2018, 15 m.cnNo.: )2018-005、
Sunshine under the May , 11 2018-008、2018-029、
100
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Technolog same December 2018-047、2018-052、
y Co., Ltd. controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
83 Electronics Fresh 1.54 1.54 0.00% 9,500 No -
controlling goods price exchange May , 11 2018-008、2018-029、
Tech. Co.,
shareholde December 2018-047、2018-052、
Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Hongxin same Sales of Marketing Spot 2018, 15 m.cnNo.: )2018-005、
84 Fresh 3.80 3.80 0.00% 15,000 No -
Software controlling goods price exchange May , 11 2018-008、2018-029、
Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Hongcheng enterprise Sales of Air-conditio Marketing Spot 2018, 11 May Website(www.cninfo.co
85 9.46 9.46 0.00% 9,500 No -
Real Estate control goods ner price exchange 2018, 15 m.cn)No.: 2018-005、
Co., Ltd. under the May , 11 2018-008、2018-029、
101
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
New same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
86 35.22 35.22 0.00% 15,000 No -
Energy controlling goods ner, fresh price exchange May , 11 2018-008、2018-029、
Technolog shareholde December 2018-047、2018-052、
y Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Air-conditio Marketing Spot 2018, 15 m.cnNo.: )2018-005、
87 Internation 36.19 36.19 0.00% 9,500 No -
controlling goods ner, fresh price exchange May , 11 2018-008、2018-029、
al Hotel
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Changhong enterprise Sales of Bluetooth, Marketing Spot 2018, 11 May Website(www.cninfo.co
88 2.60 2.60 0.00% 15,000 No -
Electronic control goods fresh price exchange 2018, 15 m.cn)No.: 2018-005、
System under the May , 11 2018-008、2018-029、
102
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Co., Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Fresh,
Precision same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
89 refrigerator 18.06 18.06 0.00% 15,000 No -
Electronics controlling goods price exchange May , 11 2018-008、2018-029、
etc.
Tech. Co., shareholde December 2018-047、2018-052、
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
under the 2018, 11 May Website(www.cninfo.co
Orion.PDP same Sales of Refrigerator Marketing Spot 2018, 15 m.cn)No.: 2018-005、
90 2,626.30 2,626.30 0.15% 9,500 No -
.Co.,ltd controlling goods , freezer price exchange May , 11 2018-008、2018-029、
shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Changhong Other 30 March Juchao
Internation enterprise Sales of Air-conditio Marketing Spot 2018, 11 May Website(www.cninfo.co
91 58.92 58.92 0.00% 6,000 No -
al control goods ner, fresh price exchange 2018, 15 m.cn)No.: 2018-005、
Holdings under the May , 11 2018-008、2018-029、
103
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(Hong same December 2018-047、2018-052、
Kong) Co., controlling 2018 2018-071、2018-073
Ltd. shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
under the 2018, 11 May Website(www.cninfo.co
Changhong
same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
92 EuropeEle Refrigerator 14.14 14.14 0.00% 15,000 No -
controlling goods price exchange May , 11 2018-008、2018-029、
ctrics.r.o
shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Yibin under the 2018, 11 May Website(www.cninfo.co
Red-Star same Sales of Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
93 91.74 91.74 0.01% 9,500 No -
Electronics controlling goods ner price exchange May , 11 2018-008、2018-029、
Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
CHANGH Other Air-conditio 30 March Juchao
ONGELE enterprise Sales of ner, Marketing Spot 2018, 11 May Website(www.cninfo.co
94 1,125.27 1,125.27 0.06% 15,000 No -
CTRICMI control goods refrigerator, price exchange 2018, 15 m.cn)No.: 2018-005、
DDLEEAS under the freezer May , 11 2018-008、2018-029、
104
CHANGHONG MEILING CO.,LTD. Annual Report 2018
TFZE same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Juicer,
Aichuang same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
95 air-conditio 247.39 247.39 0.01% 9,500 No -
Technolog controlling goods price exchange May , 11 2018-008、2018-029、
ner
y Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Yuanxin under the 2018, 11 May Website(www.cninfo.co
Financial same Sales of Marketing Spot 2018, 15 m.cn)No.: 2018-005、
96 Fresh 0.08 0.08 0.00% 15,000 No -
Lease Co., controlling goods price exchange May , 11 2018-008、2018-029、
Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Hunan Other 30 March Juchao
Grand-Pro enterprise Sales of Anti-counte Marketing Spot 2018, 11 May Website(www.cninfo.co
97 0.72 0.72 0.00% 15,000 No -
Intelligent control goods rfeit label price exchange 2018, 15 m.cn)No.: 2018-005、
Tech. under the May , 11 2018-008、2018-029、
105
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Company same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Guangdon
under the 2018, 11 May Website(www.cninfo.co
g Water and
same Provide Marketing Spot 2018, 15 m.cn)No.: 2018-005、
98 Changhong electricity 30.72 30.72 0.00% 15,000 No -
controlling fuels price exchange May , 11 2018-008、2018-029、
Electronics fee
shareholde December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the Spot 2018, 11 May Website(www.cninfo.co
Changhong Water and
same Provide Marketing exchange, 2018, 15 m.cnNo.: )2018-005、
99 Minsheng electricity 2.92 2.92 0.00% 15,000 No -
controlling fuels price Bank May , 11 2018-008、2018-029、
Logistics fee
shareholde acceptance December 2018-047、2018-052、
Co., LTD
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Water and Bank
Changhong enterprise Provide Marketing 2018, 11 May Website(www.cninfo.co
100 electricity 14.39 14.39 0.00% 12,000 No acceptance -
Jijia Fine control fuels price 2018, 15 m.cn)No.: 2018-005、
fee settlement
Co., Ltd. under the May , 11 2018-008、2018-029、
106
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Water and Bank
Mold same Provide Marketing 2018, 15 m.cnNo.: )2018-005、
101 electricity 785.39 785.39 0.04% 23,000 No acceptance -
Plastic controlling fuels price May , 11 2018-008、2018-029、
fee settlement
Tech. Co., shareholde December 2018-047、2018-052、
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Water and
Hongwei same Provide Marketing Spot 2018, 15 m.cnNo.: )2018-005、
102 electricity 0.78 0.78 0.00% 15,000 No -
Technolog controlling fuels price exchange May , 11 2018-008、2018-029、
fee
y Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other 30 March Juchao
Water and
Changhong enterprise Provide Marketing Spot 2018, 11 May Website(www.cninfo.co
103 electricity 0.92 0.92 0.00% 15,000 No -
Precision control fuels price exchange 2018, 15 m.cnNo.: )2018-005、
fee
Electronics under the May , 11 2018-008、2018-029、
107
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Tech. Co., same December 2018-047、2018-052、
Ltd. controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong Water and Bank
same Provide Marketing 2018, 15 m.cn)No.: 2018-005、
104 Device electricity 101.53 101.53 0.01% 15,000 No acceptance -
controlling fuels price May , 11 2018-008、2018-029、
Tech. Co., fee settlement
shareholde December 2018-047、2018-052、
Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Sichuan
control 30 March Juchao
Service
under the 2018, 11 May Website(www.cninfo.co
Exp. Water and
same Provide Marketing Spot 2018, 15 m.cn)No.: 2018-005、
105 Appliance electricity 0.32 0.32 0.00% 15,000 No -
controlling fuels price exchange May , 11 2018-008、2018-029、
Service fee
shareholde December 2018-047、2018-052、
Chain Co.,
r and 2018 2018-071、2018-073
Ltd.
ultimate
controller
Shenzhen Other 30 March Juchao
Water and
YijEn enterprise Provide Marketing Spot 2018, 11 May Website(www.cninfo.co
106 electricity 0.58 0.58 0.00% 15,000 No -
Technolog control fuels price exchange 2018, 15 m.cn)No.: 2018-005、
fee
y Co., Ltd. under the May , 11 2018-008、2018-029、
108
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Changhong
control 30 March Juchao
Internation
under the 2018, 11 May Website(www.cninfo.co
al Water and
same Provide Marketing Spot 2018, 15 m.cn)No.: 2018-005、
107 Holdings electricity 0.44 0.44 0.00% 6,000 No -
controlling fuels price exchange May , 11 2018-008、2018-029、
(Hong fee
shareholde December 2018-047、2018-052、
Kong) Co.,
r and 2018 2018-071、2018-073
Ltd.
ultimate
controller
Other
enterprise
control 30 March Juchao
Guangdon
under the Rent to 2018, 11 May Website(www.cninfo.co
g
same the Office Marketing Spot 2018, 15 m.cn)No.: 2018-005、
108 Changhong 99.66 99.66 0.32% 5,000 No -
controlling related building price exchange May , 11 2018-008、2018-029、
Electronics
shareholde party December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Hefei Other Rent to 30 March Juchao
Changhong enterprise the Marketing Spot 2018, 11 May Website(www.cninfo.co
109 Apartment 31.37 31.37 0.10% 5,000 No -
Industrial control related price exchange 2018, 15 m.cn)No.: 2018-005、
Co., Ltd. under the party May , 11 2018-008、2018-029、
109
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the Rent to 2018, 11 May Website(www.cninfo.co
Aichuang same the Forklift, Marketing Spot 2018, 15 m.cn)No.: 2018-005、
110 0.8 0.80 0.00% 9,500 No -
Technolog controlling related warehouse price exchange May , 11 2018-008、2018-029、
y Co., Ltd. shareholde party December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the Rent to 2018, 11 May Website(www.cninfo.co
Ailian
same the Marketing Spot 2018, 15 m.cn)No.: 2018-005、
111 Science & Warehouse 0.22 0.22 0.00% 9,500 No -
controlling related price exchange May , 11 2018-008、2018-029、
Technolog
shareholde party December 2018-047、2018-052、
y Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Rent to 30 March Juchao
Workshop,
Hongwei enterprise the Marketing Spot 2018, 11 May Website(www.cninfo.co
112 and 2# 5.03 5.03 0.02% 5,000 No -
Technolog control related price exchange 2018, 15 m.cn)No.: 2018-005、
living area
y Co., Ltd. under the party May , 11 2018-008、2018-029、
110
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan
control 30 March Juchao
Service
under the Rent to 2018, 11 May Website(www.cninfo.co
Exp.
same the Apartment, Marketing Spot 2018, 15 m.cn)No.: 2018-005、
113 Appliance 39.65 39.65 0.13% 5,000 No -
controlling related office etc. price exchange May , 11 2018-008、2018-029、
Service
shareholde party December 2018-047、2018-052、
Chain Co.,
r and 2018 2018-071、2018-073
Ltd.
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the Rent to 2018, 11 May Website(www.cninfo.co
Changhong
same the Marketing Spot 2018, 15 m.cn)No.:2018-005、
114 Package Warehouse 0.05 0.05 0.00% 5,000 No -
controlling related price exchange May , 11 2018-008、2018-029、
Printing
shareholde party December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Rent to Workshop, 30 March Juchao
Bank
Changhong enterprise the warehouse Marketing 2018, 11 May Website(www.cninfo.co
115 71.74 71.74 0.23% 5,000 No acceptance -
Jijia Fine control related and forklift price 2018, 15 m.cn)No.: 2018-005、
settlement
Co., Ltd. under the party etc. May , 11 2018-008、2018-029、
111
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the Rent to 2018, 11 May Website(www.cninfo.co
Apartment,
Precision same the Marketing Spot 2018, 15 m.cn) No.:2018-005、
116 warehouse, 11.66 11.66 0.04% 5,000 No -
Electronics controlling related price exchange May , 11 2018-008、2018-029、
forklift
Tech. Co., shareholde party December 2018-047、2018-052、
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the Rent to Spot 2018, 11 May Website(www.cninfo.co
Changhong Workshop,
same the Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
117 Minsheng apartment 282.72 282.72 0.92% 5,000 No -
controlling related price Bank May , 11 2018-008、2018-029、
Logistics etc.
shareholde party acceptance December 2018-047、2018-052、
Co., LTD
r and 2018 2018-071、2018-073
ultimate
controller
Sichuan Other Rent to 30 March Juchao
Workshop, Bank
Changhong enterprise the Marketing 2018, 11 May Website(www.cninfo.co
118 warehouse 292.59 292.59 0.95% 5,000 No acceptance -
Mold control related price 2018, 15 m.cn)No.: 2018-005、
etc. settlement
Plastic under the party May , 11 2018-008、2018-029、
112
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Tech. Co., same December 2018-047、2018-052、
Ltd. controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the Rent to 2018, 11 May Website(www.cninfo.co
Changhong Workshop,
same the Marketing Spot 2018, 15 m.cn)No.: 2018-005、
119 Device and 2# 106.21 106.21 0.35% 5,000 No -
controlling related price exchange May , 11 2018-008、2018-029、
Tech. Co., living area
shareholde party December 2018-047、2018-052、
Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Changhong
control 30 March Juchao
Internation
under the Rent to 2018, 11 May Website(www.cninfo.co
al Office and
same the Marketing Spot 2018, 15 m.cn)No.: 2018-005、
120 Holdings 2# living 16.36 16.36 0.05% 5,000 No -
controlling related price exchange May , 11 2018-008、2018-029、
(Hong area
shareholde party December 2018-047、2018-052、
Kong) Co.,
r and 2018 2018-071、2018-073
Ltd.
ultimate
controller
BVCH Other Rent to 30 March Juchao
Optronics enterprise the Freight Marketing Spot 2018, 11 May Website(www.cninfo.co
121 5.25 5.25 0.02% 5,000 No -
(Sichuan) control related elevator price exchange 2018, 15 m.cn)No.: 2018-005、
Co., Ltd. under the party May , 11 2018-008、2018-029、
113
CHANGHONG MEILING CO.,LTD. Annual Report 2018
same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Beijing under the Rent 2018, 11 May Website(www.cninfo.co
Changhong same from the Marketing Spot 2018, 15 m.cn)No.: 2018-005、
122 office 36.47 36.47 0.12% 5,000 No -
Tech. Co. controlling related price exchange May , 11 2018-008、2018-029、
Ltd, shareholde party December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Chengdu
under the Rent 2018, 11 May Website(www.cninfo.co
Changhong
same from the Marketing Spot 2018, 15 m.cn)No.: 2018-005、
123 Electronic office 47.96 47.96 0.16% 5,000 No -
controlling related price exchange May , 11 2018-008、2018-029、
Technolog
shareholde party December 2018-047、2018-052、
y Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Guangdon Other Rent 30 March Juchao
Staff
g enterprise from the Marketing Spot 2018, 11 May Website(www.cninfo.co
124 dormitory, 105.38 105.38 0.34% 5,000 No -
Changhong control related price exchange 2018, 15 m.cn)No.: 2018-005、
workshop
Electronics under the party May , 11 2018-008、2018-029、
114
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Co., Ltd. same December 2018-047、2018-052、
controlling 2018 2018-071、2018-073
shareholde
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the Rent 2018, 11 May Website(www.cninfo.co
Hongwei same from the Device Marketing Spot 2018, 15 m.cn)No.: 2018-005、
125 13.67 13.67 0.04% 5,000 No -
Technolog controlling related server price exchange May , 11 2018-008、2018-029、
y Co., Ltd. shareholde party December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Controllin 30 March Juchao
Sichuan g Rent 2018, 11 May Website(www.cninfo.co
Changhong shareholde from the Workshop, Marketing Spot 2018, 15 m.cn)No.: 2018-005、
126 1,337.21 1,337.21 4.35% 5,000 No -
Electric r and related office etc price exchange May , 11 2018-008、2018-029、
Co., Ltd. ultimate party December 2018-047、2018-052、
controller 2018 2018-071、2018-073
Other
Sichuan enterprise 30 March Juchao
Changhong control Rent 2018, 11 May Website(www.cninfo.co
Staff
Electronics under the from the Marketing Spot 2018, 15 m.cn)No.: 2018-005、
127 dormitory, 15.42 15.42 0.05% 9,000 No -
Holding same related price exchange May , 11 2018-008、2018-029、
workshop
Group Co., controlling party December 2018-047、2018-052、
Ltd. shareholde 2018 2018-071、2018-073
r and
115
CHANGHONG MEILING CO.,LTD. Annual Report 2018
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the Rent 2018, 11 May Website(www.cninfo.co
Changhong
same from the Workshop, Marketing Spot 2018, 15 m.cn)No.: 2018-005、
128 Property 208.85 208.85 0.68% 9,000 No -
controlling related office etc price exchange May , 11 2018-008、2018-029、
Service
shareholde party December 2018-047、2018-052、
Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Changhong under the Rent 2018, 11 May Website(www.cninfo.co
Huayi same from the Staff Marketing Spot 2018, 15 m.cn)No.: 2018-005、
129 3.38 3.38 0.01% 5,000 No -
Compresso controlling related dormitory price exchange May , 11 2018-008、2018-029、
r Co., Ltd. shareholde party December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
Mianyang 30 March Juchao
enterprise
Technolog 2018, 11 May Website(www.cninfo.co
control Purchasin
y Town Workshop Marketing Spot 2018, 15 m.cn)No.: 2018-005、
130 under the g fixed 26.01 26.01 0.03% 5,000 No -
Big Data construction price exchange May , 11 2018-008、2018-029、
same assets
Technolog December 2018-047、2018-052、
controlling
y Co., Ltd. 2018 2018-071、2018-073
shareholde
116
CHANGHONG MEILING CO.,LTD. Annual Report 2018
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Purchasin Juicer,
Aichuang same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
131 g fixed vending 194.36 194.36 0.23% 9,000 No -
Technolog controlling price exchange May , 11 2018-008、2018-029、
assets machine
y Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Purchasin
Hongcheng same Workshop Marketing Spot 2018, 15 m.cn)No.: 2018-005、
132 g fixed 39.32 39.32 0.05% 9,000 No -
Real Estate controlling construction price exchange May , 11 2018-008、2018-029、
assets
Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
30 March Juchao
enterprise
2018, 11 May Website(www.cninfo.co
四川虹城 control Purchasin
Workshop Marketing Spot 2018, 15 m.cn)No.: 2018-005、
133 建筑工程 under the g fixed 45.05 45.05 0.05% 9,000 No -
construction price exchange May , 11 2018-008、2018-029、
有限公司 same assets
December 2018-047、2018-052、
controlling
2018 2018-071、2018-073
shareholde
117
CHANGHONG MEILING CO.,LTD. Annual Report 2018
r and
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Purchasin
Hongxin same Information Marketing Spot 2018, 15 m.cn)No.: 2018-005、
134 g fixed 520.38 520.38 0.62% 5,000 No -
Software controlling system etc. price exchange May , 11 2018-008、2018-029、
assets
Co., Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan under the 2018, 11 May Website(www.cninfo.co
Purchasin
Huanyu same Workshop Marketing Spot 2018, 15 m.cn)No.: 2018-005、
135 g fixed 564.83 564.83 0.67% 9,000 No -
Industrial controlling construction price exchange May , 11 2018-008、2018-029、
assets
Co. Ltd. shareholde December 2018-047、2018-052、
r and 2018 2018-071、2018-073
ultimate
controller
Controllin 30 March Juchao
Workshop
Sichuan g Spot 2018, 11 May Website(www.cninfo.co
Purchasin construction
Changhong shareholde Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
136 g fixed , 774.36 774.36 0.92% 5,000 No -
Electric r and price Bank May , 11 2018-008、2018-029、
assets information
Co., Ltd. ultimate acceptance December 2018-047、2018-052、
system
controller 2018 2018-071、2018-073
118
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Purchasin
Electronics same Workshop Marketing Spot 2018, 15 m.cn)No.: 2018-005、
137 g fixed 387.68 387.68 0.46% 9,000 No -
Holding controlling construction price exchange May , 11 2018-008、2018-029、
assets
Group Co., shareholde December 2018-047、2018-052、
Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the 2018, 11 May Website(www.cninfo.co
Purchasin
Energy same Workshop Marketing Spot 2018, 15 m.cn)No.: 2018-005、
138 g fixed 91.3 91.30 0.11% 5,000 No -
Sunshine controlling construction price exchange May , 11 2018-008、2018-029、
assets
Technolog shareholde December 2018-047、2018-052、
y Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Changhong Purchasin
same Workshop Marketing Spot 2018, 15 m.cn)No.: 2018-005、
139 Network g fixed 31.07 31.07 0.04% 5,000 No -
controlling construction price exchange May , 11 2018-008、2018-029、
Technolog assets
shareholde December 2018-047、2018-052、
y Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
119
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other
enterprise
control 30 March Juchao
Sichuan
under the 2018, 11 May Website(www.cninfo.co
Zhiyijia Purchasin
same Air-conditio Marketing Spot 2018, 15 m.cn)No.: 2018-005、
140 Network g fixed 0.3 0.30 0.00% 5,000 No -
controlling ner price exchange May , 11 2018-008、2018-029、
Technolog assets
shareholde December 2018-047、2018-052、
y Co., Ltd.
r and 2018 2018-071、2018-073
ultimate
controller
Other
enterprise
Sichuan control 30 March Juchao
Changhong under the Production Spot 2018, 11 May Website(www.cninfo.co
Purchasin
Intelligent same line Marketing exchange, 2018, 15 m.cn)No.: 2018-005、
141 g fixed 3,290.92 3,290.92 3.92% 6,000 No -
Manufactu controlling constructio price Bank May , 11 2018-008、2018-029、
assets
ring Tech. shareholde n etc acceptance December 2018-047、2018-052、
Co., Ltd. r and 2018 2018-071、2018-073
ultimate
controller
Other
Sichuan enterprise
Changhong control 30 March Juchao
Gerun under the 2018, 11 May Website(www.cninfo.co
Sales of Mould,
Environme same Marketing Spot 2018, 15 m.cn)No.: 2018-005、
142 fixed air-conditio 2.9 2.90 0.14% 9,500 No -
ntal controlling price exchange May , 11 2018-008、2018-029、
assets ner
Protection shareholde December 2018-047、2018-052、
Tech. Co., r and 2018 2018-071、2018-073
Ltd. ultimate
controller
120
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other
commerci
enterprise
al commercial
control
factoring factoring
Yuanxin under the
and and
Financial same Marketing Spot
143 financial financial 168.68 168.68 300 No - - -
Lease Co., controlling price exchange
reconcilia reconciliatio
Ltd. shareholde
tion n business
r and
business etc.
ultimate
etc.
controller
Total -- -- 629,383.47 -- -- -- -- -- -- --
Detail of sales return with major amount involved Not applicable
1. It is estimated that the related transaction amount resulted by purchasing goods (including door shell and plastic products etc.) and accepting fuel and
power from Sichuan Changhong and its subsidiary by the Company for year of 2018 was RMB 2872 million at most (tax-excluded), actually RMB
1,595,563,600 occurred in reporting period
2. It is estimated that the related transaction amount resulted by purchasing goods (including compressor purchased) from Changhong Huayi and its
subsidiary by the Company for year of 2018 was RMB 606.5 million at most (tax-excluded), actually RMB 534,782,400 occurred in reporting period
3. It is estimated that the related transaction amount resulted by purchasing or selling equipment, software, maintenance and spare parts and molds etc. from
Sichuan Changhong and its subsidiary by the Company for year of 2018 was RMB 50 million at most (tax-excluded), actually RMB 14,434,200 occurred in
reporting period
Report the actual implementation of the daily related
4. It is estimated that the related transaction amount resulted by purchasing goods from and providing fuel and power to Sichuan Changhong and its
transactions which were projected about their total amount
subsidiary by the Company for year of 2018 was RMB 6280 million at most (tax-included), actually RMB 3,183,862,000 occurred in reporting period
by types during the reporting period (if applicable)
5. It is estimated that the related transaction amount resulted by accepting energy, power and service from Changhong Huayi and its subsidiary by the
Company for year of 2018 was RMB 1.3 million at most (tax-included), actually RMB 720,400 occurred in reporting period
6. It is estimated that the related transaction amount resulted by leasing business from Sichuan Changhong and its subsidiary by the Company for year of
2018 was RMB 50 million at most (tax-excluded), actually RMB 25,063,600 occurred in reporting period
7. It is estimated that the related transaction amount from domestic finished goods logistic business outsourcing to Sichuan Changhong Minsheng Logistic
Co., Ltd. by the Company for year of 2018 was RMB 710 million at most (tax-excluded), actually RMB 537,900,800 occurred in reporting period
8. It is estimated that the related transaction amount from after sales service of domestic goods outsourcing to Sichuan Service Exp. Appliance Service
Chain Co., Ltd. by the Company for year of 2018 was RMB 250 million at most, actually RMB 194,960,700 occurred in reporting period.
121
CHANGHONG MEILING CO.,LTD. Annual Report 2018
9. It is estimated that the related transaction amount resulted by accepting other service and labor service etc. or providing other service and labor service
etc. to Sichuan Changhong and its subsidiary by the Company for year of 2018 was RMB 50 million at most (tax-excluded), actually RMB 34,170,700
occurred in reporting period
10. It is estimated that the related transaction amount resulted by selling goods from Sichuan Changhong Electronics Holding Group Co., Ltd and its
subsidiary by the Company for year of 2018 was RMB 95 million at most (tax-excluded), actually RMB 49,577,600 occurred in reporting period.
11. It is estimated that the related transaction amount resulted by purchasing goods and receiving labor services, fuel power, leasing and purchasing
equipment etc. from Sichuan Changhong Electronics Holding Group Co., Ltd and its subsidiary by the Company for year of 2018 was RMB 160 million at
most (tax-excluded), actually RMB 121,111,900 occurred in reporting period.
Reasons of major difference between the trading price and
Not applicable
market price
Note: According to relevant provisions of the Stock Listing Rules of the Shenzhen Stock Exchange and the Authorization Management System of the company, the related transactions between
the company and related parties amounting to less than 3 million yuan (including 3 million yuan) can only be implemented after being approved by the company’s president. Therefore, during
the reporting period, the related transactions carried out by the company and the related party, Yuanxin Financial Lease Co., Ltd., amounting to less than 3 million yuan has been approved by the
company’s president.
122
CHANGHONG MEILING CO.,LTD. Annual Report 2018
2. Related transactions with Changhong Finance Company
The resolution of the 34th meeting of the 8th board of directors on August 9, 2017 and the second extraordinary
general meeting of 2017 on September 12, 2017 approved and agreed the company to continue carry out the
financial service cooperation with Sichuan Changhong Group Finance Co., Ltd. (hereinafter referred to as
“Changhong Finance Company”) and sign a triennial Financial Service Agreement, It is agreed that the maximum
deposit balance (including accrued interest and handling fees) and the highest principal and interest of outstanding
loan the Company in any finance company within the three-year validity period from the effective date of the new
agreement shall be adjusted to not exceed RMB 3.8 billion per day. In accordance with the agreement, Changhong
Finance Company shall provide a series of financial services such as deposit and loan in its business scope
according to the requirements of the Company and its subsidiaries. The related transactions between the company
and its subsidiaries and Changhong Finance Company from the beginning of the year to the end of the reporting
period are as follows:
Up to 31 December 2018, the Company and its subsidiaries have opened financial business as savings, loans, note
drawing and notes discounted with Changhong Finance Company. The Company and its subordinate company
owns 3,119,117,207.91 Yuan savings in Changhong Finance Company, takes 28.41% of the deposit taking balance
in Changhong Finance Company without 30% occupied, balance of notes drawing at period-end was
819,806,514.07 Yuan and balance of notes discounted outstanding as 772,233,395.98 Yuan. More details are:
In RMB/CNY
Interest and
commission
Balance at Increased in the Decreased in the Balance at
Item charge
year-begin Year Year year-end received or
paid
I. Savings in
Changhong
2,762,513,703.88 45,997,197,744.62 45,640,594,240.59 3,119,117,207.91 103,532,219.23
Group Finance
Company
II. Borrowings
from
Changhong - 113,400,000.00 113,400,000.00 - 2,981,085.00
Group Finance
Company
1.Short-term
- 113,400,000.00 113,400,000.00 - 2,981,085.00
loans
2.Long-term
- - - - -
loans
III. Other
financial
123
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Interest and
commission
Balance at Increased in the Decreased in the Balance at
Item charge
year-begin Year Year year-end received or
paid
business
1.notes drawing 721,645,627.87 1,790,388,282.05 1,692,227,395.85 819,806,514.07 771,936.36
2.notes
699,356,853.98 1,312,666,811.99 1,239,790,269.99 772,233,395.98 13,533,515.67
discounted
According to the regulation of Information Disclosure Business Memorandum No. 2 - Transactions and Related Transactions of the
Shenzhen Stock Exchange, the company issued the Risk Continuous Assessment Report About Sichuan Changhong Group Finance
Co., Ltd. for the deposit, loan and other financial services that the company carried out with Changhong Finance Company during the
reporting period, and disclosed at www.cninfo.com.cn on 29 March 2019
(ii) Related transactions by assets acquisition and sold
□ Applicable √ Not applicable
There are no related transactions by assets acquisition and sold in the period
(iii) Material related transaction of jointly foreign investment
□ Applicable √ Not applicable
The Company has no material related transaction of jointly foreign investment occurred in reporting
period-end.
(iv) Connect of related liability and debt
√Applicable □ Not applicable
Whether has non-operational contact of related liability and debts or not
□Yes √ No
No non-operational contact of related liability or debts in Period
124
CHANGHONG MEILING CO.,LTD. Annual Report 2018
1.Claim receivable from related party
Whether has Balance at Current Current Balance at
Current
non-business period-begi newly interest period-end
Seria collected(10 Interes
Related party Relationship Causes capital n (10 added(10 (10 (10
l thousand t rate
occupying or thousand thousand thousand thousand
Yuan)
not Yuan) Yuan) Yuan) Yuan)
Operational
Sichuan Changhong Controlling shareholder
1 contact of No 181.46 5,163.23 3,917.93 - - 1,426.76
Electric Co., Ltd. and ultimate controller
related credit
Sichuan Changhong Operational
Controlling shareholder
2 Electronics Holding contact of No 10.06 148.96 154.05 - - 4.96
and ultimate controller
Group Co., Ltd. related credit
Other enterprise control
Sichuan Changhong Operational
under the same
3 International Hotel contact of No - 36.19 33.15 - - 3.04
controlling shareholder
Co., Ltd. related credit
and ultimate controller
Other enterprise control
Anhui Xinhao Operational
under the same
4 Plasma Display contact of No 6.30 - 6.30 - - -
controlling shareholder
Panel Co., Ltd. related credit
and ultimate controller
Other enterprise control
Yibin Red-Star Operational
under the same
5 Electronics Co., contact of No - 91.74 91.74 - - -
controlling shareholder
Ltd. related credit
and ultimate controller
Sichuan Changhong Other enterprise control Operational
6 Xinrui Tech. Co. under the same contact of No - 0.14 0.14 - - -
Ltd. controlling shareholder related credit
125
CHANGHONG MEILING CO.,LTD. Annual Report 2018
and ultimate controller
Other enterprise control
Operational
Sichuan Huafeng under the same
7 contact of No - 29.84 29.84 - - -
Corp. Group controlling shareholder
related credit
and ultimate controller
Other enterprise control
Operational
Sichuan Huanyu under the same
8 contact of No - 16.84 16.52 - - 0.32
Industrial Co. Ltd. controlling shareholder
related credit
and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
9 Group Finance Co., contact of No 0.93 5.72 6.65 - - -
controlling shareholder
Ltd. related credit
and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
10 Mold Plastic Tech. contact of No 16.84 20,984.10 20,901.21 - - 99.73
controlling shareholder
Co., Ltd. related credit
and ultimate controller
Other enterprise control
Lejiayi Chain Operational
under the same
11 Management Co., contact of No 86.71 2,324.80 2,130.50 - - 281.01
controlling shareholder
Ltd. related credit
and ultimate controller
Other enterprise control
Operational
Hefei Changhong under the same
12 contact of No - 236.41 236.41 - - -
Industrial Co., Ltd. controlling shareholder
related credit
and ultimate controller
Changhong Huayi Other enterprise control Operational
13 Compressor Co., under the same contact of No 1.98 62.05 27.68 - - 36.35
Ltd. controlling shareholder related credit
126
CHANGHONG MEILING CO.,LTD. Annual Report 2018
and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
14 Package Printing contact of No - 7.98 7.98 - - -
controlling shareholder
Co., Ltd. related credit
and ultimate controller
Other enterprise control
Operational
Sichuan Changhong under the same
15 contact of No 198.98 5,933.93 6,132.08 - - 0.83
Jijia Fine Co., Ltd. controlling shareholder
related credit
and ultimate controller
Sichuan Changhong Other enterprise control
Operational
Network under the same
16 contact of No - 29.41 29.41 - - -
Technology Co., controlling shareholder
related credit
Ltd. and ultimate controller
Other enterprise control
Sichuan Hongwei Operational
under the same
17 Technology Co., contact of No 36.39 23.05 48.01 - - 11.44
controlling shareholder
Ltd. related credit
and ultimate controller
Other enterprise control
PT.CHANGHONG Operational
under the same
18 ELECTRICINDON contact of No 2.56 711.24 334.28 - - 379.53
controlling shareholder
ESIA related credit
and ultimate controller
Other enterprise control
CHANGHONG(HK Operational
under the same
19 )TRADINGLIMITE contact of No 9,204.12 21,867.52 28,083.21 - - 2,988.43
controlling shareholder
D related credit
and ultimate controller
CHANGHONGELE Other enterprise control Operational
20 CTRIC(AUSTRALI under the same contact of No 896.60 2,557.96 1,776.27 - - 1,678.29
A) controlling shareholder related credit
127
CHANGHONG MEILING CO.,LTD. Annual Report 2018
and ultimate controller
Other enterprise control
Operational
Sichuan Changhong under the same
21 contact of No 19.87 112.08 105.73 - - 26.22
Property Co., Ltd. controlling shareholder
related credit
and ultimate controller
Sichuan Service Other enterprise control
Operational
Exp. Appliance under the same
22 contact of No 65.35 1,483.55 1,466.30 - - 82.60
Service Chain Co., controlling shareholder
related credit
Ltd. and ultimate controller
Chengdu
Other enterprise control
Changhong Operational
under the same
23 Electronic contact of No 43.45 0.17 0.00 - - 43.62
controlling shareholder
Technology Co., related credit
and ultimate controller
Ltd.
Sichuan Zhiyijia Other enterprise control
Operational
Network under the same
24 contact of No 29,257.00 254,723.26 233,408.23 - - 50,572.03
Technology Co., controlling shareholder
related credit
Ltd. and ultimate controller
Guangdong Other enterprise control
Operational
Changhong under the same
25 contact of No 1.06 429.11 401.13 - - 29.04
Electronics Co., controlling shareholder
related credit
Ltd. and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
26 Power Source Co., contact of No 3.04 10.64 13.68 - - -
controlling shareholder
Ltd. related credit
and ultimate controller
Sichuan Changhong Other enterprise control Operational
27 No - 538.32 510.75 - - 27.57
Minsheng Logistics under the same contact of
128
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Co., LTD controlling shareholder related credit
and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
28 Device Tech. Co., contact of No - 226.84 226.84 - - -
controlling shareholder
Ltd. related credit
and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
29 Wisdom Health contact of No - 1.02 1.02 - - -
controlling shareholder
Tech. Co., Ltd. related credit
and ultimate controller
Sichuan Changhong Other enterprise control
Operational
Intelligent under the same
30 contact of No 52.79 1,544.26 0.00 - - 1,597.05
Manufacturing controlling shareholder
related credit
Tech. Co., Ltd. and ultimate controller
Mianyang
Other enterprise control
Technology Town Operational
under the same
31 Big Data contact of No - 0.26 0.26 - - -
controlling shareholder
Technology Co., related credit
and ultimate controller
Ltd.
Other enterprise control
Operational
BVCH Optronics under the same
32 contact of No - 8.60 8.60 - - -
(Sichuan) Co., Ltd. controlling shareholder
related credit
and ultimate controller
Other enterprise control
Shenzhen YijEn Operational
under the same
33 Technology Co., contact of No 0.18 1.25 0.00 - - 1.43
controlling shareholder
Ltd. related credit
and ultimate controller
34 Sichuan Changhong Other enterprise control Operational No 1.50 30.64 27.75 - - 4.39
129
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Precision under the same contact of
Electronics Tech. controlling shareholder related credit
Co., Ltd. and ultimate controller
Sichuan Changhong Other enterprise control
Operational
Education under the same
35 contact of No - 59.29 59.29 - - -
Technology Co., controlling shareholder
related credit
Ltd. and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
36 Property Service contact of No 0.77 2.71 3.19 - - 0.30
controlling shareholder
Co., Ltd. related credit
and ultimate controller
Other enterprise control
Operational
081 Electronic under the same
37 contact of No - 434.53 409.33 - - 25.20
Group controlling shareholder
related credit
and ultimate controller
GuangYuan
Other enterprise control
Changhong Operational
under the same
38 Electronic contact of No - 160.00 160.00 - - -
controlling shareholder
Technology Co., related credit
and ultimate controller
Ltd.
Sichuan Ailian Other enterprise control
Operational
Science & under the same
39 contact of No - 28.02 28.02 - - -
Technology Co., controlling shareholder
related credit
Ltd. and ultimate controller
Other enterprise control
Operational
ChanghongEuropeE under the same
40 contact of No 14.14 0.98 - - 13.16
lectrics.r.o controlling shareholder
related credit
and ultimate controller
130
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other enterprise control
CHANGHONGELE Operational
under the same
41 CTRICMIDDLEEA contact of No 1,125.27 786.07 - - 339.20
controlling shareholder
STFZE related credit
and ultimate controller
Other enterprise control
Sichuan Aichuang Operational
under the same
42 Technology Co., contact of No 248.19 151.75 - - 96.44
controlling shareholder
Ltd. related credit
and ultimate controller
Sichuan Changhong
Other enterprise control
Gerun Operational
under the same
43 Environmental contact of No 1,588.39 1,588.39 - - -
controlling shareholder
Protection Tech. related credit
and ultimate controller
Co., Ltd.
Other enterprise control
Sichuan Changhong Operational
under the same
44 Electronic Products contact of No 27.04 27.04 - - -
controlling shareholder
Co., Ltd. related credit
and ultimate controller
Other enterprise control
Operational
Yuanxin Financial under the same
45 contact of No 0.08 0.08 - - -
Lease Co., Ltd. controlling shareholder
related credit
and ultimate controller
Other enterprise control
Hunan Grand-Pro Operational
under the same
46 Intelligent Tech. contact of No 0.72 0.72 - - -
controlling shareholder
Company related credit
and ultimate controller
Sichuan Changhong Other enterprise control Operational
47 Venture Investment under the same contact of No - 0.20 0.20 - - -
Co., Ltd. controlling shareholder related credit
131
CHANGHONG MEILING CO.,LTD. Annual Report 2018
and ultimate controller
Other enterprise control
Guangyuan Operational
under the same
48 Hongcheng contact of No - 14.68 14.68 - - -
controlling shareholder
Industrial Co., Ltd. related credit
and ultimate controller
Sichuan Changhong Other enterprise control
Operational
Energy Sunshine under the same
49 contact of No - 2.45 2.45 - - -
Technology Co., controlling shareholder
related credit
Ltd. and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
50 Electronics Tech. contact of No - 1.54 1.54 - - -
controlling shareholder
Co., Ltd. related credit
and ultimate controller
Other enterprise control
Operational
Sichuan Hongxin under the same
51 contact of No 4.50 3.80 8.30 - - -
Software Co., Ltd. controlling shareholder
related credit
and ultimate controller
Other enterprise control
Sichuan Hongcheng Operational
under the same
52 Real Estate Co., contact of No 14.74 9.46 24.20 - - -
controlling shareholder
Ltd. related credit
and ultimate controller
Other enterprise control
Operational
Sichuan Jiahong under the same
53 contact of No 0.37 - 0.37 - - -
Industrial Co., Ltd. controlling shareholder
related credit
and ultimate controller
Sichuan Changhong Other enterprise control Operational
54 New Energy under the same contact of No 17.32 35.22 27.73 - - 24.81
Technology Co., controlling shareholder related credit
132
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Ltd. and ultimate controller
Other enterprise control
Sichuan Changhong Operational
under the same
55 Electronic System contact of No - 2.60 2.60 - - -
controlling shareholder
Co., Ltd. related credit
and ultimate controller
Other enterprise control
Operational
under the same
56 Orion.PDP.Co.,ltd contact of No 1,008.30 2,626.30 1,391.58 - - 2,243.02
controlling shareholder
related credit
and ultimate controller
Changhong Other enterprise control
Operational
International under the same
57 contact of No 11.11 75.73 84.66 - - 2.18
Holdings (Hong controlling shareholder
related credit
Kong) Co., Ltd. and ultimate controller
Total 41,144.29 325,801.48 304,906.84 - - 62,038.93
2.Debts payable to related party
Current Current Balance at
Balance at Amount
newly interest period-end
Seria period-begin returned (10 Interes
Related party Relationship Causes added(10 (10 (10
l (10 thousand thousand t rate
thousand thousand thousand
Yuan) Yuan)
Yuan) Yuan) Yuan)
Sichuan Changhong Controlling shareholder Operational contact of
1 6,195.50 39,504.62 44,146.67 - - 1,553.45
Electric Co., Ltd. and ultimate controller related debt
Sichuan Changhong
Controlling shareholder Operational contact of
2 Electronics Holding 0.51 495.26 415.51 - - 80.26
and ultimate controller related debt
Group Co., Ltd.
133
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other enterprise control
CHANGHONG(HK)TR under the same Operational contact of
3 246.66 - 39.05 - - 207.60
ADINGLIMITED controlling shareholder related debt
and ultimate controller
Other enterprise control
CHANGHONGELECTR under the same Operational contact of
4 0.16 - 0.16 - - -
ICMIDDLEEASTFZE controlling shareholder related debt
and ultimate controller
Other enterprise control
Guangdong Changhong under the same Operational contact of
5 223.89 800.46 1,024.36 - - -
Electronics Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Changhong Huayi under the same Operational contact of
6 10,565.03 53,323.45 53,277.26 - - 10,611.22
Compressor Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Lejiayi Chain under the same Operational contact of
7 8.22 - 6.19 - - 2.03
Management Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Zhiyijia Network under the same Operational contact of
8 57.19 762.01 818.47 - - 0.74
Technology Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
9 Intelligent Manufacturing 1,031.26 3,928.03 3,787.16 - - 1,172.12
controlling shareholder related debt
Tech. Co., Ltd.
and ultimate controller
134
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other enterprise control
Sichuan Hongwei under the same Operational contact of
10 165.84 65.54 231.38 - - -
Technology Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Service Exp.
under the same Operational contact of
11 Appliance Service Chain 558.45 19,496.07 20,028.65 - - 25.87
controlling shareholder related debt
Co., Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
12 Package Printing Co., 3,463.89 10,413.66 12,942.04 - - 935.51
controlling shareholder related debt
Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong under the same Operational contact of
13 - 0.49 -0.00 - - 0.49
Power Source Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong under the same Operational contact of
14 941.09 - 938.77 - - 2.33
Device Tech. Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
15 Electronic Products Co., 2,924.29 2,718.80 - - 205.49
controlling shareholder related debt
Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
16 Gerun Environmental 114.88 11.56 67.58 - - 58.85
controlling shareholder related debt
Protection Tech. Co., Ltd.
and ultimate controller
135
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other enterprise control
Sichuan Changhong
under the same Operational contact of
17 International Hotel Co., 4.28 38.86 30.99 - - 12.15
controlling shareholder related debt
Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong Jijia under the same Operational contact of
18 10,612.53 30,669.97 39,509.96 - - 1,772.54
Fine Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
19 Precision Electronics 3,790.08 6,325.00 10,011.60 - - 103.47
controlling shareholder related debt
Tech. Co., Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
20 Minsheng Logistics Co., 3,268.72 53,790.08 52,341.60 - - 4,717.20
controlling shareholder related debt
LTD
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
21 Mold Plastic Tech. Co., 17,964.15 73,365.32 88,375.55 - - 2,953.92
controlling shareholder related debt
Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong under the same Operational contact of
22 30.69 - 30.69 - - -
Xinrui Tech. Co. Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong New
under the same Operational contact of
23 Energy Technology Co., - 4.18 4.18 - - -
controlling shareholder related debt
Ltd.
and ultimate controller
136
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other enterprise control
Beijing Changhong Tech. under the same Operational contact of
24 - 36.47 36.47 - - -
Co. Ltd, controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
25 Electronic System Co., - 4.74 4.74 - - -
controlling shareholder related debt
Ltd.
and ultimate controller
Other enterprise control
Sichuan Jiahong under the same Operational contact of
26 2.83 39.62 38.12 - - 4.33
Industrial Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Hongxin under the same Operational contact of
27 56.47 633.40 687.75 - - 2.12
Software Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
四川虹城建筑工程有限 under the same Operational contact of
28 - 45.05 45.05 - - -
公司 controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
29 International Travel - 87.00 87.00 - - -
controlling shareholder related debt
Service Co., Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
30 Property Service Co., 0.41 297.62 298.03 - - -
controlling shareholder related debt
Ltd.
and ultimate controller
137
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other enterprise control
Hefei Changhong New
under the same Operational contact of
31 Energy Science & - 37.75 37.75 - - -
controlling shareholder related debt
Technology Co., Ltd.
and ultimate controller
Other enterprise control
Mianyang Technology
under the same Operational contact of
32 Town Big Data 26.01 15.87 - - 10.14
controlling shareholder related debt
Technology Co., Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
33 Jiahua Information 0.60 0.60 - - -
controlling shareholder related debt
Products Co., Ltd.
and ultimate controller
Other enterprise control
BVCH Optronics under the same Operational contact of
34 6.79 6.79 - - -
(Sichuan) Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Huanyu under the same Operational contact of
35 564.83 264.83 - - 300.00
Industrial Co. Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
36 Energy Sunshine 91.30 86.00 - - 5.30
controlling shareholder related debt
Technology Co., Ltd.
and ultimate controller
Other enterprise control
Hunan Grand-Pro
under the same Operational contact of
37 Intelligent Tech. 230.21 181.46 - - 48.75
controlling shareholder related debt
Company
and ultimate controller
138
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other enterprise control
Sichuan Aichuang under the same Operational contact of
38 5,405.54 4,503.14 - - 902.40
Technology Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
39 Communication Tech. 2.58 2.58 - - -
controlling shareholder related debt
Co., Ltd.
and ultimate controller
Other enterprise control
Yuanxin Financial Lease under the same Operational contact of
40 0 168.68 0.00 - - 168.68
Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
under the same Operational contact of
41 081 Electronic Group 353.50 184.39 535.39 - - 2.51
controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Ailian Science & under the same Operational contact of
42 181.66 1,167.16 1,178.63 - - 170.19
Technology Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
43 Education Technology 21.13 - 21.13 - - -
controlling shareholder related debt
Co., Ltd.
and ultimate controller
Other enterprise control
Sichuan Changhong
under the same Operational contact of
44 Network Technology Co., 0.02 38.94 37.62 - - 1.35
controlling shareholder related debt
Ltd.
and ultimate controller
139
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other enterprise control
Chengdu Changhong
under the same Operational contact of
45 Electronic Technology - 47.96 47.96 - - -
controlling shareholder related debt
Co., Ltd.
and ultimate controller
Other enterprise control
Sichuan Hongcheng Real under the same Operational contact of
46 - 39.32 39.32 - - -
Estate Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
GuangYuan Changhong
under the same Operational contact of
47 Electronic Technology 3.71 27.34 0.00 - - 31.04
controlling shareholder related debt
Co., Ltd.
and ultimate controller
Other enterprise control
Yibin Red-Star under the same Operational contact of
48 58.20 - 58.20 - - -
Electronics Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
Hefei Changhong under the same Operational contact of
49 0.23 2.13 0.00 - - 2.36
Industrial Co., Ltd. controlling shareholder related debt
and ultimate controller
Other enterprise control
ChanghongEuropeElectri under the same Operational contact of
50 0.44 - 0.44 - - -
cs.r.o controlling shareholder related debt
and ultimate controller
Other enterprise control
Sichuan Hongyu Metal under the same Operational contact of
51 89.39 134.82 222.74 - - 1.47
Manufacturing Co., Ltd. controlling shareholder related debt
and ultimate controller
140
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Total 60,011.01 305,239.09 339,184.22 - - 26,065.88
For the above-mentioned statement, up to the Period-end, debts payable to related party from the Company and subordinate are amounting as 260,658,800 Yuan in
total, the claim receivable from related party for the Company and subordinate amounting as 620,389,300 Yuan.
141
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(v) Other related transactions
√ Applicable □ Not applicable
1. On August 14, 2018, the resolution of the 14th meeting of the ninth board of directors of the company passed
and agreed the company to newly add the planning for purchasing cleaning robots from Hunan Grand-Pro
Intelligent Tech. Company, a subsidiary of Changhong Huayi Compressor Co., Ltd., by the company and its
holding subsidiaries and other daily related transactions in 2018 amounting to 6.5 million yuan at most (excluding
tax).
2. On December 10, 2018, the resolutions of the 17th meeting of the ninth board of directors and the 9th meeting of
the ninth board of supervisors of the company passed and agreed the company to newly add the planning on sales
of goods and purchase of goods between the company and its holding subsidiaries with Sichuan Changhong Mold
Plastic Tech. Co., Ltd.., a subsidiary of Sichuan Changhong Electric Co., Ltd. (hereinafter referred to as “Sichuan
Changhong”), and Sichuan Changhong Electronics Holding Group Co., Ltd. and its subsidiaries and other daily
related transactions in 2018 amounting to 110 million yuan at most(excluding tax).
3. On December 10 and December 27, 2018, the resolutions of the 17th meeting of the ninth board of directors and
the 9th meeting of the ninth board of supervisors of the company and the 4th extraordinary general meeting of 2018
passed and agreed the estimated daily related transactions between the company and its holding subsidiaries with
the related parties in 2019 is not more than 12,362.30 million yuan (excluding tax).
4. On December 10 and December 27, 2018, the resolutions of the 17th meeting of the ninth board of directors and
the 9th meeting of the ninth board of supervisors of the company and the 4th extraordinary general meeting of 2018
passed and agreed the company to continue to carry out related transactions in financial services such as deposits
and loans with Sichuan Changhong Group Finance Co., Ltd. in 2019.
Related searches for disclosure website of interim report with major related transaction concerned
Interim report Disclosure date Website for disclosure
Notice of Resolution of 14th session of 9th BOD (No.: 2018-047);
Juchao Website:
New Prediction of the Routine Related Transactions for Year of 15 August 2018
http://www.cninfo.com.cn
2018 (No.: 2018-052)
Notice of Resolution of 17th session of 9th BOD (No.: 2018-071);
Notice of Resolution of 9th session of 9th Supervisory Committee
(No.: 2018-072); 11 December 2018 Juchao Website:
New Prediction of the Routine Related Transactions for Year of 28 December 2018 http://www.cninfo.com.cn
2018 (No.: 2018-073)
Prediction of the Continuous Related Transactions with Sichuan
142
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Changhong Group Finance Co., Ltd. For 2019 (No.: 2018-074);
Prediction of the Routine Related Transactions for Year of 2019
(No.: 2018-075);
Notice of Resolution of 4th Interim Shareholders General Meeting
of 2018 (No.: 2018-079)
XVII. Significant contract and implementations
(i) Entrust, contract and leasing
1. Entrust
□ Applicable √ Not applicable
No entrust in Period.
2. Contract
□ Applicable √ Not applicable
No contract in Period.
3. Leasing
√ Applicable □ Not applicable
(1) Leasing
Operational leasing of the Company please found more details in “investment real estate”, “fixed assets”, “Lease
of related party” and “Rent of related party” in Note of Financial Statement.
(2) Gains/losses to the Company from projects that reached over 10% in total profit of the Company
in reporting period
□ Applicable √ Not applicable
No gains or losses to the Company from projects that reached over 10% in total profit of the Company in
reporting period.
(ii) Major guarantee
√ Applicable □ Not applicable
1. Guarantee
During the reporting period, the company did not provide guarantees to any legal person or natural person other
than the wholly-owned and holding subsidiaries. The guarantees provided by the company to the wholly-owned
and holding subsidiaries are guarantees for supporting bank credits generated by its production and operation. The
guaranty style is the guarantee.
143
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Up to 31 December 2018, the company guaranteed for the bank credit of parts of the wholly-owned and
controlling subsidiaries of the Company, balance of guarantee are including in the limit approved by Shareholder
General Meeting and the Board. The external guarantees of the Company and subsidiaries are as follows:
In 10 thousand Yuan
Particulars about the external guarantee of the Company and subsidiaries (Barring the guarantee for subsidiaries)
Name of Complet
the Guaran Actual date of Actual Guaran e Guarantee
Related Announcement
Company tee happening (Date of guarante Guarantee type tee impleme for related
disclosure date
guarantee limit signing agreement) e limit term ntation party
d or not
Notice No.: 2015-038,
No. : 2015-040 and
No.:2015-064 released on
Dealer of 29 Aug. 2015 and 23 Dec.
Changhon 2015 respectively; Notice Joint liability One
20,000 29 June 2016 15.00 Yes No
g Meiling No.:2016-068, guaranty year
Co., Ltd. No.:2016-072 and No.:
2016-077 released on 26
Nov. 2016 and 14 Dec.
2016
Notice No.:2015-038,
No.: 2015-040 and
Dealer of
No.:2015-064 released on
Sichuan
29 Aug. 2015 and on 23
Changhon
Dec. 2015 respectively; Joint liability One
g 20,000 14 Oct. 2016 111.00 Yes No
Notice No.:2016-068, guaranty year
Air-condi
No.: 2016-072 and
tioner
No.:2016-077 released on
Co., Ltd.
26 Nov. 2016 and 14 Dec.
2016
Total actual occurred
Total approving external guarantee
0 external guarantee in 126.00
in report period (A1)
report period (A2)
Total actual balance of
Total approved external guarantee at external guarantee at the
0 0
the end of report period ( A3) end of report period
(A4)
Guarantee between the Company and the subsidiaries
Name of Complet
Guaran Actual date of Actual Guaran Guarantee
the Related Announcement e
tee happening (Date of guarante Guarantee type tee for related
Company disclosure date impleme
limit signing agreement) e limit term party
guarantee ntation
144
CHANGHONG MEILING CO.,LTD. Annual Report 2018
d or not
Notice No.:2016-027,
No.:2016-031 and
Joint liability One
No.:2016-046 released on 56,500 28 Oct. 2016 5,000 Yes No
guaranty year
25 March 2016 and 5
May respectively
Joint liability One Yes No
22 Jan. 2017 5,500
guaranty year
Joint liability One Yes No
24 Feb. 2017 6,000
guaranty year
Notice No.:2017-010,
Joint liability One Yes No
No.:2017-014 and 1 Mar. 2017 20,000
guaranty year
No.:2017-031 released on 70,000
Joint liability One Yes No
30 March 2017 and 5 23 June 2017 10,000
guaranty year
May respectively
Joint liability One Yes No
24 July 2017 5,000
guaranty year
Zhongsha
n Joint liability One Yes No
6 Nov. 2017 10,000
Changhon guaranty year
g Electric Joint liability One No
30 March 2018 10,000 No
Co., LTD guaranty year
Joint liability One No No
11 April 2018 6,000
guaranty year
Joint liability One No No
12 April 2018 5,000
guaranty year
Notice No.:2018-005,
Joint liability One No No
No.:2018-009 and 18 April 2018 5,500
guaranty year
No.:2018-029 released on 70,000
Joint liability One No No
30 March 2018 and 11 21 August 2018 5,000
guaranty year
May respectively
Joint liability One No No
11 Sept.2018 10,000
guaranty year
Joint liability One No No
11 Oct. 2018 5,000
guaranty year
Joint liability One No No
25 Oct. 2018 10,000
guaranty year
Joint liability One Yes
Guangdo Notice No.:2017-010, 13 August 2017 4,500 No
No.:2017-014 and guaranty year
ng
Changhon No.:2017-031 released on 10,500 Joint liability One Yes No
14 Nov. 2017 4,000
g Ridian 30 March 2017 and 5 guaranty year
Technolo May respectively 15 Dec. 2017 2,000 Joint liability One Yes No
145
CHANGHONG MEILING CO.,LTD. Annual Report 2018
gy Co., guaranty year
Ltd. Notice No.:2018-005, Joint liability One No
31 Aug. 2018 4,000 No
No.:2018-009 and No.: guaranty year
2018-029 released on 30 25,500 Joint liability One No
March 2018 and 11 May 22 Sept. 2018 4,500 guaranty year No
respectively
Notice No.:2017-010, Joint liability One Yes No
16 Feb. 2017 2,000
No.:2017-014 and guaranty year
No.:2017-031 released on 6,000 Joint liability One Yes No
Zhongke
30 March 2017 and 5 23 June 2017 1,000 guaranty year
Meiling
May respectively
Cryogeni
Notice No.:2018-005, Joint liability One Yes No
c 30 Jan. 2018 2,000
No.:2018-009, No.: guaranty year
Technolo
2018-029, No.:2018-056 Joint liability One No
gy Co.,
and No.: 2018-059 9,000 29 June 2018 1,000 No
Ltd. guaranty year
released on 30 March
Joint liability One No
2018, 11 May and 18 Oct. 20 July 2018 2,000 guaranty No
year
respectively
Sichuan
Notice No.:2018-005,
Changhon
No.:2018-009 and No.:
g
2018-029 released on 30 70,000 - - - - - -
Air-condi
March 2018 and 11 May
tioner
respectively
Co., Ltd.
Changhon
Notice No.:2018-061 and
g RUBA
No.: 2018-063 released 6,264 - - - - - -
Trade
on 9 Nov. 2018
Company
Jiangxi Notice No.:2018-061,
Meiling No.:2018-064 and No.:
Electric 2018-069 released on 9 25,000 - - - - - -
Appliance Nov. 2018 and 28 Nov.
Co., Ltd. respectively
Total amount of actual
Total amount of approving guarantee occurred guarantee for
205,764 140,000
for subsidiaries in report period (B1) subsidiaries in report
period (B2)
Total balance of actual
Total amount of approved guarantee
guarantee for subsidiaries
for subsidiaries at the end of 205,764 68,000
at the end of reporting
reporting period (B3)
period (B4)
146
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Guarantee of the subsidiaries for the subsidiaries
Name of Complet
the Guaran Actual date of Actual Guaran e Guarantee
Related Announcement
Company tee guarante Guarantee type tee impleme for related
disclosure date happening
guarantee limit e limit term ntation party
d or not
- - - - - - - - -
Total amount of actual
Total amount of approving guarantee occurred guarantee for
0 0
for subsidiaries in report period (C1) subsidiaries in report
period (C2)
Total balance of actual
Total amount of approved guarantee
guarantee for subsidiaries
for subsidiaries at the end of 0 0
at the end of reporting
reporting period (C3)
period (C4)
Total amount of guarantee of the Company (total of three above mentioned guarantee)
Total amount of actual
Total amount of approving guarantee occurred guarantee in
205,764 140,126.00
in report period (A1+B1+C1) report period
(A2+B2+C2)
Total balance of actual
Total amount of approved guarantee
guarantee at the end of
at the end of report period 205,764 68,000
report period
(A3+B3+C3)
(A4+B4+C4)
Ratio of actual guarantee (A4+B4+C4) in net assets of the Company 13.56%
Including:
Amount of guarantee for shareholders, actual controller and its
0
related parties (D)
The debts guarantee amount provided for the guaranteed parties
56,500
whose assets-liability ratio exceed 70% directly or indirectly (E)
Proportion of total amount of guarantee in net assets of the
0
Company exceed 50% (F)
Total amount of the aforesaid three guarantees (D+E+F) 56,500
Explanations on possibly bearing joint and several liquidating
N/A
responsibilities for undue guarantees (if applicable)
Explanations on external guarantee against regulated procedures (if
N/A
applicable)
Note: During the reporting period, the company and its subsidiary, Sichuan Changhong Air-conditioner Co., Ltd.,
did not provide joint liability for the dealers’ credit line within the designated bank. The accrual during the
reporting period was mainly the bank acceptance bills that have occurred within the guarantee amount in the
previous year (2017) but were still subject to guarantee obligations.
The above guarantees are all wholly-owned and holding subsidiaries of the Company. Production and operation of
147
CHANGHONG MEILING CO.,LTD. Annual Report 2018
these wholly-owned and holding subsidiaries was normal with no overdue unpaid loans and guarantee risk is
controllable. During the reporting period, the highest level of security the Company provided amounted to
2057.64 million Yuan by the approval, the actual amount of guarantee is 1401.26 million Yuan. At the end of the
reporting period, the practical guarantee balance amounted to 680 million Yuan, accounting for the Company’s
latest net assets ratio of 13.56%.
Explanation on guarantee with composite way: Not applicable
2. Guarantee outside against the regulation
□ Applicable √ Not applicable
No guarantee outside against the regulation in Period.
(iii) Entrust others to cash asset management
1. Trust financing
√ Applicable □ Not applicable
Trust financing in the period
In 10 thousand Yuan
Type Capital resources Amount for entrust Undue balance Overdue amount
Bank financing Idle raised fund 186,000 91,000 0
Idle self-owned
Broker financing 20,000 20,000 0
capital
Idle self-owned
Trust products 60,000 0 0
capital
Total 266,000 111,000 0
Details of the single major amount, or high-risk trust investment with low security, poor fluidity and
non-guaranteed:
√ Applicable □ Not applicable
148
CHANGHONG MEILING CO.,LTD. Annual Report 2018
In 10 thousand Yuan
Amou
nt of
reserv Wheth
Whether
e for er
has Summary of the
Criteria Actual devalu approv
Trustee Source Reference Anticipated Actual entrust items and
Trustee Start End for collected ation ed by
institution r Type Amount of Capital investment purpose annual rate income (if gains/losses finance related query
type date date fixing gains/losses of legal
name funds of return applicable) in period plan in index (if
reward in period withdr proced
the applicable)
awing ure
future
(if (Y/N)
applic
able)
The bank deposits, government
bonds, financial bonds, central bank
bills, enterprise bonds with AA+
rating, enterprise short-term
financing bonds with short-term
credit ratings of A-1 and above,
bond reverse repurchases, bank
Earmark financial products, money market
Juchao
Sichuan ed Self-o funds, and other money market Annual Not
30 Nov. 30 Nov. Website(www.c
Trust Co., Trust capital 60,000 wned products; the asset management yield of 6.10% 3,660.00 3,443.50 3,443.50 N/A Yes applicab
2017 2018 ninfo.com.cn)(N
Ltd. trust capital plans issued by securities 6.10% le
o.: 2017-095)
schemes companies; the asset management
plans issued by special fund
subsidiaries; the trust products
issued by trust companies or
transferring trust beneficiary right;
the transferring usufruct of
receivables; the insurance funds of
trust industries, etc.
The asset is planned to invest in the
Juchao
Asset Jinshiqi Phase II debt financing plan
Soochow Self-o Maturity Not Website(www.c
manage 12 April 12 April of 2018 issued by Jinshiqi
Securities Broker 20,000 wned liquidati 8.28% 4,968.00 - - N/A Yes applicab ninfo.com.cn)(N
ment 2018 2021 International Holdings Co., Ltd. at
Co., Ltd. capital on le o.: 2018-014;
plan the Beijing Financial Assets
No.: 2018-015)
Exchange.
Hefei Idle Annual Not
Floating 12 Jan. 28 March Take the funds collected by the Juchao
Branch of Bank 50,000 raised structured deposit sales as the yield of 4.80% 493.15 493.15 493.15 N/A Yes applicab Website(www.c
income 2018 2018
CMBC fund nominal principal, and trade the 4.80% le ninfo.com.cn)(N
149
CHANGHONG MEILING CO.,LTD. Annual Report 2018
capital cost of the nominal principal o.: 2018-002)
as investment income and financial
derivatives transactions related to
USD3M-LIBOR with the counter
party.
The principal of this financial
product is included in the unified
operations management of bank
funds. The product investment scope Juchao
Anhui Income- Idle is money market instruments and Annual Not
16 Jan. 27 June Website(www.c
Branch of Bank guarante 56,000 raised fixed income instruments, in which yield of 4.90% 1,217.88 1,217.88 1,217.88 N/A Yes applicab
2018 2018 ninfo.com.cn)(N
BOC ed fund money market instruments account 4.90% le
o.: 2018-002)
for 30%-100%, and fixed income
instruments account for 0-30%.
The funds collected by the structured
deposit sales is used as the notional
Chengdu principal, and the fund cost of the Juchao
Idle notional principal is traded with the Annual Not
Branch of Floating 26 April 26 July Website(www.c
Bank 50,000 raised counter party as investment income yield of 4.70% 585.89 585.89 585.89 N/A Yes applicab
China Citic income 2018 2018 ninfo.com.cn)(N
fund and financial derivatives linked to 4.70% le
Bank o.: 2018-025)
USD3M-LIBOR.
The funds collected by the structured
deposit sales is used as the notional
principal, and the fund cost of the Juchao
Anhui Idle Annual Not
Floating 29 June 26 Sept. notional principal is traded with the Website(www.c
Branch of Bank 30,000 raised yield of 5.05% 369.41 369.41 369.41 N/A Yes applicab
income 2018 2018 counter party as investment income ninfo.com.cn)(N
BOC fund 5.05% le
and financial derivatives linked to o.: 2018-042)
3MShibor benchmark comparison
value.
Take the funds collected by the
structured deposit sales as the
nominal principal, and trade the
capital cost of the nominal principal Annual Juchao
Anhui Idle Not
Floating 29 June 26 Dec. as investment income and financial yield of Website(www.c
Branch of Bank 10,000 raised 5.05% 249.04 249.04 249.04 N/A Yes applicab
income 2018 2018 derivatives transactions related to 5.05% ninfo.com.cn)(N
BOC fund le
comparison value of 3MShibor with o.: 2018-042)
the counter party.
Hefei Idle Foreign currency structured financial Annual Not Juchao
Floating 28 June 19 Dec.
Branch of Bank 10,000 raised products (it refers to the structured yield of 5.00% 238.36 241.67 241.67 N/A Yes applicab Website(www.c
income 2018 2018
BEA fund financial products provided by the 5.00% le ninfo.com.cn)(N
150
CHANGHONG MEILING CO.,LTD. Annual Report 2018
bank to the customer under the o.: 2018-042)
premise that the customer
voluntarily undertakes the relevant
market risks which link certain funds
to the specified exchange rate one or
several foreign currencies), linking
indicator: Australian dollar Against
the US dollar.
Chengdu The structured deposit product, the Juchao
Idle Annual Not
Branch of Floating 9 Aug. 19 Dec. structural derivatives tied with the Website(www.c
Bank 48,000 raised yield of 4.35% 755.11 755.11 755.11 N/A Yes applicab
China Bohai income 2018 2018 3-month interbank lending rate in ninfo.com.cn)(N
fund 4.35% le
Bank London (Libor) o.: 2018-046)
Take the funds collected by the
structured deposit sales as the
nominal principal, and trade the
capital cost of the nominal principal Annual Juchao
Anhui Idle Not
Floating 28 Sept. 26 Dec. as investment income and financial yield of Website(www.c
Branch of Bank 26,000 raised 4.40% 278.95 278.95 278.95 N/A Yes applicab
income 2018 2018 derivatives transactions related to 4.40% ninfo.com.cn)(N
BOC fund le
comparison value of 3MShibor with o.: 2018-053)
the counter party.
Chengdu The structured deposit product, the Juchao
Idle Annual Not
Branch of Floating 21 Dec. 10 June structural derivatives tied with the Website(www.c
Bank 48,000 raised yield of 4.20% 944.48 - - N/A Yes applicab
China Bohai income 2018 2019 3-month interbank lending rate in ninfo.com.cn)(N
fund 4.20% le
Bank London (Libor) o.: 2018-078)
Investment of the central bank bill in
Break-e bank market, treasury bond,
Juchao
Hefei ven & Idle corporate bonds, short-term Annual Not
26 Dec. 30 Jan. Website(www.c
Branch of Bank income 23,000 raised financing, medium-term bills, yield of 3.95% 87.12 - - N/A Yes applicab
2018 2019 ninfo.com.cn)(N
SPD Bank protectio fund inter-bank borrowing, inter-bank 3.95% le
o.: 2018-080)
n deposits, bills or bill repurchase
etc.
The principal of funds raised by this
structured deposit is included in the
unified operations management of
the funds of China Guangfa Bank. Annual Juchao
Hefei Idle Not
Floating 27 Dec. 28 Jan. The proportion of investment in yield of Website(www.c
Branch of Bank 10,000 raised 3.90% 34.19 - - N/A Yes applicab
income 2018 2019 money market instruments 3.90% ninfo.com.cn)(N
CGB fund le
(including but not limited to bank o.: 2018-080)
deposits, inter-bank lending,
buy-back, etc.) ranges from 20% to
100%, and the proportion of bonds
151
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(including but not limited to national
debt, central bank bills, financial
bonds, short-term financing bonds,
enterprise bonds, medium-term
notes, corporate bonds) and other
financial assets ranges from 0% to
80%, and the income is invested in
the financial derivatives linking to
the exchange rate of the US dollar
against the Hong Kong dollar.
The product is mainly composed of
risk-free assets investment and
option trading. The product principal
Mianyang Break-e is invested in bank fixed time Juchao
Branch of ven & Idle deposits, and the corresponding Annual Not
28 Dec. 28 Jan. Website(www.c
China Bank income 10,000 raised application of funds is based on the yield of 3.75% 31.85 - - N/A Yes applicab
2018 2019 ninfo.com.cn)(N
Everbright protectio fund bank deposits, and the income is 3.75% le
o.: 2018-081)
Bank n linked to the bank’s comprehensive
liability cost.
Total 451,000 -- -- -- -- -- -- 13,913.43 7,634.60 -- -- -- -- --
152
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Entrust financial expected to be unable to recover the principal or impairment might be occurred
□ Applicable √ Not applicable
2. Entrust loans
□ Applicable √ Not applicable
No entrust loans in the period.
(iv) Other material contracts
□ Applicable √ Not applicable
No other material contracts in the period
XVIII. Social responsibility
(i) Performance of social responsibility: Not applicable
(ii) Fulfill the precise social responsibility for poverty alleviation
The Company has no precise social responsibility for poverty alleviation in the period and has no
follow-up plan either.
(iii) Environment protection
The listed Company and its subsidiary whether belongs to the key sewage units released from
environmental protection department:
√ Yes □ No
153
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Distributio Total
Name of number of Discharge
Major pollutants and Way of n of concentration of Pollutants discharge standards discharge
company or discharge Total discharge volume beyond the
name of typical pollutants discharge discharge discharge enacted volume
subsidiary outlets standards
outlets certified
Concentration of Total discharge volume of
particulates The Emission Standards for Air particulates for the year of
discharge:2.7mg/m Pollutants (GB 16297-1996) applies 2018:86.27kg;
Sichuan Changhong
Air-conditioner Co., Discharge to exhaust emission, that is
Sichuan Ltd. -Exhaust constitutes to air after Concentration of secondary standard- concentration Total discharge volume of Satisfy the
Distributed
Changhong the major pollutants, and the satisfying NMHC emission: of particulates discharge: NMHC for the year of standards for Not beyond the
12 in related
Air-conditio typical pollutants comprise the 63.7mg/m； ≤120mg/m 2018: 1437.78kg; total volume standards
workshops
ner Co., Ltd. of NMHC, smoke discharge Concentration of NMHC control
particulates, tin and its standards Concentration of tin and emission:≤120mg/m Total discharge volume of
compound. its compound Concentration of tin and its tin and its compound for
discharge:0.0494mg/m compound discharge:≤8.5mg/m the year of 2018: 2.29kg
The Emission Limits for Air
Concentration of
Pollutants (DB44/27—2001)
Discharge particulates discharge＜
Exhaust constitutes the applies to exhaust emission.
Zhongshan to air after 1#Worksh 20mg/m Satisfy the
major pollutants, and the Concentration of particulates
Changhong satisfying op and Concentration of 48,000,000 standard standards for Not beyond the
typical pollutants comprise 2 discharge:120mg/ m
Electric Co., the 2#Worksh NMHC cubic meters total volume standards
of particulates, NMHC and Concentration of NMHC
LTD discharge op emission:2.54mg/ m control
odor concentration. emission:120mg/ m
standards Concentration of stink:
Concentration of stink: 2000
1318 non-dimensional.
non-dimensional.
154
CHANGHONG MEILING CO.,LTD. Annual Report 2018
1.Construction and operation of pollution prevention facilities
The Company and its subsidiaries actively respond to the national ecological civilization construction plan, and
actively participate in national environmental protection works in line with the purpose of actively fulfilling its
corporate social responsibility. In recent years, The Company and its subsidiaries have actively explored the
introduction of advanced management concepts and methods, and invested a large amount of money in the
purchase of pollution control equipment and facilities notwithstanding they have already fully met the emission
standards, just to further bring down and reduce discharge of corporate pollutants and realize emission reduction
by scientific technical methods. At the same time, in order to ensure the effective operation of the management
equipment and facilities, the Company and its subsidiaries have adopted such management measures as setting up
special personnel to manage and maintain the operation of the equipment and facilities, formulating proper rules
for operation and maintenance of the equipment and facilities, emergency disposal regulations, supervision and
assessment mechanism, allocating special maintenance funds and so on, so as to ensure the effective operation of
the governing facilities in a full round, delivering its best to protect and improve the ecological environment
around the enterprise.
2. Environment impact assessment and other required environment protection administrative license for
construction projects
The Company and its subsidiaries earnestly implement the Environmental Protection Law, the Environmental
Impact Assessment Law and the Regulations on Environmental Protection Management of Construction Projects,
consciously abide by environmental protection laws and regulations, industry requirements and government
regulations. For new, renovated and expanded projects, the Company and its subsidiaries adhere to the project
environmental impact assessment and "three simultaneous" system, fully implement environmental protection
measures, act well in environment protection management in respect of project planning, design, construction and
operation, make full use of advanced crafts and technological means to reduce environmental pollution.
Environmental impact assessment is carried out synchronously while making the feasibility study for a
construction project. Third-party professional parties are engaged to analyze the industrial policy, land use
planning, environmental impact and the feasibility of environmental protection measures of the project.
Construction will be started only after approved by the competent environmental protection authorities. During
the construction, environmental protection requirements are earnestly implemented, environmental protection
facilities are built synchronously, environmental protection acceptance of the project is arranged in time upon
completion of the project to ensure that the project meets the acceptance criteria and could be put into official
operation with all the environmental impact assessment requirements met. During the operation period, the
Company conducts pollution prevention to ensure the normal operation of environmental protection facilities in
strict compliance with the relevant environmental impact assessment documents and the reply requirements of the
competent environmental protection authorities.
3. Emergency plan for environmental emergencies
The Company and its subsidiaries have set up related emergency plans for environmental emergencies. The
Company and its subsidiaries have determined classified warning based on the different extent and severity of
environmental impacts that may be caused by the material environmental factors, defined the responsibilities for
155
CHANGHONG MEILING CO.,LTD. Annual Report 2018
emergency response, regulated emergency handling procedures, established special team to handle emergencies
and organized regular rehearsal and appraisal of relevant emergency plans, so as to ensure the effectiveness of
these plans, improve their capability of emergency handling and take precautions against contingent emergencies.
4. Independent plan to monitor environment
The Company and its subsidiaries have established regular monitoring plan for environmental pollutants, set up
special funds for pollutants monitoring, and engaged third-party authoritative to regularly monitor the operation of
major pollution-production links and environmental protection treatment facilities in connection with the major
pollutants produced by the Company and its subsidiaries, to make sure that the Company and its subsidiaries
could achieve emission standards in a full round.
5. Other environment information that should be disclosed
According to the Environmental Information Disclosure Measures of Enterprises and Institutions, the Company
and its subsidiaries have realized the disclosure of information relating to environmental impact assessment,
project acceptance, pollutants production and discharge, solid waste management, important environmental
factors, environmental objectives and performance of construction projects.
6. Other environment related information
In order to further realize the scientific and systematic environmental protection work of the Company and its
subsidiaries, the Company and its subsidiaries have established an environmental management system in
accordance with ISO14001 standards, set up an environmental protection organization, acquired environmental
protection resources, regularly identified, updated and appraised environmental factors, compliance obligations,
environmental risks and opportunities, and regularly determined environmental objectives and management
programs. Through the implementation of management programs and continuous normal improvement, the
environmental performance of the Company and its subsidiaries has been continuously improved. Through regular
internal audit and management review, as well as the verification and examination of the third parties, the
environmental management system of the Company and its subsidiaries has been effectively controlled and fully
meets the system management standards and relevant regulations.
Meanwhile, the Company and its subsidiaries have been rated as environmental integrity enterprises for
consecutive years in the environment credit evaluation organized by environment protection authorities.
XIX. Explanation on other significant events
√ Applicable □ Not applicable
(i)The resolutions of the 7th meeting of the ninth board of directors of the company and the 2017 annual general
meeting of shareholders passed and agreed the company and its subsidiaries to carry out the forward foreign
exchange fund transactions from July 1, 2018 to June 30, 2019, of which the balance does not exceed US$700
million (mainly including US dollar, Australian dollar, Euro, and other foreign exchanges are all converted into
US dollars), and the maximum single-business delivery period is no more than one year. Found more on appointed
156
CHANGHONG MEILING CO.,LTD. Annual Report 2018
media “Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn
that the Company disclosed in the form of announcement (Announcement No. 2018-005, No. 2018-012 and No.
2018-029) on 30 March 2018 and 10 May.
(ii) On March 28 and May 9, 2018, the 7th meeting of the ninth board of directors and the 4th meeting of the ninth
board of supervisors of the company and the 2017 annual general meeting of shareholders reviewed and approved
the Plan for Profits Distribution of the Company in 2017, at the same time, the independent directors of the
company issued independent recognition opinions on the plan, taking into account the interests of shareholders
and the long-term development needs of the company, agreed the company to send cash dividends of 0.6 yuan
(including tax) per every 10 shares to all shareholders based on the total share capital of 1,044,597,881 shares as
of December 31, 2017, totally sending cash dividends of 62,675,872.86 yuan (including tax). After this allocation,
the company’s total share capital remains unchanged, and the remaining undistributed profits of the parent
company were 830,766,775.42 yuan, and the remaining undistributed profits were carried forward in the
subsequent years for distribution.
The notice of implementation for profit distribution plan 2017 was released on 27 June 2018, the plan above
mentioned was completed. Found more on appointed media “Securities Times”, “China Securities Journal”,
“Hong Kong Commercial Daily” and www.cninfo.com.cn that the Company disclosed in the form of
announcement (Announcement No. 2018-0005, No.2018-006, No. 2018-029 and No.2018-040 ) on 30 March
2018, 10 May and 27 June
(iii) The resolutions of the 9th meeting of the ninth board of directors of the company passed and agreed the
company and its subsidiaries to apply for a special credit line of maximum 600 million yuan in the bill pool to
Hangzhou Bank Co., Ltd., Hefei Branch, and agreed the company and its subsidiaries to apply for a special credit
line of maximum 500 million yuan in the bill pool to Hua Xia Bank Co., Ltd,. Hefei Branch, and agreed the
company and its subsidiaries to apply for a special credit line of maximum 1000 million yuan in the bill pool to
Bank of Communications Co., Ltd., Anhui Branch, and agreed the company and its subsidiaries to apply for a
special credit line of maximum 500 million yuan in the bill pool to China Zheshang Bank Co., Ltd., Hefei Branch.
The credit period was one year, and the credit line was mainly used for bill special business, and the bill pledge
method was adopted. Found more on appointed media “Securities Times”, “China Securities Journal”, “Hong
Kong Commercial Daily” and www.cninfo.com.cn that the Company disclosed in the form of announcement
(Announcement No. 2018-005 and No.2018-013 ) on 30 March 2018
(iv)The resolutions of the 8th meeting of the ninth board of directors of the company passed and agreed the
company to use its idle funds of 200 million yuan to subscribe the “Soochow – CMB – Donghui No.135
Directional Asset Management Plan” issued by Soochow Securities Co., Ltd. (hereinafter referred to as “Soochow
Securities”) under the premise of ensuring the capital needs of daily operation and operation and effectively
controlling the investment risks. This asset plan mainly invested in the Jinshiqi Phase II debt financing plan of
157
CHANGHONG MEILING CO.,LTD. Annual Report 2018
2018 issued by Jinshiqi International Holdings Co., Ltd. (hereinafter referred to as “Jinshiqi Holdings”) at the
Beijing Financial Assets Exchange (hereinafter referred to as “CFAE”). Found more on appointed media
“Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn that the
Company disclosed in the form of announcement (Announcement No. 2018-014 and No.2018-015 ) on 13 April
2018
(v) On April 13, 2018, the company received the Notice on the Shareholding Reduction Plan of Hefei Meiling Co.,
Ltd. from Caitong Fund Management Co., Ltd. (hereinafter referred to as “Caitong Fund”) that held more than 5%
of the company’s shares, Caitong Fund held a total of 76,158,362 shares (accounting for 7.29% of the company’s
total share capital) of the company through its asset management plan, and its plan was to reduce its holdings of
the Company’s shares of no more than 62,675,866 shares (not exceeding 6% of the company’s total share capital)
by centralized bidding transactions or block trading or other legal means within six months from April 14, 2018.
On October 12, 2018, the company received the Notice on the Shareholding Reduction Plan of Changhong
Meiling Co., Ltd. from Caitong Fund, Caitong Fund held a total of 66,990,871 shares (accounting for 6.41% of
the company’s total share capital) of the company through its asset management plan, and its plan was to reduce
its holdings of the Company’s shares of no more than 62,675,866 shares (not exceeding 6% of the company’s total
share capital) by centralized bidding transactions or block trading or other legal means within six months from
October 13, 2018. Found more on appointed media “Securities Times”, “China Securities Journal”, “Hong Kong
Commercial Daily” and www.cninfo.com.cn that the Company disclosed in the form of announcement
(Announcement No. 2018-018 and No.2018-055 ) on 14 April 2018 and 13 Oct. 2018
(vi)The resolutions of the 10th meeting of the ninth board of directors of the company and the 2017 annual general
meeting of shareholders passed and agreed to amend some articles of the Articles of Association, newly added
party building work, and clarified the relevant provisions of medium and small investors. Found more on
appointed media “Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and
www.cninfo.com.cn that the Company disclosed in the form of announcement (Announcement No. 2018-022,
No.2018-023 and No.2018-029 ) on 20 April 2018 and 10 May 2018
(vii)The resolution of the 11th meeting of the ninth board of directors of the company passed and agreed the
company to submit a binding offer for the purchase of Gorenje Company’s stock equity in accordance with
relevant regulations. In view of the uncertainty of the matter, it was predicted that the transaction amount would
reach the standard for consideration by the company’s general meeting of shareholders, which might constitute a
major asset restructuring. In order to ensure the fair information disclosure, safeguard the interests of the investors,
and avoid causing abnormal fluctuations in the company’s stock price, the company applied to the Shenzhen Stock
Exchange for suspending the company’s stocks (stock name: Meiling Electric, Wan Meiling B, stock code:
000521, 200521) from the opening on May 9, 2018. On the evening of May 9, 2018 (Beijing time), after the
discussion and negotiation among related parties, the company decided to terminate the bidding due to the large
differences between the company and Gorenje Company and some of its shareholders regarding the acquisition
transaction procedures and prices. Upon application by the company to the Shenzhen Stock Exchange, the
company’s stock resumed trading on May 11, 2018.
158
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Found more on appointed media “Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily”
and www.cninfo.com.cn that the Company disclosed in the form of announcement (Announcement No. 2018-027
and No.2018-028 ) on 9 May 2018 and 11 May 2018
(viii)On June 2, 2018, the company received a written resignation report from Mr. Teng Guangsheng, a
non-independent director of the ninth board of directors of the company. Mr. Teng Guangsheng applied for
resignation from his position as a director of the ninth board of directors and a member of the strategy committee
for his personal reason. Found more on appointed media “Securities Times”, “China Securities Journal”, “Hong
Kong Commercial Daily” and www.cninfo.com.cn that the Company disclosed in the form of announcement
(Announcement No. 2018-031 ) on 5 June 2018
(ix) The resolutions of the 12th meeting of the ninth board of directors of the company and the 2nd extraordinary
general meeting of shareholders in 2018 passed and agreed to change the stock name of the company’s A-share
from “Meiling Electric” to “Changhong Meiling”, change the stock name of the company’s B-share from “Wan
Meiling B” to “Hong Meiling B”, the company’s stock code and business scope remained unchanged. At the same
time, the relevant provisions of the Articles of Association were revised. Found more on appointed media
“Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn that the
Company disclosed in the form of announcement (Announcement No. 2018-032, No.2018-033, No.2018-034, No.
2018-038 and No.2018-043 ) on 5 June 2018, 22 June and 3 July
(x) The resolutions of the 12th meeting of the ninth board of directors of the company and the 2nd extraordinary
general meeting of shareholders in 2018 passed and agreed to elect Mr. Hu Zhaogui as a non-independent director
of the ninth board of directors of the company for a term of office consistent with the term of the ninth board of
directors. The resolutions of the 13th meeting of the ninth board of directors of the company passed and agreed to
engage Mr. Hu Zhaogui as the company’s vice president for a term of office consistent with the term of the current
board of directors. Found more on appointed media “Securities Times”, “China Securities Journal”, “Hong Kong
Commercial Daily” and www.cninfo.com.cn that the Company disclosed in the form of announcement
(Announcement No. 2018-032, 2018-038 and No.2018-039 ) on 5 June 2018, 22 June and 22 June
(xi)The resolution of the 12th meeting of the ninth board of directors of the company passed and agreed the
company and its subsidiaries to apply for a special credit line of maximum 300 million yuan in the bill pool to
Ping An Bank Co., Ltd., Heifei Branch, the credit period was one year, and the credit line was mainly used for bill
special business, and the bill pledge method was adopted. Found more on appointed media “Securities Times”,
“China Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn that the Company disclosed
in the form of announcement (Announcement No. 2018-032, 2018-033 and No.2018-035 ) on 5 June 2018 and 22
June
(xii) On June 27, 2018, the company received the enterprise policy funds of 15.41 million yuan allocated by the
Finance Treasury Payment Center of Hefei Economic and Technological Development Zone. Found more on
159
CHANGHONG MEILING CO.,LTD. Annual Report 2018
appointed media “Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and
www.cninfo.com.cn that the Company disclosed in the form of announcement (Announcement No. 2018-041 ) on
29 June 2018
(xiii)In February 2017, the company received the notice from its controlling shareholder Sichuan Changhong
Electric Co., Ltd. (a listed company on the main board of the Shanghai Stock Exchange, stock code: 600839,
hereinafter referred to as “Sichuan Changhong”), Sichuan Changhong intended to issue non-public offering of
exchangeable corporate bonds with its shareholding of part of the Company’s A-share and its earnings (including
capital reserve converted into equity, stock dividend, dividends, stock dividend, etc.) as the object, the planned
issuance period was no more than 3 years, and the funds planned to raise was not more than 500 million yuan. On
August 6, 2018, the company received a written letter from the controlling shareholder Sichuan Changhong, in
view of the changes in the market environment, Sichuan Changhong decided to terminate the non-public offering
of exchangeable corporate bonds after its communication with the Shenzhen Stock Exchange. Found more on
appointed media “Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and
www.cninfo.com.cn that the Company disclosed in the form of announcement (Announcement No. 2018-045 ) on
7 Aug. 2018
(xiv)The resolution of the 14th meeting of the ninth board of directors of the company passed and agreed the
company to postpone the subproject “newly increasing 600,000 sets of medium and large-capacity environmental
protection and energy-saving freezer intelligent production line construction project” of the non-public offering of
stock investment project “intelligent manufacturing construction project”, the date that the project achieves the
scheduled serviceable condition was postponed from the end of June 2018 to the end of December 2019. Found
more on appointed media “Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and
www.cninfo.com.cn that the Company disclosed in the form of announcement (Announcement No. 2018-047 and
No.2018-051 ) on 15 Aug. 2018
(xv) The resolution of the 15th meeting of the ninth board of directors of the company passed and agreed the
company and its subsidiaries to apply for a special credit line of maximum 700 million yuan in the bill pool to
CCB., Heifei Luyang Branch, the credit period was one year, and the credit line was mainly used for bill special
business, and the bill pledge method was adopted. Found more on appointed media “Securities Times”, “China
Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn that the Company disclosed in the
form of announcement (Announcement No. 2018-056, No.2018-060 and No.2018-069 ) on 18 Oct. 2018 and 28
November
(xvi)The resolutions of the 16th meeting of the ninth board of directors of the company and the 8th meeting of the
ninth board of supervisors of the company, and the 3rd extraordinary general meeting of shareholders in 2018
passed and agreed the company and its subsidiaries to use their own idle funds not exceeding RMB 1 billion (the
limit can be rolled over) to invest in the high security, good liquidity, low risk, and reliable financial products with
product term of no more than one year, and the authorization period shall be valid within one year from the date of
approval by the company’s general meeting of shareholders, and agreed the company to use its own idle funds not
160
CHANGHONG MEILING CO.,LTD. Annual Report 2018
exceeding RMB 940 million (the limit can be rolled over) to invest in the high security, good liquidity
principal-protected financial products with single product term of no more than one year, and the authorization
period shall be valid within one year from the date of approval by the company’s general meeting of shareholders.
Found more on appointed media “Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily”
and www.cninfo.com.cn that the Company disclosed in the form of announcement (Announcement No. 2018-056,
No.2018-061, No.2018-062, No. 2018065, No.2018-066 and No.2018-069 ) on 9 Nov. 2018 and 28 November
(xvii) From November 26 to November 28, 2018, the rate of deviation value of the closing price of the company’s
A-share stocks accumulated to more than 20% for three consecutive trading days. According to the relevant
regulations of the Shenzhen Stock Exchange, the company’s stock trading had abnormal fluctuations. The
company checked the relevant matters and explained the situation. Found more on appointed media “Securities
Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn that the Company
disclosed in the form of announcement (Announcement No. 2018-056, No.2018-061, No.2018-070 ) on 29 Nov.
2018
(xviii）In late March 2019, the company received the "Notice of Proposed Civil Penalty" issued by U.S.
Department of Energy ("DOE"). Found more on appointed media “Securities Times”, “China Securities Journal”,
“Hong Kong Commercial Daily” and www.cninfo.com.cn that the Company disclosed in the form of
announcement (Announcement No. 2019-014 ) on 26 March 2018
XX.Major event of the subsidiary
√ Applicable □ Not applicable
(i) The resolution of the 17th meeting of the ninth board of directors of the company passed and agreed the
company to invest 10 million yuan to establish a new technology-based subsidiary Hefei Meiling Zhihuijia
Technology Co., Ltd. (tentative name, which is subject to the name approved by the industrial and commercial
bureau) to work on the intelligence, frequency conversion and other key technology research and development
and the software development of refrigeration, freezer and other electrical products.Found more on appointed
media “Securities Times”, “China Securities Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn
that the Company disclosed in the form of announcement (Announcement No. 2018-056, No.2018-071 ) on 11
December 2018
161
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section VI. Changes in shares and particular about shareholders
I. Changes in shares
(i) Changes in shares
In Share
Before the Change Increase/Decrease in the Change (+, -) After the Change
Bon Capitaliz
New
Proporti us ation of Proporti
Amount shares Others Subtotal Amount
on shar public on
issued
es reserve
I. Restricted shares 80,858,588 7.74% 0 0 0 -427,180 -427,180 80,431,408 7.70%
1. State-owned shares 0 0.00% 0 0 0 0 0 0 0.00%
2. State-owned legal person’s
70,793,625 6.78% 0 0 0 0 0 70,793,625 6.78%
shares
3. Other domestic shares 8,797,543 0.84% 0 0 0 -427,180 -427,180 8,370,363 0.80%
Including: Domestic legal
4,716,077 0.45% 0 0 0 0 4,716,077 0.45%
person’s shares
Domestic natural person’s
4,081,466 0.39% 0 0 0 -427,180 -427,180 3,654,286 0.35%
shares
4. Foreign shares 1,267,420 0.12% 0 0 0 0 0 1,267,420 0.12%
Including: Foreign legal
0 0.00% 0 0 0 0 0 0 0.00%
person’s shares
Foreign natural person’s shares 1,267,420 0.12% 0 0 0 0 0 1,267,420 0.12%
II. Unrestricted shares 963,739,293 92.26% 0 0 0 427,180 427,180 964,166,473 92.30%
1. RMB ordinary shares 802,142,713 76.79% 0 0 0 427,180 427,180 802,569,893 76.83%
2. Domestically listed foreign
161,596,580 15.47% 0 0 0 0 0 161,596,580 15.47%
shares
3. Overseas listed foreign shares 0 0.00% 0 0 0 0 0 0 0.00%
4. Others 0 0.00% 0 0 0 0 0 0 0.00%
III. Total shares 1,044,597,881 100.00% 0 0 0 0 0 1,044,597,881 100.00%
1. Reasons for share changed
√ Applicable □ Not applicable
(1) During the reporting period, Mr. Hu Zhaogui, the new director of the ninth board of directors of the company,
originally held 178,050 shares of the Company. Since his appointment as a director and vice president during the
reporting period, 75% of the shares held by him, i.e. 133,537 shares, were locked in accordance with relevant
regulations.
162
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(2) On November 21, 2017, Mr. Liao Tao, the former vice president of the company, resigned as the vice president
of the company due to job transfer reasons, his original term of office expired on September 12, 2020. According
to the relevant provisions of the Detailed Rules for Reducing the Shareholding of the Shareholders and Directors,
Supervisors and Senior Management of Listed Companies of the Shenzhen Stock Exchange, during the reporting
period, 25% of the shares held by Mr. Liao Tao, i.e. 176,242 shares, were released from restrictions and the
remaining shares continued to be locked.
(3) On October 24, 2017, Mr. Zhang Xiaolong, the former vice president and chief financial officer of the
company, resigned as the vice president and chief financial officer of the company due to job transfer reasons, his
original term of office expired on September 12, 2020. According to the relevant provisions of the Detailed Rules
for Reducing the Shareholding of the Shareholders and Directors, Supervisors and Senior Management of Listed
Companies of the Shenzhen Stock Exchange, during the reporting period, 25% of the shares held by Mr. Zhang
Xiaolong, i.e. 121,175 shares, were released from restrictions and the remaining shares continued to be locked.
(4) During the reporting period, Mr. Teng Guangsheng, the former director of the company, resigned as a director
of the company due to personal work reasons, his original term of office expired on September 12, 2020.
According to the relevant provisions of the Detailed Rules for Reducing the Shareholding of the Shareholders and
Directors, Supervisors and Senior Management of Listed Companies of the Shenzhen Stock Exchange, during the
reporting period, 25% of the shares held by Mr. Teng Guangsheng, i.e. 29,400 shares, were released from
restrictions and the remaining shares continued to be locked.
(5) During the reporting period, Mr. Yu Wanchun, the former chairman of the board of supervisors of the company,
whose original term of office expired and had left his post for more than six months, 263,300 shares of the
company’s stock held by him were released from restrictions
2. Approval of share changed
□ Applicable √ Not applicable
3.Ownership transfer of share changed
□ Applicable √ Not applicable
4. Progress of shares buy-back
□ Applicable √ Not applicable
5.Implementation progress of the reduction of repurchases shares by centralized bidding
□ Applicable √ Not applicable
6. 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
7.Other information necessary to disclose for the Company or need to disclosed under requirement from
security regulators
163
CHANGHONG MEILING CO.,LTD. Annual Report 2018
□ Applicable √ Not applicable
(ii)Changes of restricted shares
√ Applicable □ Not applicable
In Share
Restricted
Shares
Opening Shares
Shareholde Increased Ending shares Restricted
shares released in Date for released
rs In restricted reasons
restricted Period
the
Period
75% of the shares are restricted on sales each
year. At the same time, there are other restrictions
Share lockup in on the shares held by the company. For details,
Hu
0 - 133,537 133,537 senior please refer to “III Implementation of
Zhaogui
executives Commitments” in “Section 5 Important Events”
of the 2017 Annual Report.
On June 2, 2018, he resigned as a director of the
Company for personal job reasons, his original
term of office expired on September 12, 2020.
Dong Jiangao resigned before the expiration of his
term of office, according to the relevant
regulations, the shares transferred each year
Teng Share lockup in
should not exceed 25% of the Company’s shares
Guangshen 88,200 - 29,400 117,600 senior
held by him during the term of office determined
g executives
at the time when he took office and within six
months after the expiration of his term of office;
the shares of the Company held by him should not
be transferred within half a year after he left the
company.
On September 12, 2017, due to the change of the
company’s board of supervisors, he no longer held
the post of the chairman of the company’s board
Share lockup in
Yu of supervisors due to the expiration of the term of
263,300 263,300 0 0 senior
Wanchun office. During the reporting period, he had left his
executives
post for six months, and the shares of the
company held by him had been released from
restrictions on March 9, 2018.
Share lockup in
On 21 Nov. 2017, he resigned as a director of the
Liao Tao 704,966 176,242 0 528,724 senior
Company for personal job reasons, his original
executives
164
CHANGHONG MEILING CO.,LTD. Annual Report 2018
term of office expired on September 12, 2020.
Dong Jiangao resigned before the expiration of his
term of office, according to the relevant
regulations, the shares transferred each year
should not exceed 25% of the Company’s shares
held by him during the term of office determined
at the time when he took office and within six
months after the expiration of his term of office;
the shares of the Company held by him should not
be transferred within half a year after he left the
company.
On 24 Oct. 2017, he resigned as a director of the
Company for personal job reasons, his original
term of office expired on September 12, 2020.
Dong Jiangao resigned before the expiration of his
term of office, according to the relevant
Share lockup in regulations, the shares transferred each year
Zhang
484,700 121,175 0 363,525 senior should not exceed 25% of the Company’s shares
Xiaolong
executives held by him during the term of office determined
at the time when he took office and within six
months after the expiration of his term of office;
the shares of the Company held by him should not
be transferred within half a year after he left the
company.
Total 1,541,166 560,717 162,937 1,143,386 -- --
II. Security offering and listing
(i) Security offering in reporting period (Not including preferred stock)
□ Applicable √ Not applicable
(ii) Explanation on changes of total shares, shareholders structure and assets & liability
structures
□ Applicable √ Not applicable
(iii) Current shares held by internal staffs
□ Applicable √ Not applicable
III. Particulars about shareholder and actual controller of the Company
(i) Amount of shareholders of the Company and particulars about shares holding
In Share
Total shareholders at end 65,470 Total common 61,766 Total preference 0 Total preference 0
165
CHANGHONG MEILING CO.,LTD. Annual Report 2018
of the Period shareholders at shareholders with shareholders with
end of last month voting rights voting rights
before annual recovered at end recovered at end of
report disclosed of reporting last month before
period (if annual report
applicable) disclosed (if
applicable)
Particulars about shares held above 5% by shareholders or top 10 shares holding
Number of
Total share
Proport Changes in Amount of Amount of
Nature of ion of shareholders pledged/frozen
Full name of Shareholders report restricted un-restricted
shareholder shares at the end of State
held period shares held shares held
report period of Amount
share
Sichuan Changhong Electric State-owned
23.58% 246,301,524 11,595,556 69,877,638 176,423,886 - -
Co., Ltd. legal person
Hefei Industry Investment State-owned
4.58% 47,823,401 0 0 47,823,401 - -
Holding (Group) Co., Ltd. legal person
CHANGHONG (HK) Foreign legal
3.15% 32,898,580 2,003,138 0 32,898,580 - -
TRADING LIMITED person
Foreign natural
CAO SHENGCHUN 1.36% 14,240,979 411,596 0 14,240,979 - -
person
Ping An UOB-Ping An Domestic
Bank-Guohai Securities Co., non-state-owned 1.20% 12,522,361 0 0 12,522,361 - -
Ltd. legal person
Caitong Fund- Ningbo
Domestic
Bank-Haitong Xingtai (Anhui)
non-state-owned 1.03% 10,733,452 0 0 10,733,452 - -
Emerging Industry Investment
legal person
Fund (Limited Partnership)
Caitong Fund-Everbright Domestic
Bank-Soochow Securities Co., non-state-owned 0.68% 7,079,454 0 0 7,079,454 - -
Ltd. legal person
Domestic nature
Wang Zhenfeng 0.56% 5,874,000 5,874,000 0 5,874,000 - -
person
China Securities Finance Domestic legal
0.42% 4,362,500 0 0 4,362,500 - -
Corporation Limited person
Foreign legal
NORGES BANK 0.34% 3,549,776 -996,656 0 3,549,776 - -
person
Strategy investors or general legal person Not applicable
166
CHANGHONG MEILING CO.,LTD. Annual Report 2018
becomes top 10 shareholders due to rights issued
(if applicable)
Among the above shareholders, CHANGHONG (HK) TRADING LIMITED is
the wholly-owned subsidiary of Sichuan Changhong Electric Co., Ltd.; there
existed no associated relationship or belong to the concerted actors as specified in
the Measures for the Administration of Information Disclosure of Shareholder
Equity Changes of Listed Companies among Sichuan Changhong Electric Co.,
Ltd., CHANGHONG (HK) TRADING LIMITED and other top 8 shareholders;
“Ping An UOB-Ping An Bank-Guohai Securities Co., Ltd. ”Ping An UOB-Ping
An Bank-Guohai Securities Co., Ltd. refers to the products of Ping An UOB Fund
Explanation on associated relationship among the
Management Company subscribe for privately placement of 2016;
aforesaid shareholders
“Caitong Fund- Ningbo Bank-Haitong Xingtai (Anhui) Emerging Industry
Investment Fund (Limited Partnership) ” and “Caitong Fund-Everbright
Bank-Soochow Securities Co., Ltd.”refers to the products of Caitong Fund
Management Company subscribe for privately placement of 2016;
The company neither knows whether there is any association among other
shareholders, nor knows whether other shareholders belong to the persons acting
in concert that is stipulated in the “Administrative Measures on Information
Disclosure of Changes in Shareholding of Listed Companies”.
Particular about top ten shareholders with un-restrict shares held
Amount of unrestricted Type of shares
Shareholders’ name shares held at end of
Type Amount
Period
Sichuan Changhong Electric Co., Ltd. 176,423,886 RMB ordinary shares 176,423,886
Hefei Industry Investment Holding (Group) Co., Ltd. 47,823,401 RMB ordinary shares 47,823,401
Domestically listed
CHANGHONG (HK) TRADING LIMITED 32,898,580 32,898,580
foreign shares
Domestically listed
CAO SHENGCHUN 14,240,979 14,240,979
foreign shares
Ping An UOB-Ping An Bank-Guohai Securities Co., Ltd. 12,522,361 RMB ordinary shares 12,522,361
Caitong Fund- Ningbo Bank-Haitong Xingtai (Anhui)
10,733,452 RMB ordinary shares 10,733,452
Emerging Industry Investment Fund (Limited Partnership)
Caitong Fund-Everbright Bank-Soochow Securities Co.,
7,079,454 RMB ordinary shares 7,079,454
Ltd.
Wang Zhenfeng 5,874,000 RMB ordinary shares 5,874,000
China Securities Finance Corporation Limited 4,362,500 RMB ordinary shares 4,362,500
Domestically listed
NORGES BANK 3,549,776 3,549,776
foreign shares
Expiation on associated relationship or consistent actors Found more in “Particulars about shares held above 5% by
within the top 10 un-restrict shareholders and between top shareholders or top 10 shares holding”
167
CHANGHONG MEILING CO.,LTD. Annual Report 2018
10 un-restrict shareholders and top 10 shareholders
Explanation on top ten common shareholders involving
Not applicable
margin business (if applicable)
Note 1: At end of the reporting period, the person acting in concert with controlling shareholder Sichuan
Changhong-- CHANGHONG (HK) TRADING LIMITED, holds B-stock of the Company as 32,898,580 shares,
among which, 5,820,783 shares are held through Philip Securities (H.K.) Co., Ltd. by CHANGHONG (HK)
TRADING LIMITED
Note 2: In the above table, "Particulars about shares held above 5% by shareholders or top 10 shares holding" is
subject to the data on stock transfer books provided by China Securities Depository and Clearing Corporation
Limited Shenzhen Branch
Whether the top ten ordinary shareholders of the company and the top 10 ordinary shareholders of unrestricted
conditions have made the repurchase transactions as agreed during the reporting period.
□Yes √ No
The top ten ordinary shareholders of the company and the top 10 ordinary shareholders of unrestricted conditions
have not made the repurchase transactions as agreed during the reporting period.
(ii) Controlling shareholder of the Company
1. Nature of controlling shareholders: local state-owned holding
2. Type of controlling shareholders: legal person
Controlling Legal
Dated Organization
shareholders’ rep./person in Main business
founded code
name charge of unit
Manufactures, sales and maintenance of household appliance,
automotive electrical appliance, Electronic products and spare parts,
communications equipment, lighting equipment, household products,
computer and other Electronic equipment, specialized equipment of
Electronic and Electronic, Electronic machinery and equipment,
series products of batteries, Electronic medicine products, Electronic
equipment, mechanical equipment , Refrigeration equipment and
Sichuan
accessories digital monitoring products, metal products, apparatus
Changhong 8 April 91510700205
Zhao Yong and instruments, culture and office machines, culture and education
Electric Co., 1993 412308D
and sports products, kitchen cabinet and gas appliance; house and
Ltd.
equipment rental; packing products and technical services; road
transportation; storage and discharging convey; R&D, sales and
services of integrated circuit and software; consultancy and services
of enterprise management; hi-tech project investment and other
state-permitted business; development and operation of property;
engineering construction for house and buildings; callback and
disposal of obsolete appliance and Electronic products; services of
168
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Information Technology; consultancy and services of finance;
sales, relevant import and export business of Chemical raw materials
and products(Not contain dangerous chemicals), building materials,
non-ferrous metal, Steel, plastics, packing material, mechanical and
electrical equipment, Precious metals, Automotive components,
Electronic components, agent service of telecommunication;
designing, manufacturing, releasing and agency for the
advertisement; R&D and design of the drone and unmanned aerial
vehicle system as well as the promotion of drone technology;
transfer and technical consulting service, production and sales of
drone (any projects that needs permission by the law should subject
to the approval by relevant authority )
1. Ended as 31 December 2018, 29.9774 percent equity of Changhong Huayi Compressor Co.,
Ltd. (stock code: 000404), the listed company in main board of SSE, were directly hold by
Equity controlling and jointly Sichuan Changhong.
of other foreign/domestic
listed company by
2. Up to 31 December 2018, 1,008,368,000 common shares of the Changhong IT (Stock code:
controlling shareholder in
08016), the listed company in GEM of Hong Kong Stock Exchange, were held by Sichuan
reporting period
Changhong and its persons acting in concert, representing 69.3202 percent in total issued
common shares of Changhong IT
3. Controlling shareholder changes in reporting period
□ Applicable √ Not applicable
Controlling shareholder stays the same in Period.
4. Other notes
On February 25, 2019, the company received the Notice of Sichuan Changhong Electric Co., Ltd. and its
Concerted Action Person Changhong (Hong Kong) Trading LIMITED. to Increase the Shareholding of
Changhong Meiling Co., Ltd. and the Equity Changes (hereinafter referred to as “Notice”). Sichuan Changhong
and its concerted action person Changhong (Hong Kong) Trading Co., Ltd. (hereinafter referred to as “HK
Changhong” or “concerted action person”) bought 16,231,024 shares of Changhong Meiling (including
13,751,756 shares of Changhong Meiling A shares and 2,479,268 shares of Changhong Meiling B shares) by
bidding transaction method through the secondary market from November 12, 2018 to February 25, 2019,
accounting for 1.55% of Changhong Meiling’s total share capital, consequently, the equity ratio of Changhong
Meiling held by Sichuan Changhong and concerted action person accumulatively increased by 5% from
September 2009 to February 2019. Found more on appointed media “Securities Times”, “China Securities
Journal”, “Hong Kong Commercial Daily” and www.cninfo.com.cn that the Company disclosed in the form of
announcement (Announcement No. 2019-013 ) on 26 Feb. 2019
(iii) Actual controller of the Company and its person acting in concert
1. Nature of actual controller: local state-owned assets management
169
CHANGHONG MEILING CO.,LTD. Annual Report 2018
2. Type of actual controller: legal person
Legal
Dated Organization
Actual controller rep./person in Main business
founded code
charge of unit
State-owned Assets Supervision &
Administration Commission of
Mianyang Municipality is entrusted by
the same level government, together
State-owned Assets Supervision &
performs decision-making and
Administration Commission of -- -- --
management of state-owned asset
Mianyang Municipality
owners, and is one organization which
executes comprehensive management
and supervision on its belonged
state-owned assets.
Equity controlling of other
foreign/domestic listed company by Not applicable
actual controller in reporting period
3. Changes of actual controller in Period
□ Applicable √ Not applicable
Actual controller stays the same in Period
4. Property rights and the block diagram of the control relationship between the Company and the
actual control (ended as 31st December 2018)
State-owned Assets Supervision & Administration Commission of
Mianyang Municipality
100%
%
Sichuan Changhong Electronics Holding Group Co., Ltd.
23.22%
%
Sichuan Changhong Electric Co., Ltd.
100%
四川省绵阳 23.58%
Changhong (Hong Kong) Trading
四川省绵
Limited 有限责任公
3.15% 阳市虹欢
司
科技有限
%
Changhong Meiling Co., Ltd. 责任公司
%
%
170
CHANGHONG MEILING CO.,LTD. Annual Report 2018
5. Actual controller controlling the Company by means of entrust or other assets management
□ Applicable √ Not applicable
(iv) Other legal person’s shareholders with over ten percent shares held
□ Applicable √ Not applicable
(v) Limitation and reducing the holdings of shares of controlling shareholders, actual
controllers, restructuring side and other commitment subjects
□ Applicable √ Not applicable
171
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section VII. Preferred Stock
□ Applicable √ Not applicable
The Company had no preferred stock in the reporting.
172
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section VIII. Particular about Directors, Supervisors, Senior Executives and Employees
I. Changes of shares held by directors, supervisors and senior executive
Amount of
Amount of
Shares held shares Other
Post shares Shares held
at increase in
Name Title Sex Age Office dated from Office dated ended decreased in changes at period-end
status period-begin( this
this period (Share)
Share) period(Share (share)
(Share)
)
Curre
Li Wei Chairman ntly in M 46 20 June 2011 12 Sept. 2020 1,428,473 0 0 0 1,428,473
office
Curre
Wu
Deputy Chairman ntly in M 46 3 July 2014 12 Sept. 2020 570,500 0 0 0 570,500
Dinggang
office
Curre
Kou Director, Deputy
ntly in M 49 3 July 2014 12 Sept. 2020 0 0 0 0 0
Huameng president
office
Curre
Shi Qiang Director ntly in M 50 12 Sept. 2017 12 Sept. 2020 0 0 0 0 0
office
Yong Curre
Director M 50 12 Sept. 2017 12 Sept. 2020 0 0 0 0 0
Fengshan ntly in
173
CHANGHONG MEILING CO.,LTD. Annual Report 2018
office
Curre
Director, Deputy
Hu Zhaogui ntly in M 45 21 June 2018 12 Sept. 2020 178,050 0 0 0 178,050
president
office
Curre
Gan Independent
ntly in M 52 3 July 2014 12 Sept. 2020 0 0 0 0 0
Shengdao director
office
Curre
Independent
Ren Jia ntly in M 55 3 July 2014 12 Sept. 2020 0 0 0 0 0
director
office
Curre
Independent
Lu Yingjin ntly in M 54 3 July 2014 12 Sept. 2020 0 0 0 0 0
director
office
Curre
Chairman of
Shao Min ntly in M 36 12 Sept. 2017 12 Sept. 2020 0 0 0 0 0
Supervisory
office
Curre
Huang
Supervisor ntly in F 48 12 Sept. 2017 12 Sept. 2020 0 0 0 0 0
Hong
office
Curre
He Xintan Supervisor ntly in M 38 12 Sept. 2017 12 Sept. 2020 0 0 0 0 0
office
Curre
Ji Ge Staff supervisor ntly in F 37 25 Dec. 2017 12 Sept. 2020 0 0 0 0 0
office
Curre
Zhu Wenjie Staff supervisor ntly in M 31 8 Apr. 2015 12 Sept. 2020 0 0 0 0 0
office
Liu Executive deputy Curre M 55 20 June 2011 12 Sept. 2020 1,689,893 0 0 0 1,689,893
174
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Hongwei president ntly in
office
Curre
Zhong Ming Deputy president ntly in M 46 30 Dec. 2013 12 Sept. 2020 314,900 0 0 0 314,900
office
Curre
Huang
Deputy president ntly in M 49 12 Sept. 2017 12 Sept. 2020 356,450 0 0 0 356,450
Danian
office
Curre
CFO (person in
Pang Haitao ntly in M 43 25 Oct. 2017 12 Sept. 2020 0 0 0 0 0
charge of finance)
office
Curre
Secretary of the
Li Xia ntly in F 38 22 May 2009 12 Sept. 2020 552,800 0 0 0 552,800
Board
office
Office
Teng
Director leavin M 50 4 May 2017 2 June 2018 117,600 0 0 0 117,600
Guangsheng
g
Total -- -- -- -- -- -- 5,208,666 0 0 0 5,208,666
175
CHANGHONG MEILING CO.,LTD. Annual Report 2018
II. Changes of directors, supervisors and senior executives
√ Applicable □ Not applicable
Name Title Type Date Reasons
Teng Resigned his post as director of the Company due
Director Office leaving 2 June 2018
Guangsheng to personal reasons
Being approved by the 2nd interim shareholders
general meeting of 2018, Mr. Hu Zhaogui was
Director Election 21 June 2018
elected as the non-independent director of the 9th
BOD with service term same as the 9th BOD
Hu Zhaogui
Being approved by the 13th session of 9th BOD,
Mr. Hu Zhaogui was elected as the deputy
Deputy president Appointment 21 June 2018
president of the 9th BOD with service term same
as the 9th BOD
Resigned his post as president of the Company
Wu Dinggang President Office leaving 12 Jan. 2019
due to career move
III. Post-holding
(i) Professional background, major working experience and present main responsibilities in Company of
directors, supervisors and senior executive at the present
1. Li Wei, male, the Han nationality from Tongliang, Chongqing, was born in February 1973, Member of CPC,
Assistant Economist with Master degree, he is reading EMBA in USTC. He ever took the post of General
Manager of Xi’an Sales Branch of Sichuan Changhong Electronic Co., Ltd., General Manger of Southeast
Operation Management Center of Changhong Electronic (China) Marketing Co., Ltd., GM of Sichuan Changhong
Air-conditioner Co., Ltd., chairman of Zhongshan Changhong Electric Co., Ltd., and deputy president, president
and deputy chairman of the Company. Now he serves as Director and GM of Sichuan Changhong Electric Co.,
Ltd. and chairman of the Company.
2. Wu Dinggang, male, the Han nationality from Suining, Sichuan Province, was born in March 1973, Member of
CPC, owns bachelor degree, graduate from Tianjin University of Commerce China (Tianjin University of
Commerce now), major in refrigeration equipment and cryogenic technique. He served successively as GM of
Suining Sale Branch and Chengdu Sales Branch of Sichuan Changhong Electric Co., LTD, director of Sichuan
and Chongqing Marketing Management Department of Sichuan Changhong Electric Co., LTD, deputy GM of
Changhong Electronics (China) Marketing Co., GM of market planning center of Changhong Multimedia Industry,
director and GM of Le-Jia-Yi Chain Management Co., Ltd., Zhongke Meiling Cryogenic Technology Co., Ltd.
director and GM of Sichuan Changong Air Conditioner Co., Ltd and deputy president and chairman of the
Company. Currently he serves as vice GM of Sichuan Changhong Electric Co., Ltd., party secretary, deputy
chairman of the Company; Chairman of Zhongshan Changhong Electric Co., LTD; Chairman of Sichuan
Changhong Air-conditioner Co., Ltd. and Chairman of Zhongke Meiling Cryogenic Technology Co., Ltd.
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
3. Kou Huameng, male, the Han nationality from Yanting, Sichuan Province, was born in February 1970, Member
of CPC, master degree candidate, EMBA graduate from UESTC. He served successively as deputy director of
production office of Sichuan Changhong Electric Co., LTD, director of Guangxi Marketing management
Committee, director of Fujian-Jiangxi Marketing Management and director and GM of Guangdong Changhong
Digital Technology Co., Ltd.; Sichuan Changhong Electric Co., Ltd, director of development management
department of Sichuan Changhong Electric Co., Ltd.; now he serves as director of Changhong Huayi Compressor
Co., Ltd., director and deputy president of the Company (acting president/conducting works)
4. Shi Qiang, male, Han nationality, was born in July 1968, a member of the Communist Party of China, earned a
bachelor’s degree in underwater sound electronic engineering from Southeast University, and is an engineer. He
successively served as the office secretary of Changhong Company, director of quality management division,
the director of goods and material department, liaison office of overseas marketing, the director and vice director
of asset management department; Director of Sichuan Changhong New Energy Technology Co., Ltd.;Director of
Sichuan Changhong Power Source Co., Ltd. Currently he serves as deputy party secretary, discipline inspection
commission, director, secretary of Changhong Huayi Compressor Co., Ltd.; Director of Jiaxipera Compressor Co.,
Ltd., director of Huayi Compressor (Jingzhou) Co., Ltd. and director of Changhong Grand-Pro Tech. Co., Ltd. and
director of the Company
5. Yong Fengshan, male, Han nationality, was born in Dingyuan, Anhui in June 1968, a member of the Communist
Party of China, a senior accountant, and a master degree holder. He ever took the posts of the deputy director and
the director of finance department of Hefei Cable Factory, the director of finance division and the deputy chief
accountant of Hefei Meiling Co., Ltd., the director of Hefei Department Store Co., Ltd., the deputy general
manager and chief accountant of Hefei Meiling Group Holding Co., Ltd., the secretary of the party committee and
the president of Hefei Industrial Investment Holdings Co., Ltd., the president of CAS (Hefei) Institute of
Technology Innovation Co., Ltd., the vice president of Whirlpool (China) Co., Ltd., the president of Hefei Venture
Capital Guidance Fund Co., Ltd. , and the director of the Company.
6. Hu Zhaogui, male, the Han nationality, born in Feixi Hefei in October 1974, a member of the Communist Party
of China, holds a master’s degree, graduated from Chongqing University as a master of business administration.
He has served successively as the head of marketing and sales department stationed abroad of Hefei Meiling Co.,
Ltd., assistant president and general manager of the freezer and washing machine business division, and general
manager of the domestic marketing division. He is currently the director and vice president of the Company and
the general manager of Sichuan Changhong Air Conditioner Co., Ltd., a subsidiary of the Company.
7. Gan Shengdao, male, the Han nationality from Tianchang, Anhui Province, was born in March 1967, member
of China Democratic National Construction Association, a doctoral candidate and Doctor of Economic. He served
successively as teaching assistant, lecturer and associate professor in Department of National Economic
Management of Sichuan University, the associate professor and professor in Department of Business
177
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Administration of Sichuan University. An independent director of Liangshan Rural Commercial Bank Co., Ltd.,
and an independent director of Chengdu Rainbow Electric (Group) Co., Ltd. Currently serves as a professor and
doctoral supervisor at Business School of Sichuan University, deputy director of the Financial Research Institute
of Sichuan University, an independent director of Sichuan Riji Seals Co., Ltd., an independent director of Sichuan
Yahua Industrial Group Co., Ltd., an independent director of Yibin Wuliangye Co., Ltd., and an external director
of Sichuan Huashi Group Co., Ltd., and an independent director of the Company.
8. Ren Jia, male, Han nationality, was born in Nantong, Jiangsu in July 1963, a master degree holder, and
graduated from the Department of Materials Science and Engineering of Tsinghua University. He ever took the
posts of the assistant general manager of Beijing Building Materials Imp. & Exp. Co., Ltd., the department deputy
manager of Jiangsu Overseas Group Co., Ltd., the department deputy manager and assistant general manager of
Jiangsu Economic and Trade Corporation, the general manager of Import and Export Company of Zhejiang
Xiangyang Group, the director and general manager of Nanjing Shenlu Textile & Apparel Co., Ltd., the deputy
general manager of Guangzhou Anyka Microelectronics Co., Ltd., the deputy general manager of Shanghai
Multimedia Valley Investment Co., Ltd., and independent director of Kingnet Co., Ltd. He currently serves as the
vice president of SIMIC Holdings Electronics Co., Ltd., the chairman and general manger of SIMIC Technology
Development Co., Ltd., the partner of Shanghai Heda Enterprise Management Partnership (limited partnership),
the president of Shanghai Zhongke Xinwei Information Technology Park Co., Ltd. Long, an independent director
of InHand Networks, and an independent director of the Company.
9. Lu Yingjin, male, the Han nationality, was born in October 1964, Member of CPC, a doctoral candidate, Doctor
of Management Science and Engineering of the UESTC. He served successively as Assistant Engineer of Shenli
Field Drilling Technical Company and lecturer of Staff Education and Training Center of South-West Petroleum
Bureau, and he teaches in UESTC since 2002.And he has been a visiting scholar in the department of computer
science at the University of Kentucky in the United States. Now he serves as associate professor in Economics and
Management School of UESTC and Independent Director of the Company.
10. Shao Min, male, Han nationality, was born in Linyi, Shandong in March 1983, and earned a bachelor’s degree
in accounting major from Xi’an Jiaotong University. He joined in work in July 2004, and ever served as the
finance manager of the branch office of Sichuan Changhong Electric Co., Ltd., the financial director of finance
department, the project manager of asset management department, the director of asset management department,
and the director of asset operation department of Sichuan Changhong Electric Co., Ltd. He currently serves as the
deputy director of asset management department of Sichuan Changhong Electric Co., Ltd., and the chairman of
the Board of Supervisors of the Company.
11. Huang Hong, female, Han nationality, was born in Shehong, Sichuan in June 1970, a member of the
Communist Party of China, a master degree holder, and graduated from the University of Glasgow as a MBA. She
joined in work in July 1992, and ever served as the financial director of finance department, the audit manager,
audit director, and audit chief of auditing department of Sichuan Changhong Electric Co., Ltd. He currently serves
178
CHANGHONG MEILING CO.,LTD. Annual Report 2018
as the deputy director of auditing department and the deputy director of labor union audit committee of Sichuan
Changhong Electric Co., Ltd., and a supervisor of the Company.
12. He Xintan, male, Han nationality, was born in Xiayi, Henan in April 1980, a member of the Communist Party
of China, an economist, and earned a master’s degree in management science and engineering from Xi’an
Jiaotong University. He joined in work in July 2002, and successively took the posts of the operations
management director of operation management department and the manager of general management office of
Sichuan Changhong Electric Co., Ltd. Currently he serves as the deputy director of development and management
department of Sichuan Changhong Electric Co., Ltd., and a director of Changhong Huayi Compressor Co., Ltd.,
and a supervisor of the Company.
13. Ji Ge, female, Han nationality, was born in Nanyang, Henan Province in January 1982, a member of the
Communist Party of China, and earned a bachelor’s degree in law from Hunan University and a master’s degree
from Anhui University. She joined Hefei Meiling Co., Ltd. in July 2005 and once served as the legal specialist of
legal department, the sponsor of legal affairs, and the intellectual property director of the legal department of the
Company. She currently serves as the director of the legal department of the Company, director of office of Party
Committee, member of commission for Discipline Inspection, director of Discipline Inspection office and staff
supervisor of the Company
14. Zhu Wenjie, male, the Han nationality from Hefei, Anhui Province, member of Communist Party of China,
born in January 1988, bachelor's degree, study MBA in University of Science and Technology of China. He
started to work in Hefei Meiling Co., Ltd. in July 2010 after graduation, served as an accountant for big customer
accounting in financial management department of Hefei Meiling Co., Ltd., securities affairs assistant at the office
of secretary of the board, and director of securities affairs, and currently serves as the representative of the
Company's securities affairs, director of securities affairs at the office of secretary of the board, and staff
supervisor of the Company.
15. Liu Hongwei, Male, Chinese American, bored in May 1963, Doctor of Applied Mechanics from Lehigh
University, graduate from department of mechanical engineering, Tsinghua University. He served successively in
Kulicke and Soffa Industries, Pennsylvania; Tessera Technology Corporation, Califonia; serves technical and
management post in Intel Corporation in Silicon Velleg. He joints the Hefei Meiling Co., Ltd. in 2007, now he
serves as executive deputy president of the Company.
16. Zhong Ming, male, the Han nationality from Meishan, Sichuan Province, was born in November 1972,
member of CPC, a senior engineer, EMBA master and a PhD major in engineering thermophysics. He
successively served as deputy director of research institution of Sichuan Changhong Air-conditioner Co., Ltd.,
deputy GM of Sichuan Changhong Air-conditioner Co., Ltd. and technical director of household appliance group
of Sichuan Changhong Electric Co., LTD. He serves as deputy president of the Company currently and director of
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Zhongke Meiling Cryogenic Technology Co., Ltd.
17. Huang Danian, male, Han nationality, was born in Huaining, Anhui in November 1969, a member of the
Communist Party of China, an engineer, and a master degree holder. He once served as the logistics director and
the deputy general manager of the Sales Company of Hefei Meiling Co., Ltd., the director of the human resources
department, the director of the comprehensive planning department, the director of the enterprise management
department, and the assistant to the general manager of Hefei Meiling Co., Ltd. He is now the vice president of
Hefei Meiling Co., Ltd.
18. Pang Haitao, male, Han nationality, was born in Qionghai, Hainan in May 1975, a member of the Communist
Party of China, a senior accountant, a senior political engineer, and a bachelor degree holder, and earned the
EMBA degree from Jiangxi University of Finance and Economics. He used to be a member of the finance
department, the director of related transactions and the director of capital operations of Sichuan Changhong
Electric Co., Ltd., the chief of finance office of Guangdong Changhong Electronics Co., Ltd., the director of
general ledger, the head of general management office, and the head of general ledger management office of the
finance department of Sichuan Changhong Electric Co., Ltd., the deputy general manager and chief financial
officer of Sichuan Changhong Development Co., Ltd., the deputy general manager and chief accountant of Huayi
Compressor Co., Ltd. Currently he is the chief financial officer (person in charge of finance) of the Company.
19. Li Xia, female, the Han nationality from Qionglai, Sichuan Province, was born in October 1980, Member of
CPC and Intermediate Accountant with Master Degree. She graduated from Accounting Department of Sichuan
University Business and Management School. She ever was Project Manager in Financing & Acquisition Office
of Asset Management Department and Business Executive in Board Office of Sichuan Changhong Electronic Co.,
Ltd. she took the posts of Deputy GM and Financial Supervisor of Sichuan Changhong Innovation Investment Co.,
Ltd. She is the Secretary of the Board, deputy secretary of the Party and secretary of discipline inspection
commission of the Company recently and chairman of supervisory committee of Zhongke Meiling Cryogenic
Technology Co., Ltd.
20. Teng Guangsheng, male, Han nationality, was born in Santai, Sichuan in August 1968, and earned a bachelor’s
degree in history from Beijing Normal University. He ever took the posts of the manager of marketing
management department and the general manager of branch offices of Sichuan Changhong Electric Co., Ltd., the
deputy general manager of Domestic Marketing Company of Multimedia Industry Company of Sichuan
Changhong Electric Co., Ltd., the director and general manager of Zhongshan Changhong Electric Appliance Co.,
Ltd., the president and general manager of Pakistan Changhong RUBA Trading Co., Ltd., and the president and
general manager of Sichuan Changhong Air Conditioning Co., Ltd. He is currently the general manager of
Multimedia Industry Company of Sichuan Changhong Electric Co., Ltd., and the director of the Company.
(ii) Post-holding in shareholder’s unit
180
CHANGHONG MEILING CO.,LTD. Annual Report 2018
√ Applicable □ Not applicable
Drawing
remuneration and
Start date of End date of office
Name Title allowance from
Shareholder’s unit office term term
shareholder’s unit
(Y/N)
Director 2017.08.29
Li Wei Sichuan Changhong Electric Co., Ltd. 2020.08.28 Y
GM 2017.07.21
Y, drawing
Wu Dinggang Sichuan Changhong Electric Co., Ltd. Deputy GM 2019.01.12 2020.08.28 remuneration since
work in the unit
Hefei Industry Investment Holding Party Secretary,
Yong Fengshan 2015.02.13 - Y
(Group) Co., Ltd. Chairman
GM of
Teng multi-media
Sichuan Changhong Electric Co., Ltd. 2017.11.17 - Y
Guangsheng industry
company
Deputy director
of assets
Shao Min Sichuan Changhong Electric Co., Ltd. 2019.02.01 - Y
management
department
Deputy Chief of
Huang Hong Sichuan Changhong Electric Co., Ltd. auditing 2011.09.16 - Y
department
Deputy Chief of
development
He Xintan Sichuan Changhong Electric Co., Ltd. and 2019.02.01 - Y
management
department
Post-holding in
shareholder’s N/A
unit
(iii) Post-holding in other unit
√ Applicable □ Not applicable
Drawing
Start date of End date of remuneration and
Name Title
Other unit office term office term allowance from
other unit (Y/N)
181
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Meiling CANDY Washing Machine Co., Ltd. Chairman 2017.04.24 2019.01.22 No
Guangdong Changhong Electronics Co., Ltd. Chairman 2017.10.11 - No
Sichuan Changhong Minsheng Logistics Co., LTD Chairman 2017.08.31 - No
Li Wei
Lejiayi Chain Management Co., Ltd. Chairman 2017.09 - No
Changhong International Holdings (Hong Kong)
Chairman 2019.01.30 - No
Co., Ltd.
Director 2015-05.18 No
Whirlpoor (China) Co., Ltd. Deputy 2019.06.15
2015.07.10 No
Chairman
Hefei Venture Capital Guidance Fund Co., Ltd. Chairman 2015.04.17 - No
CAS (Hefei) Technical Innovation Engineering
Chairman 2015.04.17 - No
Institute Co., Ltd.
Hefei International Inland Port Development Co.,
Chairman 2017.12.14 - No
Ltd.
Hefei State-owned Assets Holding Co., Ltd. Chairman 2015.04 No
Yong
Fengshan Hefei Industry Investment Holding Co., Ltd. Chairman, GM 2014.09 No
Party
Hefei Gongtou Industrial Tech. Development
Secretary, 2018.09 No
Co., Ltd.
Chairman
Anhui Integrated Circuit Industry Capital Co., Ltd. Chairman 2017.05 No
Anhui IT Industry Investment Holdings Co., Ltd. Director 2014.01 No
Jianghuai Automobile Co., Ltd. Director 2018.07.21 2021.07.20 No
Industrial Investment (HK) Ltd Director 2017.04 No
Hefei Smart Energy Innovation Platform Co., Ltd. Director 2017.06 - No
Zhongke Meiling Cryogenic Technology Co., Ltd. Chairman 2017.08.21 2021.08.26 No
Wu
Director 2017.09.27 - No
Dinggang Meiling CANDY Washing Machine Co., Ltd.
Chairman 2019.01.22 No
Director 2017.05.03 No
Shi Qiang Changhong Huayi Compressor Co., Ltd. Secretary of 2021.05.17
2018.03.05 Yes
the Board
Kou
Changhong Huayi Compressor Co., Ltd. Director 2015.04.16 2021.05.17 No
Huameng
Professor,
doctoral
Gan
Business School of Sichuan University supervisor, 1990.07 - Yes
Shengdao
director of
Financial
182
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Institute of
Sichuan
University
Independent
Chengdu Rainbow Electric (Group) Co., Ltd. 2012.03.23 2018.04.26 Yes
director
Independent
Sichuan Sunny Seal Co., Ltd. 2011.06.21 2021.02.11 Yes
director
Independent
Sichuan Yahua Industrial Group Co., Ltd 2015.06.09 2021.06.25 Yes
director
Outside
Sichuan Huashi Group Co., Ltd. 2015.08.10 - Yes
Director
Independent
Yibing Wuliangye Co., Ltd. 2016.11.18 - Yes
director
Deputy
SIMIC Holdings Co., Ltd. 2013.01 - Yes
president
SIMIC Development Co., Ltd. Chairman/GM 2014.07 - No
Shanghai Hefa Enterprise Management Partner / legal
2016.05 - No
Partnership (Limited Partnership) representative
Ren Jia
Shanghai Zhongke Xinwei IT Park Co., Ltd. Chairman 2018.01 - No
Independent
Beijing Inhand Networks Co., Ltd 2017.12.06 2019.09.28 Yes
director
Independent
Kingnet Co., Ltd. 2018.05.12 2019.03.18 Yes
director
Lu Associate
School of Management and Economics of UESTC 2001.12.30 - Yes
Yingjin professor
He
Changhong Huayi Compressor Co., Ltd. Director 2018.01.05 2021.05.17 No
Xintan
Zhong
Zhongke Meiling Cryogenic Technology Co., Ltd. Director 2015.08.28 2021.08.26 No
Ming
Chairman of
Zhongke Meiling Cryogenic Technology Co., Ltd. 2015.08.28 2021.08.26 No
Li Xia Supervisory
Meiling CANDY Washing Machine Co., Ltd. Supervisor 2017.04.24 - No
Post-hold
ing in N/A
other unit
(iv) Punishment of securities regulatory authority in recent three years to the company’s
current and outgoing directors, supervisors and senior management during the reporting
period
183
CHANGHONG MEILING CO.,LTD. Annual Report 2018
□ Applicable √ Not applicable
IV. Remuneration of directors, supervisors and senior executives
(i) Decision-making, determine basis and actually payment of remuneration for directors, supervisors and
senior executives
1. Procedure for deciding remunerations of directors, supervisors and senior management
Implemented in line with laws, regulations and relevant rules of “Company Law”, “Article of Association” and
“Enforcement Regulation of Remuneration and Evaluation Committee of the Board”, including:
(1) Allowance plan of independent directors are implemented after deliberated in the Board and approved in
Shareholders’ General Meeting. Other directors and non-staff supervisors except independent directors are
received no remuneration from the Company.
(2) Remuneration of senior executives are deliberated and approved by the Board according to remuneration
evaluation plan together with opinions of Remuneration and Evaluation Committee.
2. Bases on which remunerations of directors, supervisors and senior management are decided
The Company conducted the performance examination on the task of directors, supervisors and senior executives
according to the HR management policy, wages of directors, supervisors and senior executives are decided by
their performance and evaluations check by the Company. All wages are performing by the evaluation results
according to the only evaluation standard that carried by the Company.
3. Actual payment of remunerations of directors, supervisors and senior management
Allowance of the independent directors are paid by the standards approved in Annual Shareholders’ General
Meeting, other director, who serves as senior executive at the same time, and non-staff supervisors except
independent directors did not received remuneration from the Company; remunerations for senior executives of
the Company are paid strictly by the unify remuneration valuation mechanism of the Company.
Directors, supervisors and senior executives of the Company has 19 in total up to 31 December 2018, actually 13
person receiving remuneration from the Company, 2 staff supervisors are received their remuneration by actual
positions (non-supervisor post); furthermore, 3 independent directors are received the allowance monthly from the
Company; the Company will pay remuneration to senior executives monthly/quarterly/annually.
During the reporting period, the Company has established the executive compensation and performance
management program for the senior management of 2018 in accordance with the main scope, the responsibilities,
the importance of the management positions of the senior management, and the compensation level of other
relevant company and position, the program includes but not limited to the company's key performance indicator
(KPI) and performance evaluation criteria, procedures and major evaluation system; the major programs and
systems of the reward and punishment; review the performance of duties of the company's senior management and
conduct the annual performance appraisal.
At the end of the year, the Remuneration and Appraisal Committee combined the work report and self-evaluation
of the senior management in 2018, followed the performance evaluation criteria and procedures, and evaluated the
184
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Key Performance Indicator (KPI) of the senior management in 2018; and other relevant indicators of performance
evaluation; proposed the remuneration amount and performance appraisal approach of the senior management
based on the job performance evaluation results and the remuneration policy, and reported to the Board for
approval.
(ii) Remuneration for directors, supervisors and senior executives in reporting period
In 10 thousand Yuan
Total Whether
remuneration remuneration
Name Title Sex Age Post status obtained from the obtained from
Company (before related party of
taxes) the Company
Currently in
Li Wei Chairman M 46 0 Yes
office
Currently in
Wu Dinggang Deputy Chairman M 46 45.04 No
office
Director, Deputy Currently in
Kou Huameng M 49 29.19 No
president office
Currently in
Shi Qiang Director M 50 0 Yes
office
Currently in
Yong Fengshan Director M 50 0 Yes
office
Director, Deputy Currently in
Hu Zhaogui M 45 43.05 No
president office
Independent Currently in
Gan Shengdao M 52 11.90 No
director office
Independent Currently in
Ren Jia M 55 11.90 No
director office
Independent Currently in
Lu Yingjin M 54 11.90 No
director office
Chairman of Currently in
Shao Min M 36 0 Yes
Supervisory office
Currently in
Huang Hong Supervisor F 48 0 Yes
office
Currently in
He Xintan Supervisor M 38 0 Yes
office
Currently in
Ji Ge Staff supervisor F 37 19.79 No
office
Zhu Wenjie Staff supervisor M 31 Currently in 18.46 No
185
CHANGHONG MEILING CO.,LTD. Annual Report 2018
office
Executive deputy Currently in
Liu Hongwei M 55 49.47 No
president office
Currently in
Zhong Ming Deputy president M 46 30.70 No
office
Currently in
Huang Danian Deputy president M 49 30.53 No
office
CFO (person in Currently in
Pang Haitao M 43 30.19 No
charge of finance) office
Secretary of the Currently in
Li Xia F 38 26.60 No
Board office
Teng
Director M 50 Office leaving 0 Yes
Guangsheng
Total -- -- -- -- 358.72 --
Note: deputy chairman Mr. Wu Dinggang received remuneration for serves as President of the
Company in the period
(iii) Equity incentive authorized for director, supervisor and senior executive in reporting
period
□ Applicable √ Not applicable
(iv) Equity incentive authorized for director, supervisor and senior executive in reporting
period
□ Applicable √ Not applicable
V. Staff of the Company
Changhong Meiling Co., Ltd. and its controlling subsidiaries owned on-job employees of 16,520 people in total.
There are 97 people in retired are enjoying expenses paid by the Company.
(i) Numbers, professional structure and education background
On-job employee in parent company (people) 6,825
On-job employee in main subsidiary (people) 9,695
Total on-job employees (people) 16,520
Current total payroll(people) 16,520
Number of retired employees with expenses paid by the
97
parent company and main subsidiary (people)
Professional structure
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Types of professional category Numbers of professional category (people)
Production staff 10,357
Salesman 3,250
Technician 2,278
Financial staff 238
Administration staff 397
Total 16,520
Education background
Type of education background Numbers (people)
High school and below 11,165
Junior college 2,475
Undergraduate 2,732
Master and above 148
Total 16,520
(ii) Remuneration policy
Remuneration policy of the employees: the Company formulated human resources and compensation policy
conducive to sustainable development of enterprise according to the provisions of relevant laws and policies
promulgated by the state and to the Company's actual situation; through the performance appraisal, we guided
managers and staff to make contribution for the development of the Company. At the same time, the Company
attaches great importance to staff development, build the position system and promotion channels, and enhance
staff capacity through a variety of training. We combine the incentive and guarantee compensation, encourages
mutual develop between employees and the Company. The Companies concerned about employee benefits,
shaping corporate culture by providing various holiday, allowance, sympathy, traffic and organizing colorful
activities, thus improve employee satisfaction.
(iii) Training plans
Training plan: The Company has established the Staff Training Management System, Credit Management
Regulations, Reserve Team Selection and Training Regulations and other systems and standard work flows, set up
the staff capacity model, and gradually established the growth mechanism by combining the training with the
individual employee development, and combining the qualification promotion with the career development.
1. The mechanism for the selection, education and use of reserve talents gradually presented. In 2018, the
Company focused on advancing the project for talent construction, and optimized the high-level talent
development echelons such as reserve leaders, reserve cadres, overseas businesses, overseas factories, and
outstanding university students, and so on; establish a clear evaluation model for talent standards, promote the
construction of talent standards for management, general manager of domestic sales, and overseas regional
managers; establish succession maps for each sequence of talents, and clarify the ability status of existing talent
teams and future talent succession systems.
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2. Talent cultivation is more effective in supporting the development of the company. In order to effectively
support the company’s business policy of “product leadership, marketing transformation, efficiency improvement,
team activation”, the company released the Human Resources Strategic Plan of Changhong Meiling, on the one
hand, improve the training enthusiasm and development capabilities of R & D personnel through the project
points-based system, industry exchanges and other activities, on the other hand, aim at the shortcomings of team
and personal ability, and promote accurate training programs, focus on actual working scenes, targeted at the core
talent-oriented push courses, and the training effect gradually appears and the number of talents gradually
increases.
3. Build a competitive enterprise cultural atmosphere. Successfully organized the corporate culture benchmark
selection and theme activity of culture-on-wall;revised the enterprise culture manual, and re-organized the core
concepts of the enterprise, and combined with monthly enterprise cultural construction, sports cultural festivals
and other ways to deepen the awareness and recognition of the Company’s employees to enterprise culture.
(iv) Labor outsourcing
□ Applicable √ Not applicable
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Section IX. Corporate Governance
I. Corporate governance of the Company
(I) Overview of the corporate governance
In strict compliance with the Company Law, Securities Law, Governance Principles of Listed Company issued by
the CSRC, and the Rules Governing the Listing of Securities on Shenzhen Stock Exchange (amended in 2018),
the Company continued to construct and perfect its governance structure, thereby forming its decision-making,
supervision and operation management organization with general meeting, the board of directors, the board of
supervisors and operation management as the major structure. The general meeting, board of directors, board of
supervisors and operation management of the Company has definite terms of reference, which can ensure an
effective balance, scientific decision-making process and coordinative operation, laying firm foundation for
making decisions relating to the Company’s continuous, steady and healthy development.
During the reporting period, the actual situation of corporate governance has been in line with the requirements of
relevant state laws and regulations, and regulatory documents relevant to governance of listed companies issued
by China Securities Regulatory Commission and Shenzhen Stock Exchange.
1. Shareholders and general meeting
The Company standardized the procedures concerning convening, holding and voting of general meeting in strict
compliance with the Articles of Association and Rules of Procedure of General Meeting. All shareholders,
especially the minority shareholders, were equally treated to ensure all shareholders shall rank equal status and
can fully exercise their right. During the reporting period, the Company convened shareholders general meetings.
In addition to convening general meeting in forms of site conference, the Company offered convenience for
shareholders to present general meeting via network voting which was safe, economic and convenient. At the
same time, all the matters submitted to the Company’s general meeting of shareholders should count the votes of
the small and medium investors separately, and the results of the vote count should be disclosed timely so as to
effectively protect the rights and interests of small and medium investors and ensure that all shareholders,
especially the small and medium shareholders, fully exercise their rights.
2. The Company and controlling shareholders:
The Company has independent business and independent management capability. The Company and its
controlling shareholders owe independent business, personnel, assets, organs and finance. During the period,
controlling shareholder abide by requirement of Article of Association and Management System of Related
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Transactions, strictly regulate their behaviors, and no controlling shareholder has directly or indirectly intervened
in the Company’s policy-making and business activities beyond the general meeting of stockholders, no capital or
assets of the Company occupied by controlling shareholder and its affiliates either.
3. The directors and board of directors
Board Meeting are revoke and open in line with the regulation of Company Law and Article of Association
strictly, voting and information disclosure procedures appliance with relevant rules. All directors of the Company
carry out work according to “Rules of Procedure of the Board” and “Independent Director System”, seriously
attend the board of directors and shareholders’ meeting, exercise obligations by the law and faithfully perform
their duties vigorously, positively participate in trainings of related knowledge open by Shenzhen Stock Exchange
and Securities Bureau, and get familiar with related laws and regulations. Independent directors follow close to
the line of Instruction of Setting Up Independent Directors System in Listed Companies and Independent Director
System, take an active part in decision-making of the Company and present a prior approval and independent
opinions for related transactions and major events, bring out the functions of independent directors.
In the Period, Board of the Company setting up four special committees including strategy, remuneration and
appraisal, audit and nomination, each special committee respectively undertakes the functions of discussion,
policy making, supervision and assessment according to the relevant working instruction, and plays important role
in improving the scientific decision-making, decision-making efficiency and quality for the Board.
4. Supervisors and board of supervisors
The Company convened and held meeting of supervisors in strict compliance with the Company Law and Articles
of Association, and the voting and information disclosure procedures of supervisors’ meeting complied with
relevant requirements. The 8th session of board of supervisors consisted or five supervisors, two of whom are staff
supervisor, the number and constitution of which met applicable laws and regulations. Our supervisors can
carefully performed their duties including presenting at general meeting and meeting of the board of directors in
accordance to the Rules of Procedures of Board of Supervisors, to exercise supervision over the board of
directors’ decision-making procedures, subjects to be proposed and our operation in law, to review the periodic
reports prepared by the Board and form written audit opinion in respect thereof and to make effective supervision
over our material transactions, connected transaction, financial position as well as the legality and compliance of
the performance by directors and senior management and issue independent opinions in respect thereof.
5. The performance appraisal and incentive and constraint mechanism
The Company owes and continues to improve fair-ness and transparency performance appraisal standards and
incentive and constraint mechanism for directors, supervisors and senior management, the engagement of
managers of the Company is open and transparent and meets the provisions of laws and regulations.
6. The stakeholders
The Company fully respects and maintains the legitimate rights and interests of stakeholders; strengthen
communication and negotiation with each other, realizes the coordination and balance of interests for all parties
including society, shareholders, company and staff, pushes forward the sustainable, steady and harmonious
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
development of the Company together.
7. The information disclosure and transparency
During the Period, the Company strengthens management of information disclosure, performs the duty of
information disclosure in strict accordance with the rules of related laws and regulations, Rules Governing the
stock listed on Shenzhen Stock Exchange (2018 Reversion) and “Management System of Information Disclosure”,
and appoints Securities Times, China Securities Journal, Hong Kong Commercial Daily and Juchao Website
(www.cninfo.com.cn) for information disclosure medial; as for the major un-disclosed inside information,
exercise strictly confidential procedures and controlling persons with inside information kowned. The Company
perform duty in aspect of truthfully, accurately, timely and completely discloses information, ensures all investors
obtain the Company’s information equally and other legal interest.
8. Investor relations management
The Company has seriously done the job of the investor relations management in accordance with the
requirements of the "Investor Relations Management System" and "Reception and Promotion system" during the
Period. Received the consultation and research of the professional institutional investors to the company, checking
records for visitors and signing letter of commitment, disclosed the "investor relations activities record" timely.
At the same time, communicated with the investors through the "interact easily" platform of Shenzhen Stock
Exchange Investor Relations; seriously received the suggestion and opinions from investors, protect interest of the
minority investors, earnestly accepted and replied the calls, faxes, and emails from the investors; cautiously dealt
with the media coverage.
(ii) Is there any difference between the actual condition of corporate governance and relevant regulations
about corporate governance for listed company from CSRC?
□Yes √ No
There are no differences between the actual condition of corporate governance and relevant regulations about
corporate governance for listed company from CSRC.
II. Independent of the Company relative to controlling shareholders’ in aspect of businesses, personnel,
assets, organization and finance
The Company totally separated in business, personnel, assets, institutions and financial aspects from Sichuan
Changhong (controlling shareholder), with independent business accounting, responsibility and risk and
independent business operation capability.
1. The business: the Company has an independent and complete business as well as operation ability, with
specialized procurement, production, technology, marketing, management, human resources and other
departments. We autonomously manage and operate business on our own. While the management staff are
independent from controlling shareholders and their subordinate enterprises. The Company is free from
interference by controlling shareholders and other affiliates, and there is no dependence on controlling
shareholders and other affiliates.
2. The personnel: personnel, labor, personnel and salary of the Company are completely independent. President,
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
vice president, Secretary of the board of directors and other senior management personnel are working in the
Company and receive salary, not receiving any remuneration and holding position of any except directors,
supervisors in the controlling shareholder and its subordinate enterprises.
3. Assets: the Company owns places of production and management independent from its controlling shareholder,
owns complete assets structure, independent production system, auxiliary production systems and supporting
facilities, land use rights, ownership of houses and other assets, and independent purchase and sales system. No
assets occupied by controlling shareholders and other affiliates.
4. Institutions: the Company established organization completely independent from controlling shareholders; the
general meeting, board of directors, board of supervisors and the internal organization are capable of taking
independent action, with no controlling shareholder intervention of corporation's decision-making behavior. The
Company strengthen the power restriction system via general meeting, the Board, supervisory committee,
independent directors and vary committees, formulated an effective structure for corporate governance.
5. Financial aspects: the Company set up independent financial management, and independent accounting system
and financial management system, independently setting up banking account and tax declaration.
III. Horizontal competition
□ Applicable √ Not applicable
IV. In the report period, the Company held annual shareholders’ general meeting and
extraordinary shareholders’ general meeting
1. Annual Shareholders’ General Meeting in the report period
Ratio of
Session of investor
Type Date Date of disclosure Index of disclosure
meeting participati
on
First
Juchao
Extraordinary Extraordinary
Website—(http://www.cninfo.co
General General 31.74% 9 Jan. 2018 10 Jan. 2018
m.cn) “Resolution Notice of
Meeting of Meeting
First extraordinary general
2018
meeting of 2018” No.: 2018-001
Juchao
Website—(http://www.cninfo.co
AGM of 2017 AGM 30.1619% 10 May 2018 11 May 2018 m.cn) “Resolution Notice of
Annual General Meeting of
2017” No.: 2018-029
Second Juchao
Extraordinary
Extraordinary Website—(http://www.cninfo.co
General 31.1951% 21 June 2018 22 June 2018
General m.cn) “Resolution Notice of
Meeting
Meeting of Second extraordinary general
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
2018 meeting of 2018” No.: 2018-038
Third Juchao
Extraordinary Extraordinary Website—(http://www.cninfo.co
General General 31.63% 27 Nov. 2018 28 Nov. 2018 m.cn) “Resolution Notice of
Meeting of Meeting Third extraordinary general
2018 meeting of 2018” No.: 2018-069
Fourth Juchao
Extraordinary Extraordinary Website—(http://www.cninfo.co
General General 33.70% 27 Dec. 2018 28 Dec. 2018 m.cn) “Resolution Notice of
Meeting of Meeting Fourth extraordinary general
2018 meeting of 2018” No.: 2018-079
2. Request for extraordinary general meeting by preferred stockholders whose voting rights
restore
□ Applicable √ Not applicable
V. Responsibility performance of independent directors
(I)The attending of independent directors to Board meetings and general meeting
The attending of independent directors
Times of
Times of
Times of Absent the attending
Board meeting Times of Times of
Independent attending by Times of Meeting for the the
supposed to present in entrusted
director communicati Absence second time in a shareholde
attend in the person presence
on row (Y/N) r general
report period
meeting
Gan Shengdao 11 1 10 0 0 No 1
Ren Jia 11 1 10 0 0 No 4
Lu Yingjin 11 3 8 0 0 No 2
Explanation of absent the Board Meeting for the second time in a row:
No independent directors absent the Board Meeting for the second time in a row.
(ii) Objection for relevant events from independent directors
Whether independent directors come up with objection about company’s relevant matters or not
□ Yes √ No
Independent directors has no objections for relevant events in reporting period
(iii) Other explanation about responsibility performance of independent directors
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Whether the opinions from independent directors have been adopted or not
√Yes □ No
Explanation on recommendations adopted or un-adopted:
During the report period, the independent directors of the 8th session of the Board, Mr. Gan Shengdao, Mr. Ren Jia
and Mr. Lu Yingjin, faithfully performed their duties, and prudently, earnestly and diligently exercised their rights
as independent directors in strict accordance with “Corporation Law”, “Securities Law”, “Guidance on the
Establishment of Independent Director System in Listed Companies” of China Securities Regulatory Commission,
“Stock listing Rules”(Revised in 2018) of Shenzhen Stock Exchange, “Articles of Association”, “Independent
Director System”, “Annual Report Working System of Independent Director”, and rules of related laws and
regulations, not influenced by the major shareholders, actual controllers, or other units and individuals having a
stake in the Company, actively attended the general meeting of shareholders and board meeting, made
independent opinions on related matters, gave reasonable suggestions to the production and management and the
business development of the Company, gave full play to the role as independent directors, and maintained the
legitimate rights and interests of shareholders of the Company, especially the medium and small shareholders.
1. Deepen understanding operation of the Company. Independent directors take advantage of attending the
shareholders meeting and Board meetings, fully understand the situation of operation of the Company, listen to
the reports of business status and operation from the management. While in deliberated the related transactions,
independent directors are accredited and issued opinions on the Board Meeting; as for the other proposals that
need to decided by the Board, such as business development, financial operations and risk controlling, relevant
materials are well-deliberated by independent directors, after report, they issued independent opinions and
effectively promoted the scientific and objectivity of decisions of the board of directors.
2. Positive reinforce competency. Independent directors actively joined in the training activities for directors,
supervisors and senior management held by the supervision organization, study relevant system and normative
documents released and renew by the CSRC, Shenzhen Stock Exchange and other authority, deepened their
understanding to relevant regulations, especially the regulations involving corporate governance structure and
rights protection for shareholders with public shares, so as to strengthen and improve their protective capabilities
for the Company and shareholders’ rights and interests, and form the ideology of consciously protecting the
shareholders with public shares.
3. Diligently perform their duties. In the process of establishment and disclosure for 2018 annual report, the
independent directors, Mr. Gan Shengdao, Mr. Ren Jia and Mr. Lu Yingjin, positively performed their duties,
gave full play to their independent roles in the annual reports, carefully listened the management’s report about
the annual business condition and development of major events and did necessary field visits, directly met and
communicated with the Certified Public Accountants for annual report and internal control auditing in the audit
process, and diligently performed their duties as the independent directors
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
In reporting period, independent directors propose opinions on the Board, and details of suggestions as:
Dated Items Agree/against Disclosure index
Juchao
Independent opinion on relevant proposal of
2018-03-28 Agreed Website(www.cninfo.com
the 7th session of 9th BOD
.cn)
Juchao
Independent opinion on relevant proposal of
2018-04-12 Agreed Website(www.cninfo.com
the 8th session of 9th BOD
.cn)
Independent opinion on carrying out forward Juchao
2018-04-17 foreign exchange fund transaction in 1Q of Agreed Website(www.cninfo.com
2018 .cn)
Juchao
Independent opinion on relevant proposal of
2018-06-04 Agreed Website(www.cninfo.com
the 12th session of 9th BOD
.cn)
Juchao
Independent opinion on Appointment of the
2018-06-21 Agreed Website(www.cninfo.com
Deputy President of the Company
.cn)
Juchao
Independent opinion on relevant proposal of
2018-08-14 Agreed Website(www.cninfo.com
the 14th session of 9th BOD
.cn)
Juchao
Independent opinion on relevant proposal of
2018-10-17 Agreed Website(www.cninfo.com
the 15th session of 9th BOD
.cn)
Juchao
Independent opinion on relevant proposal of
2018-11-08 Agreed Website(www.cninfo.com
the 16th session of 9th BOD
.cn)
Juchao
Independent opinion on relevant proposal of
2018-12-10 Agreed Website(www.cninfo.com
the 17th session of 9th BOD
.cn)
VI. Responsibility performance of subordinate special committee of the Board in report
period
(i) Responsibility performance for strategy committee of the Board
In accordance with the requirements of the relevant laws and regulations of the Company Law and the Listing
Rules of the Shenzhen Stock Exchange and the relevant requirements of the CSRC and the Shenzhen Stock
Exchange, the Strategic Committee under the Board of Directors of the company has strictly followed the
provisions of the Articles of Association and the Working Rules of the Strategic Committee of the Board of
Directors, strictly performed their duties, and offered proposals and carried out positive guides for the company's
strategic development and foreign investments, the specific situation is as follows:
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
1. On March 18, 2018, the Strategic Committee convened the 1st meeting of the Strategy Committee of the 9th
Board of Directors, deliberated and approved the two proposals as development plans for year of 2018, and
Shareholder Return Plan for Next 3 Years (2018-2020);
(1)According to the Company’s medium and long term development strategy, the committee members combined
with the macroeconomic situation and industry status and summarized the annual work situation in 2017,
discussed and established the Company’s business thoughts and business plans in 2018, and further ensured the
realization of the Company’s medium and long term development strategic targets.
(2) In order to further improve and perfect the scientific, sustained and stable shareholder reward mechanism,
increase the profit distribution policy and the transparency and operability of decision-making, and effectively
protect the legitimate rights and interests of public investors, according to the requirements of Company Law, and
the Notice on Further Implementing the Relevant Issues Concerning Cash Dividends of Listed Companies (ZJF
No. [2012] 37) and Listing Company Supervision Guidelines No. 3 – Cash Dividends of Listed Companies
(CSRC Announcement No. [2013] 43) of China Securities Regulatory Commission and other relevant laws,
regulations and regulatory documents, in accordance with the relevant provisions of the Articles of Association,
and comprehensively considering the company’s financial status and other factors, it agreed to the company’s
Shareholder Return Plan of the Company for the Next Three Years (2018-2020). It agreed to submit the matter to
the board of directors for consideration.
2. On May 4, 2018, the strategy committee held the second meeting of the strategy committee of the ninth board
of directors, and reviewed and approved the Proposal of the Company to Submit a Binding Quotation for the
Purchase of Stock Equity of Gorenje gospodinjski aparati d.d..
In order to rapidly enhance the company’s brand influence, industry status and market share in overseas markets,
further optimize the existing industrial structure and enhance its comprehensive competitiveness, it agreed the
company to submit a binding quotation for the purchase of Gorenje’s stock equity. It agreed to submit the proposal
to the company’s board of directors for consideration. .
3. On October 15, 2018, the strategy committee held the second meeting of the strategy committee of the ninth
board of directors, and reviewed and approved the Proposal on the Capital Increase of Subsidiary Hongyuan
Geothermal Heat Pump Technology Co., Ltd. to its Wholly-Owned Subsidiary.
According to the market demand, with the scale expansion of the company’s geothermal heat pump products, in
order to effectively meet market demand and make full use of policy resources, it agreed the company’s holding
subsidiary, Hongyuan Geothermal Heat Pump Technology Co., Ltd., to increase capital of RMB 30 million to its
wholly-owned subsidiary, Hongyuan Geothermal Heat Pump Technology (Zhongshan) Co., Ltd. so as to further
expand the production capacity of geothermal heat pump products and increase the R&D investment, and
effectively meet market demand. It agreed to submit the matter to the board of directors for consideration.
4. On December 8, 2018, the strategy committee held the fourth meeting of the strategy committee of the ninth
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
board of directors, and reviewed and approved the Proposal of the Company to Newly Establish
Technology-based Subsidiary.
According to the company’s intelligent development strategy, in order to further enhance the company’s product
research and development capabilities in intelligence, frequency conversion, etc., and provide platforms for the
company’s internal new business development, it agreed the company to invest 10 million yuan to newly establish
a technology-based subsidiary Hefei Meiling Zhihuijia Technology Co., Ltd. (tentatively, subject to the approval
of the industrial and commercial bureau) to work on the intelligence, frequency conversion and other key
technology research and development and the software development of refrigeration, freezer and other electrical
products. It agreed to submit the matter to the board of directors for consideration.
5. On March 17, 2019, the strategy committee held the fifth meeting of the strategy committee of the ninth board
of directors, and reviewed and approved the Proposal on the Company’s Development Planning in 2019”.
According to the company’s medium and long-term development strategy, and combined with the macro
environment and industry situation of the company, it discussed and established the company’s management
concept and business plans in 2019 to further ensure the realization of the company’s medium and long-term
development strategic goals after analyzing the company’s overall work situation in 2018 .
(ii) Responsibility performance for audit committee of the Board
Audit committee of the Board performed its functions of supervision and examination to maintain the
independence of audition in auditing for year of 2018 according to the requirements of related laws and
regulations such as Company Law and Rules Governing the Listing of Stocks on Shenzhen Stock Exchange and
related requirements of Securities Regulatory Commission and Shenzhen Stock Exchange by abiding of Articles
of Incorporation, Implementing Regulations of Audit Committee of Board of the Directors, and Annual Work
Rules of Audit Committee, the details are as follows:
1. On 30 January 2018, the “Financial Statement Report for year of 2017 and Arrangement of Internal Control
Auditing” and “Un-audited Financial Accounting Statement for year of 2017” were deliberated and approved in
2nd session of 9th audit committee of the Board. Found more details in “(II) Responsibility performance for audit
committee of the Board” of “VI. Responsibility performance of subordinate special committee of the Board in
report period” carried in “Section IX. Corporate Governance” disclosed in Annual Report 2017, released on
Juchao Website (www.cninfo.com.cn) dated 30 March 2018.
2. On 8 March 2018, the 3rd session of 9th audit committee of the Board deliberated the first draft of Annual
Report 2017, after a preliminary audit opinion issued from Shine Wing CPA (LLP). Found more details in “(II)
Responsibility performance for audit committee of the Board” of “VI. Responsibility performance of subordinate
special committee of the Board in report period” carried in “Section IX. Corporate Governance” disclosed in
Annual Report 2017, released on Juchao Website (www.cninfo.com.cn) dated 30 March 2018.
3. On March 18, 2018, the audit committee held the 4th session of the 9th audit committee of the board o which
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
reviewed and approved six proposals as "The Company's 2017 Annual Audited Financial Reports", "2017 Internal
Control Audit Report", "Summary report about the company's 2017 annual audit work taken up by Shine Wing
Certified Public Accountants", "Motion on reappointment of the audit institution for 2018 annual financial report
and internal controls and its payment", “Change of the Accounting Standards”and "Motion on the company to
carry out forward foreign exchange transaction business", and agreed to submit the above motions to the board of
directors for consideration.
4. On 15 April 2018, the “Financial Statement of 1Q of 2018” was deliberated and approved in 5th session of 9th
audit committee of the Board, the un-audited financial statement present a real, accurate and completed financial
status and operation results of the Company for 1Q of 2018. The financial statements of 1Q of 2018 agree to
submit for approval in the Board.
5. On 4 August 2018, the “Financial Statement of Semi-annual 2018” was deliberated and approved in 6th session
of 9th audit committee of the Board, the un-audited financial statement present a real, accurate and completed
financial status and operation results of the Company for semi-annual of 2018. The financial statements of
semi-annual 2018 agree to submit for approval in the Board.
6. On 15 October 2018, the “Financial Statement of 3Q 2018” was deliberated and approved in 7th session of 9th
audit committee of the Board, the un-audited financial statement present a real, accurate and completed financial
status and operation results of the Company for 3Q of 2018. The financial statement of 3Q 2018 agree to submit
for approval in the Board.
7. On 24 January 2019, the “Financial Statement Report for year of 2018 and Arrangement of Internal Control
Auditing” and “Un-audited Financial Accounting Statement for year of 2018” were deliberated and approved in
8th session of 9th audit committee of the Board, the un-audited financial statement presented an objectified
financial status and operation results for year of 2018 basically.
8. On 9 March 2019, the audit committee held the 9th session of the 9th audit committee after the Shine Wing
Certified Public Account (LLP) issued preliminary audit opinion. Reviewed the auditing draft of financial report
for year of 2018, proposed specific opinions; members of audit committee communicated with certified public
accountant who was responsible for audition of the company, the certified public accountant who was be
responsible for annual audition of the company reported related matters and adjusted matters during the audition
to the audit committee, and matters of the company needs to be adjusted have been adjusted according to
adjustment opinions of the certified public accountant who was responsible for annual audition. The audit
committee read the first draft of audited financial accounting statements for 2018 of the company according to
audition condition known from certified public accountant who was responsible for annual audition and
production operation condition and financial performances reported by management level of the company,
considered that the annual financing accounting statements for 2018 audited preliminarily by the Shine Wing
Certified Public Account can truly, correctly and completely reflect the operation condition of the company, and
confirmed the preliminary audit opinions of financing accounting statements of the company issued by the Shine
Wing Certified Public Account.
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
9. On 17 March 2019, the 10th session of the 9th audit committee of the Board deliberated and approved the
followed six proposals as” Audited Financial Statement Report of 2018”, “Auditing Report of Internal Control for
year of 2018”, ‘Summary Report on Auditing Works for year of 2018 from Shine Wing Certified Public Account”,
“Auditing Institution for Financial Report of 2019 and Internal Control Auditing Re-engagement and
Remuneration Paid”,, “Opening Business of Forward Exchange” and “Change of the Accounting Policy”, and
agreed to submit these auditing institutions to board of the directors of the Company for deliberation.
(iii) Responsibility performance for nominations committee of the Board
The nominations committee under the board of directors practically performed their duties on the basis of
requirements of laws and regulations of “Company Law” and “Rules Governing the Listing of Stocks on Shenzhen
Stock Exchange” and related requirements of China Securities Regulatory Commission and Shenzhen Stock
Exchange, and in strict accordance with “Articles of Association”, “Implementation Rules of Nominations
Committee of the Board”, in the reporting period, the nominations committee reviewed and made
recommendations to the engaged senior management that needed to be submitted to the board for consideration
and nomination.
1. On June 1, 2018, the nomination committee held its 4th meeting of the nomination committee of the 9th board of
directors, deliberated and approved proposal of qualification auditing for the non-independent director elected as
9th BOD. The committee considered that the qualifications of the candidate for the Company’s non-independent
director to be elected were in line with the “Company Law”, “Articles of Association” and the relevant provisions
of the China Securities Regulatory Commission, there were no cases that the China Securities Regulatory
Commission determined as market bans or bans have not been lifted; the education background, office holding
experience, professional competence, and professional qualities of the people to be elected were in line with the
job requirements. It’s agreed to nominate Mr. Hu Zhaogui as the non-independent director of the 9th board of
directors of the Company, which was submitted to the board of directors for deliberation.
2. On June 19, 2018, the nomination committee held its 5th meeting of the nomination committee of the 9th board
of directors, deliberated and approved proposal of qualification auditing for the deputy president. The committee
considered that the qualifications of the candidate for the Company’s deputy president to be elected were in line
with the “Company Law”, “Articles of Association” and the relevant provisions of the China Securities
Regulatory Commission, there were no cases that the China Securities Regulatory Commission determined as
market bans or bans have not been lifted; the education background, office holding experience, professional
competence, and professional qualities of the people to be elected were in line with the job requirements. In line
with the relevant regulation of Article of Association, and being nominated by the President, Mr. Hu Zhaogui was
nominated as the nomination of deputy president of the Company and submitted to the board of directors for
deliberation.
3. On 9 Jan. 2019, the nomination committee held its 6th meeting of the nomination committee of the 9th board of
directors, deliberated and approved proposal of acting as the chairman by the director and deputy president Mr.
Kou Huameng. In view of the resignation of president - Mr. Wu Dinggang, the Company agreed to authorized
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
director and deputy president Mr. Kou Huameng acting as the Chairman of the Company;duration of the acting
period will end till the new president appointed since 11 Jan. 2019, and submitted to the board of directors for
deliberation.
(iv) Responsibility performance for remuneration and appraisal committee of the board
In line with relevant laws and regulation of Company Law and “Rules Governing the Listing of Stocks on
Shenzhen Stock Exchange” as well as requirement from CSRC and Shenzhen Stock Exchange, remuneration and
appraisal committee of the Board, strictly follow rules of “Article of Association” and “Implementation Rules of
remuneration and appraisal committee of the Board”, in the reporting period, the committee proposed suggestions
on the performance evaluation standards and incentive & restraint mechanism for directors, supervisors and senior
executives, and review the appraisal and remuneration of directors, supervisors and senior executives, accrual and
distribution for performance incentive fund included. More details are as:
1. On March 18, 2018, the 1st meeting of the Remuneration and Appraisal Committee of the 9th Board of Directors
was convened. The meeting reviewed and approved the "Appraisal and Payment of Remuneration of Directors
and Senior Executives in the Year 2017", and carried out follow opinions:
The committee assessed and reviewed the remunerations and payment status of the Company’s directors and
senior executives in 2017, and considered that the allowances received by the independent directors of the
Company should be paid at the allowance rate approved by the general meeting of shareholders; the
remunerations received by the Company’s senior executives from the Company should be strictly based on the
Company’s remuneration and assessment system, the remuneration information disclosed by the Company was
truthful, accurate, and complete and conformed to requirements of “Content and Format Norm for Information
Disclosure of Companies Publicly Issuing Securities No. 2 - Content and Format of Annual Report (Revised in
2017)” of China Securities Regulatory Commission
The Board of Directors of the Company reviewed and passed the remuneration assessment and payment matters
of the directors and senior executives in the Company’s 2017 annual report based on the remuneration assessment
status of senior executives of the Company and the opinions of the remuneration and appraisal committee.
2. On March 19, 2019, the remuneration and appraisal committee of the Ninth Session of Board of Directors
convened the 2nd meeting which reviewed and approved the “Remuneration Assessment and Payment of Directors
and Senior Executives of the Company in 2018” and issued the following review opinions:
The committee assessed and reviewed the remunerations and payment status of the Company’s directors and
senior executives in 2018, and considered that the allowances received by the independent directors of the
Company should be paid at the allowance rate approved by the general meeting of shareholders; the
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
remunerations received by the Company’s senior executives from the Company should be strictly based on the
Company’s remuneration and assessment system, the remuneration information disclosed by the Company was
truthful, accurate, and complete and conformed to requirements of “Content and Format Norm for Information
Disclosure of Companies Publicly Issuing Securities No. 2 - Content and Format of Annual Report (Revised in
2017)” of China Securities Regulatory Commission
The Board of Directors of the Company reviewed and passed the remuneration assessment and payment matters
of the directors and senior executives in the Company’s 2018 annual report based on the remuneration assessment
status of senior executives of the Company and the opinions of the remuneration and appraisal committee.
VII. Works from Supervisory Committee
Whether the Company has risks or not in reporting period that found in supervisory activity from supervisory
committee
□Yes √ No
Supervisory committee has no objection about supervision events in reporting period
VIII. Appraisal and incentive to senior management
(I) Evaluation mechanism for senior executives of the Company
The Company formulated “Implementation Rules of Remuneration and Appraisal Committee of the Board”, the
remuneration and appraisal committee established 2018 annual compensation and performance management plan
for the senior management of the Company in accordance with the main scope, responsibilities, importance of
their management positions and the remuneration level of other relevant enterprises and positions; the plan
included but not limited to key performance indicator (KPI), performance appraisal standards, procedures and
major programs and systems of main appraisal system, reward and punishment; investigated the execution of duty
of the senior management and implemented annual performance appraisal to them. After reviewed by the
committee, submit to the Board for approval.
At the end of the year, combined with the senior management’s working reports and self-evaluation of 2018, and
according to the performance evaluation criteria and procedures, the Compensation and Appraisal Committee has
carried out performance appraisal to the senior management’s key performance indication (KPI) in 2018 and other
related indicators; proposed the remuneration amount and performance assessment methods for senior
management according to the job performance evaluation results and remuneration distribution policy, and
reported to the Board of Directors for approval.
(ii) Establishment and implementation of performance incentive mechanism
The Company formulated a mid-long term incentive and restraint mechanism, that is “Implementation Plan of
Annual Performance Incentive Fund” in 2012, on 9 August 2012 and 28 August 2012, the Plan was deliberated
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
and approved in 16th meeting of 7th session of the Board and 2nd extraordinary general meeting 2012. Details of
the aforesaid event can be found in the announcement (No.: 2012-028 and No.: 2012-035) released on appointed
media Securities Times, China Securities Journal, Hong Kong Commercial Daily and Juchao Website
(www.cninfo.com.cn) dated 10 August 2012 and 29 August 2012. Implementation of the annual performance
incentive fund found more in “ Implementation of Annual Performance Incentive Fund” of “XV Implementation
of the company’s stock incentive plan, employee stock ownership plan or other employee incentives” in “Section
V. Important Event” carried in the Report.
IX. Internal Control
(I) Details of major defects in IC appraisal report that found in reporting period
□Yes √ No
There are no details of major defects in IC appraisal report in reporting period
(ii) Appraisal Report of Internal Control
Date of evaluation report of internal control
2019-3-29
disclosed (Full-text)
Index of evaluation report of internal control
Juchao Website(www.cninfo.com.cn)
disclosed (Full-text)
The ratio of the total assets of units included in
the scope of evaluation accounting for the total
97.79%
assets on the company's consolidated financial
statements
The ratio of the operating income of units
included in the scope of evaluation accounting
95.78%
for the operating income on the company's
consolidated financial statements
Defects Evaluation Standards
Category Financial Reports Non-financial Reports
1. Material defect: severally or jointly with other defects, will lead Occurrence of the followings shall
to material wrong reporting in financial reports being not able to be deemed as material defect,
prevented or found or rectified in a timely manner. Occurrence of otherwise as major defect or
the followings will be deemed as material defect: general defect subject to the level
1. inefficiency of environment control; of influence.
Qualitative 2. fraud of directors, supervisors and senior management; 1. breach of national laws,
criteria 3. The external auditor finds material wrong reporting in current regulations or regulatory
financial statement, while the Company has not found such documents;
reporting during its operation; 2. procedure for making significant
4. The material defect identified and reported to the management decisions is not scientific;
fails to be rectified in a reasonable time period; 3. absence of system may lead to
5. The audit committee and audit department of the Company invalid system;
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
exercise invalid supervision upon internal control; 4. Material or major defects are not
6. Other defects which may affect financial statement users to make likely to rectify;
correct judgment. 5. Large negative effects on the
2. Major defect: severally or jointly with other defects, will lead to company and disclosed in the form
wrong reporting in financial reports being not able to prevented or of announcement;
found or rectified in a timely manner which still needs attention 6. Other issues that materially
from the management though it doesn’t reach or exceed material affect the Company.
defect as described above. Occurrence of the followings will be
deemed as major defect:
(1) Financial losses caused by guaranteeing and investing in
securities and financial derivatives transactions and disposing
property right and stock right without authorization;
(2) The company's financial staff or other relevant business
personnel have unclear powers and responsibilities or job chaos, or
are suspected of being involved in economic or job-related crimes
and have been transferred to the judiciary;
(3) Punishment or severely negative impacts on the company's
image due to the bias implementation of the policy or accounting
errors, etc.;
(4) Financial losses caused by destroying, concealing, or altering
the important original evidences at will, such as invoices and
checks, etc.
(5) Cash income is not entered into the account book, or public
funds are deposited in private account or "private coffer" is
established by breaking the rules.
3. General defect: other internal control related defects that do not
constitute material defects or major defect.
1. Proportion of direct property
1. Proportion of potential wrong reporting in total operating loss in total operating income:
income: Material defect: wrong reporting ≧0.5%; Major defect: Material defect: wrong reporting
0.1% ≤ wrong reporting＜0.5%; General defect: wrong reporting＜ ≧ 0.1%; Major defect: 0.05% ≤
0.1%. wrong reporting ＜ 0.1%; General
2. Proportion of potential wrong reporting in total profit: defect: wrong reporting＜0.05%.
Material defect: wrong reporting ≧10%; Major defect: 5% ≤ 2. Proportion of direct property
Quantitative wrong reporting＜10%; General defect: wrong reporting＜5%. loss in total profit: Material
standard 3. Proportion of potential wrong reporting in total assets: defect: wrong reporting ≧ 10%;
Material defect: wrong reporting ≧0.5%; Major defect: 0.1% ≤ Major defect: 5% ≤ wrong
wrong reporting＜0.5%; General defect: wrong reporting＜0.1%. reporting ＜ 10%; General defect:
4. Proportion of potential wrong reporting in total owners’ wrong reporting＜5%.
equity: Material defect: wrong reporting ≧0.5%; Major defect: 3. Proportion of direct property
0.1% ≤ wrong reporting＜0.5%; General defect: wrong reporting＜ loss in total assets: Material
0.1%. defect: wrong reporting ≧ 0.2%;
Major defect: 0.1% ≤ wrong
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
reporting＜0.2%; General defect:
wrong reporting＜0.1%.
4. Proportion of direct property
loss in total owners’ equity:
Material defect: wrong reporting
≧0.2%; Major defect: 0.1% ≤
wrong reporting＜0.2%; General
defect: wrong reporting＜0.1%.
Amount of significant defects in
0
financial reports
Amount of significant defects in
0
non-financial reports
Amount of important defects in financial
0
reports
Amount of important defects in
0
non-financial reports
X. Auditing report of internal control
√ Applicable □ Not applicable
Deliberation section of auditing report of IC
We consider that: in all major aspects, Changhong Meiling Co., Ltd. has efficiency in financial report of internal
control dated 31 December 2018 according to Basic Standards of Internal Control for Enterprise and relevant
regulations.
Disclosure details of audit report of
Disclosed
internal control
Disclosure date of audit report of
2019-3-29
internal control (full-text)
Index of audit report of internal control
Juchao Website(www.cninfo.com.cn)
(full-text)
Opinion type of auditing report of IC Standard unqualified
whether the non-financial report had
No
major defects
Whether CPA carries out qualified opinion for audit report of internal control or not
□Yes √ No
Whether the opinions are consistent in audit report of internal control carrying out by CPA and the self-evaluation
report of the Board or not
√ Yes □ No
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section X. Corporate Bond
Whether the Company has a corporation bonds that issuance publicly and listed on stock exchange and without
due on the date when annual report approved for released or fail to cash in full on due
□Yes √No
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section XI. Financial Report
I. Audit report
Type of audit opinion Standard unqualified opinion
Date for signing the report 27 March 2019
Name of audit institute Shine Wing Certified Public Accountants (LLP)
Serial of Auditing Report XYZH/2019CDA40016
Name of CPA Li Xifu, Xia Cuiqiong
Auditor’s Report
XYZH/2019CDA40016
To Shareholders of Changhong Meiling Co., Ltd.:
I. Auditor’s opinion
We, as the auditors, audited the financial statements of Changhong Meiling Co., Ltd. (the “Company”), which
included the consolidated balance sheet as of 31 December 2018, the consolidated statement of income, the
consolidated statement of cash flow and the consolidated statement of changes in equity of the Company for the
year ended 31 December 2018, together with the relevant notes thereto.
We are the view that the attached financial statements are prepared in accordance with the Business Accounting
Standards in all material aspects, which reflect fairly the consolidated financial position of the Company as of 31
December 2018 and the operating results and cash flow of the Company for the year of 2018.
II. Basis for audit opinions
We conducted this audit under the requirements of the Auditing Standards of the Certified Public Accountant of
the PRC. The section headed “Certified Public Accountant’s responsibility for audit of financial statement” in the
audit report has further clarified our responsibilities under these standards. Pursuant to the code of professional
conduct as certified public accountant in the PRC, we are independent of the Company and have performed other
responsibility as required by our professional ethics. We believe that the audit evidence obtained by us is
sufficient and adequate, which provides foundation for us to issue audit opinion.
III. Key audit issues
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
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
these matters. The key audit matter we identified is as follows:
1.Recognition of revenue
Please refer to note (iv) 25 and note (vi) 37.
Key audit matters Audit address
Sales revenue of the Company was mainly sourced from Main auditing procedures for revenue recognition are including:
sales of refrigerator, air conditioner and washing machines to 1)know and test the cycle internal control of sales and collection, to
both domestic and overseas customers. As indicated in note assess the design and effectiveness of the internal control;
(vi) 37 of the financial statement - Operating income and
2)understand the business substance, inspect significant sales
cost, the operating income was RMB17,490,174,950.01 in
contract and the corresponding sales invoice, on a random basis,
2018. Since the truthfulness and completeness of revenue
receipt of notes, delivery information confirmed through systems,
recognition has material impact on operating results, we
verify that whether revenue was recognized upon satisfaction of
attached great importance to recognition of sales revenue.
required conditions and whether the revenue recognition was made
in right timing, and verify that whether profit was adjusted through
aggressive sales policy;
3) Conduct inquiry through issue of letters, and carry out additional
audit procedures for the items for which reply was abnormal;
4) review collection of trade receivables, confirm the conformity
between the entities owing receivables and name of customers to
verify whether there was collection of receivables from third parties,
to review the truthfulness of the collection and revenue;
5)review collection of receivables in subsequent period;
6)Make cut-off test and analysis re-review on revenue.
2.Capitalization of development expense
Please refer to note (iv) 19 and note (vi) 15
Key audit matters Audit address
The development expense occurred for research and 1. Understand the key control of capitalization of development
development of non-patent technology in 2018 was expenditures, implement internal control audit procedures,
RMB152,448,558.04, which was capitalized and accounted understand the scope and accounting methods of development
for as development expense in the consolidated financial expenditures, understand and make research and development on
statement. Development expense could only be capitalized related control systems and processes, and test the effectiveness of
upon satisfaction of all the capitalization conditions set out in relevant internal control design and operation;
note (iv)19 to the financial statement. Since to confirm 2. Implementation: compare the developed projects in intangible
whether all the capitalization conditions are met requires the assets with machinery models for external sales, and re-verify the
management to make significant judgment and estimate, we truthfulness of capitalization of completely developed projects
deem this matter important in the context of our audit. 3. Dual purpose testing: inspect the project reports and inspection
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
and acceptance reports formed during the research and development
and commercialization of developed products, and judge the
sufficiency of basis for accounting of development expense
IV. Other information
The management of Changhong Meiling Co., Ltd. (the “Management”) is responsible for other information which
includes the information covered in the Company’s 2018 annual report excluding the financial statement and our
audit report.
The audit opinion issued by us for the financial statement has not covered other information, for which we do not
issue any form of assurance opinions.
Considering our audit on financial statements, we are liable to read other information, during which, we shall
consider whether other information differs materially from the financial statements or that we understand during
our audit, or whether there is any material misstatement.
Based on the works executed by us, we should report the fact if we find any material misstatement in other
information. In t his regards, we have nothing to report.
V. Responsibilities of management and those charged with governance for the financial statements
The management is responsible for the preparation of the financial statements in accordance with the Accounting
Standards for Enterprise to secure a fair presentation, and for the design, establishment and maintenance of the
internal control necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing the Company’s ability to
continue as a going concern, disclosing matters related to going concern and using the going concern assumption
unless the management either intends to liquidate the Company or to cease operations, or has no realistic
alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting process.
Ⅵ. Responsibilities of the auditor for 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 audit report that includes our audit opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
with the CAS 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 the financial statements.
As part of an audit in accordance with the CAS, we exercise professional judgment and maintain professional
skepticism 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 audit 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, intentional 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 the management.
(4) Conclude on the appropriateness of the management’s use of the going concern assumption and, based on the
audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required by the CAS to draw users’ attention in audit report to the related disclosures in
the financial statements or, if such disclosures are inadequate, to modify audit opinion. Our conclusions are based
on the information obtained up to the date of audit 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 audit opinion on the financial statements. We are responsible for the
direction, supervision and performance of the group audit. We remain solely responsible for audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, 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
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
requirements regarding independence, and communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguard measures.
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 the 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 the auditor’s report because of the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
Chinese CPA: (engagement partner): Li Xifu
Shine Wing Certified Public
Accountants (LLP)
Chinese CPA: Xia Cuiqiong
Beijing China 27 March 2019
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
II. Financial Statement
Statement in Financial Notes are carried in RMB/CNY
1. Consolidated balance sheet
Prepared by Changhong Meiling Co., Ltd.
2018-12-31
In RMB
Item Balance at period-end Balance at period-begin
Current assets:
Monetary funds 4,596,077,557.40 5,283,081,788.04
Settlement provisions
Capital lent
Financial assets measured by
fair value and with variation reckoned 9,253,635.59 15,646,731.48
into current gains/losses
Derivative financial assets
Note receivable and account
4,058,819,532.50 3,855,064,993.38
receivable
Including: Note receivable 2,387,830,887.74 2,074,648,484.36
Account receivable 1,670,988,644.76 1,780,416,509.02
Accounts paid in advance 86,180,459.26 200,106,216.59
Insurance receivable
Reinsurance receivables
Contract reserve of reinsurance
receivable
Other account receivable 62,129,574.17 69,051,262.91
Including: Interest receivable 2,653,712.36 4,692,303.18
Dividend receivable
Buying back the sale of financial
assets
Inventories 2,174,436,573.67 2,918,100,650.27
Assets held for sale
Non-current asset due within
44,497,902.00
one year
Other current assets 1,184,686,956.96 801,894,930.97
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Total current assets 12,171,584,289.55 13,187,444,475.64
Non-current assets:
Loans and payments on behalf
Finance asset available for sales 45,000,000.00 31,000,000.00
Held-to-maturity investment
Long-term account receivable
Long-term equity investment 61,869,440.55 90,534,671.92
Investment real estate 46,846,507.41 9,569,711.72
Fixed assets 1,733,957,012.14 1,515,302,743.61
Construction in progress 464,558,352.60 174,857,717.15
Productive biological asset
Oil and gas asset
Intangible assets 817,579,958.94 772,853,622.41
Expense on Research and
108,210,966.60 85,624,078.79
Development
Goodwill
Long-term expenses to be
3,635,861.94
apportioned
Deferred income tax asset 112,203,656.75 90,689,083.63
Other non-current asset
Total non-current asset 3,390,225,894.99 2,774,067,491.17
Total assets 15,561,810,184.54 15,961,511,966.81
Current liabilities:
Short-term loans 2,336,373,929.62 1,631,206,000.00
Loan from central bank
Absorbing deposit and interbank
deposit
Capital borrowed
Financial liability measured by
fair value and with variation reckoned 55,586,666.70 16,034,000.00
into current gains/losses
Derivative financial liability
Note payable and account
6,009,929,380.98 6,876,651,907.18
payable
Accounts received in advance 354,551,354.80 438,386,810.72
Selling financial asset of
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
repurchase
Commission charge and
commission payable
Wage payable 163,638,627.79 184,819,166.86
Taxes payable 109,753,432.17 61,292,671.72
Other account payable 660,320,360.26 843,617,509.48
Including: Interest payable 7,519,756.26 6,441,508.68
Dividend payable 17,317,286.45 2,890,364.80
Reinsurance payable
Insurance contract reserve
Security trading of agency
Security sales of agency
Liability held for sale
Non-current liabilities due
273,682,737.85 46,454,376.68
within one year
Other current liabilities
Total current liabilities 9,963,836,490.17 10,098,462,442.64
Non-current liabilities:
Long-term loans 1,920,000.00 253,160,000.00
Bonds payable
Including: preferred stock
Perpetual capital
securities
Long-term account payable 5,017,208.00 12,483,687.53
Long-term wages payable 19,073,101.29 24,645,421.94
Accrual liability 273,063,677.21 313,013,878.20
Deferred income 160,250,963.60 102,569,955.39
Deferred income tax liabilities 3,098,699.11
Other non-current liabilities
Total non-current liabilities 462,423,649.21 705,872,943.06
Total liabilities 10,426,260,139.38 10,804,335,385.70
Owner’s equity:
Share capital 1,044,597,881.00 1,044,597,881.00
Other equity instrument
Including: preferred stock
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Perpetual capital
securities
Capital public reserve 2,684,369,598.46 2,684,806,344.07
Less: Inventory shares
Other comprehensive income -18,143,569.26 -7,262,322.02
Reasonable reserve
Surplus public reserve 400,673,993.50 391,029,420.33
Provision of general risk
Retained profit 904,232,582.87 937,894,771.93
Total owner’s equity attributable to
5,015,730,486.57 5,051,066,095.31
parent company
Minority interests 119,819,558.59 106,110,485.80
Total owner’s equity 5,135,550,045.16 5,157,176,581.11
Total liabilities and owner’s equity 15,561,810,184.54 15,961,511,966.81
Legal Representative: Li Wei Person in charge of accounting works: Pang Haitao
Person in charge of accounting institute: Luo Bo
2. Balance Sheet of Parent Company
In RMB
Item Balance at period-end Balance at period-begin
Current assets:
Monetary funds 2,897,004,041.87 3,411,454,144.54
Financial assets measured by fair
value and with variation reckoned into 9,253,635.59 14,077,531.48
current gains/losses
Derivative financial assets
Note receivable and account
3,483,525,970.01 3,121,486,894.18
receivable
Including: Note receivable 2,433,243,946.64 1,748,615,925.92
Account receivable 1,050,282,023.37 1,372,870,968.26
Accounts paid in advance 58,710,427.38 162,232,742.46
Other account receivable 182,744,033.52 39,849,732.36
Including: Interest receivable 2,653,712.36
Dividend receivable
Inventories 911,130,106.30 1,028,423,929.21
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
Assets held for sale
Non-current asset due within one
year
Other current assets 1,113,987,528.70 615,877,268.44
Total current assets 8,656,355,743.37 8,393,402,242.67
Non-current assets:
Finance asset available for sales 45,000,000.00 31,000,000.00
Held-to-maturity investment
Long-term account receivable
Long-term equity investment 1,731,109,903.70 1,705,007,815.84
Investment real estate 7,618,550.16 7,960,789.08
Fixed assets 1,082,915,540.08 976,732,228.85
Construction in progress 125,064,106.10 67,205,463.02
Productive biological asset
Oil and gas asset
Intangible assets 462,425,105.64 457,534,626.06
Expense on Research and
57,383,653.72 23,782,085.92
Development
Goodwill
Long-term expenses to be
apportioned
Deferred income tax asset 78,357,299.17 76,015,591.58
Other non-current asset
Total non-current asset 3,589,874,158.57 3,345,238,600.35
Total assets 12,246,229,901.94 11,738,640,843.02
Current liabilities:
Short-term loans 1,911,719,726.13 1,186,026,000.00
Financial liability measured by
fair value and with variation reckoned 19,893,875.00 16,034,000.00
into current gains/losses
Derivative financial liability
Note payable and account
4,013,263,630.45 3,675,862,014.96
payable
Accounts received in advance 105,815,140.88 53,558,493.11
Wage payable 31,271,182.48 33,060,896.41
Taxes payable 21,992,129.58 16,641,410.98
215
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other account payable 427,293,961.56 1,020,147,696.15
Including: Interest payable 5,801,215.14 3,999,358.60
Dividend payable 17,317,286.45 2,890,364.80
Liability held for sale
Non-current liabilities due within
258,588,504.48 7,715,255.20
1 year
Other current liabilities
Total current liabilities 6,789,838,150.56 6,009,045,766.81
Non-current liabilities:
Long-term loans 1,920,000.00 253,160,000.00
Bonds payable
Including: preferred stock
Perpetual capital
securities
Long-term account payable
Long-term wages payable 19,073,101.29 24,645,421.94
Accrual liability 266,641,323.73 313,013,878.20
Deferred income 53,118,676.50 56,906,985.04
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities 340,753,101.52 647,726,285.18
Total liabilities 7,130,591,252.08 6,656,772,051.99
Owner’s equity:
Share capital 1,044,597,881.00 1,044,597,881.00
Other equity instrument
Including: preferred stock
Perpetual capital
securities
Capital public reserve 2,753,017,007.10 2,753,017,007.10
Less: Inventory shares
Other comprehensive income
Reasonable reserve
Surplus public reserve 400,455,827.82 390,811,254.65
Retained profit 917,567,933.94 893,442,648.28
Total owner’s equity 5,115,638,649.86 5,081,868,791.03
216
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Total liabilities and owner’s equity 12,246,229,901.94 11,738,640,843.02
Legal Representative: Li Wei Person in charge of accounting works: Pang Haitao
Person in charge of accounting institute: Luo Bo
3. Consolidated Profit Statement
In RMB
Item Current period Last period
I. Total operating income 17,490,174,950.01 16,797,436,757.36
Including: Operating income 17,490,174,950.01 16,797,436,757.36
Interest income
Insurance gained
Commission charge and commission
income
II. Total operating cost 17,494,759,477.68 16,900,689,559.48
Including: Operating cost 14,226,402,020.40 13,802,673,137.30
Interest expense
Commission charge and commission
expense
Cash surrender value
Net amount of expense of compensation
Net amount of withdrawal of insurance contract
reserve
Bonus expense of guarantee slip
Reinsurance expense
Tax and extras 138,915,058.61 149,482,479.91
Sales expense 2,576,277,169.86 2,434,337,059.85
Administrative expense 317,917,548.03 285,953,969.91
R&D expense 235,299,398.06 210,977,773.13
Financial expense -39,305,608.74 -33,648,833.18
Including: Interest expenses 101,451,047.10 67,750,377.89
Interest income 127,986,419.36 145,489,942.29
Losses of devaluation of asset 39,253,891.46 50,913,972.56
Add: other income 94,938,682.39 71,747,005.11
Investment income (Loss is listed with “-” 3,931,358.68 102,766,412.15
217
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Including: Investment income on affiliated
-23,357,648.90 -2,625,710.04
company and joint venture
Income from change of fair value (Loss is
-45,949,257.12 -11,888,232.24
listed with “-”)
Exchange income (Loss is listed with “-”)
Income from assets disposal (Loss is listed
787,721.32 -8,206,289.88
with “-”)
III. Operating profit (Loss is listed with “-”) 49,123,977.60 51,166,093.02
Add: Non-operating income 6,486,445.70 5,671,791.04
Less: Non-operating expense 21,268,525.58 222,977.82
IV. Total Profit (Loss is listed with “-”) 34,341,897.72 56,614,906.24
Less:Income tax expense -533,886.62 20,520,373.53
V. Net profit (Net loss is listed with “-”) 34,875,784.34 36,094,532.71
(i) net profit from continuous operation (Net loss
34,875,784.34 36,094,532.71
is listed with “-”)
(ii) net profit from discontinued operation (Net
loss is listed with “-”)
Net profit attributable to owner’s of parent
38,658,256.97 32,473,204.92
company
Minority shareholders’ gains and losses -3,782,472.63 3,621,327.79
VI. Net after-tax of other comprehensive income -15,324,313.47 -14,082,920.83
Net after-tax of other comprehensive income
-10,881,247.24 -10,736,868.97
attributable to owners of parent company
(i) Other comprehensive income items which will
not be reclassified subsequently to gain/loss
1.Re-measurement of the change of
defined benefit plan
2.Other comprehensive income unable
transfer to gain/loss under equity method
(II) Other comprehensive income items which
-10,881,247.24 -10,736,868.97
will be reclassified subsequently to profit or loss
1.Other comprehensive income able to
transfer to gain/loss under equity method
2.Gains or losses arising from changes in
fair value of available-for-sale financial assets
3.Gains or losses arising from
reclassification of held-to-maturity investment as
available-for-sale financial assets
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CHANGHONG MEILING CO.,LTD. Annual Report 2018
4.The effect hedging portion of gains or
losses arising from cash flow hedging instruments
5.Translation differences arising on
-10,881,247.24 -10,736,868.97
translation of foreign currency financial statements
6. Other
Net after-tax of other comprehensive income
-4,443,066.23 -3,346,051.86
attributable to minority shareholders
VII. Total comprehensive income 19,551,470.87 22,011,611.88
Total comprehensive income attributable to
27,777,009.73 21,736,335.95
owners of parent Company
Total comprehensive income attributable to
-8,225,538.86 275,275.93
minority shareholders
VIII. Earnings per share:
(i) Basic earnings per share 0.0370 0.0311
(ii) Diluted earnings per share 0.0370 0.0311
As for the enterprise combined under the same control, net profit of 0 Yuan achieved by the merged party before
combination while 0 Yuan achieved last period
Legal Representative: Li Wei Person in charge of accounting works: Pang Haitao
Person in charge of accounting institute: Luo Bo
4. Profit Statement of Parent Company
In RMB
Item Current period Last period
I. Operation income 9,527,195,962.62 8,517,669,513.46
Less: Operating cost 8,403,695,872.50 7,638,749,033.68
Tax and extras 60,224,004.51 68,182,464.42
Sales expense 795,840,509.28 709,359,125.82
Administrative expense 139,521,280.49 118,980,188.48
R&D expense 100,055,433.15 90,459,548.26
Financial expense 3,339,104.39 -17,337,616.73
Including: Interest expenses 78,111,310.86 49,327,120.29
Interest income 78,419,587.54 95,116,040.27
Losses of devaluation of asset 13,569,683.39 1,260,709.01
Add: other income 59,460,881.42 24,681,144.75
Investment income (Loss is listed with “-” 45,078,361.41 59,581,326.89
219
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Including: Investment income on affiliated
-4,601,912.14 2,649,526.63
company and joint venture
Income from change of fair value (Loss is
-8,683,770.89 -14,016,681.82
listed with “-”)
Income from assets disposal (Loss is listed
-3,459,155.14 8,023,508.61
with “-”)
II. Operating profit (Loss is listed with “-”) 103,346,391.71 -13,714,641.05
Add: Non-operating income 3,972,014.46 2,670,109.81
Less: Non-operating expense 13,050,649.33 5,994.20
III. Total Profit (Loss is listed with “-”) 94,267,756.84 -11,050,525.44
Less: Income tax expense -2,177,974.85 -10,829,795.68
IV. Net profit (Net loss is listed with “-”) 96,445,731.69 -220,729.76
(i) net profit from continuous operation (Net loss
96,445,731.69 -220,729.76
is listed with “-”)
(ii) net profit from discontinued operation (Net
loss is listed with “-”)
V. Net after-tax of other comprehensive income
(i) Other comprehensive income items which will
not be reclassified subsequently to gain/loss
1.Re-measurement of the change of
defined benefit plan
2.Other comprehensive income unable
transfer to gain/loss under equity method
(iii) Other comprehensive income items which
will be reclassified subsequently to profit or loss
1.Other comprehensive income able to
transfer to gain/loss under equity method
2.Gains or losses arising from changes in
fair value of available-for-sale financial assets
3.Gains or losses arising from
reclassification of held-to-maturity investment as
available-for-sale financial assets
4.The effect hedging portion of gains or
losses arising from cash flow hedging instruments
5.Translation differences arising on
translation of foreign currency financial statements
6. Other
VI. Total comprehensive income 96,445,731.69 -220,729.76
220
CHANGHONG MEILING CO.,LTD. Annual Report 2018
VII. Earnings per share:
(i) Basic earnings per share 0.0923 -0.0002
(ii) Diluted earnings per share 0.0923 -0.0002
Legal Representative: Li Wei Person in charge of accounting works: Pang Haitao
Person in charge of accounting institute: Luo Bo
5. Consolidated Cash Flow Statement
In RMB
Item Current period Last period
I. Cash flows arising from operating activities:
Cash received from selling commodities and
15,976,109,415.91 14,387,433,715.06
providing labor services
Net increase of customer deposit and interbank
deposit
Net increase of loan from central bank
Net increase of capital borrowed from other
financial institution
Cash received from original insurance contract
fee
Net cash received from reinsurance business
Net increase of insured savings and investment
Net increase of amount from disposal financial
assets that measured by fair value and with variation
reckoned into current gains/losses
Cash received from interest, commission charge
and commission
Net increase of capital borrowed
Net increase of returned business capital
Write-back of tax received 513,524,044.20 481,226,085.12
Other cash received concerning operating
288,727,912.46 72,232,660.48
activities
Subtotal of cash inflow arising from operating
16,778,361,372.57 14,940,892,460.66
activities
Cash paid for purchasing commodities and
14,150,885,874.62 12,822,457,926.13
receiving labor service
Net increase of customer loans and advances
221
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Net increase of deposits in central bank and
interbank
Cash paid for original insurance contract
compensation
Cash paid for interest, commission charge and
commission
Cash paid for bonus of guarantee slip
Cash paid to/for staff and workers 1,593,886,073.87 1,412,237,721.51
Taxes paid 354,788,287.80 529,295,201.24
Other cash paid concerning operating activities 899,361,751.64 728,403,606.52
Subtotal of cash outflow arising from operating
16,998,921,987.93 15,492,394,455.40
activities
Net cash flows arising from operating activities -220,560,615.36 -551,501,994.74
II. Cash flows arising from investing activities:
Cash received from recovering investment 3,440,000,000.00 5,185,762,362.50
Cash received from investment income 78,170,149.44 99,388,295.58
Net cash received from disposal of fixed,
18,142,337.83 16,382,561.67
intangible and other long-term assets
Net cash received from disposal of subsidiaries
and other units
Other cash received concerning investing
132,195,914.39 150,058,101.10
activities
Subtotal of cash inflow from investing activities 3,668,508,401.66 5,451,591,320.85
Cash paid for purchasing fixed, intangible and
632,592,327.39 536,726,917.60
other long-term assets
Cash paid for investment 3,944,000,001.00 4,389,654,061.22
Net increase of mortgaged loans
Net cash received from subsidiaries and other
units obtained
Other cash paid concerning investing activities 46,837,275.82 34,559,606.18
Subtotal of cash outflow from investing activities 4,623,429,604.21 4,960,940,585.00
Net cash flows arising from investing activities -954,921,202.55 490,650,735.85
III. Cash flows arising from financing activities
Cash received from absorbing investment 24,865,000.00 33,078,316.00
Including: Cash received from absorbing
24,865,000.00 33,078,316.00
minority shareholders’ investment by subsidiaries
222
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Cash received from loans 3,144,071,966.63 2,847,116,546.03
Cash received from issuing bonds
Other cash received concerning financing
44,497,902.00
activities
Subtotal of cash inflow from financing activities 3,213,434,868.63 2,880,194,862.03
Cash paid for settling debts 2,514,013,375.52 1,568,796,275.10
Cash paid for dividend and profit distributing or
129,757,442.60 104,008,477.82
interest paying
Including: Dividend and profit of minority
1,364,418.00
shareholder paid by subsidiaries
Other cash paid concerning financing activities 2,692,486.99 755,161.84
Subtotal of cash outflow from financing activities 2,646,463,305.11 1,673,559,914.76
Net cash flows arising from financing activities 566,971,563.52 1,206,634,947.27
IV. Influence on cash and cash equivalents due to
3,387,671.93 -42,116,337.75
fluctuation in exchange rate
V. Net increase of cash and cash equivalents -605,122,582.46 1,103,667,350.63
Add: Balance of cash and cash equivalents at the
5,089,765,770.39 3,986,098,419.76
period -begin
VI. Balance of cash and cash equivalents at the period
4,484,643,187.93 5,089,765,770.39
-end
Legal Representative: Li Wei Person in charge of accounting works: Pang Haitao
Person in charge of accounting institute: Luo Bo
6. Cash Flow Statement of Parent Company
In RMB
Item Current period Last period
I. Cash flows arising from operating activities:
Cash received from selling commodities and
7,727,625,739.70 7,050,861,082.17
providing labor services
Write-back of tax received 252,804,115.39 277,612,425.00
Other cash received concerning operating
69,407,867.46 36,403,787.40
activities
Subtotal of cash inflow arising from operating
8,049,837,722.55 7,364,877,294.57
activities
Cash paid for purchasing commodities and
6,922,851,690.83 7,234,343,960.87
receiving labor service
223
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Cash paid to/for staff and workers 503,716,419.03 537,308,223.27
Taxes paid 70,693,096.67 141,241,809.02
Other cash paid concerning operating activities 375,443,290.96 241,365,806.44
Subtotal of cash outflow arising from operating
7,872,704,497.49 8,154,259,799.60
activities
Net cash flows arising from operating activities 177,133,225.06 -789,382,505.03
II. Cash flows arising from investing activities:
Cash received from recovering investment 3,400,000,000.00 4,535,200,000.00
Cash received from investment income 79,368,449.44 86,311,303.39
Net cash received from disposal of fixed,
1,977,299.42 13,587,847.40
intangible and other long-term assets
Net cash received from disposal of subsidiaries
and other units
Other cash received concerning investing
159,661,646.80 122,984,125.03
activities
Subtotal of cash inflow from investing activities 3,641,007,395.66 4,758,083,275.82
Cash paid for purchasing fixed, intangible and
230,279,910.34 273,777,654.00
other long-term assets
Cash paid for investment 3,954,704,000.00 4,474,076,391.20
Net cash received from subsidiaries and other
units obtained
Other cash paid concerning investing activities 295,811,872.57 29,844,135.92
Subtotal of cash outflow from investing activities 4,480,795,782.91 4,777,698,181.12
Net cash flows arising from investing activities -839,788,387.25 -19,614,905.30
III. Cash flows arising from financing activities
Cash received from absorbing investment
Cash received from loans 2,292,940,156.01 2,362,551,446.03
Cash received from issuing bonds
Other cash received concerning financing
29,222,628.76 520,583,765.55
activities
Subtotal of cash inflow from financing activities 2,322,162,784.77 2,883,135,211.58
Cash paid for settling debts 1,590,083,600.00 1,483,860,614.21
Cash paid for dividend and profit distributing or
114,844,654.18 101,663,528.19
interest paying
Other cash paid concerning financing activities 472,573,573.53 118,049,145.68
Subtotal of cash outflow from financing activities 2,177,501,827.71 1,703,573,288.08
224
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Net cash flows arising from financing activities 144,660,957.06 1,179,561,923.50
IV. Influence on cash and cash equivalents due to
2,349,591.64 -28,206,473.71
fluctuation in exchange rate
V. Net increase of cash and cash equivalents -515,644,613.49 342,358,039.46
Add: Balance of cash and cash equivalents at the
3,410,029,424.54 3,067,671,385.08
period -begin
VI. Balance of cash and cash equivalents at the period
2,894,384,811.05 3,410,029,424.54
-end
Legal Representative: Li Wei Person in charge of accounting works: Pang Haitao
Person in charge of accounting institute: Luo Bo
225
CHANGHONG MEILING CO.,LTD. Annual Report 2018
7. Statement of Changes in Owners’ Equity (Consolidated)
Current period
In RMB
Current period
Owners’ equity attributable to parent company
Other equity Reas
Item Less: Provisi
instrument Other onab Minority Total owner’s
Capital public Invento Surplus on of Retained
Share capital Prefe Perpetual comprehensiv le interests equity
Oth reserve ry public reserve general profit
rred capital e income reser
er shares risk
stock securities ve
I. Balance at the end of
1,044,597,881.00 2,684,806,344.07 -7,262,322.02 391,029,420.33 937,894,771.93 106,110,485.80 5,157,176,581.11
the last year
Add: Changes of
accounting policy
Error correction
of the last period
Enterprise
combined under the same
control
Other
II. Balance at the
1,044,597,881.00 2,684,806,344.07 -7,262,322.02 391,029,420.33 937,894,771.93 106,110,485.80 5,157,176,581.11
beginning of this year
III. Increase/ Decrease in
this year (Decrease is -436,745.61 -10,881,247.24 9,644,573.17 -33,662,189.06 13,709,072.79 -21,626,535.95
listed with “-”)
226
CHANGHONG MEILING CO.,LTD. Annual Report 2018
(i) Total comprehensive
-10,881,247.24 38,658,256.97 -8,225,538.86 19,551,470.87
income
(ii) Owners’ devoted and
-436,745.61 23,299,029.65 22,862,284.04
decreased capital
1．Common shares
24,865,000.00 24,865,000.00
invested by owners
2．Capital invested by
holders of other equity
instruments
3．Amount reckoned into
owners equity with
share-based payment
4．Other -436,745.61 -1,565,970.35 -2,002,715.96
(III) Profit distribution 9,644,573.17 -72,320,446.03 -1,364,418.00 -64,040,290.86
1．Withdrawal of surplus
9,644,573.17 -9,644,573.17
reserves
2．Withdrawal of general
risk provisions
3．Distribution for owners
-62,675,872.86 -1,364,418.00 -64,040,290.86
(or shareholders)
4．Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
227
CHANGHONG MEILING CO.,LTD. Annual Report 2018
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss with
surplus reserve
4．Change amount of defined
benefit plans that carry
forward retained earnings
5．Other
(v) Reasonable reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(vi) Other
IV. Balance at the end of
1,044,597,881.00 2,684,369,598.46 -18,143,569.26 400,673,993.50 904,232,582.87 119,819,558.59 5,135,550,045.16
the report period
Last period
In RMB
Last period
Owners’ equity attributable to parent company
Item Other equity Less: Provisi
Other Reason Surplus Minority Total owner’s
instrument Capital public Invento on of Retained
Share capital comprehensi able public interests equity
Preferr Perpetu reserve ry general profit
Other ve income reserve reserve
ed al shares risk
228
CHANGHONG MEILING CO.,LTD. Annual Report 2018
stock capital
securiti
es
I. Balance at the end of the
1,044,597,881.00 2,687,961,060.65 3,474,546.95 391,029,420.33 968,097,382.98 70,921,198.01 5,166,081,489.92
last year
Add: Changes of
accounting policy
Error correction
of the last period
Enterprise
combined under the same
control
Other
II. Balance at the
1,044,597,881.00 2,687,961,060.65 3,474,546.95 391,029,420.33 968,097,382.98 70,921,198.01 5,166,081,489.92
beginning of this year
III. Increase/ Decrease in
this year (Decrease is -3,154,716.58 -10,736,868.97 -30,202,611.05 35,189,287.79 -8,904,908.81
listed with “-”)
(i) Total comprehensive
-10,736,868.97 32,473,204.92 3,621,327.79 25,357,663.74
income
(ii) Owners’ devoted and
-3,154,716.58 31,567,960.00 28,413,243.42
decreased capital
1．Common shares
32,255,000.00 32,255,000.00
invested by owners
2．Capital invested by
holders of other equity
instruments
229
CHANGHONG MEILING CO.,LTD. Annual Report 2018
3．Amount reckoned into
owners equity with
share-based payment
4．Other -3,154,716.58 -687,040.00 -3,841,756.58
(III) Profit distribution -62,675,815.97 -62,675,815.97
1．Withdrawal of surplus
reserves
2．Withdrawal of general
risk provisions
3．Distribution for owners
-62,675,815.97 -62,675,815.97
(or shareholders)
4．Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital (share
capital)
2. Surplus reserves
conversed to capital (share
capital)
3. Remedying loss with
surplus reserve
4．Change amount of
defined benefit plans that
carry forward retained
earnings
230
CHANGHONG MEILING CO.,LTD. Annual Report 2018
5．Other
(v)Reasonable reserve
1. Withdrawal in the report
period
2. Usage in the report
period
(vi)Other
IV. Balance at the end of
1,044,597,881.00 2,684,806,344.07 -7,262,322.02 391,029,420.33 937,894,771.93 106,110,485.80 5,157,176,581.11
the report period
Legal Representative: Li Wei Person in charge of accounting works: Pang Haitao Person in charge of accounting institute: Luo Bo
8. Statement of Changes in Owners’ Equity (Parent Company)
Current period
In RMB
Current period
Other equity instrument
Less: Other
Item Preferr Perpetual Capital public Reasonable Surplus public Total owner’s
Share capital Inventory comprehensive Retained profit
ed capital Other reserve reserve reserve equity
shares income
stock securities
I. Balance at the end of
1,044,597,881.00 2,753,017,007.10 390,811,254.65 893,442,648.28 5,081,868,791.03
the last year
Add: Changes of
accounting policy
Error correction
of the last period
231
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Other
II. Balance at the
1,044,597,881.00 2,753,017,007.10 390,811,254.65 893,442,648.28 5,081,868,791.03
beginning of this year
III. Increase/ Decrease in
this year (Decrease is 9,644,573.17 24,125,285.66 33,769,858.83
listed with “-”)
(i)Total comprehensive
96,445,731.69 96,445,731.69
income
(ii) Owners’ devoted and
decreased capital
1．Common shares
invested by owners
2．Capital invested by
holders of other equity
instruments
3．Amount reckoned into
owners equity with
share-based payment
4．Other
(III) Profit distribution 9,644,573.17 -72,320,446.03 -62,675,872.86
1．Withdrawal of surplus
9,644,573.17 -9,644,573.17
reserves
2．Distribution for owners
-62,675,872.86 -62,675,872.86
(or shareholders)
3．Other
(IV) Carrying forward
232
CHANGHONG MEILING CO.,LTD. Annual Report 2018
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss with
surplus reserve
4．Change amount of
defined benefit plans that
carry forward retained
earnings
5．Other
(v)Reasonable reserve
1. Withdrawal in the
report period
2. Usage in the report
period
(vi)Other
IV. Balance at the end of
1,044,597,881.00 2,753,017,007.10 400,455,827.82 917,567,933.94 5,115,638,649.86
the report period
Last period
In RMB
233
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Last period
Other equity instrument
Less: Other
Item Preferr Perpetual Capital public Reasonable Surplus public Total owner’s
Share capital Inventory comprehensive Retained profit
ed capital Other reserve reserve reserve equity
shares income
stock securities
I. Balance at the end of
1,044,597,881.00 2,753,017,007.10 390,811,254.65 956,339,194.01 5,144,765,336.76
the last year
Add: Changes of
accounting policy
Error correction
of the last period
Other
II. Balance at the
1,044,597,881.00 2,753,017,007.10 390,811,254.65 956,339,194.01 5,144,765,336.76
beginning of this year
III. Increase/ Decrease in
this year (Decrease is -62,896,545.73 -62,896,545.73
listed with “-”)
(i) Total comprehensive
-220,729.76 -220,729.76
income
(ii) Owners’ devoted and
decreased capital
1．Common shares
invested by owners
2．Capital invested by
holders of other equity
instruments
234
CHANGHONG MEILING CO.,LTD. Annual Report 2018
3．Amount reckoned into
owners equity with
share-based payment
4．Other
(III) Profit distribution -62,675,815.97 -62,675,815.97
1．Withdrawal of surplus
reserves
2．Distribution for owners
-62,675,815.97 -62,675,815.97
(or shareholders)
3．Other
(IV) Carrying forward
internal owners’ equity
1. Capital reserves
conversed to capital
(share capital)
2. Surplus reserves
conversed to capital
(share capital)
3. Remedying loss with
surplus reserve
4．Change amount of
defined benefit plans that
carry forward retained
earnings
5．Other
(v)Reasonable reserve
235
CHANGHONG MEILING CO.,LTD. Annual Report 2018
1. Withdrawal in the
report period
2. Usage in the report
period
(vi)Other
IV. Balance at the end of
1,044,597,881.00 2,753,017,007.10 390,811,254.65 893,442,648.28 5,081,868,791.03
the report period
Legal Representative: Li Wei Person in charge of accounting works: Pang Haitao Person in charge of accounting institute: Luo Bo
236
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
I. Company profile
Changhong Meiling Co., Ltd (hereinafter referred to as “the Company”)，originally named as Hefei Meiling
Co., Ltd. is an incorporated Company established and reorganized by Hefei Meiling Refrigerator General
Factory and approved on June 12th 1992 through [WanTiGaiHanZi (1992) No.039] issued by original
Mechanism Reform Committee of Anhui Province. On August 30th 1993, through Anhui Provincial
Government [Wanzhenmin (1993) No.166] and re-examination of China Securities Regulatory Commission,
the Company made first public issue for 30 million A shares and the Company was listed on Oct. 18th, 1993
in Shenzhen Stock Exchange. On August 13th, 1996, the Company was approved to issue 100 million B
shares to investors abroad through [ZhengWeiFa (1996) No.26] issued by China Securities Regulatory
Commission. The Company went public in Shenzhen Stock Exchange on August 28th, 1996.
State-owned Assets Supervision & Administration Commission of the State Council approved such transfers
with Document Guozi Chanquan No.253 in 2007 Reply on Matters of Hefei Meiling Group Holdings
Company Limited Transferring Partial State-owned Ownership, Hefei Meiling Group Holdings Company
Limited (hereinafter abbreviated as Meiling Group) transferred its holding 37,852,683 shares in 82,852,683
state-owned shares of the Company to Sichuan Changhong Electronic Group Co., Ltd (hereinafter
abbreviated as Changhong Group), other 45,000,000 shares to Sichuan Changhong Electric Co. Ltd
(hereinafter abbreviated as Sichuan Changhong). On Aug 15, 2007, the above ownership were transferred
and Cleaning Corporation Limited.
On 27 August 2007, State-owned Assets Supervision & Administration Commission of Anhui Provincial
Government replied with Document [WGZCQH (2007) No.309] Reply on “Related Matters of Share Merger
Reform of Meiling Co., Ltd.”, agreed the Company’s ownership split reform plan. The Company made
consideration that non-tradable share holders deliver 1.5 shares to A share holders per 10 shares, and original
Meiling Group made prepayment 3,360,329 shares for some non-tradable share holders as consideration for
split reform plan.
On 29 May 2008, concerning 34,359,384 state-owned shares (including 3,360,329 shares paid for other
non-tradable shareholders by original Meiling Group in share reform) held by original Meiling Group, the
“Notice of Freely Transfer of Meiling Electrics Equity held by Meiling Group”[HGZCQ(2008) No. 59]
issued from State-owned Assets Supervision & Administration Commission of Hefei Municipal, agrees to
transfer the above said shares to Hefei Xingtai Holding Group Co., Ltd.(“Xingtai Holding Co.,”) for free. On
7 August 2008, the “Reply of Transfer Freely of Part of the Shares of Hefei Meiling Co., Ltd. held by
State-owned shareholders” [GZCQ (2007) No. 752] issued by SASAC, agrees the above said transferring.
On October 29, 2008, Changhong Group Company signed Agreement on Equity Transfer of Hefei Meiling
Co., Ltd with Sichuan Changhong, in which 32,078,846 tradable A-shares with conditional subscription of
the Company (accounting for 7.76% in total shares) held by Changhong Group Company. On 23 December
2008, “Reply of Transfer Freely of Part of the Shares of Hefei Meiling Co., Ltd. held by State-owned
shareholders” [GZCQ (2008) No. 1413] issued by SASAC agrees the above said share transferring.
On 24 December 2010, being deliberated and approved in 32nd Session of 6th BOD and 2nd Extraordinary
Shareholders’ General Meeting of 2010 as well as approval of document [ZJXP(2010) No. 1715] from CSRC,
237
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
totally 116,731,500 RMB ordinary shares (A stock) were offering privately to target investors with issue
price of RMB 10.28/share. Capital collecting amounting to RMB 1,199,999,820 after issuing expenses RMB
22,045,500 deducted, net capital collected amounting to RMB 1,177,954,320, and paid-in capital(share
capital) increased RMB 116,731,500 with capital reserve(share premium) RMB 1,061,106,088.5 increased.
The increasing capital has been verified by Capital Verification Report No.: ［XYZH2010CDA6021］issued
from Shinwing CPA Co., Ltd.
On 20 June 2011, the general meeting of the Company considered and approved the 2010 profit distribution
plan, namely to distribute cash dividends of RMB0.5 (tax included) plus two shares for every ten shares held
by shareholders to all shareholders, based on the total share capital of 530,374,449 shares as of 31 December
2010. The total share capital of the Company upon profit distribution increased to 636,449,338 shares. The
capital increase was verified by Anhui Huashen Zhengda Accounting Firm with the verification report
WHSZDKYZ (2011) No.141.
On 26 June 2012, the general meeting of the Company considered and approved the 2011 profit distribution
and capitalization of capital reserve plan, namely to distribute cash dividends of RMB0.5 (tax included) plus
two shares for every ten shares to all shareholders capitalized from capital reserve, based on the total share
capital of 636,449,338 shares as of 31 December 2011. The total share capital of the Company upon
implementation of capitalization of capital reserve increased to 763,739,205 shares from 636,449,338 shares,
and was verified by Anhui Anlian Xinda Accounting Firm with the verification report WALXDYZ (2012)
No.093.
On November 18, 2015, considered and approved by the 12th Session of the 8th BOD of the company and the
first extraordinary general meeting in 2016, and approved by the document of China Securities Regulatory
Commission [CSRC License No. (2016) 1396] “Reply to the approval of non-public offering of shares of
Hefei Meiling Co., Ltd.”, the company has actually raised funds of 1,569,999,998.84 Yuan by non-public
offering of no more than 334,042,553 new shares at face value of RMB 1 Yuan per share and with issue
price no less than RMB 4.70 per share, after deducting the issue costs of 29,267,276.08 Yuan , the net amount
of raised funds is 1,540,732,722.76 Yuan , the increased paid-in capital (share capital) of 280,858,676.00
Yuan , increased capital reserve (share premium) of 1,259,874,046.76 Yuan. This capital increase has been
verified by No. ［ XYZH2016CDA40272 ］ capital verification report of ShineWing Certified Public
Accountants special general partnership.
Ended as 31 December 2018, total share capital of the Company amounting to 1,044,597,881shares with
ordinary shares in full. Among which, 881,733,881 shares of A-share accounting 84.41% in total shares
while B-share with 162,864,000 shares accounting 15.59% in total shares. Detail share capital as:
Type of stock Quantity Proportion
(I)Restricted shares 80,431,408 7.70%
1. State-owned shares
2. State-owned legal person’s shares 70,793,625 6.78%
3. Other domestic shares 8,370,363 0.80%
Including: Domestic legal person’s shares 4,716,077 0.45%
238
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Domestic natural person’s shares 3,654,286 0.35%
4. Foreign shares 1,267,420 0.12%
Including: Overseas legal persons
Overseas natural person’s shares 1,267,420 0.12%
(II)Unrestricted shares 964,166,473 92.30%
1. RMB Ordinary shares 802,569,893 76.83%
2. Domestically listed foreign shares 161,596,580 15.47%
3. Overseas listed foreign shares
4. Others
Total shares 1,044,597,881 100.00%
The Company belongs to the manufacture of light industry, and engaged in the production and sale of refrigerator, freezer and
air-conditioner. Unified social credit code of the Company: 9134000014918555XK; Address: No.2163, Lianhua Road,
Economy and Technology Development Zone, Hefei City; Legal Representative: Li Wei; register capital (paid-in capital):
RMB 1,044,597,881; type of company: limited liability company(joint venture and listed of Taiwan, Hong Kong and Macao)
Business Scope: R&D, manufacture and sales of cooling apparatus, air-conditioner, washing machine, water heater,
kitchenware, home decoration, bathroom, lamps & lanterns, household & similar appliance, injection plastic machine of
computer controlling, plastic products, metalwork, packaging products and decorations as well as the installation and technical
consultant services. Business of self-produced products, technology export and import-export of the raw& auxiliary materials,
machinery equipment, instrument and technology; department sales and transportation
II. Scope of consolidated financial statement
The Company’s consolidated financial statement included 47 subsidiaries including Sichuan Changhong
Air-conditioner Co., Ltd., Zhongshan Changhong Electric Co., LTD and Zhongke Meiling Cryogenic
Technology Co., Ltd. Etc.As compared to previous year, subsidiary Zhongshan Hongyou Electric Co.,Ltd,
Shijiazhuang Meiling Electronic Appliance Marketing Co., Ltd, Guiyang Meiling Electronic Appliance
Marketing Co., Ltd, Kunming Meiling Electronic Appliance Marketing Co., Ltd, Chongqing Meiling
Electronic Appliance Marketing Co., Ltd, Wuhu Meiling Electronic Appliance Marketing Co., Ltd.,
Changchun Meiling Electronic Appliance Marketing Co., Ltd, Jingzhou Meiling Electronic Appliance
Marketing Co., Ltd, Nantong Meiling Electronic Appliance Marketing Co., Ltd, Harbin Meiling Electronic
Appliance Marketing Co., Ltd and Shenyang Meiling Electronic Appliance Marketing Co., Ltd were
excluded due to liquidation.
More detail can be seen in “VII. Changes of consolidated scope” and “VIII. Rights and interest in other
subjects” in the Note.
III. Basis for preparation of financial statement
1. Basis for preparation
The financial statements of the Company were prepared in accordance with the actual transactions and
proceedings, and relevant regulation of Accounting Standards for Enterprise released by the Ministry of
239
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Finance, and was on the basis of sustainable operation, and the accounting policy and estimation stated in the
“IV. Significant Accounting Policy and Accounting Estimation”
2.Continuous operation
The Company recently has a history of profitability operation and has financial resources supporting, and
prepared the financial statement on basis of going concern is reasonable.
IV. Significant Accounting Policy, Accounting Estimation
1. Statement on observation of accounting standards for enterprise
The financial statement prepared by the Company applies with the requirements of Accounting Standard for
Enterprise, and reflects the financial condition, operational achievements and cash flow of the Company
effectively and completely.
2. Accounting period
The accounting period of the Company is the calendar date from 1 January to 31 December.
3. Operation cycle
Operation cycle of the Company was 12 months, and it is the standard of flow classification for assets and
liabilities.
4. Standard currency for accounting
The Company takes RMB as the standard currency for accounting.
5. Accountant arrangement method of business combination under common control and not under common
control
As acquirer, the Company measures the assets and liabilities acquired through business combination under
common control at their carrying values as reflected in the consolidated financial statement of the ultimate
controller as of the combination date. Capital reserve shall be adjusted in respect of any difference between
carrying value of the net assets acquired and carrying value of the combination consideration paid. In case
that capital reserve is insufficient to offset, the Company would adjust retained earnings.
The acquiree’s net identifiable assets, liabilities or contingent liabilities acquired through business
combination not under common control shall be measured at fair value as of the acquisition date. The cost of
combination represents the fair value of the cash or non-cash assets paid, liabilities issued or committed and
equity securities issued by the Company as at the date of combination in consideration for acquiring the
controlling power in the acquiree, together with the sum of any directly related expenses occurred during
business combination(in case of such business combination as gradually realized through various
transactions, the combination cost refers to the sum of each cost of respective separate transaction). Where
the cost of the combination exceeds the acquirer’s interest in the fair value of the acquirer’s identifiable net
assets acquired, the difference is recognized as goodwill; where the cost of combination is lower than the
acquirer’s interest in the fair value of the acquiree’s identifiable net assets, the Company shall firstly make
240
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
further review on the fair values of the net identifiable assets, liabilities or contingent liabilities acquired as
well as the fair value of the non-cash assets portion of combination consideration or the equity securities
issued by the Company. In case that the Company finds the cost of combination is still lower than the
acquirer’s interest in the fair value of the acquiree’s identifiable net assets after such further review, the
difference is recognized in non-operating income for the current period when combination occurs.
6. Measures on Preparation of Consolidated Financial Statements
The Company shall put all the subsidiaries controlled and main body structured into consolidated financial
statements.
Any difference arising from the inconformity of accounting year or accounting policies between the
subsidiaries and the Company shall be adjusted in the consolidated financial statements.
All the material inter-company transactions, non-extraordinary items and unrealized profit within the
combination scope are written-off when preparing consolidated financial statement. Owners’ equity of
subsidiary not attributable to parent company and current net gains and losses, other comprehensive income
and total comprehensive income attributable to minority shareholders are recognized as non-controlling
interests, minority interests, other comprehensive income attributable to minority shareholders and total
comprehensive income attributable to minority shareholders in consolidated financial statement respectively.
As for subsidiary acquired through business combination under common control, its operating results and
cash flow will be included in consolidated financial statement since the beginning of the period when
combination occurs. When preparing comparative consolidated financial statement, the relevant items in
previous years financial statement shall be adjusted as if the reporting entity formed upon combination has
been existing since the ultimate controller commenced relevant control.
As for equity interests of the investee under common control acquired through various transactions which
eventually formed business combination, the Company shall supplement disclosure of the accounting
treatment in consolidated financial statement in the reporting period when controlling power is obtained. For
example, as for equity interests of the investee under common control acquired through various transactions
which eventually formed business combination, adjustments shall be made as if the current status had been
existing when the ultimate controller commenced control in connection of preparing consolidated financial
statement; in connection with preparing comparative statement, the Company shall consolidate the relevant
assets and liabilities of the acquiree into the Company’s comparative consolidated financial statement to the
extent not earlier than the timing when the Company and the acquiree are all under control of the ultimate
controller, and the net assets increased due to combination shall be used to adjust relevant items under
owners’ equity in comparative statement. In order to prevent double computation of the value of the
acquiree’s net assets, the relevant profits and losses, other comprehensive income and change of other net
assets recognized during the period from the date when the Company acquires original equity interests and
the date when the Company and the acquiree are all under ultimate control of the same party (whichever is
later) to the date of combination in respect of the long-term equity investment held by the Company before
satisfaction of combination shall be utilized to offset the beginning retained earnings and current gains and
241
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
losses in the period as the comparative financial statement involves, respectively.
As for subsidiary acquired through business combination not under common control, its operating results and
cash flow will be included in consolidated financial statement since the Company obtains controlling power.
When preparing consolidated financial statement, the Company shall adjust the subsidiary’s financial
statement based on the fair value of the various identifiable assets, liabilities or contingent liabilities
recognized as of the acquisition date.
As for equity interests of the investee not under common control acquired through various transactions which
eventually formed business combination, the Company shall supplement disclosure of the accounting
treatment in consolidated financial statement in the reporting period when controlling power is obtained. For
example, as for equity interests of the investee not under common control acquired through various
transactions which eventually formed business combination, when preparing consolidated financial statement,
the Company would re-measure the equity interests held in the acquiree before acquisition date at their fair
value as of the acquisition date, and any difference between the fair value and carrying value is included in
current investment income. in case that the equity interests in acquiree held by the Company before the
relevant acquisition date involves other comprehensive income at equity method and change of other owners’
equity (other than net gains and losses, other comprehensive income and profit distribution), then the equity
interests would transfer to investment gains and losses for the period which the acquisition date falls upon.
The other comprehensive income arising from change of the net liabilities or net assets under established
benefit scheme as acquiree’s re-measured such scheme is excluded.
The transaction with non-controlling interest to dispose long-term equity investment in a subsidiary without
losing control rights over the subsidiary, the difference between the proceeds from disposal of interests and
the decrease of the shared net assets of the subsidiary is adjusted to capital premium (share premium). In case
capital reserve is not sufficient to offset the difference, retained earnings will be adjusted.
As for disposal of part equity investment which leads to losing control over the investee, the Company would
re-measure the remaining equity interests at their fair value as of the date when the Company loses control
over the investee when preparing consolidated financial statement. The sum of consideration received from
disposal of equity interest and fair value of the remaining equity interest, less the net assets of the original
subsidiary attributable to the Company calculated based on the original shareholding proportion since the
acquisition date or the date then consolidation commences, is included in investment gains and losses for the
period when control is lost, meanwhile to offset goodwill. Other comprehensive income related to equity
interest investment in original subsidiaries is transferred into current investment gains and losses upon lost of
control.
If the disposal of the equity investment of a subsidiary is realized through multiple transactions until loss of
control and is a package deal, the accounting treatment of these transactions should be dealt with as one
transaction of disposal of the subsidiary until loss of control. However, before the Company loses total
control of the subsidiary, the differences between the actual disposal price and the share of the net assets of
the subsidiary disposed of in every transaction should be recognized as other comprehensive income in the
consolidated financial statements, and transferred to profit or loss when losing control.
242
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
7. Accounting treatment for joint venture arrangement and joint controlled entity
The joint venture arrangement of the Company consists of joint controlled entity and joint venture. As for
jointly controlled entity, the Company determines the assets held and liabilities assumed separately as a party
to the jointly controlled entity, recognizes such assets and liabilities according to its proportion, and
recognizes relevant income and expense separately under relevant agreement or according to its proportion.
As for asset transaction relating to purchase and sales with the jointly controlled entity which does not
constitute business activity, part of the gains and losses arising from such transaction attributable to other
participators of the jointly controlled entity is only recognized.
8. Cash and cash equivalents
Cash in the cash flow statement comprises the Group’s cash on hand and deposits that can be readily
withdrawn on demand. Cash equivalents are short-term, highly liquid investments held by the Group, that
are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in
value, including but not limited to the followings which meet the aforesaid conditions: debt investment
matured within three months upon the acquisition date, bank time deposit which can be early withdrew by
serving a notice and transferrable deposit receipt, etc. for time deposit which can not be used for payment at
any time, it would be note recognized as cash; while if can be used for such purpose, it would be recognized
as cash. Guarantee deposit over three months in other monetary capital shall not be recognized as cash
equivalents, and those less than three months are recognized as cash equivalents.
9. Foreign currency business and foreign currency financial statement conversion
(1) Foreign currency business
As for the foreign currency business, the Company converts the foreign currency amount into RMB amount
pursuant to the spot exchange rate as of the business day. As at the balance sheet date, monetary items
expressed by foreign currency are converted into RMB pursuant to the spot exchange rate as of the balance
sheet date. The conversion difference occurred is recorded into prevailing gains and losses, other than the
disclosure which is made according to capitalization rules for the exchange difference occurred from the
special foreign currency borrowings borrowed for constructing and producing the assets satisfying condition
of capitalization. As for the foreign currency non-monetary items measured by fair value, the amount is then
converted into RMB according to the spot exchange rate as of the confirmation day for fair value. And the
conversion difference occurred during the procedure is recorded into prevailing gains and losses directly as
change of fair value. As for the foreign currency non-monetary items measured by historical cost, conversion
is made with the spot exchange rate as of the business day, with no change in RMB amount.
(2) Conversion of foreign currency financial statement
Spot exchange rate as of the balance sheet date is adopted for conversion of assets and liabilities in foreign
currency balance sheet; as for the items in statement of owners’ equity except for “Undistributed profit”,
conversion is made pursuant to the spot exchange rate of business day; income and expense items in income
243
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
statement then are also converted pursuant to the spot exchange rate of transaction day. Difference arising
from the aforementioned conversions shall be listed separately in items of owners’ equity. Spot exchange rate
as of the occurrence date of cash flow is adopted for conversion of foreign currency cash flow. The amount
of cash affected by exchange rate movement shall be listed separately in cash flow statement.
10. Financial assets and financial liabilities
(1) Financial assets
1) Classification of financial assets
In consideration of investment targets and economic essence, the Company groups the financial assets owned
by it as four categories, namely financial assets measured by fair value and whose movement is recorded into
prevailing gains and losses, held-to-maturity investment, accounts receivables and financial assets
available-for-sale.
Financial assets at fair value through profit or loss include trading financial assets and financial assets
designated at air value through profit or loss at initial recognition. Financial asset is classified as held for
trading if one of the following conditions is satisfied: It has been acquired principally for the purpose of
selling in the near term; or on initial recognition it is a part of a portfolio of identifiable financial instruments
that the group manages together and there is objective evidence that the group recently manages the portfolio
through the approach of short-term profit-taking; or it is a derivative that is not designated and effective as a
hedging instrument, or a financial guarantee contract, or a derivative that is linked to and must be settled by
delivery of an unquoted equity instrument (without a quoted price in an active market) whose fair value
cannot be reliably measured. A financial asset may be designated as at FVTPL upon initial recognition only
when one of the following conditions is satisfied: such designation eliminates or significantly reduces a
measurement or recognition inconsistency that would otherwise result from measuring assets or recognizing
the gains or losses on them on different bases; or the financial asset forms part of a group of financial assets
or a group of financial assets and financial liabilities, which is managed and its performance is evaluated on a
fair value basis, in accordance with the Group’s documented risk management or investment strategy, and
information about the grouping is reported to key management personnel on that basis; hybrid instruments
which contain one or more embedded derivatives, unless the embedded derivatives does not have a
substantial effect on the cash flows of the hybrid instruments, or the embedded derivatives obviously should
not be separated from the relevant hybrid instruments; hybrid instruments that have to be separated but
cannot be individually measured after it has been obtained or the balance sheet date afterwards. Such kind of
financial assets designated by the Company mainly includes forward exchange settlement business. The
Group applies subsequent measurement based on fair value in respect of such kind of financial assets.
Changes in fair values is included in gains or loss from change of fair value; interests or cash dividends
obtained during the period of holding assets, shall be recognized as investment income; difference between
the fair value and the amount initially recorded of the assets shall be recognized as investment gains or losses
on disposal of the assets, and the profit or loss from changes of fair value will be adjusted at the same time.
244
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Held-to-maturity investment represents the non-derivative financial assets which has fixed maturity day,
fixed or available-for-confirmation recovered amount and for which the management has definite intention
and ability to hold till maturity. Held-to-maturity investment adopts effective interest rate method for
follow-up measurement according to the amortized cost, the gains or losses from amortization or
depreciation and de-recognization will reckon into current gains/losses.
Accounts receivables represent the non-derivative financial assets which have no quotation in an active
market and fixed or available-for-confirmation recovered amount.
Available-for-sale financial assets refer to the non-derivative financial assets that are designated as available
for sale at initial recognition, and the financial assets that are not classified as other types. Among this type of
assets, the equity instrument investments that are not quoted in an active market and whose fair value cannot
be reliably measured, and the derivative financial assets that are linked to the equity instruments and must be
settled through the delivery of the equity instruments are subsequently measured at cost; others that have the
active market quotes or don’t have the active market quotes but of which the fair value can be reliably
measured should be measured at fair value, and the changes in fair value are included in other comprehensive
income. With regard to such financial assets using fair value for follow-up measurement, except for the
impairment losses and the exchange gains and losses arising from foreign currency monetary financial assets,
the changes in fair value of available-for-sale financial assets are directly reckoned in the shareholders’
equity, the accumulative amount of changes in fair value that originally included directly in equity is
transferred to the current profits and losses until the derecognition of the financial assets. The interests of
available-for-sale debt instrument investments calculated by effective interest method during the holding
period and the cash dividends relevant to available-for-sale equity instrument investments issued by Invested
unit are included in the current profits and losses as investment income. The equity instrument investments
that have no quotes in an active market and whose fair value cannot be reliably measured are measured at
cost.
2) Recognization basis and measure method for transfer of financial assets
The financial assets meet one of following requirements will be terminated recognition: ① The contract
rights of collecting cash flow of the financial assets is terminated; ②The financial assets has already been
transferred, and the Company has transferred almost all risks and remunerations of financial assets ownership
to the transferee; ③The financial assets has been transferred, even though the Company has neither
transferred nor kept almost all risks and remunerations of financial assets ownership, the Company has given
up controlling the financial assets.
If the enterprise has neither transferred or kept almost all risks and remunerations of financial assets
ownership, nor given up controlling the financial assets, then confirm the relevant financial assets according
to how it continues to involve into the transferred financial assets and confirm the relevant liabilities
245
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
accordingly.
If the entire transfer of financial assets satisfies the demand for derecognition, reckon the balance between
the book value of the transferred financial assets and the sum of consideration received from transfer and
fluctuation accumulated amount of fair value formerly reckoned in other consolidated income in the current
profits and losses.
If part transfer of financial assets satisfies the demand for derecognition, apportion the integral book value of
the transferred financial assets between the derecognized parts and the parts not yet derecognized according
to each relative fair value, and reckon the balance between the sum of consideration received from transfer
and fluctuation accumulated amount of fair value formerly reckoned in other consolidated income that
should be apportioned to the derecognized parts and the apportioned aforementioned carrying amounts in the
current profits and losses.
3) Method of impairment testing and accounting treatment for financial assets
Except for the financial assets which are measured by fair value and whose fair value change is recorded into
prevailing gains and losses, the Company will make check in the carrying value of other financial assets as at
the balance sheet date. If there is objective evidence proving impairment of certain financial assets, the
Company then makes provision for impairment.
When the financial assets calculated by amortized cost decrease in value, count and draw the provision for
impairment according to the balance between present value and book value of predicted future cash flows
(Excluding future credit losses that haven’t occurred yet.). If there is any objective evidence to indicate that
the financial assets has recovered and is objectively connected with matters occurred after confirming the
losses, the formerly confirmed impairment losses will be reversed and reckoned in current profits and losses.
When the fair value of financial assets available for sale goes down substantially or non- transiently, the
accumulating losses previously and directly reckoned in shareholder's equity and formed due to shrinkage of
fair value will be transferred and reckoned in impairment losses. As for the debt instrument investment
available for sale with confirmed impairment losses, if its fair value rises after and it is objectively connected
with matters occurred after confirming the primary impairment losses, the formerly confirmed impairment
losses will be reversed and reckoned in current profits and losses. And the debt instrument investment
available for sale with confirmed impairment losses shall be directly reckoned in stockholder's equity if its
fair value rises after.
(2)Financial liability
1) Classification, recognization basis and measurement
246
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
When making the initial recognition for financial liabilities, the Company classifies the financial liabilities
into ones which are measured by fair value and whose change is recorded into prevailing gains and losses,
and other financial liabilities.
Financial liabilities which are measured by fair value and whose change is recorded into prevailing gains and
losses include tradable financial liabilities and financial liabilities which are measured by fair value and
whose change is recorded into prevailing gains and losses at the initial recognition day. Follow-up
measurements are made by fair value. Recorded into prevailing gains and losses are the gains or losses
formed through fair value change and dividend and interest expenditure regarding to the financial liabilities.
As for other financial liabilities, effective interest rate method is adopted and follow-up measurement is
made according to amortized cost.
2) Condition of the de-recognization of financial liability
A financial liability or a part of financial liability is derecognized when and only when the obligation
specified in the contract is discharged or canceled. An agreement between the Company and a lender to
replace the original financial liability with a new financial liability with substantially different terms is
accounted for as an extinguishment of the original financial liability and the recognition of a new financial
liability. As for substantive changes made to the contract terms (whole or in part) of the existing financial
liabilities, the existing financial liabilities (or part of it) will be derecognized. And financial liabilities after
term revision will be recognized as a new financial liability. The difference between the carrying amount of
the financial liability derecognized and the consideration paid is recognized in profit or loss for the period.
(3)Method for recognition of fair value of financial assets and liabilities
Fair values of financial assets and financial liabilities of the Company are measured at the prices in principal
market. In case there is no principal market, fair values of financial assets and financial liabilities are
calculated using the price which is the most beneficial to the market, and using valuation technology which is
the most appropriate at that time and with sufficient available data and other information. The inputs which
are used to measure the fair value have been divided into 3 levels by the Company: Level 1-inputs consist of
unadjusted quoted prices in active markets for identical assets or liabilities. Level 2-inputs are quoted prices
for the asset or liability (other than those included in Level 1) that are either directly or indirectly observable.
Level 3-inputs are unobservable inputs to the related assets or liabilities. The Level 1 inputs are the first
priority to use by the Group, and level 3 inputs will be the last one to use. The level to which the results of
measurement of fair value belong is subject to the lowest level to which the inputs having great significance
to the measurement of fair value as whole belong.
11. Bad debt provision for accounts receivable
Allowance method is adopted for the bad debt losses which are likely to happen. And conducting impairment
test independently or by combination at period-end, withdrawn bad debt provision and then recorded into
247
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
current gains and losses. As for the accounts receivable which are not able to call back through definite
evidence, they shall be treated as bad debt losses after approval of the Group according to regulated
procedures to offset withdrawn bad debt provision.
The following situation as standards for confirmation of bad debt losses of accounts receivable: revoke,
bankruptcy, insolvency, serious insufficiency of cash flow of its debit units, or the debit units have to stop
production due to serious natural disaster and are not able to settle the debts or in predicted time, or other
definite evidence showing that the debt is not available to call back or the possibility of calling back is tiny.
Account receivables were divided as follow categories at period-end, which was performed impairment test
in way of individual or group, and withdrawal bad debt provision:
(1) Account receivable with single significant amount:
If totally amount takes over 80% of the total for over 5% occupied, than 5% of single amount
Determine basis or amount
in total amounts recognized as single significant amount; if totally amount takes less than
standards for single
80% of the total for over 5% occupied, than lower recognition standards till qualified 80% in
significant amount
total
Method of bad debt
provision accrual for account Withdrawal bad debt provision according to difference between the current value of future
receivable with single major cash flow and book values; if there has no impairment been found in individual test,
amount withdrawal bad debt provision while testing by group
(2) Account receivable withdrawal bad debt provision based on combination:
Basis for combination recognized
Combination 1 Account receivable except combination 2
Employee reserve fund, foreign investment amount, contact with related party in consolidated statement
Combination 2 of Changhong Group, export tax refund receivable, account receivable with L/C or insurance,
government subsidy etc.
Methods on withdrawal of bad debt provision based on combination
Combination 1 Methods on withdrawal of bad debt provision based on combination
Combination 2 Combination 1 Withdrawal bad debt provision by proportion in different age group
In combination 1, withdrawal proportion of bad debt provision for account receivable based on age
analysis:
Withdrawal proportion of account receivable Withdrawal proportion of other account
Account age
(%) receivable (%)
Within one year(one year
5 5
included )
1－2 years 15 15
2－3 years 35 35
3－4 years 55 55
4－5 years 85 85
Over 5 years 100 100
(3) Account receivable with single minor amount but withdrawal single item bad debt provision:
Reasons for withdrawal single
Account with minor amount but have significant inflow risk on predicted future cash flow
item bad debt provision
248
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Withdrawal method for bad Impairment test on the current value of predicted future cash flow, bad debt provision
debt provision withdrawal.
12. Inventories
Inventories of the Company principally include raw materials, stock goods; work in process, self-made
semi-finished product, materials consigned to precede, low-value consumption goods, goods in transit, goods
in process, mould and engineering construction etc.
Perpetual inventory system is applicable to inventories. For daily calculation, standard price is adopted for
raw materials, low-value consumption goods and stock goods. Switch-back cost of the current month is
adjusted by distribution price difference at the end of the month, the dispatched goods will share the cost
differences of inventory while in settlement the business income; and low-value consumption goods is
carried forward at once when being applied for use; the mould expenses will evenly deferred share based on
balance at period-begin plus increase amount in this period divided by 12 months.
Inventory at period-end is valued by the Lower-of-value between the cost and net realizable value. For those
individual stock, suffering damage, totally or partly out of fashion or has lower sales price than cost,
predicted recoverable parts in cost, and withdrawal provision of inventory depreciation single. For those raw
materials, stock commodities and goods in transit, withdrawal provision of inventory depreciation by follow
methods:
(1) Determined the net realizable value of raw materials on the higher amount between the final prices of
estimated sale-price deducted cost (about to happen till products finished), estimated sales expense and
relevant taxes, and the fair value of external disposal.
(2) Withdrawal obsolete provision for commodity stocks and goods in transit by the follow proportion:
1) Refrigerator, freezer and washing machine
Withdrawal proportion for obsolete
Grade Stock duration
provision
Within 3 months 0%
4-6 months 5%
7-12 months 15%
Grade-A
1-2 years 25%
2-3 years 40%
Over 3 years 100%
Qualified 40%
Grade-B 50%
Grade-C 60%
Unqualified 60%
Disposal 65%
249
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Withdrawal proportion for obsolete
Grade Stock duration
provision
Sample machine 30%
Special user type that exceed the order quantity 50%
2) Air-conditioner
Withdrawal proportion for obsolete
Location level
provision
Repair 50%
Awaiting repair 70%
Store return 70%
De-stocking 70%
Overstock 100%
With respect to the inventories and delivered goods which are not vested to the above classification, their realizable net value
will be calculated by the Company based on the estimated selling price of the inventories less estimated selling expense and
related taxes. The Company re-checks the above mentioned proportion at every end of the year. Calculated the net realizable
value by difference between the estimated sale price less the estimated sales expense and relevant taxation; after comparison
with the book value of commodity stocks and goods in transit, determined whether adjusted the proportion or not. Mould
expense will amortize in installment in usual times. Once the use-life of mould is terminated, and than transfer its remaining
cost into gains/losses, no withdrawal of obsolete provision at period-end.
13. Long-term equity investment
Long-term equity investment of the Company is mainly about investment in subsidiary, investment in
associates and investment in joint-ventures.
For long-term equity investments acquired through business combination under common control, the initial
investment cost shall be the acquirer’s share of the carrying amount of net assets of the acquiree as of the
combination date as reflected in the consolidated financial statement of the ultimate controller. If the carrying
amount of net assets of the acquiree as of the combination date is negative, the investment cost of long-term
equity investment shall be zero. For long-term equity investment acquired through business combination not
under common control, the initial investment cost shall be the combination cost.
Excluding the long-term equity investment acquired through business combination, there is also a king of
long-term equity investment acquired through cash payment, for which the actual payment for the purchase
shall be investment cost; If Long-term equity investments are acquired by issuing equity securities, fair value
of issuing equity investment shall be investment cost; for Long-term equity investments which are invested
by investors, the agreed price in investment contract or agreement shall be investment cost; and for long-term
equity investment which is acquired through debt reorganization and non-monetary assets exchange,
regulations of relevant accounting standards shall be referred to for confirming investment cost.
The Company adopts cost method for investment in subsidiaries, makes calculation for investments in
250
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
joint-ventures and associates by equity method.
When calculated by cost method, long-term equity investment is priced according to its investment cost, and
cost of the investment is adjusted when making additional investment or writing off investment; When
calculated by equity method, current investment gains and losses represent the proportion of the net gains
and losses realized by the invested unit in current year attributable to or undertaken by the investor. When the
Company is believed to enjoy proportion of net gains and losses of invested unit, gains and losses
attributable to the Company according to its shareholding ratio is to computer out according to the
accounting policy and accounting period of the Company, on the basis of the fair value of various
recognizable assets of the invested unit as at the date of obtaining of the investment, after offset of gains and
losses arising from internal transactions with associates and joint-ventures, and finally to make confirmation
after adjustment of net profit of the invested unit. Confirmation on gains and losses from the long-term
equity investment in associates and joint-ventures held by the Company prior to the first execution day, could
only stand up with the precedent condition that debit balance of equity investment straightly amortized
according to its original remaining term has already been deducted, if the aforementioned balance relating to
the investment do exist.
In case that investor loses joint control or significant influence over investee due to disposal of part equity
interest investment, the remaining equity interest shall be calculated according to Enterprise Accounting
Principles No.22-Recognition and Measurement of Financial Instrument. Difference between the fair value
of the remaining equity interest as of the date when lose of joint control or significant influence and the
carrying value is included in current gains and losses. Other comprehensive income recognized in respect of
the original equity interest investment under equity method should be treated according to the same basis
which the investee adopts to directly dispose the relevant assets or liabilities when ceasing adoption of equity
method calculation; and also switches to cost method for calculating the long-term equity investments which
entitles the Company to have conduct control over the invested units due to its additional investments; and
switches to equity method for calculating the long-term equity investments which entitles the Company to
conduct common control or significant influence, while no control over the invested units due to its
additional investments, or the long-term equity investments which entitles the Company with no control over
the invested units any longer while with common control or significant influence.
When disposing long-term equity investment, the balance between its carrying value and effective price for
obtaining shall be recorded into current investment income. When disposing long-term equity investment
which is calculated by equity method, the proportion originally recorded in owners’ equity shall be
transferred to current investment income according to relevant ratio, except for that other movements of
owners’ equity excluding net gains and losses of the invested units shall be recorded into owners’ equity.
14. Investment real estate
The investment real estate of the Company includes leased houses and buildings, and is accounted value by
its cost. Cost of purchased-in investment real estate consists of payment for purchase, relevant taxes and
other expenditure which is attributable to the assets directly; while cost of self-built investment real estate is
formed with all necessary expenditures occurred before construction completion of the assets arriving at the
251
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
estimated utilization state.
Consequent measurement of investment estate shall be measured by cost method. Depreciation is provided
with average service life method pursuant to the predicted service life and net rate of salvage value. The
predicted service life and net rate of salvage value and annual depreciation are listed as follows:
Predicted rate of Depreciation rate per
Category Depreciation term
salvage value annual
House and buildings 30-40 years 4%-5% 2.375%-3.20%
When investment real estate turns to be used by holders, it shall switch to fixed assets or intangible assets
commencing from the date of such turning. And when self-used real estate turns to be leased out for rental or
additional capital, the fixed assets or intangible assets shall switch to investment real estate commencing
from the date of such turning. In situation of switch, the carrying value before the switch shall be deemed as
the credit value after the switch.
When investment is disposed, or out of utilization forever and no economic benefit would be predicted to
obtain through the disposal, the Company shall terminate recognition of such investment real estate. The
amount of income from disposal, transfer, discarding as scrap or damage of investment real estate after
deducting the asset’ s carrying value and relevant taxation shall be written into current gains and losses.
15. Fixed assets
Fixed assets of the Company represent the tangible assets and assets package: held by the Company for
purpose of producing commodities, providing labor service, leasing or operational management, service life
exceeds one year, and unit price exceeds RMB 2,000. Including four categories of houses and buildings,
machinery equipments, transportation equipments and other equipments
Their credit value is determined on the basis of the cost taken for obtaining them. Of which, cost of
purchased-in fixed assets include bidding price and import duty and relevant taxes, and other expenditure
which occurs before the fixed assets arrive at the state of predicted utilization and which could be directly
attributable to the assets; while cost of self-built fixed asset is formed with all necessary expenditures
occurred before construction completion of the assets arriving at the estimated utilization state; credit value
of the fixed assets injected by investors is determined based on the agreed value of investment contracts or
agreements, while as for the agreed value of investment contracts or agreements which is not fair, it shall
take its fair value as credit value; and for fixed assets which are leased in through finance leasing, credit
value is the lower of fair value of leased assets and present value of minimized leasing payment as at the
commencing date of leasing.
Consequent expenditure related to fixed assets consists of expenditures for repair and update reform. For
those meeting requirements for recognization of fixed assets, they would be accounted as fixed asset cost;
and for the part which is replaced, recognization of its carrying value shall cease; for those not meeting
requirements for recognization of fixed assets, they shall be accounted in current gains and losses as long as
252
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
they occur. When fixed asset is disposed, or no economic benefit would be predicted to obtain through
utilization or disposal of the asset, the Company shall terminate recognization of such fixed asset. The
amount of income from disposal, transfer, discarding as scrap or damage of fixed asset after deducting the
asset’ s carrying value and relevant taxation shall be written into current gains and losses.
The Company withdraws depreciation for all fixed assets except for those which have been fully depreciated
while continuing to use. It adopts average service life method for withdrawing depreciation which is treated
respectively as cost or current expense of relevant assets according to purpose of use. The depreciation term,
predicted rate of salvage value and depreciation rate applied to fixed assets of the Company are as follows:
Predicted rate of salvage Depreciation rate per
No. Category Depreciation term
value year
1 House and buildings 30-40 years 4%-5% 2.375%-3.20%
2 Machinery equipment 10-14 years 4%-5% 6.786%-9.60%
3 Transport equipment 5-12 years 4%-5% 7.92%-19.20%
4 Other equipment 8-12 years 4%-5% 7.92%-12.00%
The Company makes re-examination on predicted service life, predicted rate of salvage value and
depreciation method at each year-end. Any change will be treated as accounting estimation change.
16. Construction in process
Construction in process is measured with effective cost. Self-operated constructions projects are measured
with direct materials, direct salaries and direct construction expense; construction projects undertaken by
external are measured with the engineering payment payable; and engineering cost (income abatement) of
equipment-installation projects is confirmed with consideration of value of the equipments, installation fee,
and expenditure arising from trial operation of the projects. Borrowing expense and exchange gains and
losses which should be capitalized are also included in cost of construction in process.
17. Borrowing expense
Borrowing expenses include interest expense, amortization of discount or premium, auxiliary expenses and
exchange difference due to borrowing in foreign currency. The borrowing expense which could be directly
attributable to purchase or production of assets satisfying capitalization condition, starts capitalization when
capital expenditure and borrowing expense occur and when necessary purchase or production conducted for
promoting assets to reach the predicted available-for-use or available-for-sale state; and capitalization shall
cease when purchased or produced assets satisfying capitalization condition have reached the predicted
available-for-use or available-for-sale state. Other borrowing expense is recognized as expense during the
occurrence period.
Capitalization shall be exercised for interest expense actually occurred from special borrowings in current
period after deduction of the interest income arising from unutilized borrowing capital which is saved in
banks or deduction of investment income obtained from temporary investment; For recognization of
capitalized amount of common borrowing, it equals to the weighted average of the assets whose
accumulated expense or capital disburse is more than common borrowing times capitalization rate of
253
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
occupied common borrowing. Capitalization rate is determined according to weighted average interest rate of
common borrowing.
Assets satisfying capitalization principle generally refer to fixed assets, investment real estate and inventories
which can only arrive at predicted available-for-use and available-for-sale state after quite a long time
(generally over one year) in purchase or production activities.
If abnormal interruption happens during purchase or production of assets satisfying capitalization principle
and the interruption lasts over 3 months, the capitalization for the borrowing expense shall pause until the
purchase or production restarts.
18. Intangible assets
The Company holds intangible assets including land use right, trademark, patent technology and non-patent
technology. Intangible assets are measured according to the effective costs paid for obtaining the assets. For
those intangible assets purchased in by the Company, their effective cost consist of actual payment and
relevant other expenditure; for the intangible assets input by investors, effective cost is determined according
to the value agreed in investment contracts and agreements, while if the agreed value is not fair, then
effective value is confirmed according to fair value.
Land use right is averagely amortized according to its transfer term commencing from the sate of transfer;
trademark use-rights averagely amortized by 10 years; patent technology, non-patent technology and other
intangible assets is averagely amortized according to the shortest of their predicted service life, beneficial
term concluded by contract and effective term regulated by laws. Amortization amount is recorded in assets
cost and current gains and losses relevant to beneficial objectives.
Re-examination on predicted service life and amortization method of the intangible assets which have limited
service life shall be conducted at the end of each year. If changed, it would be treated as change of
accounting estimation. Re-examination on predicted service life of intangible assets which have uncertain
service life shall be conducted. For any evidence proving that service life of intangible assets is limited, then
the service life shall be estimated and the Company shall make amortization within the predicted service life
period.
19. Research and development
As for expenditure for research and development, the Company classifies it into expenditure on research
phase and development phase, based on nature of the expenditure and that whether the final intangible assets
formed by research & development is of great uncertainty. Expenditure arising during research should be
recorded in current gains and losses upon occurrence; expenditure arising during development is confirmed
as intangible assets when satisfying the following conditions:
(1) Completions of the intangible assets make it available for application or sell in technology;
254
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(2) Equipped with plan to complete the intangible asset and apply or sell it;
(3) There is market for products produced with this intangible assets or the intangible asset itself;
(4) Have sufficient technology, financial resource and other resources to support development of the
intangible assets, and have ability to apply or sell the assets;
(5) Expenditure attributable to development of the intangible assets could be reliable measured.
Expenditure arising during development not satisfying the above conditions shall be recorded in current
gains and losses upon occurrence. Development expenditure which had been recorded in gains and losses in
previous period would not be recognized as assets in later period. Expenditure arising during development
phase which has been starting capitalization is listed in balance sheet as development expenditure, and
transferred to intangible assets since the project reaches at predicted utilization state.
20. Impairment of non-financial long-term assets
As at each balance sheet date, the Company has inspection on long-term equity investment, fixed assets,
construction in process and intangible assets with limited service life. When the following indications appear,
assets may be impaired, and the Company would have impairment test. As for goodwill and intangible assets
which have uncertain service life, no matter there is impairment or not, impairment test shall be conducted at
the end of every year. If it is hard to make test on recoverable amount of single asset, test is expected to make
on the basis of the assets group or assets group portfolio where such asset belongs to.
After impairment test, if the carrying value exceeds the recoverable amount of the asset, the balance is
recognized as impairment loss. As long as impairment loss of the aforementioned assets is recognized, it
couldn’t be switched back in later accounting periods. Recoverable amount of assets refers to the higher of
fair value of assets net disposal expense and present value of predicted cash flow of the asset.
Indications for impairment are as follows:
(1) Market value of asset drops a lot in current period, the drop scope is obviously greater than the predicted
drop due to move-on of times or normal utilization;
(2) Economy, technology or law environment where enterprise operates or market where asset is located will
have significant change in current or recent periods, which brings negative influence to enterprise;
(3) Market interest rate or returning rate of other market investments have risen in current period, which
brings influence in calculating discount rate of present value of predicted future cash flow of assets, which
leads to a great drop in recoverable amount of such assets;
(4) Evidence proving that asset is obsolete and out of time or its entity has been damaged;
(5) Asset has been or will be keep aside, terminating utilization or disposed advance;
(6) Internal report of enterprise shows that economic performance of asset has been or will be lower than
prediction, such as that net cash flow created by asset or operation profit (or loss) realized by asset is greatly
lower (or higher) than the predicted amount;
255
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(7) Other indications showing possible impairment of assets
21. Goodwill
Goodwill represents balance between equity investment cost or business combination cost under no common
control exceeding the attributable part or fair value of recognizable net assets of party invested or purchased
(obtained through business combination) as of acquisition day or purchase day.
Goodwill relating to subsidiaries is separately listed in consolidated financial statement. And goodwill
relating to associates and joint-ventures is included in carrying value of long-term equity investment.
22. Long-term deferred expenses
Long-term deferred expenses of the Company refer to the expense which has been paid out while should be
amortized from the current period and periods thereafter, with amortization term over 1 year (excluding 1
year). Such expense is averagely amortized during the beneficial period. If such long-term deferred expense
could not bring benefit to following accounting periods, the unamortized value of the item shall be fully
transferred to current gains and losses.
23. Staff remuneration
Employee benefits mainly include all kinds of remuneration incurred in exchange for services rendered by
employees or compensation to the termination of employment relationship such as short-term wages,
post-employment benefits, compensation for the termination of employment relationship and other long-term
employee welfare.
Short-term remuneration includes: staff salary, bonus, allowances and subsidies, staff benefits, social
insurances like medical insurance, work-related injury insurance and maternity insurance, housing fund,
labor union funds and staff education funds, short-term paid absence of duty, short-term profit sharing
scheme, and non-monetary benefits as well as other short-term remuneration. During the accounting period
when staff provides services, the short-term remuneration actually occurred is recognized as liabilities and
shall be included in current gains and losses or related asset costs according to the beneficial items.
Retirement benefits mainly consist of basic pension insurance, unemployment insurance and early-retirement
benefits, etc. retirement benefit scheme represents the agreement reached by the Company and its employees
in respect of retirement benefits, or the rules or regulations established by the Company for providing
retirement benefits to employees. In particular, defined contribution plan means a retirement benefit plan,
pursuant to which, the Company makes fixed contribution to independent fund, upon which, and it is not
obliged to make further payment. Defined benefit plan refers to retirement benefit scheme other than defined
contribution plan.
256
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
The early retirement policy for staff and workers of the Company is the compensation for encouraging staff
and workers to accept the reduction voluntarily. The employees make applications voluntarily, the two
parties sign the compensation agreement after approved by the Company and calculate the compensation
amount according to the compensation standard passed by the staff representative conference, and the
Company confirms it as dismiss welfare and reckons it in current profits and losses. As the Company
promises to adjust the treatment for early retiring staff and workers with the increase of social basic cost of
living allowances, the discount elements will not be considered for calculating the dismiss welfare.
24.Accrual liability
If the business in connection with such contingencies as a security involving a foreign party, commercial
acceptance bill discount, pending litigation or arbitration, product quality assurance, etc. meets all of the
following conditions, the Company will confirm the aforesaid as liabilities: the obligation is an existing
obligation of the Company; performance of the obligation is likely to cause economic benefits to flow out of
the enterprise; the amount of the obligation is reliably measurable.
25. Principle of recognition of revenue and measurement method
The Company’s sales revenue is mainly comprised of revenue from sale of goods, labor providing income
and revenue from assignment of asset use rights. The principle of recognition of such revenue is as follows:
(1) Revenue from the sale of goods shall be recognized when the Company has transferred to the buyer the
significant risks and rewards of ownership of the goods; the Company retains neither continuing managerial
involvement to the degree usually associated with ownership nor effective control over the goods sold; the
amount of revenue can be measured reliably; it is probable that the associated economic benefits will flow
into the Company; The export business is recognized when the packing list is received; and the associated
costs incurred or to be incurred can be measured reliably. Air-conditioner OEM/ODM will recognize revenue
while notes issued after commodity transferring to the shipping space that appointed by the client.
(2) The Company confirms the realization of service income when the gross income and total cost of labor
service cab be unfailingly calculated, the economic benefits related to labor service are likely to flow into the
Group, and the progress of labor service can be confirmed reliably. On balance sheet date, with regard to
those with results provided for labor service transactions can be estimated reliably, confirm the relevant
service income according to percentage of completion method and determine the percentage-of-completion
method by the proportion of the occurred cost in the estimated total cost; as for those with results provided
for labor service transactions can’t be estimated reliably and with occurred labor cost predicted to be able to
get compensation, confirm to provide service income according to labor cost amount occurred and
capable of getting compensation, and carry over the occurred labor costs; for those with results provided for
labor service transactions can’t be estimated reliably and with occurred labor cost predicted to be not able to
get compensation, reckon the occurred labor cost in the current profits and losses, but not confirm to provide
service income.
257
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(3) The economy benefit of use-right of transfer assets probably wills inflow to the Company, if the income
can be measure accountability, than use-right income of transfer assets recognized.
26. Government grant
Government grant is recognized when the Company fulfils the conditions attached to them and there is
reasonable assurance that the grant will be received. The government grant, other than fiscal subsidy,
received by the Company shall be accounted on an aggregate basis. In particular, the government grants
relating to ordinary activities would be included in other income; the government grants not relating to
ordinary activities would be included in non-operating income.
When the government grant is in the form of monetary assets, it is measured at the actual amount received.
When the grant is provided based on a pre-determined rate, it is measured at the fair value of the amount
receivable. When the government grant is in the form of non-monetary assets, it is measured at fair value,
and measured at the nominal value of RMB1.00 in case of failure to obtain reliable fair value.
(1)Basis of determination and accounting of government grant relating to assets
Government grant relating to assets refers to that obtained by the Company for the purpose of acquiring or
otherwise formation of long-term assets. Government grant relating to assets is deemed as that relating to
ordinary activities in principle and recognized as deferred income upon receipt. The government grant shall
be allocated averagely over the life of use of relevant assets and accounted in other income.
(2)Basis of determination and accounting of government grant relating to income
Government grant relating to income refers to the government grant other than that relating to assets.
Government grant relating to income shall be recognized as deferred income if the grant is used to
compensate the Company’s expenses or losses for subsequent periods, and shall be accounted in profit or loss
for the period during the period in which the relevant expense is recognized. Those grants relating to our
ordinary activities are recorded in other income in the period in which the relevant expenses or losses are
recognized. Those grants not relating to our ordinary activities are recorded in non-operating income in the
period in which the relevant expenses or losses are recognized. Government grants used to compensate the
relevant costs or losses incurred by the Company and relating to our ordinary activities shall be accounted in
other income directly upon receipt of the grant, and accounted in non-operating income directly upon receipt
if it is not related to our ordinary activities.
With respect to government grant comprising both portions relating to assets and income, it shall be
accounted separately based on different portions, and it shall be aggregated as that relating to income if it is
difficult to distinguish the two portions.
(3)The policy-related preferential loan received by the Company shall be accounted separately in the
following two manners:
258
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
In case that government’s appropriation of interest subsidy is made to the lending bank, the Company shall
account for the relevant loan based on the actual amount of loan received by it, and calculate the borrowing
expense based on the principal of the borrowing and the policy-related preferential interest rate.
In case that government’s appropriation of interest subsidy is made to the Company, the Company applied
the relevant interest subsidy to offset borrowing expense.
27. Deferred Income Tax Assets and Deferred Income Tax Liabilities
A deferred tax asset and deferred tax liability shall be determined by a difference (temporary difference)
between the carrying amount of an asset or liability and its tax base. The deferred tax asset shall be
recognized for the carry forward of unused deductible losses that it is probable that future taxable profits will
be available against which the deductible losses can be utilized. For temporary difference arising from initial
recognition of goodwill, no corresponding deferred income tax liabilities will be recognized. For temporary
difference arising from initial recognition of assets and liabilities occurred in the transaction related to non
business combination which neither affect accounting profit nor assessable income (or deductible losses), no
corresponding deferred income tax assets and deferred income tax liabilities will be recognized. As of the
balance sheet date, deferred income tax assets and deferred income tax liabilities are measured at the
effective tax rate applicable to the period when recovery of assets or settlement of liabilities occur.
The Company recognizes deferred income tax assets to the extent of future assessable income tax which is
likely to be obtained to offset deductible temporary difference, deductible losses and tax credits.
28. Lease
The Company categorizes the lease into the financial lease and the operating lease.
The financial lease is the lease in which all risks and returns related to the ownership of assets are transferred
in substance. The Company as a lease holder, on the date of lease, the financial lease is recognized as the
fixed asset at lower cost of fair value of the rental asset and the NPV of minimum payment of leasing. The
minimum payment of leasing is recognized as long-term payable and the difference is accounted into
unrecognized financing expense.
The operating lease is the lease apart from the financial lease. The Company, as a lease holder, accounts the
rents into current period by straight line method during the term of the lease. The Company, as a leaser,
accounts the rental income into current period by straight line method during the term of the lease.
29. Held-for-sale
(1)The Company classifies non-current assets or disposal groups that meet all of the following conditions as
held-for-sale: 1) according to the practice of selling this type of assets or disposal groups in a similar
259
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
transaction, the non-current assets or disposal group can be sold immediately at its current condition; 2) The
sale is likely to occur, that is, the Company has made resolution on the selling plan and obtained definite
purchase commitment, the selling is estimated to be completed within one year. Those assets whose disposal
is subject to approval from relevant authority or supervisory department under relevant requirements are
subject to that approval. Prior to the preliminary classification of non-current assets or disposal group as the
category of held-for-sale, the Company measures the carrying value of the respective assets and liabilities
within the non-current assets or disposal group under relevant accounting standards. For non-current asset or
disposal group held for sale, for which it is found that the carrying value is higher than its fair value less
disposal expense during the initial measurement or re-measurement on the balance sheet date, the carrying
value shall be deducted to the net amount of fair value less disposal expense, and the reduced amount shall
be recognized as impairment loss in profit or loss for the period, and provision of impairment of assets held
for sale shall be provided for accordingly.
(2)The non-current assets or disposal group that the Company has acquired specially for resale are classified
as held for sale on the acquisition date when they meet the condition that “the selling is estimated to be
completed within one year” on the acquisition date, and are likely to satisfy other conditions of being
classified as the type of held for sale in a short-term (usually being 3 months). Non-current assets or disposal
group classified as held for sale are measured at the lower of their initial measurement amount and the net
amount after their fair value less the selling expenses based on the assumption that such non-current assets or
disposal group are not classified as held for sale at the time of initial measurement. Except for the
non-current assets or disposal group acquired in a business combination, the difference arising from
considering the net amount of such non-current assets or disposal group after their fair value less the selling
expenses as the initial measurement amount is recorded in the current profit or loss.
(3)In case of loss of control over the subsidiaries due to the sales of investment in subsidiaries, no matter
whether the Company retains part of the equity investment after selling investment in subsidiaries, the
investment in subsidiaries shall be classified as held for sale on an aggregate basis in the separate financial
statements of the parent company when the investment in subsidiaries proposed to be sold satisfies the
conditions for being classified as held for sale; and all the assets and liabilities of the subsidiary shall be
classified as held for sale in the consolidated financial statements.
(4)If the net amount of fair value of non-current assets held for sale less sales expense on subsequent balance
sheet date increases, the amount previously reduced for accounting shall be recovered and reverted from the
impairment loss recognized after the asset is classified under the category of held for sale, with the amount
reverted recorded in profit or loss for the period. Impairment loss recognized before the asset is classified
under the category of held for sale shall not be reverted.
260
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(5)For the amount of impairment loss on assets, the carrying value of disposal group’s goodwill shall be
offset against first, and then offset against the book value of non-current assets according to the proportion of
book value of non-current assets.
If the net amount of fair value of the disposal group held for sale on the subsequent balance sheet date less
sales expenses increases, the amount reduced for accounting in previous periods shall be restored, and shall
be reverted in the impairment loss recognized in respect of the non-current assets which are applicable to
relevant measurement provisions after classification into the category of held for sale, with the reverted
amount charged in profit or loss for the current period. The written-off carrying value of goodwill and
impairment loss of non-current assets which is recognized prior to classification into the category of held for
sale shall not be reverted.
The subsequent reversed amount in respect of the impairment loss on assets recognized in the disposal group
held for sale will increase the book value in proportion of the book value of each non-current assets (other
than goodwill) in the disposal group.
(6)The non-current assets in the non-current assets or disposal group held for sale is not depreciated or
amortized, and the debt interests and other fees in the disposal group held for sale continue to be recognized.
(7)If the non-current assets or disposal group are no longer classified as held for sale since they no longer
meet the condition of being classified as held for sale or the non-current assets are removed from the disposal
group held for sale, they will be measured at the lower of the following: 1) the amount after their book value
before they are classified as held for sale is adjusted based on the depreciation, amortization or impairment
that should have been recognized given they are not classified as held for sale; 2) the recoverable amount.
(8)The unrecognized profits or loss will be recorded in the current profits or loss when derecognizing the
non-current assets or disposal group held for sale.
30. Discontinued operation
A discontinued operation is a separately identified component of the Group that either has been disposed of
or is classified as held for sale, and satisfies one of the following conditions: (1) represents a separate major
line of business or geographical area of operations; (2) is part of a single co-ordinate plan to dispose of a
separate major line of business or geographical area of operations; and (3) is a subsidiary acquired
exclusively with a view to resale.
31. Income tax accounting
The Company accounted the income tax in a method of debit in balance sheet. The income tax expenses
include income tax in the current year and deferred income tax. The income tax associated with the events
and transactions directly included in the owners’ equity shall be included in the owners’ equity; and the
261
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
deferred income tax derived from business combination shall be included in the carrying amount of goodwill,
except for that above, the income tax expense shall be included in the profit or loss in the current period.
The income tax expense in the current year refers to the tax payable, which is calculated according to the tax
laws on the events and transactions incurred in the current period. The deferred income tax refers to the
difference between the carrying amount and the deferred tax assets and deferred tax liabilities at the year-end
recognized in the method of debit in the balance sheet.
32. Segment information
Business segment was the major reporting form of the Company, which divided into 4 parts: air-conditioner,
refrigerator and freezer, marketing and others. The transfer price among the segments will recognize based
on the market price, common costs will allocated by income proportion between segments except for the
parts that without reasonable allocation.
33. Explanation on significant accounting estimation
The management of the Company needs to apply estimation and assumption when preparing financial
statement which will affect the application of accounting policy and amounts of assets, liabilities, income and
expense. The actual condition may differ from the estimation. Constant evaluation is conducted by the
management in respect of the key assumption involved in the estimation and judgment of uncertainties.
Effect resulting from change of accounting estimation is recognized in the period the change occurs and
future periods.
The following accounting estimation and key assumption may result in material adjustment to the book value
of assets and liabilities in future period.
(1) Inventory impairment provision
The Company provides impairment provision according to the type of finished products and goods delivered
under fixed proportion, and estimates the realizable net value of inventories by reference to the projected
selling price of similar inventories less sales expenses and related taxes on a regular basis, so as to evaluate
the rationality of the provision proportion. If the actual selling price or expense differs from the previous
estimation, the management will make corresponding adjustment to the proportion. The estimation results
based on existing experiences may differ from the latter actual results, which may result in adjustment to the
book value of inventories in the balance sheet and affect over the gains and losses of the period when the
estimation changes.
(2) Accounting estimation on long-term assets impairment provision
The Company makes impairment test on fixed assets such as buildings, machine and equipments which have
impairment indication and long-term assets such as goodwill as at the balance sheet date. The recoverable
amount of relevant assets and assets group shall be the present value of the projected future cash flow which
shall be calculated with accounting estimation.
262
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
If the management amends the gross profit margin and discount rate adopted in calculation of future cash
flow of assets and assets group and the amended gross profit margin is lower than the currently adopted one
or the amended discount rate is higher than the currently adopted one, the Company needs to increase
provision of impairment provision. If the actual gross profit margin is higher (or the discount rate is lower)
than the estimation of management, the Company can not transfer back the long term assets impairment
provision provided already.
(3) Accounting estimation on realization of deferred income tax assets
Estimation on deferred income tax assets needs estimation on the taxable income and applicable tax rate for
each future year. Realization of deferred income tax assets depends on whether a company is able to obtain
sufficient taxable income in future. Change of future tax rate and switch back of temporary difference could
affect the balance of income tax expense (gains) and deferred income tax. Change of the aforesaid estimation
may result in material adjustment to deferred income tax.
(4) Usable term and residual value rate of fixed assets and intangible assets
The Company, at least at the end of each accounting year, reviews the projected usable life and residual value
rate of fixed assets and intangible assets. The projected usable life and residual value rate are determined by
the management based on the historical experiences of similar assets by reference to the estimation generally
used by the same industry with consideration on projected technical upgrade. If material change occurs to
previous estimation, the Company shall accordingly adjust the depreciation expenses and amortization
expenses for future period.
(5) Projected liabilities arising from product quality guarantee
The Company commits to repair the major spare parts of refrigerators sold through go-to-countryside
promotion activity for free for ten years. As to the maintenance expenses that may be increased arising from
such commitment, the Company has provided projected liabilities.
Taking into account the various uncertainties during the ten years, the Company considers no discount factor
of such projected liabilities. In stead, the Company reviews the parameters (probility, proportion,
maintenance expense per single set) based on the actual occurrence of maintenance expenses as of each
balance sheet date. If obvious change is found, the Company will adjust the projected liabilities according to
the latest parameters so as to reflect the best estimation.
34. Other comprehensive income
Other comprehensive income represents various gains and losses not recognized in current gains and losses
according to other accounting rules.
Other comprehensive income items shall be reported in the following two classes under other relevant
accounting rules:
(1) Other comprehensive income items that can not be reclassified into gains and losses in future accounting
periods, mainly including changes arising from re-measurement of net liabilities or net assets under defined
benefit plan and interest in investee’s other comprehensive income which are measured under equity method
263
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
and which can not be reclassified into gains and losses in future accounting periods;
(2) Other comprehensive income items that will be reclassified into gains and losses in future accounting
periods upon satisfaction of required conditions, mainly including interest in investee’s other comprehensive
income which are measured under equity method and which will be reclassified into gains and losses in
future accounting periods upon satisfaction of required conditions, gains or losses arising from change of fair
value of available-for-sale financial assets, gains or losses arising from reclassification of held-to-maturity
investment into available-for-sale financial assets, gains or losses occurred by cash flow hedging instruments
attributable to effective hedge, foreign currency financial statement translation difference, etc.
35. Change of significant accounting policies and accounting estimates
(1) Change of significant accounting policies
Content and reasons Approval procedure Note
Revised the format of financial statement according to the Notice of
the Ministry of Finance on Revising and Printing the Format of Approved by 20th session of 9th Found below as
Financial Statements for General Enterprises in 2018 (CK [2018] BOD details
No.15)
The Company prepared the financial statement 2018 in line with the (CK [2018] No.15) documents,
relevant items are changed with retrospective application. Details are as:
The consolidated balance sheet and balance sheet of parent company on 31 December 2017 are:
consolidated balance sheet balance sheet of parent company
Item affected Before Amount After Before Amount After
adjustment adjusted adjustment adjustment adjusted adjustment
Note
receivable and
3,855,064,993.38 3,855,064,993.38 3,121,486,894.18 3,121,486,894.18
account
receivable
Note
2,074,648,484.36 -2,074,648,484.36 1,748,615,925.92 -1,748,615,925.92
receivable
Account
1,780,416,509.02 -1,780,416,509.02 1,372,870,968.26 -1,372,870,968.26
receivable
Interest
4,692,303.18 -4,692,303.18
receivable
Interest
dividend
Other account
64,358,959.73 4,692,303.18 69,051,262.91 39,849,732.36 0.00 39,849,732.36
receivable
Fixed assets 1,439,427,226.50 75,875,517.11 1,515,302,743.61 933,149,895.50 43,582,333.35 976,732,228.85
Construction
174,857,717.15 174,857,717.15 67,205,463.02 0.00 67,205,463.02
in progress
Engineering
0.00 0.00
material
Disposal of
75,875,517.11 -75,875,517.11 43,582,333.35 -43,582,333.35
fixed assets
Note payable 6,876,651,907.18 6,876,651,907.18 3,675,862,014.96 3,675,862,014.96
and
264
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
account pay
able
Note payable 4,006,765,857.99 -4,006,765,857.99 2,001,732,195.76 -2,001,732,195.76
Account paya
2,869,886,049.19 -2,869,886,049.19 1,674,129,819.20 -1,674,129,819.20
ble
Interest
6,441,508.68 -6,441,508.68 3,999,358.60 -3,999,358.60
payable
Dividend
2,890,364.80 -2,890,364.80 2,890,364.80 -2,890,364.80
payable
Other account
834,285,636.00 9,331,873.48 843,617,509.48 1,013,257,972.75 6,889,723.40 1,020,147,696.15
payable
Long-term
10,953,687.53 1,530,000.00 12,483,687.53
payables
Special
1,530,000.00 -1,530,000.00
payable
Consolidate profit statement and parent company’s profit statement for year of 2017 are as:
Consolidate profit statement parent company’s profit statement
Item
affected Before Amount After Before Amount After
adjustment adjusted adjustment adjustment adjusted adjustment
Administr
ative 496,931,743.04 -210,977,773.13 285,953,969.91 209,439,736.74 -90,459,548.26 118,980,188.48
expenses
R&D
210,977,773.13 210,977,773.13 90,459,548.26 90,459,548.26
expenses
(2) Change of significant accounting estimates
The Company had no change of significant accounting estimates in the year.
V. Taxation
1. Major taxes (expenses) and tax rates
Tax(expenses) Tax base Tax rate
Income from sales of goods and from
VAT 17%/16%、11%/10%、6%、5%
processing
Urban maintenance and
Turnover tax 5% or 7%
construction tax
Education surcharge Turnover tax 3%
Local education
Turnover tax 2%
surcharge
Corporate income tax Taxable income 15% or 25%
Original Book value of house
House Property Tax 1.2% or 12%
property×(1-30%)or annual rent income
Land use tax Actual land area used 1 Yuan/M2 to 15 Yuan /M2
2. Preferential tax and approval documents
The Company and its subsidiary Zhongke Meiling Cryogenics Technology Limited Company were
265
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
recognized as second Hi-Tech Enterprise for year of 2014 in Anhui Province with term of three years.
Therefore, the Company and its subsidiary Zhongke Meiling Cryogenics Technology Limited Company
enjoys 15% rate for the income tax for State Hi-Tech Enterprise. On 20 July 2017, being recognized by
“Name Lists of First Hi-Tech Enterprise for year of 2017 in Anhui Province”[KG(2017) No. 62] from Anhui
Science & Technology Department, the Company and Zhongke Meiling Cryogenics Technology Limited
Company continuous to enjoy 15% rate for the income tax for State Hi-Tech Enterprise for three years term.
Subsidiary Zhongshan Changhong Home Appliances Company Limited was recognized as the first High &
New tech. enterprise (three-years term) for year of 2008 in Guangdong Province, and enjoins the 15%
income tax rate. On 9 November 2017, the company listed in Notice of the First High & New Tech.
Enterprise for year of 2017 in Guangdong Province issued by office of recognization management office, the
company continues to shares the 15% rate in income tax with term of three years.
The subsidiary Sichuan Changhong Air-conditioner Co., Ltd. has passed the review for high-tech enterprise
certification on December 8, 2016, which is valid for three years. And continues to enjoy the 15% income tax
rare for State Hi-Tech Enterprise
Subsidiary Sichuan Hongmei Intelligent Technology Co., Ltd. pass the software enterprise certificate on 27
June 2014, and obtained the Software Enterprise Certification [Chuan No.:R-2014-0072]. Calculating the
promotion period since the year of profit-making, the 1st year to 2nd year, the income tax shall be exempted,
levy income tax based on half of the statutory rates from the 3rd year to 5th year, and enjoy the preferential till
expired.
Subsidiary Mianyang Meiling Refrigeration Co., Ltd. pass the review of Reply [Chuan JX Industrial H(2014)
No.408] from Sichuan Commission of Information on 9 May 2014, and the enterprise belongs to the
encourage industry listed in Directories of Industrial Structure Adjustment (2011) Revised (State Law
Reform Committee No. 21 Order); which enjoys the preferential tax policy of income tax for the western
development enterprise. And file in tax bureau with 15% rate for enterprise income tax since 2014 with seven
years term.
Guangdong Changhong Ridian Technology Co., Ltd., a subsidiary of The Company, was authenticated as a
high-tech enterprise by Guangdong Science and Technology Bureau on 9 December 2016, which is valid for
three years. And enjoy the 15% income tax rare for State Hi-Tech Enterprise
The subsidiary Hefei Meiling Nonferrous Metal Products Co., Ltd. has passed the qualification of high-tech
enterprise certification on 26 Oct. 2018 (Certification No.:GR201834001779), which is valid for three years.
And enjoy the 15% enterprise income tax rare for State Hi-Tech Enterprise
VI. Notes to the major items in the consolidated financial statements
With respect to the financial statements figures disclosed below, unless otherwise specified, “year-beginning”
refers to Jan. 1, 2018; “year-end” refers to Dec. 31, 2018; “the year” refers to Jan. 1 to Dec. 31, 2018; “the
266
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
last year” refers to Jan. 1 to Dec. 31, 2017; the currency is RMB.
1.Monetary fund
Item Balance at year-end Balance at year-begin
Cash 28,650.21 43,454.93
Bank deposit 4,029,892,318.85 4,600,242,944.53
Other Monetary fund 566,156,588.34 682,795,388.58
Total 4,596,077,557.40 5,283,081,788.04
Including: total amount deposited in overseas 13,722,335.29 16,015,873.59
Other monetary fund:
Item Ending amount
Cash deposit 557,255,760.45
Account of foreign currency for verification 6,114,884.47
Union Pay online 1,530,036.79
Taobao account 1,255,906.63
Total 566,156,588.34
Cash deposit which serves as non cash and cash equivalents refers to the banking acceptance draft deposit with a term of over
three months, amounting to RMB 99,141,504.99, the amount restricted for used in managed account was RMB11,542,030.82;
the cash deposit for L/C from Municipal utilities administration of Feng feng Mining District, Handan City was RMB
500,833.66. China Union Pay, Taobao account and Ten Pay are all third party payment platforms. Except for the deposit of
RMB 250,000.00, utilization of other balance is not subject to any restriction.
Pars of the goods payment denominated in foreign currency should be transferred to reviewing accounts which may not be used
temporarily. Upon approval of such review, those payments may be transferred to general accounts. Due to the relatively short
time for reviewing foreign exchange, balance of the reviewing accounts is not limited on utilization.
2. Financial assets measured at fair value and whose changes are recorded in the profits and losses of the
current period
Item Balance at year-end Balance at year-begin
Tradable financial assets 9,253,635.59 15,646,731.48
Including: Derivative financial assets 9,253,635.59 15,646,731.48
Derivative financial assets refers to the RMB forward exchange fund in the year
3.Note receivable and account receivable
Item Balance at year-end Balance at year-begin
Note receivable 2,387,830,887.74 2,074,648,484.36
Account receivable 1,670,988,644.76 1,780,416,509.02
Total 4,058,819,532.50 3,855,064,993.38
3.1Note receivable
267
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(1) Category of note receivable
Item Balance at year-end Balance at year-begin
Bank acceptance 2,143,384,546.78 1,865,540,158.79
Trade acceptance 244,446,340.96 209,108,325.57
Total 2,387,830,887.74 2,074,648,484.36
(2) Notes receivable already pledged by the Company at the end of the period
Item Amount pledge at year-end
Bank acceptance 655,399,922.44
Note: with purpose of improving the note utilization, the Company draw up bank acceptance by pledge parts
of the outstanding notes receivable to the bank. Pledge of the note receivable found more in 53. Assets with
ownership or the right to use restricted in VI.
(3) Notes endorsement or discount and undue on balance sheet date
Amount derecognition at Amount without
Item
year-end derecognition at year-end
Bank acceptance 2,977,154,673.65
Trade acceptance 515,905,705.13
Total 3,493,060,378.78
(4) Notes transfer to account receivable due for failure implementation by drawer at period-end
3.2Account receivable
(1) Category of account receivable
Ending amount
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Account receivable with single
significant amount and withdrawal single
item bad debt provision
Account receivable withdrawal bad debt
provision by combination
Combination 1 777,954,849.92 44.73% 45,585,909.49 5.86% 732,368,940.43
Combination 2 929,208,927.34 53.43% 929,208,927.34
Combination Subtotal 1,707,163,777.26 98.16% 45,585,909.49 2.67% 1,661,577,867.77
Account receivable with single minor
amount but withdrawal single item bad 32,057,190.91 1.84% 22,646,413.92 70.64% 9,410,776.99
debt provision
Total 1,739,220,968.17 100.00% 68,232,323.41 3.92% 1,670,988,644.76
(Continued)
Category Opening amount
268
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Account receivable with single
significant amount and withdrawal single
item bad debt provision
Account receivable withdrawal bad debt
provision by combination
Combination 1 1,099,760,720.22 59.49% 56,934,296.29 5.18% 1,042,826,423.93
Combination 2 720,513,272.25 38.97% 720,513,272.25
Combination Subtotal 1,820,273,992.47 98.46% 56,934,296.29 3.13% 1,763,339,696.18
Account receivable with single minor
amount but withdrawal single item bad 28,425,106.80 1.54% 11,348,293.96 39.92% 17,076,812.84
debt provision
Total 1,848,699,099.27 100.00% 68,282,590.25 3.69% 1,780,416,509.02
1）Account receivable with single significant amount and withdrawal bad debt provision separately at period
end:
2) Account receivable with withdrawal bad debt provision for combination 1 by aging account
Balance at year-end
Account age
Account receivable Bad debt provision Provision ratio
Within one year 730,176,485.08 36,508,824.25 5.00%
1-2 years 42,655,826.93 6,398,374.04 15.00%
2-3 years 1,838,777.09 643,571.98 35.00%
3-4 years 2,661,420.50 1,463,781.28 55.00%
4-5 years 339,882.54 288,900.16 85.00%
Over 5 years 282,457.78 282,457.78 100.00%
Total 777,954,849.92 45,585,909.49
3)Account receivable without bad debt provision withdrawal in combination 2
Combination Book balance
Connected amount between related parties 693,467,089.57
Account receivable already insured 175,942,330.94
L/C 59,799,506.83
Total 929,208,927.34
4) Account receivable with single minor amount but withdrawal bad debt provision singly, refers to the minor
single receivables, and withdrawal bad debt provision by combination shows no risk characteristic of the
receivables, 19 clients involved.
(2) Bad debt reserve provided for, reversed (or recovered) during this year
Bad debt reserve written off this period was RMB 2,225,353.98, and the bad debt reserve reversed this period
was RMB 2,275,620.82. No trade receivables written-off in previous year was recovered this period.
269
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(3)No account receivable actually written-off in the year。
(4) Pledge of the account receivable at year-end can be found in 53. Assets with ownership or the right to use
restricted in VI.
(5) In the period, top five receivables collected by arrears party amounting to RMB 951,783,244.16 in total,
accounted for 54.72% of the receivables at balance of the period-end, the bad debt provision accrual
correspondingly amounting to RMB16,342,050.03 at period-end balance.
4. Accounts paid in advance
(1) Age of account paid in advance
Ending amount Opening amount
Item
Amount Ratio Amount Ratio
Within one year 77,433,864.54 89.85% 191,934,459.26 95.92%
1-2 years 4,345,186.02 5.05% 5,283,741.30 2.64%
2-3 years 2,115,459.14 2.45% 2,377,113.61 1.19%
Over 3 years 2,285,949.56 2.65% 510,902.42 0.25%
Total 86,180,459.26 100.00% 200,106,216.59 100.00%
(2) Top 5 of account paid in advance in balance at period-end amounting to RMB 49,661,318.93,
accounted for57.62% of the account.
5. Other account receivable
Item Balance at year-end Balance at year-begin
Interest receivable 2,653,712.36 4,692,303.18
Other account receivable 59,475,861.81 64,358,959.73
Total 62,129,574.17 69,051,262.91
5.1 Interest receivable
(1) Category of interest receivable
Item Balance at year-end Balance at year-begin
Interest receivable from time deposit 1,892,948.46 4,692,303.18
Income receivable from financial products 760,763.90
Total 2,653,712.36 4,692,303.18
(2) Major overdue interest: nil
270
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
5.2Other account receivable
（1）Category of other account receivable
Ending amount
Category Bookbalance Bad debtprovision
Bookvalue
Amount Ratio Amount Ratio
Other account receivable with single significant
amount and withdrawal single item bad debt
provision
Other account receivable withdrawal bad debt
provision bycombination
Combination 1 33,540,656.32 52.11% 4,861,209.84 14.49% 28,679,446.48
Combination 2 30,796,415.33 47.84% 30,796,415.33
Combination Subtotal 64,337,071.65 99.95% 4,861,209.84 7.56% 59,475,861.81
Other account receivable with single minor amount
30,000.00 0.05% 30,000.00 100.00%
butwithdrawal singleitembad debtprovision
Total 64,367,071.65 100.00% 4,891,209.84 7.60% 59,475,861.81
(Continued)
Opening amount
Category Bookbalance Bad debtprovision
Bookvalue
Amount Ratio Amount Ratio
Other account receivable with single significant
amount and withdrawal single item bad debt
provision
Other account receivable withdrawal bad debt
provision bycombination
Combination 1 15,360,536.87 22.77% 2,839,700.68 18.49% 12,520,836.19
Combination 2 51,838,123.54 76.83% 51,838,123.54
Combination Subtotal 67,198,660.41 99.60% 2,839,700.68 4.23% 64,358,959.73
Other account receivable with single minor amount
267,932.63 0.40% 267,932.63 100.00%
butwithdrawal singleitembad debtprovision
Total 67,466,593.04 100.00% 3,107,633.31 4.61% 64,358,959.73
1) No significant other account receivable and no withdrawal bad debt provision single at year-end.
2) Other account receivable with withdrawal bad debt provision for combination 1 by aging account
Balance at year-end
Account age Other Account
Bad debt provision Provision ratio
receivable
Within one year 21,531,783.72 1,076,589.18 5.00%
1-2 years 7,623,542.26 1,143,531.34 15.00%
2-3 years 2,172,404.00 760,341.40 35.00%
3-4 years 703,164.26 386,740.34 55.00%
4-5 years 105,030.00 89,275.50 85.00%
271
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at year-end
Account age Other Account
Bad debt provision Provision ratio
receivable
Over 5 years 1,404,732.08 1,404,732.08 100.00%
Total 33,540,656.32 4,861,209.84
3) Other account receivable with no withdrawal bad debt provision for combination 2
Combination Book balance
Connected amount between related parties 1,470,228.16
Loans of employee’s pretty cash 16,248,265.59
Export rebate and other refundable tax 12,524,216.47
Pre-paid charge of the employee 553,705.11
Total 30,796,415.33
4) The other account receivable with major amount at year-end and accrual for bad debt provision single
refers to the receivable amount of 30,000.00 Yuan from Chengdu Rongcheng Agricultural Tech. Co., Ltd.,
(2) Reversal (or withdraw) of reserve for bad debts in the Year
Bad debt provision accrual in the year amounted as 2,051,509.16 Yuan, collected bad debt provision of
267,932.63 Yuan in the year
(3) No actual verification of other receivables in the year
(4) Classification of other accounts receivable according to the nature of account
Nature Ending book balance Opening book balance
Export rebate and other refundable tax 12,524,216.47 35,017,055.24
Loans of employee’s pretty cash 16,248,265.59 15,747,553.42
Cash deposit 32,292,605.75 13,548,566.97
Other 1,278,050.57 2,079,902.53
Related party not in consolidation statement 1,470,228.16 657,720.80
Advance money temporary 553,705.11 415,794.08
Total 64,367,071.65 67,466,593.04
(5) Top 5 other receivables collected by arrears party at balance of year-end:
Proportion
Balance of
in total
Account bad debt
Name Nature Balance atyear-end other
age provision at
receivables
year-end
at year-end
Export rebates Withi
SAT of Hefei Economic & Technological
and other 12,294,910.68 n 1 19.10%
Development Zone
rebates year
Withi
Development & Reform Bureau of Performance
8,500,000.00 n 1 13.21% 425,000.00
Wangdu County bond
year
272
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Proportion
Balance of
in total
Account bad debt
Name Nature Balance atyear-end other
age provision at
receivables
year-end
at year-end
Office of the Beijing Pinggu District New Performance 1-3
3,500,000.00 5.44% 625,000.00
Socialist Countryside Construction bond years
Withi
Development & Reform Bureau of Anguo Performance
2,100,000.00 n 1 3.26% 105,000.00
City bond
year
Withi
New rural construction service center of Guarantee
1,403,038.00 n 1 2.18% 70,151.90
Tongzhou District, Beijing money
year
Total 27,797,948.68 43.19% 1,225,151.90
(6) No other account receivable involved government subsidies at year-end.
(7) No other receivables terminated recognization due to the transfer of financial assets at year-end.
(8) No assets and liability transfer other receivables and continues to involve at year-end.
6. Inventories
(1) Classification of inventories
Ending amount
Item
Book balance Impairment provision Book value
Raw materials 143,684,247.48 12,759,205.28 130,925,042.20
Stock commodities 1,735,811,082.70 111,451,370.33 1,624,359,712.37
Low value consumable articles 9,282,634.55 300,940.36 8,981,694.19
Goods in transit 273,895,754.50 975,168.15 272,920,586.35
Goods-in-process 7,262,896.05 7,262,896.05
Engineering construction 70,933,181.87 70,933,181.87
Deferred expense for mould 59,053,460.64 59,053,460.64
Total 2,299,923,257.79 125,486,684.12 2,174,436,573.67
(Continued)
Opening amount
Item Impairment
Book balance Book value
provision
Raw materials 333,003,731.78 4,238,458.01 328,765,273.77
Stock commodities 2,288,756,168.67 99,568,255.11 2,189,187,913.56
Low value consumable articles 13,795,361.33 300,940.36 13,494,420.97
Goods in transit 206,306,918.31 2,888,710.76 203,418,207.55
Goods-in-process 34,035,823.80 34,035,823.80
Engineering construction 97,609,145.79 97,609,145.79
Deferred expense for mould 51,589,864.83 51,589,864.83
Total 3,025,097,014.51 106,996,364.24 2,918,100,650.27
273
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(2) Inventory falling price reserves
Increased in the Decreased in the Year
Item Opening amount Ending amount
Year Switch-back Other switch-out
Raw materials 4,238,458.01 8,520,747.27 12,759,205.28
Stock
99,568,255.11 26,370,962.51 14,487,847.29 111,451,370.33
commodities
Goods in
2,888,710.76 1,353,328.36 3,266,870.97 975,168.15
transit
Low value
consumable 300,940.36 300,940.36
articles
Total 106,996,364.24 36,245,038.14 17,754,718.26 125,486,684.12
(3) Provision for inventories
Reasons for the Switch-back
Item Specific basis for determining of net realizable value
or conversion in the year
Cost is higher than net realizable value (The processed products are
Raw materials
decline)
Cost is higher than net realizable value (The market price at year-end
Stock commodities
fell)
Cost is higher than net realizable value (The market price at year-end
Goods in transit
fell)
Cost is higher than net realizable value (The processed products are
Goods-in-process
decline)
7. Non current assets due within one year
Item Balance at year-end Balance at Nature
year-begin
Time deposits due within one
44,497,902.00 定期存款重分类
year
8. Other current assets
Item Balance at year-end Balance at Nature
year-begin
Financial products 1,110,000,000.00 620,000,000.00 Bank financial products
Reclassify of value-added tax to be
Value-added tax to be deducted 62,040,151.40 166,730,091.15
deducted
Advance payment of income Reclassify of advance payment of
12,057,771.72 15,071,202.22
tax income tax
Finance lease un-recognized 589,033.84 93,637.60 Finance lease un-recognized
Total 1,184,686,956.96 801,894,930.97
274
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
9. Finance asset available for sales
(1) Finance asset available for sales
Balance at year-end Balance at year-begin
Item Impairme Impairment
Book balance Book value Book balance Book value
nt loss loss
Equity instrument available 31,000,000.0
45,000,000.00 45,000,000.00 31,000,000.00
for sales 0
31,000,000.0
Including: measured by cost 45,000,000.00 45,000,000.00 31,000,000.00
0
31,000,000.0
Total 45,000,000.00 45,000,000.00 31,000,000.00
0
(2) Finance asset available for sales measured by cost at year-end
Invested
Year-beginni Increased Decreased enterprise Cash bonus
Invested enterprise Year-end
ng in the Year in the Year Shareholdi in the year
ng ratio
Huishang Bank Co., Ltd. 5,000,000.00 5,000,000.00 0.0972% 268,439.33
Sichuan Hongyun New it
26,000,000.00 14,000,000.00 40,000,000.00 16.00%
Investment Fund
Total 31,000,000.00 14,000,000.00 45,000,000.00 268,439.33
(3) No impairment reserve of finance asset available for sales at year-end.
275
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
10. Long-term equity investment
Changes in the year Ending
Additio Investment Other Other Provisio balance
Balance at Declaration of Balance at
Invested enterprise nal Disinvest profit and loss comprehen changes n for of
year-begin cash dividends Other year-end
investm ment confirmed by sive income of impair impairmen
or profits t
ent equity method adjustment equity ment
Associated companies
1.ChanghongRuba
note 1 27,930,634.94 -15,129,056.84 -3,751,882.47 9,049,695.63
ElectricCompany(Private)Ltd.
2.Hefei Xingmei Assets Management Co.,
10,696,982.04 -1,276,882.77 9,420,099.27
Ltd.
3.Sichuan Zhiyijia Network Technology Co.,
note 2 10,695,570.98 -6,713,204.21 3,982,366.77
Ltd.
4.Hongyuan Ground Energy Heat Tech. Co.,
note 3 21,144,973.09 2,003,963.45 23,148,936.54
Ltd.
5.Sichuan Tianyou Guigu Technology Co.,
note 4 8,448,865.51 -1,337,911.44 7,110,954.07
Ltd.
6.Chengdu Guigu Environmental Tech. Co.,
note 5 11,617,645.36 -2,460,257.09 9,157,388.27
Ltd.
7.Hefei Meiling Solar Energy Technology
1,555,700.00 -1,555,700.00
Co., Ltd.note 6
Total 90,534,671.92 -23,357,648.90 -3,751,882.47 -1,555,700.00 61,869,440.55
Note 1: Zhongshan Changhong, a subsidiary of the Company, entered into a supplemental joint venture agreement with RUMA Comprehensive Trading Company in 2017, pursuant to which, both parties
agreed to increase capital contribution of USD1,130,191.00, among which, Zhongshan Changhong subscribed to contribute USD452,076.00 (equivalent to RMB3,001,649.02 on the actual contribution
date) according to the original shareholding proportion of 40% and RUMA Comprehensive Trading Company subscribed to contribute USD678,115.00 according to the original shareholding proportion of
60%.
Note 2: on 16 December 2014, the Company executed a joint venture agreement with its controlling shareholder Sichuan Changhong Electric Co., LTD, targeting to jointly establish Sichuan Zhiyijia
276
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Network Technology Co., Ltd. On 5 January 2015, Sichuan Zhiyijia Network Technology Co., Ltd was officially incorporated with registered capital of RMB50 million, among which, the Company made
contribution of RMB15 million with shareholding proportion of 30% and Sichuan Changhong Electric Co., LTD made contribution of RMB35 million with shareholding proportion of 70%.
Note 3: our subsidiary Sichuan Changhong Air Conditioner Co., Ltd (“Changhong Air Conditioner”) and Hengyouyuan Technology Development Group Co., Ltd. (“Hengyouyuan”) cooperated to establish
Hongyuan Ground Energy Heat Technology Co., Ltd. on 28 October 2015. The registered capital of the company is RMB50 million, among which, Changhong Air Conditioner contributed RMB24.5
million, accounting for 49% of the registered capital, and Hengyouyuan contributed RMB25.5 million, accounting for 51% of the registered capital.
Note 4: Sichuan Tianyou Guigu Technology Co., Ltd. was incorporated on 31 March 2015 with registered capital of RMB100 million. Our subsidiary Changhong Air Conditioner made capital contribution
of RMB 25 million in cash, accounting for 25% of the registered capital. Chengdu Jiaodao Property Development Company made capital contribution of RMB 20 million, accounting for 20% of the
registered capital. Chengdu Southwest Jiaotong University Industry (Group) Co., Ltd made capital contribution of RMB 20 million, accounting for 20% of the registered capital. Mianyang Investment
Holding (Group) Co., Ltd made capital contribution of RMB 5 million, accounting for 5% of the registered capital. Shanghai Zhongcheng Xindaya Financial Information Service Co., Ltd made capital
contribution of RMB 5 million, accounting for 5% of the registered capital. Jiangsu Runye Investment Co., Ltd made capital contribution of RMB 10 million, accounting for 10% of the registered capital.
Chengdu Dongyu Shangmao Co., Ltd made capital contribution of RMB 15 million, accounting for 15% of the registered capital. In 2016, shareholders meeting of Sichuan Tianyou Guigu Technology Co.,
Ltd. agreed to reduce the 50 million Yuan capital, the shareholders are reducing the capital by ratio of share-holding. After capital reduction, subsidiary Changhong Air conditioner contributed 12.5 million
Yuan, representing 25% of the registered capital.
Note 5: Chengdu Tianyou Guigu Environmental Tech. Co., Ltd. was incorporated on 31 March 2015 with registered capital of RMB40 million. Our subsidiary Changhong Air Conditioner made capital
contribution of RMB 10 million, accounting for 25% of the registered capital. Chengdu Jiaodao Property Development Company made capital contribution of RMB 8 million, accounting for 20% of the
registered capital. Chengdu Southwest Jiaotong University Industry (Group) Co., Ltd made capital contribution of RMB 8 million, accounting for 20% of the registered capital. Mianyang Investment
Holding (Group) Co., Ltd made capital contribution of RMB 2 million, accounting for 5% of the registered capital. Shanghai Zhongcheng Xindaya Financial Information Service Co., Ltd made capital
contribution of RMB 2 million, accounting for 5% of the registered capital. Sichuan Shuye Jiachen Property Development Company made capital contribution of RMB 4 million, accounting for 10% of
the registered capital. Chengdu Dongyu Shangmao Co., Ltd made capital contribution of RMB 6 million, accounting for 15% of the registered capital.
note 6: .Hefei Meiling Solar Energy Technology Co., Ltd. was incorporated on 18 April 2002 with registered capital of RMB 10 million. Subsidiary Meiling Group invested 3.1114 million Yuan,
accounting for 31.114% of the registered capital; Hefei Huayi Investment Co., Ltd. Invested 4.972 million Yuan, accounting for 49.72% of the registered capital; and Hefei Xingtai Assets Management Co.,
Ltd contributed 1.9166 million Yuan, accounting for 19.166% of the registered capital
277
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
11. Investment real estate
(1) Investment real estate measured at costs
Item House and buildings Land use rights Total
I. Original book value
1.Balance at year-begin 17,630,687.27 916,691.38 18,547,378.65
2.Increased in the Year 36,588,767.51 2,495,156.62 39,083,924.13
(1)fixed assets\intangible assets transfer-in 36,588,767.51 2,495,156.62 39,083,924.13
3.Decreased in the Year
4.Balance at year-end 54,219,454.78 3,411,848.00 57,631,302.78
II. Accumulated depreciation and
accumulated amortization
1.Balance at year-begin 8,484,500.32 493,166.61 8,977,666.93
2.Increased in the Year 1,759,958.62 47,169.82 1,807,128.44
(1) Provision or amortization 1,254,818.20 38,368.56 1,293,186.76
(2)fixed assets\intangible assets transfer-in 505,140.42 8,801.26 513,941.68
3.Decreased in the Year
4.Balance at year-end 10,244,458.94 540,336.43 10,784,795.37
III.Impairment loss
IV.Book value
1.Ending book value 43,974,995.84 2,871,511.57 46,846,507.41
2.Opening book value 9,146,186.95 423,524.77 9,569,711.72
(2) No investment real estate measured by fair value at year-end.
(3) No particular about mortgage of investment property at year-end.
(4)Investment real estate without property certification held
Reasons for failing to complete
Item Book value
property rights certificate
Workshop 23,435,026.46 In processing
12. Fixed assets
Item Balance at year-end Balance at year-begin
Fixed assets 1,658,081,495.03 1,439,427,226.50
Disposal of fixed assets 75,875,517.11 75,875,517.11
Total 1,733,957,012.14 1,515,302,743.61
12.1 Fixed assets
(1) Fixed assets
278
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
House and Machinery Transport Other
Item Total
buildings equipment equipment equipment
I. Original book value
1.Balance at
1,092,010,409.02 1,081,570,708.11 27,344,234.00 181,348,892.73 2,382,274,243.86
year-begin
2.Increased in the Year 135,368,003.96 278,096,221.37 6,397,029.58 20,341,072.03 440,202,326.94
(1) Purchase 5,889,836.19 18,857,019.94 3,626,934.51 7,623,938.69 35,997,729.33
(2)Construction in progress
129,478,167.77 259,239,201.43 2,770,095.07 12,717,133.34 404,204,597.61
transfer-in
3.Decreased in the Year 37,163,698.09 91,988,295.64 2,665,755.68 7,854,204.36 139,671,953.77
(1) disposeorretirement 574,930.58 74,726,250.25 1,815,974.56 7,462,134.99 84,579,290.38
(2)Construction in progress
17,262,045.39 17,262,045.39
transfer-in
(3)Transfer to
36,588,767.51 36,588,767.51
investment real estate
(4)Decreased for change
849,781.12 392,069.37 1,241,850.49
of foreign rate
4.Balance at year-end 1,190,214,714.89 1,267,678,633.84 31,075,507.90 193,835,760.40 2,682,804,617.03
II.Accumulated
depreciation
1.Balance at
208,509,025.48 640,697,645.00 16,325,523.72 75,125,831.69 940,658,025.89
year-begin
2.Increased in the Year 35,706,144.99 108,901,986.31 2,423,953.53 10,032,153.42 157,064,238.25
(1)Provision 35,706,144.99 108,901,986.31 2,423,953.53 10,032,153.42 157,064,238.25
3.Decreased in the
766,719.95 69,816,915.99 2,110,822.82 2,414,134.19 75,108,592.95
Year
(1)disposeorretirement 261,579.53 60,121,262.30 1,627,493.65 2,194,134.19 64,204,469.67
(2)Construction in progress
9,695,653.69 9,695,653.69
transfer-in
(3)Transfer to
505,140.42 505,140.42
investment real estate
(4)Decreased for change
483,329.17 220,000.00 703,329.17
of foreign rate
4.Balance at year-end 243,448,450.52 679,782,715.32 16,638,654.43 82,743,850.92 1,022,613,671.19
III. Impairment loss
1.Balance at
1,981,900.10 7,403.67 199,687.70 2,188,991.47
year-begin
2.Increased in the Year
3.Decreased in the
72,136.99 7,403.67 79,540.66
Year
(1)disposeorretirement 72,136.99 7,403.67 79,540.66
4.Balance at year-end 1,909,763.11 199,687.70 2,109,450.81
IV. Book value
1.Ending book value 946,766,264.37 585,986,155.41 14,436,853.47 110,892,221.78 1,658,081,495.03
2.Opening book value 438,891,163.01 11,011,306.61 106,023,373.34 1,439,427,226.50
883,501,383.54
The new fixed assets in this year mainly due to the RMB404,204,597.61 transfer from construction in
process; decrease of the fixed assets in the Year mainly including the investment real estate transfer-in,
279
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
renewal of the assets transfer to construction in progress and assets dispose for retirement
(2) No fixed assets temporary idle at year-end.
(3) No fixed assets for collateral at year-end.
(4) Fixed assets leased through financing lease at year-end.
Accumulated
Item Original book value Impairment loss Net book value
depreciation
Machinery equipment 3,433,033.03 407,672.67 3,025,360.36
(5) No fixed assets leased through operating lease at year-end.
Accumulated
Item Original book value Impairment loss Net book value
depreciation
House and buildings 32,604,281.97 5,013,710.27 27,590,571.70
Machinery equipment 17,281,747.30 11,536,893.89 5,744,853.41
Other equipment 1,632,648.51 456,867.68 1,175,780.83
Transport equipment 197,640.00 187,758.00 9,882.00
Total 51,716,317.78 17,195,229.84 34,521,087.94
(6) Fixed assets without property certificate
Reason of not complete the
Item Book value
property certificate
Canteen 2,716,313.94 In procedure
freezer salvage station 349,166.88 In procedure
Freezer subsidiary station 4,165,499.83 In procedure
3# makeshift shelter 5,689,907.18 In procedure
5# makeshift shelter 5,140,247.60 In procedure
8# makeshift shelter 5,178,824.74 In procedure
6# building for skeleton staff 8,930,447.86 In procedure
7# building for skeleton staff 8,215,215.45 In procedure
4# makeshift shelter (dormitory building transfer to
6,651,069.97 In procedure
capital)
Big refrigerator- 3# Workshop 93,571,298.89 In procedure
Big refrigerator -3# finished warehouse 50,085,022.01 In procedure
Freezer- 7# Workshop inspection room 233,741.56 In procedure
II canteen of living area 26,029,822.03 In procedure
Hot water room for living area 2,914,385.29 In procedure
Comprehensive building 14,211,331.37 In procedure
Workshop 42,747,573.98 In procedure
Total 276,829,868.58
(7) No fixed assets held for sale at year-end
280
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
12.2 Disposal of fixed assets
Reasons for disposal
Item Ending amount Opening amount
transferred
Relocation for land
Relevant assets disposal for reserved lands 75,875,517.11 75,875,517.11
reserve
Pursuant to the urban planning requirements of the People’s Government of Hefei city, Hefei Land Reserve Center plans to
purchase and store the land use right of an integrated economic development zone of the Company located at Longgang of
Hefei with an area of 103,978.9 sq.m. (Approximately 155.9684 mu, Land Use Right Certificate No.: Dong Guo Yong (2004)
Zi No. 0200, the stated use of the land is for industrial purpose). The estimated consideration for purchasing and storage is
RMB74.48 million. The land is mainly used for the Company’s warehouse, product finishing workshop and the factory of
Zhongke Meiling. Pursuant to the purchasing and storage requirements of land use right, the land will be purchased and stored
with vacant possession. In April 2013, the Company completed the relocation of occupants of the premises, and the net fixed
assets in relation to the land will transfer as disposal, accounting treatment will be conduct in line with relevant rules upon
receiving of the relocation compensation.
Pursuant to the urban planning requirements of Hefei Municipal Government and the Government of Feidong county, the land
reserve center of Feidong county will purchase and store the land use right of an economic development zone located at
Feidong county, Hefei city, which is owned by the Company’s subordinate companies, Equator Electric and Equator Home
Appliance, respectively, with an area of 19,245.09 sq.m. (Approximately 28.87 mu, Land Use Right Certificate No.: Dong
Guo Yong (2008) No. 0366, the stated use of the land is for industrial purpose) and an area of 46,161.9 sq.m. (Approximately
69.24 mu, Land Use Right Certificate No.: Dong Guo Yong (2008) No. 0367, the stated use of the land is for industrial
purpose). The total consideration for purchasing and storage is approximately RMB36 million, of which the consideration for
the land use right owned by Equator Electric and Equator Home Appliance is approximately RMB10.59 million and
RMB25.41 million, respectively. The Company has completed the relocation of occupants of the premises, and the net fixed
assets in relation to the land will transfer as disposal, accounting treatment will be conduct in line with relevant rules upon
receiving of the relocation compensation.
No impairment of relevant assets disposal for reserved lands at year-end.
13. Construction in progress
Item Balance at year-end Balance at year-begin
Construction in progress 464,558,352.60 174,857,717.15
13.1Construction in progress
(1) Details of construction in progress
Ending amount Opening amount
Imp Imp
Item airm airm
Bookbalance ent Bookvalue Bookbalance ent Bookvalue
provi prov
sion ision
Changhong Air Conditioner-
relocation of production base and 320,579,598.28 320,579,598.28 44,191,093.23 44,191,093.23
upgrading & expansion
Construction of washing machine
54,004,325.69 54,004,325.69 469,104.32 469,104.32
plant
Construction of intelligent
31,389,804.22 31,389,804.22 30,302,738.39 30,302,738.39
manufacturing
Other petty projects 15,562,870.33 15,562,870.33 12,711,740.78 12,711,740.78
281
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Ending amount Opening amount
Imp Imp
Item airm airm
Bookbalance ent Bookvalue Bookbalance ent Bookvalue
provi prov
sion ision
Jiangxi Meiling – construction of the
production line for producing one
5,065,550.61 5,065,550.61 71,086,744.70 71,086,744.70
million energy-saving smart
refrigeration annually
Construction of laboratory
4,847,375.61 4,847,375.61 5,735,299.39 5,735,299.39
(inspection center)
Technical transformation project of
4,119,899.02 4,119,899.02
Zhongshan Changhong
Temperature control project of the
manufacturing Company of big 4,084,254.68 4,084,254.68
refrigerator
Project of the application of MES
3,545,478.16 3,545,478.16
system during manufacturing
Upgrade project for the production
line of Mianyang Meiling Intelligent 3,322,079.08 3,322,079.08 338,293.66 338,293.66
Refrigerator
Capacity enlargement and technology
improvement project for 3,188,095.36 3,188,095.36 236,439.90 236,439.90
Air-conditioner Company
Improvement for the double-gun
2,951,970.77 2,951,970.77
injection of line J
Reform project of the EPS house of
2,826,825.99 2,826,825.99 1,244,713.14 1,244,713.14
the Company
Production efficiency improvement
project of the Line C for the overseas 2,112,500.01 2,112,500.01
Refrigerator Manufacture Company
Project of cancel spraying for the side
2,021,643.02 2,021,643.02
panel of refrigerator’s door
Line modification for R290 1,769,230.77 1,769,230.77 1,769,230.77 1,769,230.77
Reform of the overseas air patenting
line; project of cabinet foam line for 1,750,000.00 1,750,000.00
Line D
Equipment to be installed 1,416,851.00 1,416,851.00 373,222.76 373,222.76
Reform of the production for big
3,128,583.30 3,128,583.30
refrigerator in Line J
Replacement of the dry & wet parts
2,050,427.36 2,050,427.36
for door foaming line
PUR glue water project 1,220,085.45 1,220,085.45
Total 464,558,352.60 464,558,352.60 174,857,717.15 174,857,717.15
(2) Changes in significant construction in progress
Transfer to
Book balance Increase Other
fixed assets in Book balance Source of
Projects at during the
decrease at period-end funds
period-begin period the period
Construction of
laboratory 5,735,299.39 45,815,451.06 46,703,374.84 4,847,375.61 Raisefunds
(inspection center)
282
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Transfer to
Book balance Increase Other
fixed assets in Book balance Source of
Projects at during the
decrease at period-end funds
period-begin period the period
Construction of
washing machine 469,104.32 53,535,221.37 54,004,325.69
Self-raised
plant
Construction of
intelligent 30,302,738.39 76,887,913.14 75,619,194.16 181,653.15 31,389,804.22 Raisefunds
manufacturing
Changhong Air
Conditioner-
relocation of
44,191,093.23 278,321,673.07 1,933,168.02 320,579,598.28 Self-raised
production base and
upgrading &
expansion
Jiangxi Meiling –
construction of the
production line for
producing one
71,086,744.70 95,382,069.86 157,914,139.37 3,489,124.58 5,065,550.61 Self-raised
million
energy-saving smart
refrigeration
annually
(Continued)
including: Interest
Budget (in Proportion of Accumulated
interest capitaliza
10 project amount of
Projects Progress capitalized tion rate
thousand investment in interest
amount of the of the
Yuan) budget capitalization
period period
Construction of laboratory
10,748.00 56.15% 80.00%
(inspection center)
Construction of washing
37,121.00 60.56% 65.00%
machine plant
Construction of intelligent
26,128.00 67.37% 82.00%
manufacturing
Changhong Air Conditioner-
relocation of production base 84,791.01 38.04% 80.00% 2,570,143.02 2,570,143.02
and upgrading & expansion
Jiangxi Meiling – construction
of the production line for
producing one million 20,960.00 95.00% 100.00%
energy-saving smart
refrigeration annually
(2) No impairment occurred for construction in progress at year-end
14. Intangible assets
(1) According to intangible assets item
Trademark Non-patent
Item Land use right Other Total
special right technology
I. Original book value
1.Balance at year-begin 752,955,269.99 283,292,439.34 266,108,731.03 4,332,185.55 1,306,688,625.91
2.Increased in the Year 107,683.47 125,101,501.65 1,978,180.28 127,187,365.40
283
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Trademark Non-patent
Item Land use right Other Total
special right technology
(1) Purchase 107,683.47 363,961.76 471,645.23
(2)Internal research 125,101,501.65 1,614,218.52 126,715,720.17
3.Decreased in the Year 2,823,174.45 425,641.02 3,248,815.47
(1)Disposal 425,641.02 425,641.02
(2)Transfer to investment
2,495,156.62 2,495,156.62
real estate
(3)Other decreased 328,017.83 328,017.83
4.Balance at year-end 750,239,779.01 283,292,439.34 391,210,232.68 5,884,724.81 1,430,627,175.84
II.Accumulated
depreciation
1.Balance at year-begin 128,984,031.92 274,842,191.09 129,826,848.10 181,932.39 533,835,003.50
2.Increased in the Year 15,806,881.62 3,882,886.80 58,730,052.80 882,390.02 79,302,211.24
(1) Provision 15,806,881.62 3,882,886.80 58,730,052.80 882,390.02 79,302,211.24
3.Decreased in the Year 8,801.26 81,196.58 89,997.84
(1)Disposal 81,196.58 81,196.58
(2)Transfer to investment
8,801.26 8,801.26
real estate
4.Balance at year-end 144,782,112.28 278,725,077.89 188,556,900.90 983,125.83 613,047,216.90
III. Impairment loss
IV.Book value
1.Ending book value 605,457,666.73 4,567,361.45 202,653,331.78 4,901,598.98 817,579,958.94
2.Opening book value 623,971,238.07 8,450,248.25 136,281,882.93 4,150,253.16 772,853,622.41
The intangible assets resulted from internal research takes 8.86% of the balance of intangible assets at
year-end
(2) No land use right without property certification done at year-end
(3) up to end of the 2018, mortgage of intangible assets is as follows:
Name Property certificate serials Area(M2) Net book value Note
Land use right HGYJCZi No.: 0121 27,120.22 18,908,720.29
15. Development expense
Increased in the Year Decreased in the Year
Balance at Internal Included in Balance at
Item Confirmed as Othe
year-begin development Other current profits year-end
intangible assets r
expenditure and losses
Technology
development for 61,188,711.14 82,469,846.22 3,145,950.06 90,152,425.38 50,360,181.92
Air-conditioner
Technology
development for 23,782,085.92 67,152,236.49 33,550,668.69 57,383,653.72
refrigerator
284
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Increased in the Year Decreased in the Year
Balance at Internal Included in Balance at
Item Confirmed as Othe
year-begin development Other current profits year-end
intangible assets r
expenditure and losses
Other technology
653,281.73 2,826,475.33 3,012,626.10 467,130.96
development
Total 85,624,078.79 152,448,558.04 3,145,950.06 126,715,720.17 108,210,966.60
16. Goodwill
(1) Original value of goodwill
Increased in the
Decreased in the Year
Year
Balance at Formation Formation Balance at
Invested enterprise
year-begin from from year-end
Other Other
enterprise enterprise
merger merger
Hefei Meiling Group Holdings
3,553,367.77 3,553,367.77
Limited
Guangxi Huidian Home
5,313,913.50 5,313,913.50
Appliance Co., Ltd.
Total 8,867,281.27 8,867,281.27
(2)Goodwill Impairment loss
Increased in the
Balance at Decreased in the Year Balance at
Invested enterprise Year
year-begin year-end
Provision Other Provision Other
Hefei Meiling Group Holdings
3,553,367.77 3,553,367.77
Limited
Guangxi Huidian Home
5,313,913.50 5,313,913.50
Appliance Co., Ltd.
Total 8,867,281.27 8,867,281.27
Note: at the period-end, the Company conducted impairment test on goodwill, and provided for impairment reserve in
connection with the difference between the predicted future cash flow of the invested and the group of assets including the
goodwill. The recoverable amount is based on the predicted future cash flow of the invested.
17. Long-term deferred expenses
Amortization Other decrease
Balance at Increased in Balance at
Item during the during the
year-begin the Year year-end
period period
Relocation of the intelligent
3,635,861.94 3,635,861.94
manufacturing plant
18. Deferred income tax assets and deferred income tax liabilities
(1) Deferred income tax assets without the offset
Balance at year-end Balance at year-begin
Item Deductible Deferred Deductible Deferred
temporary income tax temporary income tax
difference assets difference assets
Deferred income tax assets recognized from 163,800,143.96 25,443,182.41 131,024,120.50 20,010,586.00
285
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at year-end Balance at year-begin
Item Deductible Deferred Deductible Deferred
temporary income tax temporary income tax
difference assets difference assets
property depreciation preparation
Deferred income tax assets recognized from
266,641,323.73 39,996,198.56 313,013,878.20 46,952,081.73
accrual liability
Deferred income tax assets recognized from
23,369,410.19 3,505,411.53 29,851,081.96 4,477,662.29
Dismission welfare
Deferred income tax assets recognized from
113,016,902.89 16,952,535.44 49,566,302.74 7,456,073.25
deferred income
Deferred income tax assets recognized from
125,576,447.96 18,836,467.19 75,254,272.72 11,409,917.37
ir-reparable losses
Deferred income tax assets recognized from
46,033,136.96 6,904,970.53 387,268.52 58,090.28
changes in the fair value
Accrued income tax assets 3,765,940.62 564,891.09 2,164,484.73 324,672.71
Total 742,203,306.31 112,203,656.75 601,261,409.37 90,689,083.63
(2) Deferred income tax liabilities without the offset
Balance at year-end Balance at year-begin
Item Taxable Deferred Taxable Deferred
temporary income tax temporary income tax
differences liability differences liability
Recognized by fixed assets depreciation 20,657,994.05 3,098,699.11
(3) Details of unrecognized deferred income tax assets
Item Balance at year-end Balance at year-begin
Deductible temporary difference 44,702,678.05 49,551,458.77
Deductible loss 487,578,430.48 438,730,245.37
Total 532,281,108.53 488,281,704.14
19.Short-term loans
(1)Category of short-term loans
Category Balance at year-end Balance at year-begin
Loan in pledge 199,260,520.00 266,980,000.00
Guaranteed loan 9,200,000.00 374,226,000.00
Loan in credit 1,876,648,262.82 990,000,000.00
Bill financing 251,265,146.80
Total 2,336,373,929.62 1,631,206,000.00
New loans in the period:
1) The Company entered into a Contract for Loan with Hefei Branch of CMBC with 12 months in terms since the date actually
received the funds. The Company withdrawal loans on 13 June 2018, term of borrowing from 13 June 2018 to 13 June 2019.
Fixed annual rate of 4.5%, the loan amount is 100,000,000.00 Yuan.
286
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
2) The Company entered into a Liquidity Loan Contract with Shouchun Branch of Bank of Communications with 12 months in
terms since the date actually received the funds. The Company withdrawal loans on 31 August 2018, term of borrowing from
31 August 2018 to 11 March 2019. Fixed annual rate of 4.35%, the loan amount is 250,000,000.00 Yuan.
3) The Company entered into a Liquidity Loan Contract with economic & technological development zone Branch of Bank of
China with 12 months in terms since the date actually received the funds. The Company withdrawal loans on 14 September
2018, term of borrowing from 14 September 2018 to 13 September 2019. Fixed annual rate of 4.35%, the loan amount is
50,000,000.00 Yuan.
4) The Company entered into a Perfect Loan Agreement with Hefei Branch of China Zheshang Bank with 3 months in terms.
Terms of borrowing from 21 November 2018 to 20 February 2019. Fixed annual rate of 4.5675%, the loan amount is
100,000,000.00 Yuan.
5) The Company entered into a RMB Liquidity Loan Contract with Hefei Luyang Branch of China Construction Bank with one
year in terms. Terms of borrowing from 24 April 2018 to 23 April 2019. Fixed annual rate of 4.7%, the loan amount is
100,000,000.00 Yuan.
6) The Company entered into a RMB Liquidity Loan Contract with Hefei Luyang Branch of China Construction Bank with one
year in terms. Terms of borrowing from 14 May 2018 to 13 May 2019. Fixed annual rate of 4.35%, the loan amount is
100,000,000.00 Yuan.
7) The Company entered into a RMB Liquidity Loan Contract with Hefei Luyang Branch of China Construction Bank with one
year in terms. Terms of borrowing from 1 March 2018 to 28 February 2019. Fixed annual rate of 4.1325%, the loan amount is
200,000,000.00 Yuan.
8) The Company entered into a Liquidity Loan Contract with Hefei Branch of Agricultural Bank of China with 12 months in
terms. Terms of borrowing from 29 June 2018 to 28 June 2019. Fixed annual rate of 4.35%, the loan amount is 100,000,000.00
Yuan.
9) The Company entered into an Application for Advances Against Import Invoices (and domestic procurement financing) with
Chengdu Branch Business Dept. of UOB (China) with one year in terms. Terms of borrowing from 28 September 2018 to 27
March 2019. Fixed annual rate of 4.1760%, the loan amount is 105,000,000.00 Yuan.
10) The Company entered into a Cross-Border Financing Quota Contract with Macao Branch of China Guangfa Bank with 12
months in terms. Terms of borrowing from 23 November 2018 to 22 July 2019. Fixed annual rate of 3.1%, the loan amount is
USD 7,150,000.00.
11) The Company entered into a Offshore Loan Contract with Ping An Bank with 12 months in terms. Terms of borrowing
from 15 November 2018 to 5 November 2019. Fixed annual rate of 3.67%, the loan amount is USD 28,000,000.00.
12) The Company entered into an Offshore Liquidity Loan Contract with Shanghai Pudong Development Bank with 12 months
in terms. Terms of borrowing from 6 December 2018 to 29 November 2019. Fixed annual rate of 4.3%, the loan amount is
USD 35,816,619.00.
13) The Company entered into a Maximum Pledge Contract with Hefei Branch of Huaxia Bank. Applying for short-term loans
of USD 10,150,000.00 in way of note receivable factoring. Terms of borrowing from 11 May 2018 to 20 April 2019. Fixed
annual rate of 2.50%.
287
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
14) Subsidiary Sichuan Changhong Air-conditioner entered into a Liquidity Loan Contract with Mianyang Branch of ICBC
with 12 months in terms. Terms of borrowing from 9 October 2018 to 6 August 2019. Fixed annual rate of 4.785%, the loan
amount is 30,000,000.00 Yuan.
15) Subsidiary Sichuan Changhong Air-conditioner entered into a Liquidity Loan Contract with Mianyang Branch of ICBC
with 12 months in terms. Terms of borrowing from 20 December 2018 to 12 December 2019. Fixed annual rate of 4.785%, the
loan amount is 30,000,000.00 Yuan.
16) Subsidiary Sichuan Changhong Air-conditioner entered into a RMB Short-term Loans Contract with Mianyang Branch of
Bank of China with 12 months in terms. Terms of borrowing from 23 November 2018 to 23 November 2019. Fixed annual rate
of 4.5675%, the loan amount is 30,000,000.00 Yuan.
17) According to the appointments of Liquidity Loan Contract signed by the subsidiary Zhongke Meiling Company and the
Anhui Branch of Bank of China Limited, the subsidiary Zhongke Meiling Company applied for a short-term borrowing of
RMB 9,200,000.00 to the Bank of China Limited Anhui Branch by the way of guarantee, the guarantor was the Company; the
borrowing period was from June 29, 2018 to June 29, 2019, it adopted a floating rate method, and every 12 months was a
floating period.
18) According to the Exports Receivable Risk Participation Cooperation Agreement signed by Zhongshan Changhong
Company and Zhongshan Branch of China Construction Bank Co., Ltd., the subsidiary Zhongshan Changhong Company
applied for a short-term borrowing of RMB 40,000,000.00 to China Construction Bank Co., Ltd., Zhongshan Branch by the
way of accounts receivable factoring, the borrowing period was from July 23, 2018 to January 18, 2019, and the borrowing rate
was 4.90%.
19) According to the Cooperation Agreement on Export Receivable Risk Participation entered into by subsidiary Zhongshan
Changhong Company and Zhongshan Branch of China Construction Bank, subsidiary Zhongshan Changhong applying for
short-term loans of RMB39,599,040.00 in way of account receivable factoring. Terms of borrowing from 19 November 2018 to
17 May 2019. Lending rate of 4.85%.
20) According to the Comprehensive Credit Contract entered into by subsidiary Zhongshan Changhong Company and
Zhongshan Branch of China Resources Bank of Zhuhai, subsidiary Zhongshan Changhong applying for short-term loans of
RMB 50,000,000.00 in way of export invoice financing with 180 days in terms. Terms of borrowing from 25 October 2018 to
23 April 2019. Lending rate of 6.325%.
21) According to the Domestic Letter of Credit Forfaiting Business Contract of Huishang Bank signed by the subsidiary Jiangxi
Meiling and Huishang Bank Hefei Economic Development Zone Sub-branch, the subsidiary Jiangxi Meiling applied for a
short-term borrowing of RMB 100,000,000.00 to Huishang Bank Hefei Economic Development Zone Sub-branch by the way
of letter of credit without recourse buyout, the borrowing period was from April 9, 2018 to April 9, 2019, and the borrowing
rate was 4.65%.
22) According to the Forfeiting Business Bond Transfer Letter signed by the subsidiary Jiangxi Meiling and Bank of Jiujiang
Co., Ltd., Jingdezhen Branch, the subsidiary Jiangxi Meiling applied for a short-term borrowing of RMB 94,590,163.30 to
Bank of Jiujiang Co., Ltd., Jingdezhen Branch by the way of letter of credit without recourse buyout, the borrowing period was
from September 12, 2018 to September 6, 2019, and the borrowing rate was 3.78%.
(2) No overdue short term borrowings outstanding at period-end.
288
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
20.Financial liabilities measured by fair value and with its variation reckoned into current gain/loss
Item Balance at year-end Balance at year-begin
Tradable financial liability 55,586,666.70 16,034,000.00
Including: Derivative financial liability 55,586,666.70 16,034,000.00
21.Notes payable and account payable
Item Balance at year-end Balance at year-begin
Notes payable 3,727,754,399.60 4,006,765,857.99
Account payable 2,282,174,981.38 2,869,886,049.19
Total 6,009,929,380.98 6,876,651,907.18
22.1 Notes payable
Type Balance at year-end Balance at year-begin
Bank acceptance 3,284,348,686.53 3,421,210,611.84
Trade acceptance 443,405,713.07 585,555,246.15
Total 3,727,754,399.60 4,006,765,857.99
No notes expired at period-end without paid
22.2Account payable
(1) Age of account payable
Item Balance at year-end Balance at year-begin
Total 2,282,174,981.38 2,869,886,049.19
Including:overoneyear 75,298,651.56 55,323,422.28
(2) No major account payable with over one year book age at period-end.
22. Account received in advance
(1)Account received in advance
Item Balance at year-end Balance at year-begin
Total 354,551,354.80 438,386,810.72
Including: over 1 year 46,153,276.08 18,668,644.77
(2) No major account received in advance with over one year age at period-end
23. Wages payable
(1) Types of wages payable
Balance at Increased in the Decreased in the
Item Balance at year-end
year-begin Year Year
289
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at Increased in the Decreased in the
Item Balance at year-end
year-begin Year Year
Short-term compensation 171,796,192.03 1,500,763,117.87 1,516,685,227.57 155,874,082.33
After-service welfare- defined
7,817,314.81 86,586,017.65 90,935,095.90 3,468,236.56
contribution plans
Dismiss welfare 5,205,660.02 5,162,343.07 6,071,694.19 4,296,308.90
Total 184,819,166.86 1,592,511,478.59 1,613,692,017.66 163,638,627.79
(2) Short-term compensation
Item Balance atyear-begin Increased intheYear Decreased intheYear Balance atyear-end
Wages ,bonuses, allowancesand subsidies 162,141,438.55 1,363,381,199.28 1,377,323,170.16 148,199,467.67
Welfare for workers and staff 203,386.00 55,735,226.80 55,736,769.80 201,843.00
Social insurance 3,557,340.38 40,488,544.26 42,106,615.96 1,939,268.68
Including: Medical insurance 3,297,243.66 36,424,544.70 37,976,757.65 1,745,030.71
Work injury insurance 98,987.95 2,790,101.52 2,760,913.37 128,176.10
Maternity insurance 161,108.77 1,273,898.04 1,368,944.94 66,061.87
Housing accumulation fund 4,128,393.08 35,546,082.14 35,988,937.93 3,685,537.29
Labor union expenditure and
1,765,634.02 5,612,065.39 5,529,733.72 1,847,965.69
personnel education expense
Total 171,796,192.03 1,500,763,117.87 1,516,685,227.57 155,874,082.33
(3)Defined contribution plans
Balance at Increased in the Decreased in the Balance at
Item
year-begin Year Year year-end
Basic endowment insurance 6,637,301.90 83,821,259.60 87,777,956.98 2,680,604.52
Unemployment insurance 1,180,012.91 2,764,758.05 3,157,138.92 787,632.04
Total 7,817,314.81 86,586,017.65 90,935,095.90 3,468,236.56
24. Tax payable
Item Balance at year-end Balance at year-begin
Value-added tax 63,860,640.63 9,639,617.86
Enterprise income tax 3,112,632.27 19,295,436.64
Individual income tax 2,384,041.50 4,763,232.23
Urban maintenance and construction
8,430,591.08 873,061.03
tax
House property tax 6,527,533.98 6,127,114.13
Land-use right tax 2,870,637.90 2,949,096.59
Educational surtax 6,043,987.22 679,571.16
Stamp tax 1,481,453.67 2,455,816.00
Construction fund of Water
547,748.65 1,044,508.56
Conservancy Projects
Treatment fund for abandon electric &
14,421,381.00 11,579,556.00
electronics products
290
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Balance at year-end Balance at year-begin
Other 72,784.27 1,885,661.52
Total 109,753,432.17 61,292,671.72
25.Other account payable
Item Balance at year-end Balance at year-begin
Interest payable 7,519,756.26 6,441,508.68
Dividend payable 17,317,286.45 2,890,364.80
Other account payable 635,483,317.55 834,285,636.00
Total 660,320,360.26 843,617,509.48
25.1Interest payable
(1) Classification of interest payable
Item Balance at year-end Balance at year-begin
Interest on long-term borrowings for
166,494.25 172,254.25
repayment of principal of installment maturity
Interest of short-term loans 7,353,262.01 6,269,254.43
Total 7,519,756.26 6,441,508.68
(2) No significant overdue and unpaid interest at period-end.
25.2Dividends payable
Item Balance at year-end Balance at year-begin
City Insurance company 524,279.25 450,504.45
BOC-Fullgoal Tianyi Securities Investment Fund 153,697.50 153,697.50
Hefei Branch of BOC 262,139.60 225,252.20
Hefei collective industry association 262,139.20 225,251.86
Entrust Investment Wuhu of Provincial ABC 209,711.70 180,201.78
Sichuan Changhong Electric Co., Ltd. 14,082,358.08
Other units 1,822,961.12 1,655,457.01
Total 17,317,286.45 2,890,364.80
Note: Balance at period-end refers to the common dividends that not receiving by shareholders.
25.3 Other account payable
(1) Classification of other payable according to nature of account
Nature Balance at year-end Balance at year-begin
1.Accrued expenses(expenses occurred without reimbursed) 467,314,369.66 550,991,753.72
2. Receivables received temporary and deducted temporary 17,869,297.44 27,098,950.42
3.Deposit, margin 92,960,934.56 90,748,996.24
4.Not the come-and-go with related parties in statement scope 7,993,374.18 9,225,961.80
291
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Nature Balance at year-end Balance at year-begin
note
5. Other 49,345,341.71 156,219,973.82
Total 635,483,317.55 834,285,636.00
Note: Other refers to the collection of account receivable buy-out under the Buy-out Agreement of Account Receivable of
Huaxia Bank, the bank failed to deduct the money in time.
(2) The major other account payable with account age over one year at end of the period refers to the
purchase margin
26. Non-current liability due within one year
(1) Classification of non-current liability due within one year
Item Balance at year-end Balance at year-begin
Long term borrowings due within one year 250,300,000.00 32,174,400.80
Long term payable due within one year 7,000,000.00
Deferred income transfer to gains and losses within one year 16,382,737.85 14,279,975.88
Total 273,682,737.85 46,454,376.68
(2) Deferred income transfer into profit and loss within 1 year
Amount
reckoned into Assets
Itemofgovernment subsidies Opening amount Other changes Ending amount related/Income
other income related
Demolition compensation of
2,390,530.24 2,382,423.84 2,349,998.04 2,358,104.44 Assets related
Changhong Meiling
Special funds for technical
transformation of the Athena 4,286,250.00 4,286,250.00 4,286,250.00 4,286,250.00 Assets related
project
Freezer project of Changhong
734,062.48 734,062.50 734,062.54 734,062.52 Assets related
Meiling
Promoting the new industry
( annual output of 0.6 million
medium& large volume 304,412.48 304,412.50 304,412.54 304,412.52 Assets related
environmental protection and
energy saving freezer)
Subsidies for intelligent
transformation & upgrading of
enterprises from the new 605,675.00 605,675.00 Assets related
industrialization policy in
economic development zone
Industrialization of intelligent
white household appliances
software platform and typical 727,272.71 727,272.71 Assets related
application research and
development
Adaptability improvement on new
2,364,981.72 2,364,981.72 2,364,981.72 2,364,981.72 Assets related
coolants production
Promotion of the energy-saving
210,309.24 210,309.24 210,309.24 210,309.24 Assets related
room air conditioner
Research and application of the 1,409,302.33 1,409,302.32 1,409,302.32 1,409,302.33 Assets related
VISA (variable frequency volume
292
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Amount
reckoned into Assets
Itemofgovernment subsidies Opening amount Other changes Ending amount related/Income
other income related
integrated intelligent
air-conditioner)
2018 Zhongshan Special fund for
industrial development - Special 265,723.77 265,723.77 Assets related
topic of technical transformation
Smart life and fresh life project 165,279.14 165,279.14 Assets related
Government subsidy CZ028001-
96,727.01 96,727.01 Assets related
technical renovation project
Government subsidy CZ028001-
61,203.83 61,203.83 Assets related
subsidy in equipment renewal
Government subsidy for new plant
construction - industrialization of 500,000.00 500,000.00 500,000.00 500,000.00 Assets related
cryogenic refrigeration equipment
Subsidy for equipment purchasing
for Hefei Tech. Improvement 179,160.00 179,160.00 Assets related
project
Equipment subsidy for the
industrial base technical
235,000.00 235,000.00 Assets related
renovation from Economic and
Information Commission
Demolition compensation of
1,797,880.32 1,797,880.32 1,797,880.32 1,797,880.32 Assets related
Jiangxi Meiling
Subsidy for the development on
production line technical reform
40,892.59 40,892.59 40,892.59 40,892.59 Assets related
for green-friendly high-quality
metal pipe
Refrigerator evaporator workshop 29,033.05 29,033.05 Assets related
Special fund for technical
42,885.25 42,885.25 Assets related
improvement
Innovation development project
76,075.34 76,075.30 76,075.30 76,075.34 Assets related
for the E-Business
Government subsidy for the
project of ministry of finance of
science and education 57,786.21 57,786.21 Assets related
entrepreneurship park in
Mianyang Technology Town
Total 14,279,975.88 14,271,869.47 16,374,631.44 16,382,737.85
Note: The project refers to the deferred income transfer to the non-current liability due within one year, which will expected to
amortized next year
27.Long term borrowings
(1) Classification
Category Ending amount Opening amount
Loan in mortgage 1,920,000.00 2,560,000.00
Loan in credit 250,600,000.00
Total 1,920,000.00 253,160,000.00
293
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(1)Details of long-term borrowings at year-end
Foreign Opening
Borrowing Returning Interest Ending amount
Loan unit currenc amount
day day rate (RMB)
y (RMB)
Ministry of Finance of
note 2006.11.0.9 2021.11.08 RMB 2.25% 1,920,000.00 2,560,000.00
Hefei
Note: In August of 2006, the Company signed Asset Mortgage Agreement with Ministry of Finance of Hefei. It takes five
industry crusher chambers which cover an area of 2,322.98 square meters as mortgage for the Company to get the lending of
treasury bond fund which has 15-year term and worthy of RMB 7,040,000 from the Ministry of Finance of Hefei. The capital
on-lending began to bear interest from the appropriate date (November 9, 2006), which would be paid by stages in the loan
period to Ministry of Finance of Hefei by the Company. The first four years were grace period, during which the annual interest
rate was subject to floating interest rate (the annual interest rate was the annual interest rate of one year fixed deposit plus
0.3%). On 1 March 2013, according to the Letter Relating to Ceasing Process of Other Securities in respect of the Properties in
Feidong Longgang Industrial Park of Hefei Meiling Co., Ltd. (HCJ (2006) No.85) issued by the finance office of Hefei,
Meiling commenced the national purchase of its land parcels in Longgang in compliance with the land planning of Hefei
municipal government, which required its properties in Longgang land parcel to be unrestricted. The real estate for mortgage
lifted in 2006 of the Company with registration No. HGYJCZ No.0121 which was used as the security for treasury bonds
lending capital (details were set out in Note VI.14).
28. Long-term payable
Item Balance at year-end Balance at year-begin
Long-term account payable 3,487,208.00 10,953,687.53
Special payable 1,530,000.00 1,530,000.00
Total 5,017,208.00 12,483,687.53
28.1Classify by nature
Nature Balance at year-end Balance at year-begin
Financing lease 3,487,208.00 3,953,687.53
note
Supporting fund for technical transformation 7,000,000.00
Total 3,487,208.00 10,953,687.53
Note: the supporting fund for technical transformation will end in 2019, and transfer to other non-current liability due
within one year at end of this year
28.2 Special payable
Balance at Increased in Decreased Balance at
Item Reason
year-begin the Year in the Year year-end
Special funds for
technological Technology plan project
1,530,000.00 1,530,000.00
transformation from in Zhongshan City
Zhongshan
29.Long-term wage payable
Item Balance at year-end Balance at year-begin
294
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Balance at year-end Balance at year-begin
Dismissal welfare 19,073,101.29 24,645,421.94
According to the internal early retirement policy, the long-term payable dismissal welfare bears by the Company up to end of
the period amounting to RMB 19,073,101.2
30.Accrual liability
Item Balance at year-end Balance at year-begin Reason
Product quality guarantee 12,952,457.86 6,183,877.90 Guarantee of product
Guarantee fund for quality service Note 1 247,060,570.02 306,830,000.30 Guarantee of product
Penalty expenses Note 2 13,050,649.33 Penalty
Total 273,063,677.21 313,013,878.20
Note 1:Product quality deposit is the maintenance expense provided by the Company under the national policy, while
quality service special guarantee capital is the warranty costs provided for product quality in addition to such policy. Parts of
the commitments on product quality assurance beyond the national three guarantees policy are expired in 2018, the accrual
liability that have not been anticipated has written-off in the period, actually 56,603,021.87 Yuan written-off.
Note 2: In March 2019, the Company received a Notice from the United States Department of Energy stating that the
annual energy consumption of a refrigerator (freezer) manufactured from May 2014 to October 2016 by the Company and had
commercial distribution in the United States does not meet the maximum allowable energy consumption rate stipulated by the
Code of Federal Regulations after spot checking, for this batch of products, the United States Department of Energy intends to
impose penalties on the Company. The Company is estimated to pay a penalty of US$1,901,540.00 to the United States
Department of Energy.
31. Deferred income
(1) Classification of deferred income
Item Ending amount Opening amount
Government subsidies---subsidies of
116,035,026.43 54,206,139.78
development project
Government subsidies---subsidies of
44,215,937.17 48,363,815.61
Relocation
Total 160,250,963.60 102,569,955.39
(2) Government subsidy
New Amount
Assets
Opening subsidy in reckoned Other
Item Ending amount related/Income
amount the period into other changes
related
income
Demolition compensation of Jiangxi
5,758,874.30 1,797,880.32 3,960,993.98 Assets related
Meiling
Demolition compensation of
42,604,941.31 2,349,998.04 40,254,943.27 Assets related
Changhong Meiling
Special funds for technical 9,164,062.50 4,286,250.00 4,877,812.50 Assets related
295
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
New Amount
Assets
Opening subsidy in reckoned Other
Item Ending amount related/Income
amount the period into other changes
related
income
transformation of the Athena project
Freezer project of Changhong
1,468,124.96 734,062.54 734,062.42 Assets related
Meiling
Promoting the new industry ( annual
output of 0.6 million medium&
1,369,856.27 304,412.54 1,065,443.73 Assets related
large volume environmental
protection and energy saving freezer)
Research and application of the MCU
2,300,000.00 2,300,000.00 Assets related
chip for inverter control
Smart life and fresh life project 720,947.60 720,947.60 Assets related
Special funds for provincial-level
2,950,000.00 2,950,000.00 Assets related
innovation-driven development
Subsidy for the development on
production line technical reform for 170,385.82 40,892.59 129,493.23 Assets related
green-friendly high-quality metal pipe
Design and application of the air duct
300,000.00 300,000.00 Assets related
for energy-saving air-conditioner
Research and application of the VISA
(variable frequency volume integrated 7,281,395.36 1,409,302.32 5,872,093.04 Assets related
intelligent air-conditioner)
Development and production of the
whole machine of CHiQ 2,350,000.00 2,350,000.00 Assets related
air-conditioner
Adaptability improvement on new
14,189,890.14 2,364,981.72 11,824,908.42 Assets related
coolants production
Industrialization of intelligent white
household appliances software
4,000,000.00 242,424.24 727,272.71 3,030,303.05 Assets related
platform and typical application
research and development
Promotion of the energy-saving room
1,279,381.45 210,309.24 1,069,072.21 Assets related
air conditioner
Special funds for strategic emerging
industry and high-end growth 2,000,000.00 2,000,000.00 Assets related
industry
Innovation development project for
370,429.01 76,075.30 294,353.71 Assets related
the E-Business
Government subsidy for new plant
construction - industrialization of 4,291,666.67 500,000.00 3,791,666.67 Assets related
cryogenic refrigeration equipment
Subsidies for intelligent
transformation & upgrading of
enterprises from the new 4,845,400.00 353,310.42 605,675.00 3,886,414.58 Assets related
industrialization policy in economic
development zone
Key chip and module for transducer
6,840,000.00 6,840,000.00 Assets related
used and detection capacity building
Changhong Air Conditioner-
relocation of production base and 6,880,000.00 6,880,000.00 Assets related
upgrading & expansion
Demonstration factory construction
for the intelligent manufacturing of 49,500,000.00 49,500,000.00 Assets related
intelligent air-conditioner
2018 Zhongshan Special fund for 1,018,100.00 22,143.65 265,723.77 730,232.58 Assets related
296
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
New Amount
Assets
Opening subsidy in reckoned Other
Item Ending amount related/Income
amount the period into other changes
related
income
industrial development - Special topic
of technical transformation
Special fund, government subsidy
4,200,000.00 4,200,000.00 Assets related
CZ059001
Centre for external cooperation of the
2,538,300.00 2,538,300.00 Assets related
environmental protection
Government subsidy CZ028001
1,755,100.00 1,180,256.70 96,727.01 478,116.29 Assets related
technical improvement topic
Government subsidy CZ028001-
1,168,000.00 820,199.40 61,203.83 286,596.77 Assets related
subsidy in equipment renewal
Subsidy for equipment purchasing for
1,791,600.00 253,810.00 179,160.00 1,358,630.00 Assets related
Hefei Tech. Improvement project
Equipment subsidy for the industrial
base technical renovation from
2,350,000.00 332,916.67 235,000.00 1,782,083.33 Assets related
Economic and Information
Commission
Refrigerator evaporator workshop 247,000.00 31,671.64 29,033.05 186,295.31 Assets related
Special fund for technical
218,000.00 3,573.77 42,885.25 171,540.98 Assets related
improvement
Government subsidy for the project of
ministry of finance of science and
370,396.00 105,002.26 57,786.21 207,607.53 Assets related
education entrepreneurship park in
Mianyang Technology Town
Total 102,569,955.39 83,721,896.00 9,666,256.35 16,374,631.44 160,250,963.60
Note: other changes of this item are attributable to reclassification of the amount to be amortized over
one year to non-current liabilities due within one year.
32.Share capital
Change during the period (+、-)
Balance at Sharestransferred
Item Bonus Balance at year-end
year-begin New shares issued fromcapital Other Subtotal
share
reserve
Total shares 1,044,597,881.00 1,044,597,881.00
33.Capital reserve
Increased in the Decreased in the
Item Opening amount Ending amount
Year Year
Share premium 2,636,633,081.37 436,745.61 2,636,196,335.76
Other capital reserve 48,173,262.70 48,173,262.70
Total 2,684,806,344.07 436,745.61 2,684,369,598.46
Note: The changes in the share premium of the current year were due to the capital contribution of the subsidiary Changmei
Technology Co., Ltd. which caused changes in the shareholding ratio, and also due to the balance between the newly acquired
long-term equity investment through the acquisition of the minority shareholder’s stock equity of some marketing subsidiaries
and the share of net assets that the subsidiary should continuously calculate from the date of purchase according to the newly
increased shareholding ratio.
297
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
34.Other comprehensive income
Current Year
Less: written
in other
comprehensiv
Less：
e income in
Balance at Inco Belong to Belong to Balance at
Item Account before previous
year-begin me parent minority year-end
income tax in period and
tax company after shareholders
the period carried
expen tax after tax
forward to
ses
gains and
losses in
current period
Other comprehensive income re-divided into gains/losses
Including:
conversion
difference arising
from foreign -7,262,322.02 -15,324,313.47 -10,881,247.24 -4,443,066.23 -18,143,569.26
currency
financial
statement
35. Surplus reserves
Increased in the Decreased in the
Item Opening amount Ending amount
Year Year
Statutory surplus reserve 275,421,718.17 9,644,573.17 285,066,291.34
Discretionary surplus reserve 115,607,702.16 115,607,702.16
Total 391,029,420.33 9,644,573.17 400,673,993.50
36. Retained profit
Item Current Year Last Year
Amount at the end of last year 937,894,771.93 968,097,382.98
Add: adjustment from undistributed profit at period-begin
Including: retroactive adjustment by Accounting
Standards for Business Enterprise
change of accounting policy
Correction of former material error
Change of combination scope under
common control
Amount at the beginning of this year 937,894,771.93 968,097,382.98
Add: net profit attributable to shareholders of parent
38,658,256.97 32,473,204.92
company for this period
Less: withdraw of statutory surplus reserve 9,644,573.17
withdraw of discretionary surplus reserve
Withdraw of general risk provision
Dividend payable for ordinary shares 62,675,872.86 62,675,815.97
298
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Dividend of ordinary shares transferred to share
capital
Amount at the end of this period 904,232,582.87 937,894,771.93
37.Operation income and operation cost
(1)Operation income and operation cost
Item Current Year Last Year
Main business income 16,458,650,756.15 16,013,327,582.28
Other business income 1,031,524,193.86 784,109,175.08
Total 17,490,174,950.01 16,797,436,757.36
Main business cost 13,273,395,942.04 13,092,373,731.24
Other business cost 953,006,078.36 710,299,406.06
Total 14,226,402,020.40 13,802,673,137.30
(2) Main business classified according to product
Current Year Last Year
Product
Operation income Operation cost Operation income Operation cost
Refrigerator,
8,167,773,533.33 6,390,896,089.57 7,464,503,149.31 6,042,215,238.91
freezer
Air-conditioner 6,777,093,389.43 5,636,463,273.39 7,005,144,650.67 5,766,992,639.83
Washing
513,917,450.54 395,766,646.08 705,875,802.77 567,701,772.81
machine
Small
household
appliances and 689,072,966.20 583,308,199.41 536,291,620.64 456,677,143.84
kitchen and
bathroom
Other 310,793,416.65 266,961,733.59 301,512,358.89 258,786,935.85
Total 16,458,650,756.15 13,273,395,942.04 16,013,327,582.28 13,092,373,731.24
(3) Main business classified according to sales region
Current Year Last Year
Region
Operation income Operation cost Operation income Operation cost
Domestic 12,748,897,296.29 9,988,923,192.37 12,172,421,690.59 9,465,251,585.24
Overseas 3,709,753,459.86 3,284,472,749.67 3,840,905,891.69 3,627,122,146.00
Total 16,458,650,756.15 13,273,395,942.04 16,013,327,582.28 13,092,373,731.24
Top five clients have income in sales of RMB 4,913,712,759.11 yuan in total, a 28.09% in total
operation income.
38. Business tax and extra charges
299
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Treatment fund for abandon electrics & electronics 60,177,558.00 59,778,481.00
City construction tax 24,305,750.41 29,682,136.75
Extra charge for education and local education surcharge 17,875,282.24 21,916,696.12
Real estate tax 13,856,622.90 12,461,143.82
Stamp duty 8,963,160.80 11,659,990.71
Land use tax 7,021,001.03 8,300,141.16
Water fund 4,342,756.81 6,700,210.74
Other 2,372,926.42 -1,016,320.39
Total 138,915,058.61 149,482,479.91
39.Sales expense
Item Current Year Last Year
Salary, extra charges and labor service fee 635,315,875.59 597,704,401.09
Transport expenses 527,985,392.22 583,386,070.18
Market support fee 491,986,205.05 330,479,707.53
Air conditioner installation fee 397,693,064.53 403,688,837.63
National three guarantees expense 160,967,334.26 157,186,892.56
Storage lease expenses 131,417,625.27 120,029,440.81
Travelling expenses 52,346,471.72 48,042,729.60
Advertising fee 37,340,848.88 53,630,178.78
Operation activities expenses 23,804,644.95 21,412,507.25
Meeting organization expenses 9,370,395.41 12,984,091.73
House-lease expenses 19,148,254.52 16,808,642.70
Depreciation expenses 7,504,623.38 6,308,414.47
Communication expenses 8,496,026.11 7,509,452.57
Other 72,900,407.97 75,165,692.95
Total 2,576,277,169.86 2,434,337,059.85
40. Administration expense
Item Current Year Last Year
Salary and social insurance etc. 167,788,089.71 153,951,278.43
Depreciation 20,055,571.17 20,381,989.26
Amortized intangible assets 19,376,395.84 16,821,461.37
Board fees 17,279,114.44 1,970,675.26
Water and electricity fee 10,973,983.83 10,773,832.28
Domestic travelling fee 6,936,778.04 7,611,115.63
Property insurance fee 5,405,723.64 5,116,936.89
Business activities fee 5,175,165.28 4,486,233.22
300
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Office fee 5,051,067.65 4,823,779.80
Inspection and authentication fee 2,825,310.81 599,138.88
Other 57,050,347.62 59,417,528.89
Total 317,917,548.03 285,953,969.91
41. R&D expenses
Item Current Year Last Year
Salary and social insurance etc. 91,047,499.76 82,694,313.99
Amortized intangible assets 58,584,357.96 39,248,612.76
Trial fee of R&D 19,119,854.48 15,502,785.18
Technical development cost 13,885,813.48 14,263,595.37
Inspection and authentication fee 12,977,420.74 10,618,854.80
Depreciation 6,434,865.22 6,021,336.77
Cost of mould 5,310,839.33 2,337,830.43
Software royalty 2,954,351.56 1,613,001.95
Domestic travel expenses 1,931,601.98 1,707,708.92
Other 23,052,793.55 36,969,732.96
Total 235,299,398.06 210,977,773.13
42.Financial expenses
Item Current Year Last Year
Interest expenditure 101,451,047.10 67,750,377.89
Less: Interest income 127,986,419.36 145,489,942.29
Add: exchange loss -12,186,113.99 33,458,318.09
procedure charge expenditure 13,167,973.40 15,277,598.08
discount expenditure -13,752,095.89 -4,645,184.95
Total -39,305,608.74 -33,648,833.18
43. Loss from Assets depreciation
Item Current Year Last Year
Bad debt losses 3,008,853.32 16,884,408.36
Provision for falling price of inventory 36,245,038.14 33,646,355.01
Provision for fixed assets 383,209.19
Total 39,253,891.46 50,913,972.56
44.Other income
Item Current Year Last Year
Enterprise policy funds from Economic and Trade Development Bureau in 15,410,000.00
301
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Hefei economic development zone
Provincial-level foreign trade fund subsidy from finance bureau in Hefei
6,424,936.00
economic development zone
Immediate refund of VAT for software products 5,420,015.89 6,111,207.75
Development and production of the whole machine of CHiQ air-conditioner 4,700,000.00
Special funds for technical transformation of the Athena project 4,286,250.00 4,286,250.00
Logistic subsidy 4,170,300.00
National level award for the green factory and green products 4,000,000.00 1,000,000.00
Special funds for provincial-level innovation-driven development 2,950,000.00
CCTV publicity fund for the Best Anhui in 2018 2,932,124.00
Demolition compensation of Changhong Meiling 2,382,423.84 2,404,563.15
Adaptability improvement on new coolants production 2,364,981.72 2,364,981.69
Subsidy for equipment renewal and modernization 404,000.00
Government subsidy for new plant construction, industrialization of
500,000.00
cryogenic refrigeration equipment
Government subsidy CZ028001- subsidy in equipment renewal 820,199.40
Award for pilot demonstration project of the national intelligent
2,000,000.00
manufacturing
Subsidy for talent supporting 2,030,669.00 620,886.65
Demolition compensation of Jiangxi Meiling 1,797,880.32 25,153,889.09
Award of pilot demonstration enterprise for intellectual property 1,655,100.00 500,000.00
Government subsidy CZ028001 technical improvement topic 1,180,256.70
Rewards for technological transformation of enterprises in economic and
300,000.00
development zone
Special subsidy for Nanjing Port 1,414,840.00 1,238,685.00
Research and application of the VISA (variable frequency volume integrated
1,409,302.32 1,409,302.32
intelligent air-conditioner)
Subsidy for export credit insurance 1,404,475.00 1,687,311.98
Subsidy for cultivation of the enterprise brand 1,400,000.00
Subsidy for employment stable 1,242,818.98 1,357,784.00
Venture expansion fund 1,179,587.32
Funds for enterprise research and development 1,120,600.00
Service industry policy for year of 2017 from economic and trade
1,028,700.00
development bureau in Hefei Economic Development Zone
Reward for the smart home appliance technology of the industry policy 1,000,000.00 1,000,000.00
Special fund for promoting innovation and development of processing trade 1,000,000.00
Special fund for undertaking industrial transfer and promoting innovation in
1,000,000.00
processing trade for year of 2016
Subsidy for staff training 981,250.94
Smart life and fresh life project 886,226.74
Special fund for investment promotion from Commercial Bureau 879,954.00
Reward for a good start of the investment in industrial and technological
750,000.00
transformation in 2018
302
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Freezer project of Changhong Meiling 734,062.50 734,062.49
Provincial-level government subsidy for enterprise research and
654,100.00
development in Guangdong Province for year of 2017
Promoting the new industry ( annual output of 0.6 million medium& large
304,412.50
volume environmental protection and energy saving freezer)
Policy of promoting the development of new industrialization 330,000.00 1,767,041.00
Promotion of the energy-saving room air conditioner 210,309.24 210,309.27
Design and application of the air duct for energy-saving air-conditioner 300,000.00
Funds for raid growth from Ministry of Finance of Hefei 500,000.00
Award for implementing the quality management system standards from
500,000.00
Economic and Information Commission
Independent innovation policy 500,000.00
nd
The 2 batch of 2016 city-level supporting funds for side management for
496,000.00
power demand
Patent funding 435,820.00
Commission charge refund for individual income tax 329,654.25
Award for integration of information technology and industrialization 100,000.00 500,000.00
Subsidies for intelligent transformation & upgrading of enterprises from the
353,310.42
new industrialization policy in economic development zone
Subsidy for the development on production line technical reform for
40,892.59
green-friendly high-quality metal pipe
Innovation development project for the E-Business 76,075.30
2018 Zhongshan Special fund for industrial development - Special topic of
22,143.65
technical transformation
Subsidy for equipment purchasing for Hefei Tech. Improvement project 253,810.00
Refrigerator evaporator workshop 31,671.64
Special fund for technical improvement 3,573.77
Industrialization of intelligent white household appliances software platform
242,424.24
and typical application research and development
Equipment subsidy for the industrial base technical renovation from
332,916.67
Economic and Information Commission
Government subsidy for the project of ministry of finance of science and
105,002.26
education entrepreneurship park in Mianyang Technology Town
Other sporadic projects 5,655,611.19 8,898,816.72
Subsidy for Going Out in 2017 1,003,318.00
Subsidy for new workshop 208,333.33
Financial subsidy from Hefei Economic and Development Zone/
500,000.00
development refinancing award for the service industry
Policy of promote the development of a multi-tiered capital market 800,000.00
project funds for major science and technology project in Zhongshan City
1,400,000.00
for 2017
Awards of City S&T bureau 404,000.00
Policy award for the development of service industry 1,000,000.00
Government subsidy from finance bureau of Hefei economic and
development zone/award for the promotion of new products in district area 500,000.00
for 2016
303
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Sichuan Action Plan for Made in China 2025 850,000.00
Subsidy for market extension from management commission in economic
480,000.00
and development zone
Subsidy income (Enterprise Endowment Insurance Management Center of
473,901.82
Hefei City )
Subsidy for sales from overseas department from economic and trade
1,493,511.00
development bureau in Hefei economic and development zone
Subsidy for market extension 631,560.00
Fund of technical reforming 757,289.85
Total 94,938,682.39 71,747,005.11
45. Investment income
(1) Sources of investment income
Item Current Year Last Year
Long-term equity investment income by equity method -23,357,648.90 -2,625,710.04
Investment income obtained from disposal of long-term equity
867.43 2,506.98
investment
Investment income obtained from held of finance asset available for
73,852,215.97 88,862,205.90
sales
Investment income obtained from disposal of finance asset available
38,750,000.00
for sales
Investment income obtained from disposal of financial assets
measured at fair value and whose movements are included in the -46,564,075.82 -22,222,590.69
profit and loss of the current period
Total 3,931,358.68 102,766,412.15
(2) Long-term equity investment income by equity method
Reason of change of this period
Item Current Year Last Year
than last period
Hefei Xingmei Assets Management Co., Changes of net profit of the
-1,276,882.77 -1,697,818.35
Ltd. invested unit
ChanghongRuba ElectricCompany(Privat
-15,129,056.84 -400,790.01
e)Limited
Sichuan Zhiyijia Network Technology
-6,713,204.21 1,315,197.31
Co., Ltd.
Changes of net profit of the
Hongyuan Ground Energy Heat Tech.
2,003,963.45 -1,626,092.36 invested unit and counter current
Co., Ltd.
transaction offset
Sichuan Tianyou Guigu Technology Co.,
-1,337,911.44 666,148.01
Ltd.
Chengdu Guigu Environmental Tech. Co.,
-2,460,257.09 -882,354.64
Ltd.
Hefei Meiling Solar Energy Technology
1,555,700.00 Bonus from invested enterprise
Co., Ltd.
Total -23,357,648.90 -2,625,710.04
(3) Investment income obtained from disposal of long-term equity investment
304
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Equity income obtained from disposal of Hefei Meiling Packing
2,506.98
Products Co., Ltd.
Income from cancellation of Zhongshan Hongyou Electric Co.,Ltd. 867.43
Total 867.43 2,506.98
(4) Investment income obtained while holding the financial assets available for sales
Item Current Year Last Year
Bonus from Huishang Bank Co., Ltd.(Shareholding ratio of
268,439.33 654,991.95
0.0972%)
Purchase of bank financial products 73,583,776.64 88,207,213.95
Total 73,852,215.97 88,862,205.90
(5) Investment income obtained from disposal of financial assets available for sale
Item Current Year Last Year
Hefei Wanmei Property Co., Ltd. 38,750,000.00
(6) The investment income obtained from disposal of the financial assets measured by fair value and with variation reckoned
into current gains/losses refers to the gains/losses arising from delivery of forward foreign exchange(NDF) agreements
46. Changes in fair value gains/loses
Item Current Year Last Year
Financial assets measured at fair value and whose movements are
-6,393,095.89 3,586,518.18
included in the profit and loss of the current period
Including :Income of fair value changes from derivative financial
-6,393,095.89 3,586,518.18
instruments
Financial liabilities measured at fair value and whose movements are
-39,556,161.23 -15,474,750.42
included in the profit and loss of the current period
Including :Income of fair value changes from derivative financial
-39,556,161.23 -15,474,750.42
instruments
Total -45,949,257.12 -11,888,232.24
47. Income from assets disposal
Amount reckoned
into
Item Current Year Last Year non-recurring
gains/losses in the
period
Income from non-current assets disposal 787,721.32 -8,206,289.88 787,721.32
Including: income classify to assets ready for sale
income not classify as to assets ready for sale
305
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Amount reckoned
into
Item Current Year Last Year non-recurring
gains/losses in the
period
Including: Income from fixed assets disposal 787,721.32 -15,728,849.54 787,721.32
Income from disposal of investment real
8,702,662.43
estate
Income from intangible assets disposal -1,180,102.77
Total 787,721.32 -8,206,289.88 787,721.32
48.Non-operation revenue
(1) Non-operation revenue
Amount reckoned
into non-recurring
Item Current Year Last Year
gains/losses in the
period
Government subsidy 883,331.13 2,767,905.00 883,331.13
Income of penalty 813,253.72 800,507.18 813,253.72
Other 4,789,860.85 2,103,378.86 4,789,860.85
Total 6,486,445.70 5,671,791.04 6,486,445.70
Assets/benefit
Item CurrentYear LastYear Resource and basis
related
Special subsidy for innovative provinces
808,000.00 WanZ【2017】No. 52 Income related
from technology bureau of the city
Award for implementing the quality
Finance Treasury Payment
management system standards from 500,000.00 Income related
Center of Hefei City etc.
Economic and Information Commission
Government subsidy 394,000.00 ZFB(2017)No.20 Income related
Award for supporting the land intensive
265,900.00 DZ〔2016〕No.31 Income related
use
Award of local collaboration for advance
400,000.00 MFBH (2018)No.105 Income related
industrial enterprises
Science and education
entrepreneurship park of
Fund of tax incentive 121,801.13 Income related
the technology town in
Mianyang
Other government subsidy 361,530.00 800,005.00 Income related
Total 883,331.13 2,767,905.00
(2) Government subsidy
49.Non-operating expenditure
Amount reckoned
into non-recurring
Item Current Year Last Year
gains/losses in the
period
Penalty and late fee 13,094,401.47 172,208.46 13,094,401.47
Other 8,174,124.11 50,769.36 8,174,124.11
306
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Amount reckoned
into non-recurring
Item Current Year Last Year
gains/losses in the
period
Total 21,268,525.58 222,977.82 21,268,525.58
50.Income tax expenses
Item Current Year Last Year
Current income tax 17,887,061.40 28,772,913.09
Deferred Income Tax -18,420,948.02 -8,252,539.56
Total -533,886.62 20,520,373.53
51.Other comprehensive income
Found more in 34. Other comprehensive income in VI
52. Items of cash flow statement
(1) Cash received (paid) from (for) other activities relating to operation/investment/financing
1) Cash received from other activities relating to operation
Item Current Year Last Year
Government subsidy and rewards 150,185,767.81 33,703,635.65
Collection of restriction fund 105,951,876.61 2,266,666.23
Cash deposit, deposit 12,959,065.11 21,140,524.49
Rental income 7,553,077.64 6,656,826.94
Compensations 4,420,758.79 2,542,943.78
Petty cash collection 1,310,946.26
Trademark use fee 102,616.07 900,000.00
Other 6,243,804.17 5,022,063.39
Total 288,727,912.46 72,232,660.48
2) Cash paid for other activities relating to operation
Item Current Year Last Year
Market expenses 332,783,741.64 260,514,203.01
Rental fee 158,008,576.20 41,510,091.99
Travel expenses, meeting fees and exhibition fees 79,056,028.57 74,715,805.55
Petty cash, deposit, Cash deposit 45,279,661.81 14,995,492.05
Advertising fee 39,917,061.79 38,973,148.94
Transfer to restriction fund 24,070,228.43 120,068,801.01
Vehicle expenses 22,366,556.31 22,540,416.07
Business activities fee 21,958,864.60 27,088,324.43
Inspection and certification fee, certification charge and
21,408,152.10 23,596,401.97
reviewing fee
307
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Technological cooperation costs and consulting charge 10,890,258.27 8,102,519.39
Board fee 9,928,756.19 1,970,675.18
Service supporting fee 9,926,383.50 12,092,911.84
Service Charge 9,406,748.71 9,747,273.65
Office expenses 8,849,262.16 9,808,261.18
Communication fee 6,990,290.66 7,640,607.42
Labor service fee 6,452,287.26 3,737,315.12
Repair charge 4,291,510.38 2,870,994.25
Other 87,777,383.06 48,430,363.47
Total 899,361,751.64 728,403,606.52
3) Cash received from other activities relating to investment
Item Current Year Last Year
Interest income arising from bank savings 130,007,292.58 142,267,160.10
Supporting fund for technical transformation 7,000,000.00
Cash deposit 2,188,621.81 790,941.00
Total 132,195,914.39 150,058,101.10
4) Cash paid for other activities relating to investment
Item Current Year Last Year
Loses of forward exchange settlement 46,564,075.82 33,008,606.18
Bid bond refund 273,200.00 1,551,000.00
Total 46,837,275.82 34,559,606.18
5) Cash received from other activities relating to financing
Item Current Year Last Year
Withdrawal of pledge 44,497,902.00
6) Cash paid for other activities relating to financing
Item Current Year Last Year
Amount refund to minority shareholders due to the
2,000,000.00 371,865.42
cancellation of subsidiary
Financing lease 647,028.80
Handling charge of dividend 45,458.19 135,296.42
Handling charge of private placement 248,000.00
Total 2,692,486.99 755,161.84
(2) Supplementary of the consolidated cash flow statement
Item 2018 2017
1. Net profit is adjusted to cash flow of operation activities:
Net profit 34,875,784.34 36,094,532.71
Add: provision for depreciation of assets 39,253,891.46 50,913,972.56
Depreciation of fixed assets, consumption of oil gas assets and 158,357,425.01 134,852,371.89
308
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item 2018 2017
depreciation of productive biological assets
Amortization of intangible assets 79,302,211.24 56,123,680.61
Amortization of long-term retained expense 3,635,861.94 1,529,915.81
Loss from disposal of fixed assets, intangible assets and other
787,721.32 8,206,289.88
long term assets(gain is listed with “-”)
Loss from discarding fixed assets as useless (gain is listed with
“-”)
Loss from change of fair value(gain is listed with “-”) 45,949,257.12 11,888,232.24
Financial expense (gain is listed with “-”) -38,721,486.24 -35,623,226.65
Investment loss (gain is listed with “-”) -3,931,358.68 -102,766,412.15
Decrease of deferred income tax assets (increase is listed with
-21,514,573.12 -6,424,479.98
“-”)
Increase of deferred income tax liabilities (decrease is listed
3,098,699.11 -1,809,032.00
with “-”)
Decrease of inventories (increase is listed with “-”) 725,173,756.72 -974,511,402.93
Decrease of operational accounts receivable (increase is listed
-127,833,259.28 -1,383,611,294.16
with “-”)
Increase of operational accounts payable (decrease is listed with
-1,022,530,821.76 1,817,989,798.16
“-”)
Other -96,463,724.54 -164,354,940.73
Net cash flow arising from operation activities -220,560,615.36 -551,501,994.74
2. Major investment and financing activities that do not involve
cash receipts:
Conversion of debt into capital
Switching Company bonds due within one year
financing lease of fixed assets
3. Net change in cash and cash equivalents:
Balance at period-end of cash 4,484,643,187.93 5,089,765,770.39
Less: Balance at period-begin of cash 5,089,765,770.39 3,986,098,419.76
Add: Balance at period-end of cash equivalents
Less: Balance at period-begin of cash equivalents
Net increase in cash and cash equivalents -605,122,582.46 1,103,667,350.63
(3) No net cash paid for subsidiary obtained in the Year
(4) No net cash received from subsidiary disposal in the Year
(5) Cash and cash equivalent
Item Current Year Last Year
Cash 4,484,643,187.93 5,089,765,770.39
Including: cash in stock 28,650.21 43,454.93
Bank deposits available for payment at any time. 4,029,892,318.85 4,600,242,944.53
Other monetary fund available for payment at any time 454,722,218.87 489,479,370.93
Cash equivalents
309
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Including: bond investment due within 3 months
Balance of cash and cash equivalents at year-end 4,484,643,187.93 5,089,765,770.39
Including: using the restricted cash and cash equivalents of the
parent company or subsidiary of the group
53. Assets with ownership or the right to use restricted
Item Ending book value Reasons
Monetary fund 111,434,369.47 Margin
note 1
Note receivable 655,399,922.44 Pledged
note 2
Intangible assets 18,908,720.29 Pledged
Account receivable note 3 149,498,800.00 Pledged
Total 935,241,812.20
Note 1: The note receivable was pledged for: short-term financing from the bank; with purpose of improving the note
utilization, the Company draw up bank acceptance by pledge parts of the outstanding notes receivable to the bank
Note 2: intangible assets mortgaged refer to the land use right pledge, found more in “27. Long term borrowings” under this
note VI
Note 3: Pledge of the account receivable refers to the account pledge for export bill financing.
54. Foreign currency
(1) Foreign currency
Ending foreign currency Ending RMB converted
Item Exchange rate
balance balance
Monetary fund
Including: USD 18,869,934.03 6.8632 129,508,131.23
Euro 2,941,014.56 7.8473 23,079,023.56
AUD 615,061.92 4.8250 2,967,673.76
Pakistan Rupi 26,737,426.80 0.049075 1,312,139.22
IDR 12,771,074,826.00 0.000472 6,027,947.32
HKD 2.39 0.8762 2.09
Account receivable
Including: USD 79,355,131.65 6.8632 544,630,139.54
Euro 3,953,622.45 7.8473 31,025,261.45
AUD 3,662,168.00 4.8250 17,669,960.60
Pakistan Rupi 1,869,816,372.04 0.049075 91,761,238.46
IDR 28,907,144,343.00 0.000472 13,644,172.13
Other account receivable
Including: USD -5,658.16 6.8632 -38,833.08
Pakistan Rupi 23,161,615.00 0.049075 1,136,656.26
310
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Ending foreign currency Ending RMB converted
Item Exchange rate
balance balance
IDR 410,337,140.00 0.000472 193,679.13
HKD 1,925,306.59 0.8762 1,686,953.63
Account paid in advance
Including: USD 1,200.00 6.8632 8,235.84
Euro 3,230,473.00 0.049075 158,535.46
Pakistan Rupi 513,683,334.00 0.000472 242,458.53
Account payable
Including: USD 1,866,889.86 6.8632 12,812,838.49
Pakistan Rupi 600,441,093.57 0.049075 29,466,646.67
Other account payable
Including: USD 936.81 6.8632 6,429.51
Pakistan Rupi 231,487,200.46 0.049075 11,360,234.36
IDR 2,963,590,366.00 0.000472 1,398,814.65
Account received in advance
Including: USD 36,813,671.61 6.8632 252,659,590.99
Euro 2,362,051.18 7.8473 18,535,724.22
AUD 183,845.61 4.8250 887,055.07
Pakistan Rupi 35,449,804.61 0.049075 1,739,699.16
Short-term loans
Including: USD 81,116,619.00 6.8632 556,719,579.52
\(2) Foreign operational entity
The foreign operational entity of the Company was Changhong Ruba Trading Company (Private) Limited, mainly operates in
Lahore, Pakistan; Recording currency is Pakistan Rupi. CHANGHONG MEILING ELECTRIC INDONESIA,PT, mainly
operates in Jakarta; Recording currency is IDR.
55. Government subsidy
(1) Government subsidy
Amount
reckoned into
Category Amount Item
current
gain/loss
Demonstration factory construction of the intelligent
manufacturing for intelligent frequency conversion 49,500,000.00 Deferred income
air-conditioner
Enterprise policy funds from Economic and Trade
15,410,000.00 Other income 15,410,000.00
Development Bureau in Hefei economic development zone
Changhong Air Conditioner- relocation of production base
6,880,000.00 Deferred income
and upgrading & expansion
Key chip and module for transducer used and detection
6,840,000.00 Deferred income
capacity building
Provincial-level foreign trade fund subsidy from finance
6,424,936.00 Other income 6,424,936.00
bureau in Hefei economic development zone
311
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Amount
reckoned into
Category Amount Item
current
gain/loss
Immediate refund of VAT for software products 5,420,015.89 Other income 5,420,015.89
Deferred income,
Subsidies for intelligent transformation & upgrading of
Non-current
enterprises from the new industrialization policy in 4,845,400.00 353,310.42
liability due
economic development zone
within one year
Special fund, government subsidy CZ05900 4,200,000.00 Deferred income
Logistic subsidy 4,170,300.00 Other income 4,170,300.00
National level award for the green factory and green
4,000,000.00 Other income 4,000,000.00
products
CCTV publicity fund for the Best Anhui in 2018 2,932,124.00 Other income 2,932,124.00
Centre for external cooperation of the environmental
2,538,300.00 Deferred income
protection
Deferred income,
Equipment subsidy for the industrial base technical Non-current
2,350,000.00 332,916.67
renovation from Economic and Information Commission liability due
within one year
Development and production of the whole machine of
2,350,000.00 Other income 2,350,000.00
CHiQ air-conditioner
Subsidy for talent supporting 2,030,669.00 Other income 2,030,669.00
Award for pilot demonstration project of the national
2,000,000.00 Other income 2,000,000.00
intelligent manufacturing
Deferred income,
Subsidy for equipment purchasing for Hefei Tech. Non-current
1,791,600.00 253,810.00
Improvement project liability due
within one year
Deferred income,
Government subsidy CZ028001 technical improvement Non-current
1,755,100.00 1,180,256.70
topic liability due
within one year
Award of pilot demonstration enterprise for intellectual
1,655,100.00 Other income 1,655,100.00
property
Special subsidy for Nanjing Port 1,414,840.00 Other income 1,414,840.00
Subsidy for export credit insurance 1,404,475.00 Other income 1,404,475.00
Subsidy for cultivation of the enterprise brand 1,400,000.00 Other income 1,400,000.00
Subsidy for employment stable 1,242,818.98 Other income 1,242,818.98
Venture expansion fund 1,179,587.32 Other income 1,179,587.32
Deferred income,
Government subsidy CZ028001- subsidy in equipment Non-current
1,168,000.00 820,199.40
renewal liability due
within one year
Funds for enterprise research and development 1,120,600.00 Other income 1,120,600.00
Service industry policy for year of 2017 from economic
and trade development bureau in Hefei Economic 1,028,700.00 Other income 1,028,700.00
Development Zone
Deferred income,
2018 Zhongshan Special fund for industrial development - Non-current
1,018,100.00 22,143.65
Special topic of technical transformation liability due
within one year
312
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Amount
reckoned into
Category Amount Item
current
gain/loss
Reward for the smart home appliance technology of the
1,000,000.00 Other income 1,000,000.00
industry policy
Special fund for promoting innovation and development of
1,000,000.00 Other income 1,000,000.00
processing trade
Special fund for undertaking industrial transfer and
1,000,000.00 Other income 1,000,000.00
promoting innovation in processing trade for year of 2016
Subsidy for staff training 981,250.94 Other income 981,250.94
Special fund for investment promotion from Commercial
879,954.00 Other income 879,954.00
Bureau
Reward for a good start of the investment in industrial
750,000.00 Other income 750,000.00
and technological transformation in 2018
Provincial-level government subsidy for enterprise
research and development in Guangdong Province for year 654,100.00 Other income 654,100.00
of 2017
Independent innovation policy 500,000.00 Other income 500,000.00
Award for implementing the quality management system
500,000.00 Other income 500,000.00
standards from Economic and Information Commission
Funds for raid growth from Ministry of Finance of Hefei 500,000.00 Other income 500,000.00
The 2nd batch of 2016 city-level supporting funds for side
496,000.00 Other income 496,000.00
management for power demand
Patent funding 435,820.00 Other income 435,820.00
Subsidy for equipment renewal and modernization 404,000.00 Other income 404,000.00
Award of local collaboration for advance industrial Non-operation
400,000.00 400,000.00
enterprises income
Deferred income,
Government subsidy for the project of ministry of finance
Non-current
of science and education entrepreneurship park in 370,396.00 105,002.26
liability due
Mianyang Technology Town
within one year
Policy of promoting the development of new
330,000.00 Other income 330,000.00
industrialization
Commission charge refund for individual income tax 329,654.25 Other income 329,654.25
Rewards for technological transformation of enterprises in
300,000.00 Other income 300,000.00
economic and development zone
Deferred income,
Non-current
Refrigerator evaporator workshop 247,000.00 31,671.64
liability due
within one year
Deferred income,
Non-current
Special fund for technical improvement 218,000.00 3,573.77
liability due
within one year
Non-operation
Fund of tax incentive 121,801.13 121,801.13
income
Award for integration of information technology and
100,000.00 Other income 100,000.00
industrialization
Other income,
Other sporadic projects 6,017,141.19 Non-operation 6,017,141.19
income
Total 155,605,783.70 74,986,772.21
313
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(2) Refund of government subsidy: nil
314
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
VII. Changes of consolidation rage
1.Enterprise combined under the different control: nil
2.Enterprise combined under the same control: nil 。
3. Reversed takeover: Nil
4. Disposal of subsidiary: Nil
5. Subsidiary liquidated
Difference betweenthe disposalpriceand Othercomprehensive income
Priceof proportion of thesubsidiary’s netassets enjoy transferredinto investment
Ratio oftheequity Way ofthe equity Time point of controlright Determination basisforthe time
Subsidiary the equity in aspect of theconsolidatedfinancial income ,whichrelatedwith
disposed disposed lose point of control rightlose
disposed statement,whichisrespond tothe disposal the equity investment of
investment original subsidiary
Zhongshan Hongyou Electric Liquidation
60.00% 2018.7 Liquidation completed 867.43
Co.,Ltd. cancellation
Shijiazhuang Meiling Electronic Liquidation
100.00% 2018.8 Liquidation completed
Appliance Marketing Co., Ltd cancellation
Guiyang Meiling Electronic Liquidation
100.00% 2018.9 Liquidation completed
Appliance Marketing Co., Ltd cancellation
Kunming Meiling Electronic Liquidation
97.50% 2018.8 Liquidation completed
Appliance Marketing Co., Ltd cancellation
Chongqing Meiling Electronic Liquidation
100.00% 2018.10 Liquidation completed
Appliance Marketing Co., Ltd cancellation
Wuhu Meiling Electronic Appliance Liquidation
98.00% 2018.7 Liquidation completed
Marketing Co., Ltd. cancellation
Changchun Meiling Electronic Liquidation
100.00% 2018.12 Liquidation completed
Appliance Marketing Co., Ltd cancellation
315
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Shenyang Meiling Electronic Liquidation
100.00% 2018.11 Liquidation completed
Appliance Marketing Co., Ltd cancellation
Jingzhou Meiling Electronic Liquidation
96.00% 2018.9 Liquidation completed
Appliance Marketing Co., Ltd cancellation
Nantong Meiling Electronic Liquidation
100.00% 2018.11 Liquidation completed
Appliance Marketing Co., Ltd cancellation
Harbin Meiling Electronic Appliance Liquidation
100.00% 2018.9 Liquidation completed
Marketing Co., Ltd cancellation
6. Subsidiary newly established: Nil
316
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
VIII. Equity in other entity
1. Equity in subsidiary
(1) Composition of the enterprise group
Shareholding
Business Registration Business ratio(%)
Subsidiary Acquire way
area place nature Indirectl
Directly
y
Zhongke Meiling Cryogenic Technology Manufactures,
Hefei Hefei 66.87 Investment
Co., Ltd.1) sales
Sichuan Hongmei Intelligent Technology Software
Mianyang Mianyang 100.00 Investment
Co., Ltd.2) development
Mianyang Meiling Refrigeration Co., Ltd. Manufactures,
Mianyang Mianyang 95.00 5.00 Investment
3) sales
Jiangxi Meiling Electric Appliance Co., Manufactures,
Jingdezhen Jingdezhen 98.75 1.25 Investment
Ltd. 4) sales
Hefei Meiling Electric Marketing Co.,
Hefei Hefei sales 99.82 0.18 Investment
Ltd.5)
Guangxi Huidian Home Appliance Co., Enterprise combined under the
Nanjing Nanjing sales 100.00
Ltd.6) differentcontrol
Jinan Xiangyou Electric Marketing Co.,
Jinan Jinan sales 91.40 Investment
Ltd.7)
Nanchang Xiangyou Electric Marketing Nanchan
Nanchang sales 85.00 Investment
Co., Ltd.8) g
Wuhan Meizhirong Electric Marketing
Wuhan Wuhan sales 91.00 Investment
Co., Ltd.9)
Zhengzhou Meiling Electric Marketing
Zhengzhou Zhengzhou sales 100.00 Investment
Co., Ltd.10)
Chengdu Meiling Electric Marketing Co.,
Chengdu Chengdu sales 96.00 Investment
Ltd.11)
Fuzhou Meiling Electric Marketing Co.,
Fuzhou Fuzhou sales 100.00 Investment
Ltd.12)
Nanjing Meiling Electric Marketing Co.,
Nanjing Nanjing sales 100.00 Investment
Ltd.13)
Taiyuan Meiling Electric Marketing
Taiyuan Taiyuan sales 100.00 Investment
Co., Ltd.14)
Changsha Meiling Electric Marketing
Changsha Changsha sales 97.00 Investment
Co., Ltd.15)
Hangzhou Meiling Electric Marketing
Hangzhou Hangzhou sales 100.00 Investment
Co., Ltd.16)
Shanghai Meiling Electric Marketing Co.,
Shanghai Shanghai sales 99.00 Investment
Ltd.17)
Guangzhou Meiling Electric Marketing
Guangzhou Guangzhou sales 98.00 Investment
Co., Ltd.18)
Tianjin Meiling Electric Marketing Co.,
Tianjin Tianjin sales 100.00 Investment
Ltd.19)
Beijing Meiling Electric Marketing Co.,
Beijing Beijing sales 100.00 Investment
Ltd.20)
Hefei Meiling Nonferrous Metal Products Manufactures, Enterprise combined under the
Hefei Hefei 100.00
Co., Ltd.21) sales differentcontrol
Guangdong Changhong Ridian Manufactures, Enterprise combined under the
Zhongshan Zhongshan 98.855
Technology Co., Ltd.22) sales same control
Changmei Technology Co., Ltd. 23) Mianyang Mianyang sales 96.256 Investment
CHANGHONG MEILING ELECTRIC
Jakapta Jakapta sales 100.00 Investment
INDONESIA,PT 24)
317
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Shareholding
Business Registration Business ratio(%)
Subsidiary Acquire way
area place nature Indirectl
Directly
y
ChanghongRubaTradingCompany(Private
Pakistan Pakistan sales 60.00 Investment
)Limited 25)
Sichuan Changhong Air-conditioner Co., Manufactures, Enterprise combined under the
Mianyang Mianyang 100.00
Ltd. 26) sales same control
Zhongshan Changhong Electric Co., Manufactures, Enterprise combined under the
Zhongshan Zhongshan 90.00 10.00
LTD27) sales same control
Hefei Meiling Group Holdings Manufactures, Enterprise combined under the
Hefei Hefei 100.00
Limited28) sales differentcontrol
Meiling Equator Appliance (Hefei) Co., Manufactures, Enterprise combined under the
Hefei Hefei 100.00
Ltd29) sales differentcontrol
Manufactures, Enterprise combined under the
Hefei Equator Appliance Co., Ltd.30) Hefei Hefei 100.00
sales differentcontrol
Hongyuan Ground Energy Heat Pump Manufactures,
Mianyang Mianyang 51.00 Investment
Tech. Co., Ltd.31) sales
Hongyuan Ground Energy Heat Pump Manufactures,
Zhongshan Zhongshan 51.00 Investment
Tech. (Zhongshan) Co., Ltd.32) sales
Meiling CANDY Washing Machine Co., Manufactures,
Hefei Hefei 60.00 Investment
Ltd. 33) sales
Guangzhou Changhong Trading Co.,
Guangzhou Guangzhou sales 100.00 Investment
Ltd.34)
Zhongshan Hongling Trading Co.,
Zhongshan Zhongshan sales 100.00 Investment
Ltd.35)
Hebei Hongmao Household Appliance Manufactures
Handan Handan 100.00 Investment
Technology Co., Ltd36) , sales
Note:
1) Zhongke Meiling Cryogenic Technology Company Limited (hereinafter referred to as Zhongke Meiling), the predecessor of
which was Zhongke Meiling Cryogenic Technology Limited Liability Company, was established on 29 October 2002 by joint
contribution from the Company and Technical Institute of Physics and Chemistry, CAS (“TIPC”), with registered capital of
RMB60 million upon the establishment, among which, the Company made capital contribution of RMB42 million (including
the assets in specie at the consideration of RMB35,573,719.70 as evaluated by Beijing Zhongzheng Appraisal Co., Ltd. with
issuance of the Appraisal Report (ZZPBZ(2002)No.029) and cash contribution of RMB6,426,280.30) accounting for 70% of
the aforesaid registered capital, and TIPC made capital contribution of RMB18 million with intangible assets of such value
(namely the single compressor mixture industrial low temperature refrigeration technology) as evaluated by Jingzhongzi Assets
Appraisal Co., Ltd. with issuance of the Appraisal Report (ZZPBZ(2002)No.225) accounting for 30% of the aforesaid
registered capital. The paid-in of the above registered capital has been verified by Huazheng Accounting Firm by issuance of
the Assets Verification Report (HZYZ (2002) No.B157) dated 16 October 2002.
In October 2014, according to the relevant provision under the Management Rules on Application of State Owned Assets by
Central Business Organs, TIPC transferred the 30% equity interests held by it in Zhongke Meiling Cryogenic Technology
Company Limited to its wholly-owned subsidiary Zhongke Xianxing (Beijing) Assets Management Co., Ltd (hereinafter
referred to as Zhongke Xianxing) which would perform management over the operating assets of TIPC. Upon consideration
and approval at the 37th session of the 7th Board of Directors of Hefei Meiling Co., Ltd, it is agreed to waive the pre-emptive
right.
On 10 August 2015, all the founders signed the Founder Agreement of Zhongke Meiling Cryogenic Technology Company
318
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Limited, pursuant to which, they decided to change the firm type of Zhongke Meiling Cryogenic Technology Company Limited
to a joint stock company. Based on the net assets of RMB96, 431,978.25 as audited by Xinyong Zhonghe CPA as of 30 June
2015, an aggregate of 65,000,000 shares have been converted at the proportion of 1:0.67, which are to be held by the original
shareholders according to their respective entitlement. In case that the net assets exceed registered capital, the balance shall be
recorded in capital reserve. On 28 August 2015, Xinyong Zhonghe CPA reviewed the registered capital and paid-in thereof in
respect of the stock reform, and issued Assets Verification Report (XYZH/2015CDA40161). The Company registered industrial
and commercial information on 11 September 2015.
On November 25, 2016, the first Extraordinary Shareholders' General Meeting of Zhongke Meiling Cryogenic Technology Co.,
Ltd. in 2016 considered and approved the Proposal on the Issuance Plan of the Company; Zhongke Meiling Company issued
3,150,000 shares to specific investors by the non-public offering of shares at 1.63 Yuan per share. The current capital increase
was verified by the No.［XYZH/2016CDA40294］capital verification report issued by ShineWing CPA (special general
partnership). After the completion of the issuance, the share capital of Zhongke Meiling Company increased to 68,150,000
shares and the Company's shareholding ratio was 66.76%.
On 15 September 2017, the Proposal of the First Stock Placement of Zhongke Meiling Cryogenic Technology Co., Ltd for year
of 2017 was deliberated and approved by 4th session extraordinary of shareholders general meeting of 2017. Zhongke Meiling
offering 490,300 shares to specific investors by way of privately placement, which has 1.72 Yuan per share in amount. The
capital increasement has been verified by the No. ［XYZH/2017CDA40324］capital verification report issued by ShineWing
CPA (special general partnership). After the completion of shares placement, stock of the Company increased to 68,640,300
shares and 66.87% held by the Company.
2) Sichuan Hongmei Intelligent Technology Co., Ltd. (hereinafter referred to as Hongmei Intelligent) was established on Jan.
24, 2014. It is a limited company jointly invested by the Company and Mianyang Meiling Refrigeration Co., Ltd., being
approved by the Industrial and Commerce Bureau of Peicheng District, Mianyang City. The company owes registered capital of
RMB 5 million, including RMB 4.95 million contributed by Changhong Meiling Company in cash, accounted for 99% of the
registered capital; Mianyang Meiling Refrigeration Co., Ltd. contributed RMB 50000 in cash with 1% of the register capital
occupied. The above mentioned register capital have been verified by verification report of Chuanjinlai Yanzi No.[2014] B039
issued by Sichuan Jinlai Accounting Firm Co., Ltd. In July 2016, the shares of Hongmei Intelligent, held by the Company has
transferred to Sichuan Changhong AC Co., Ltd., after transferred, Changhong AC has 99% equity of Hongmei Intelligent, the
Company has no shares of Hongmei Intelligent directly.
3) Mianyang Meiling Refrigeration Co., Ltd. (hereinafter referred to as Mianyang Meiling), a limited liability company jointly
set up by the Company and China-tech Meiling Company, was founded on Mar. 6, 2009. Its registered capital and paid-in
capital was RMB 50 million upon establishment, of which, the Company invested RMB 45 million, accounting for 90% of the
registered capital; Zhongke Meiling Company invested RMB 5 million, accounting for 10% of the registered capital. The
capital receipt was verified by the verification report [CXKY (2009) No. 008] of Sichuan Xingrui Certified Public Accountants.
On 19 January 2011, the Company increase RMB 50 million in capital of Mianyang Meiling, of which RMB 95 million
invested by the Company, a 95% of total register capital while RMB 5 million invested by Zhongke Meiling, a 5% of total
capital occupied. The paid-in capital has been verified by Capital Verification Report［XYZH/2010CDA6040］from Chengdu
Branch of Shinewing CPA CO., Ltd. In 2011, Zhongke Meiling entered into “Equity Transfer Agreement” with Jiangxi Meiling
Refrigeration Co., Ltd. 5 percent equity of Mianyang Meiling held by Zhongke Meiling was transferred to Jiangxi Meiling
Refrigerator. In September 2013, Jiangxi Meiling Refrigeration was combined by Jiangxi Meiling Electric Appliance Co., Ld,
than 5 percent equity was transfer to Jiangxi Meiling Electric Appliance.
4) Jiangxi Meiling Electric Appliance Co., Ltd. (hereinafter referred to as Jiangxi Meiling Electric Appliance) was a limited
319
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
liability company jointly established by the Company and Mianyang Meiling on 23 May 2011. Register capital of the company
totally as RMB 50 million, RMB 49.375 million invested by the Company, 98.75% in total register capital while RMB 0.625
million invested by Mianyang Meiling , a 1.25% in total register capital occupied. The initial investment RMB 10.50 million
was received dated 13 May 2011 with RMB 10 million from the Company and RMB 0.5 million from Mianyang Meiling. Rest
of the capital shall be invested fully within 2 years after the joint ventures established according to capital requirement. The
initial investment capital were verified by the Capital Verification Report [JXKYZi (2011) No. 090] issued from Jingdezhen
Xingci CPA Co., Ltd. Second capital RMB 39.5 million was fully funded on 28 July 2011, the Company contributed RMB
39.375 million while Mianyang Meiling Company invested RMB 125,000, the contributions have been verified by the capital
verification report [Jing Xing Kuai Yan Zi (2011) No.: 134] issued from JDZ Xingci CPA Co., Ltd.
5) Hefei Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Meiling Marketing) is the limited company jointly
invested by the Company and Mianyang Meiling Company on 21 Oct. 2009. Registered capital and paid-up capital was RMB
10 million, including RMB 9.9 million invested by the Company, a 99% of the registered capital; Mianyang Meiling Company
contributed RMB 0.1 million, a 1% of the registered capital. The above mentioned paid-up register capital have been verified
by verification report of [Wan An Lian Xin Da Yan Zi (2009) No. 074] issued by Anhui An Lian Xin Da Accounting Firm Co.,
Ltd. On 25 Nov. 2010, the Company increased capital RMB 45 million, registered capital amounting to RMB 55 million,
including RMB 54.9 million contributed by the Company, a 99.82% of the registered capital, while Mianyang Meiling invested
RMB 0.1 million, a 0.18% of the registered capital. The increased capital have been verified by verification report of [Wan Hua
Shen Zheng Da Kuai Yan Zi (2010) No. 1514] issued by Anhui Hua Shen Zhengda CPA Co., Ltd.
6) Guangxi Huidian Home Appliance Co., Ltd. (hereinafter referred to as Guangxi Huidian) established in March 2010 with
registered capital of RMB 5 million. The Company invested RMB 1 million, accounted for 20% of the registered capital;
Meiling Marketing acquired 44% equity interests from the minority shareholders in 2014. In 2015, Meiling Marketing and
Jiangxi Meiling Appliances entered into equity transfer agreements with minority shareholders respectively, to acquire as the
transferees the 35.6% and 0.4% equity interests of Guangxi Weidian held by minority shareholders. Upon completion of equity
transfer in April 2015, Meiling Marketing and Jiangxi Meiling Appliances held the entire equity interests of Guangxi Huidian
as a whole.
7) Jinan Xiangyou Electric Marketing Co., Ltd. (hereinafter referred to as Jinan Xiangyou) was established dated 3 June 2011
with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.08 million, accounted for 36% of the registered
capital; after Meiling Marketing acquired 55.4% equity interests from the minority shareholders in 2015, Meiling Marketing
totally holds 91.4% equity of the Jinan Xiangyou.
8) Nanchang Xiangyou Electric Marketing Co., Ltd. (hereinafter referred to as Nanchang Xiangyou) was established dated 5
January 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.08 million, accounted for 36% of the
registered capital. After acquired 49% equity interests from the minority shareholders in 2014, Meiling Marketing totally holds
85% equity of Nanchang Xiangyou.
9) Wuhan Meizirong Electric Marketing Co., Ltd. (hereinafter referred to as Wuhan Meizirong) was established dated 10 January
2011 with registered capital of RMB 5 million; Meiling Marketing invested RMB 4.55 million, accounted for 91% of the
registered capital.
10) Zhengzhou Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Zhengzhou Meiling) was established dated 17
320
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
January 2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 1.08 million, accounted for 36% of the
registered capital. In 2013, Meiling Marketing purchased 10% equity from minority; Meiling Marketing signed equity transfer
agreement with the minority shareholders in April 2015, to acquire as the transferee the 39% equity interests of Zhengzhou
Meiling held by minority shareholders, Meiling Marketing acquired 10% equity interests from the minority shareholders in
February 2016; and after acquiring 5% equity from minority in 2017, Meiling Marketing totally holds 100% equity of
Zhengzhou Meiling.
11) Chengdu Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Chengdu Meiling) was established dated 26 January
2011 with registered capital of RMB 5 million; Meiling Marketing invested RMB 4.17 million, accounted for 83.4% of the
registered capital; After Meiling Marketing purchased 9% equity from minority in 2015, purchased 0.8% equity from minority
in 2016, and purchased 1.2% equity from minority in 2018, Meiling Marketing totally holds 96% equity of Chengdu Meiling.
12) Fuzhou Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Fuzhou Meiling) was established dated 25 January
2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.97 million, accounted for 99% of the
registered capital; in 2017, after acquiring 1% equity from the minority, Meiling Marketing holds 100% equity of Fuzhou
Meiling in total.
13) Nanjing Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Nanjing Meiling) was established dated 14 Feb. 2011
with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.97 million, accounted for 99% of the registered
capital; in 2017, after acquiring 1% equity from the minority, Meiling Marketing holds 100% equity of Nanjing Meiling in
total.
14) Taiyuan Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Taiyuan Meiling) was established dated 18 January
2011 with registered capital of RMB 4 million; Meiling Marketing invested RMB 1.59 million, accounted for 39.75% of the
registered capital; after Meiling Marketing purchased 45.5% equity from minority in 2013, after purchased 14.75% equity from
minority in 2016, Meiling Marketing totally holds 100% equity of the Taiyuan Meiling.
15) Changsha Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Changsha Meiling) was established dated 26
January 2011 with registered capital of RMB 5 million; Meiling Marketing invested RMB 1.8 million, accounted for 36% of the
registered capital; the Company entered into equity transferred agreement with minority shareholders in 2014, transferred 50%
equity of Changsha Meiling held by the minority, after purchased 11% equity from minority in 2016, Meiling Marketing totally
holds 97% equity of Changsha Meiling
16) Hangzhou Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Hangzhou Meiling) was established dated 17 Feb.
2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.655 million, accounted for 88.5% of the
registered capital; Meiling Marketing signed equity transfer agreement with the minority shareholders in 2015, to acquire as the
transfer the 6.5% equity interests of Hangzhou Meiling held by minority shareholders. Upon completion of such equity transfer
in February 2015, Meiling Marketing held in aggregate the 95% equity interests of Hangzhou Meiling; in 2017, after acquiring
5% equity from the minority, Meiling Marketing holds 100% equity of Hangzhou Meiling in total.
17) Shanghai Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Shanghai Meiling) was established dated 9 March
2011 with registered capital of RMB 3 million; Meiling Marketing invested RMB 2.97 million, accounted for 99% of the
registered capital.
18) Guangzhou Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Guangzhou Meiling) was established dated 13
321
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
May 2011 with registered capital of 5 million Yuan; Meiling Marketing invested 4.3 million Yuan, accounted for 86% of the
registered capital; after Meiling Marketing acquired 12% equity interests from the minority shareholders in 2014, Meiling
Marketing totally held the 98% equity interests of Guangzhou Meiling.
19) Tianjin Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Tianjin Meiling) was established dated 2 March 2011
with registered capital of 3 million Yuan; Meiling Marketing invested 2.565 million Yuan, accounted for 85.5% of the
registered capital; In 2015, Meiling Marketing and Jiangxi Meiling Appliances entered into equity transfer agreements with
minority shareholders respectively, to acquire as the transfers the 14.1% and 0.4% equity interests of Guangxi Weidian held by
minority shareholders. Upon completion of equity transfer in December 2015, Meiling Marketing totally held the entire equity
interests of Tinjian Meiling.
20) Beijing Meiling Electric Marketing Co., Ltd. (hereinafter referred to as Beijing Meiling) was established dated 28 March 2011
with registered capital of 3 million Yuan; Meiling Marketing invested 2.97 million Yuan, accounted for 99% of the registered
capital; in 2017, after acquiring 1% equity from the minority shareholders, Meiling Marketing holds 100% equity of the Beijing
Meiling in total.
21) Hefei Meiling Nonferrous Metal Products Co., Ltd. (hereinafter referred to as Nonferrous Metal) was the Sino-foreign joint
venture jointly set up by original Meiling Group, Hefei Meiling Copper Co., Ltd. And Singapore Kim Shin Development Co., Ltd., which
have been originally approved by the [WJMWFZZ (1996) No.349] of Foreign Trade and Economic Committee of Anhui
Province. Its registered capital was US$ 2.92 million upon establishment, of which, original Meiling Group invested US$ 1.46
million (monetary capital), accounting 50% of the registered capital, Hefei Meiling Copper Co., Ltd invested US$ 0.584 million
(monetary capital of RMB 0.18 million and real assets of US$ 0.404 million), accounting 20% of registered capital while Singapore Kim Shin
Development Co., Ltd invested US$ 0.876 million (monetary capital), accounting 30% of the registered capital. The above
mentioned investment verified by the verification report of [HSWZ (1995) No. 0737], [HSWZ (1996) No. 328] and
[HSWZ(1998) No. 088] from Anhui CPAs Co., Ltd. In July 2008, approved by [HWS(2008) No.53] from Foreign Trade
Economic Cooperation Bureau of Hefei City, 30% equity and 20% equity held by Singapore Kim Shin Development Co., Ltd and
Hefei Meiling Copper Co., Ltd respectively transferred to original Meiling Group Totally. The Company’s register capital came into
RMB 24,286,808.00 after transference, and was not the joint-venture any more.
22) Guangdong Changhong Ridian Technology Co., Ltd. (hereinafter referred to as Changhong Ridian) is a limited liability
company invested and established by Sichuan Changhong Electric Co., Ltd. (hereinafter referred to as Sichuan Changhong) and
Sichuan Changhong Motor Transport Co., Ltd. (hereinafter referred to as Changhong Motor Transport Company) on May 25,
2016. The registered capital and paid-in capital are RMB 40 million Yuan, of which Sichuan Changhong has invested 32
million Yuan by monetary capital, accounting for 80% of the registered capital; Changhong Motor Transport Company has
invested 8 million Yuan, accounting for 20% of the registered capital. The official receipts of registered capital have been
verified by original Sichuan Junhe Accounting Firm [No. JHYZ (2006) 3027]. Changhong Ridian increased registered capital
of 43 million Yuan on January 4, 2007, changing from 40 million Yuan to 83 million Yuan , for the newly increased 43
million Yuan , Sichuan Changhong invested 1.8 million Yuan , Guangdong Xiongfeng Electric Co., Ltd. invested 40 million
Yuan , and Kou Huameng and other 9 natural person shareholders invested 1.2 million Yuan , at the same time, the
shareholders' meeting considered and agreed to transfer the investment of 8 million Yuan of Changhong Motor Transport
Company to Sichuan Changhong Venture Investment Co., Ltd, the structure of the registered capital after changes was that
Sichuan Changhong invested 33.8 million Yuan , accounting for 40.72%；Guangdong Xiongfeng Electric Co., Ltd. invested 40
million Yuan , accounting for 48.19%; Sichuan Changhong Venture Investment Co., Ltd Invested 8 million Yuan , accounting
for 9.64%; Kou Huameng and other 9 natural person shareholders invested 1.2 million Yuan , accounting for 1.45%. The
change of registered capital was verified by Zhongshan Promise Accounting Firm [No. ZCHZ (2007)501010].
322
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
On February 18, 2009, seven natural person shareholders transferred total 0.76% stock rights to Hu Zhiheng, after the transfer,
the registered capital of Changhong Ridian was still 83 million Yuan , the structure of registered capital after changes was that
Sichuan Changhong invested 33.8 million Yuan , accounting for 40.72%; Guangdong Xiongfeng Electric Co., Ltd. invested 40
million Yuan , accounting for 48.19%; Sichuan Changhong Venture Investment Co., Ltd invested 8 million Yuan , accounting
for 9.64%; Hu Zhiheng and other two natural person shareholders invested 1.2 million Yuan , accounting for 1.45%.
On October 9, 2014, Changhong Ridian held the shareholders meeting which considered and agreed Kou Huameng to transfer
its stock rights of total 250,000 Yuan which accounts for 0.301% of the Changhong Ridian’s registered capital to Sichuan
Changhong Venture Investment Co., Ltd at the cost of 317,802 Yuan. The other shareholders of the Changhong Ridian waived
the right of pre-emption. On December 11, 2014, Changhong Ridian held the shareholders meeting which considered and
agreed Guangdong Xiongfeng Electric Co., Ltd. to transfer its stock rights of total 40 million Yuan which accounts for 48.19 %
of the company's registered capital to Sichuan Changhong Electric Co., Ltd. at the cost of 43,977,300 Yuan. The other
shareholders of the Changhong Ridian waived the right of pre-emption. The structure of registered capital after changes was
that Sichuan Changhong invested 73.8 million Yuan, accounting for 88.92%; Sichuan Changhong Venture Investment Co., Ltd
Invested 8.25 million Yuan, accounting for 9.94%; Hu Zhiheng and another natural person shareholder invested 950,000 Yuan ,
accounting for 1.14%.
On 4 January 2016, Sichuan Changhong and Sichuan Changhong Venture Investment Co., Ltd. transferred total 98.855%
equity of the Changhong Ridian to the Company. After the transfer, the Company directly holds 98.855% stock rights of
Changhong Ridian.
23) Changmei Technology Co., Ltd. (hereinafter referred to as Changmei Technology) was invested and set up on May 12,
2016 in order to promote intelligent transformation and implement the company’s intelligent life project according to the
company's strategic planning and business development needs. In accordance with the Article of Association, registered capital
of Changmei Technology was 50 million Yuan, including 48.128 million Yuan contributed by the Company in cash, a 96.256%
in the contribution capital, the management team contribute 1.872 million Yuan in cash, a 3.744% in contribution capital.
24) CHANGHONG MEILING ELECTRIC INDONESIA, PT.(hereinafter referred to as Indonesia Changhong for short) is a
subsidiary established in Indonesia and jointly invested by Zhongshan Changhong and Sichuan Changhong in 2016, the
company’s registered capital is 6 million US dollars, of which Zhongshan Changhong subscribed and paid 5.88 million US
dollars in cash, accounting for 98% of the registered capital, Changhong Air Conditioning subscribed and paid 120,000 US
dollars in cash, accounting for 2% of the registered capital. On 4 July 2017, rests of the 2.94 million US dollars are subscribed
by Zhongshan Changhong in line with the agreement.
25) Changhong Ruba Trading Company (Private) Limited (hereinafter referred to as Changhong Ruba) was a joint venture
established by Zhongshan Changhong Appliances Company Limited and RUBA GENERAL TRADING FZE Company
(“RUBA”) on 5 August 2011 with the approval from Guangdong Development and Reform Commission by issuance of the
Approval Relating to Joint Construction of a Manufacturing and Selling Platform Project in Pakistan by Zhongshan Changhong
Appliances Company Limited (YFGWZ(2011)958). The resolution of the second extraordinary shareholders' meeting of
Zhongshan Changhong in 2016 passed the "Proposal on the Company's Capital Increase to Changhong Ruba Trading Company
(Private) Limited", and agreed that the company and UAE RUBA Company jointly increase capital to Changhong Ruba
323
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Trading Company(Private) Limited which was invested by both sides in Pakistan at an earlier stage, Zhongshan Changhong
invested 3.84 million US dollars in this capital increase, and UAE RUBA Company invested 2.56 million US dollars, the shares
held by both sides remained unchanged. After the capital increase, the company’s registered capital became 12.4 million US
dollars, of which Zhongshan Changhong Home Appliances Company Limited invested 7.44 million US dollars in cash,
shareholding ratio was 60%, UAE RUBA Company invested 4.96 million US dollars in cash, and shareholding ratio was 40%.
26) Sichuan Changhong Air Conditioner Co., Ltd.( hereinafter referred to as Changhong Air Conditioner), a limited liability
company jointly set up by Sichuan Changhong and Changhong Chuangtou, was founded on November 28, 2008. Its registered
capital was RMB 200 million upon establishment, of which, Sichuan Changhong invested RMB 298 million (RMB
210,088,900 invested by monetary capital while RMB 87,911,100 invested by real material), equivalent to RMB 198 million
shares, accounting for 99% of the registered capital; and Changhong Chuangtou invested RMB 3 million, accounting for 1% of
the registered capital with equivalent of RMB 2 million shares. The registered capital receipt was verified by the verification
report [CGYYZ (2008) No. 177] of Sichuan Guangyuan Certified Public Accountants Co., Ltd. and [HLTHYZ(2008) No.
12-006] of Sichuan Henglitai Certified Public Accountants Co., Ltd. In December 2009, the Company obtained 100% equity of
Changhong Air-conditioner by consolidated under the same control. In 2017, the Company increased capital of 650 million
Yuan to Changhong Air Conditioner, after capital increased, registered capital of Sichuan Changhong comes to 850 million
Yuan from 200 million Yuan, share holding still counted as 100%.
27) Zhongshan Changhong Electric Co., LTD (hereinafter referred to as Zhongshan Changhong), was the original Guangdong
Changhong Electric Co., Ltd., and is a limited liability company jointly set up by Sichuan Changhong and China Minmetals on
May 22, 2001. Its registered capital was RMB 80 million upon establishment, of which, Sichuan Changhong invested RMB 72
million, including RMB 69.3 million biding for the estate/ non-estate from original Zhongshan Sanrong Air-conditioner Co.,
Ltd. And its patent use-right of RMB2.7 million, accounting for 90% of the registered capital; Chine Minmetals invested RMB
8 million in monetary capital accounting 10% of the registered capital. The Company changed its name originally from
Guangdong Changhong Electric Co., Ltd in July 2003. In December 2009, the Company obtained 90% equity of Zhongshan
Changhong by consolidated under same control. 10% equity held by China Minmetals has been transferred by Changhong
Air-conditioner on April 11, 2010. On 25 May 2014, the Company increased RMB 36 million to Zhongshan Changhong, and
Changhong AC increased RMB 4 million. In 2016, according to the overseas development strategy of the Company and the
development and operation needs of the subsidiaries, the Company and the wholly-owned subsidiary Changhong Air
Conditioning have increased capital of RMB 64 million Yuan to Zhongshan Changhong according to the existing shareholding
ratio, among which the capital increase of the Company was RMB 57.6 million Yuan, and the capital increase of Changhong
Air Conditioning was RMB 6.4 million Yuan. After the completion of this capital increase, the registered capital Zhongshan
Changhong shall increase to RMB 184 million Yuan, the shareholding ratio of the company and Changhong Air Conditioning
remained unchanged and was still 90% and 10%, of which the Company invested 165.6 million Yuan, accounting for 90% of
the registered capital, Changhong Air Conditioning invested 18.4 million Yuan, accounting for 10% of the registered capital.
28) Hefei Meiling Group Holdings Limited (hereinafter referred to as Meiling Group), was the state-owned company originally
approved by People’s Government of Hefei Province and established authorized by SASAC of Hefei City. On July 14, 2008, 100%
state-owned equity of Meiling Group has freely transferred to Xingtai Holding by Hefei SASAC. Agreement by the approval of
< State-owned property agreement transfer from Meiling Group> [ HGZCQ(2010) No.34] of Hefei SASAC on April 9, 2010,
100% state-owned property of Meiling Group after partial assets and liabilities separated transferred to the Company from
Xingtai Holding as amount of RMB 113.2 million. The re-registration of industrial and commercial procedure for Meiling
Group after separated partial assets liability has finished on July 28, 2010. The new Meiling Group has register capital of RMB
80 million, and has been verified by the [AD (2010) YZD No. 016] from Anhui Auding CPAs Co., Ltd.
324
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
29) Meiling Equator Appliance (Hefei) Co., Ltd.( hereinafter referred to as Equator Appliance) was the Sino-foreign joint venture jointly
set up by original Meiling Group and EQUATOR INVESTMENTS (USA) INC.( EQUATOR for short), which have been approved
by the [SWZWFZZ(2004) No.0103] of Approval Certificate of Foreign Enterprise from People’s Government of Anhui
Province. Its registered capital was US$ 3 million upon establishment, of which, Sino company invested US$ 2.25 million in
machinery equipment, accounting 75% of the registered capital while foreign company invested US$ 0.5 million in monetary
capital and US$ 0.25 million in intangible assets, amounting to US$0.75 million, accounting 25% of the registered capital. The
above mentioned investment verified by the verification report of [WYAYZ (2004) No. 135] from Anhui Yongan CPAs Co.,
Ltd. In July 2007, approved by [HWJ(2007) No.136] from Foreign Trade Economic Cooperation Bureau of Hefei City, 25%
equity held by EQUATOR transferred to Anhui Meiling Electric Co., Ltd. Totally. The Company’s register capital came into
RMB 24,793,200 after transference, and was not the joint-venture any more. 25% equity owned by Anhui Meiling Electric Co.,
Ltd has been transferred totally to original Meiling Group in July 2009.
30) Hefei Equator Appliance Co., Ltd.( hereinafter referred to as Equator Appliance) was jointly set up by original Meiling Group and
Yingkaite Appliance on September 26, 2007. Its register capital was RMB 12 million, among which, original Meiling Group
invested 8,670,600 Yuan in monetary capital, accounting 72.255% in registered capital; Equator Appliance invested 3,329,400
Yuan in the assessment value of intangible assets (land-use right), accounting 27.745% of total registered capital. The
investment being verified by [WYAZ (2004) No. 135] from Anhui Yongan CPAs Co., Ltd.
31) Hongyuan Ground Energy Heat Pump Technology Co., Ltd(hereinafter referred to as Hongyuan Ground Energy) was
established on 28 August 2015, it is a limited liability company authorized by Administration for Industry and Commerce of
Peicheng District, Mianyang, Sichuan, contributed by Sichuan Changhong Air Conditioner Co., Ltd (hereinafter referred to as
Changhong Air Conditioner) and Hengyouyuan Technology Development Group Co., Ltd. together. Registered capital
amounted as 50 million Yuan, including 25.5 million Yuan contributed by Changhong Air Conditioner in cash, a 51% in total
registered capital; Hengyouyuan Technology Development Group Co., Ltd. invested 24.5 million Yuan in cash, a 49% in
registered capital.
32) Hongyuan Ground Energy Heat Pump Tech. (Zhongshan) Co., Ltd.(hereinafter referred to as Hongyuan Zhongshan) was
established and invested on 18 July 2017 with registered capital of 15 million Yuan, The Hongyuan Ground Energy Heat Pump
Tech. Co., Ltd contributed 1.5 million Yuan with own funds and takes 100% in the registered capital.In 2018, the shareholdes
of the Hongyuan Zhongshan decided to increase capital of 30 million Yuan, and contributed by the shareholder Hongyuan
Ground Energy; thus registered capital of Hongyuan Zhongshan up to 45 million Yuan
33) Meiling Candy Washing Machine Co., Ltd. (hereinafter referred to as Meiling Candy) was established and registered on 27
April 2017, which was contributed by the Company and Candy Hoover Group S.r.l. together. Registered capital counted as 150
million Yuan, including 90 million Yuan invested by the Company, a 60% in registered capital.
34) Guangzhou Changhong Trading Co., Ltd. (hereinafter referred to as Changhong Trading) was established on 6 Jan. 2017,
the wholly-owned subsidiary of Zhongshan Changhong Electric Co., LTD (hereinafter referred to as Zhongshan Changhong)
with registered capital of one million Yuan
325
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
35) Zhongshan Hongling Trading Co., Ltd. (hereinafter referred to as Hongling Trading) was established on 5 December 2016
with registered capital of one hundred million Yuan. The Guangdong Changhong Ridian Technology Co., Ltd. contributed one
hundred million Yuan with own funds and takes 100% in the registered capital.
36) Hebei Hongmao Household Appliance Technology Co., Ltd (hereinafter referred to as Hebei Hongmao) was established on
21 July 2017 with registered capital of 5 million Yuan. Guangdong Changhong Ridian Technology Co., Ltd. invested 5 million
Yuan by own fund and takes 100% in registered capital.
(2) Major non-wholly-owned subsidiary
Dividend distributed
Gains/losses Balance of
Shareholding ratio to minority
Subsidiary attributable to minority’s interest at
of minority announced in the
minority in the year period-end
year
Meiling CANDY 40.00% -2,707,503.04 36,457,676.84
Changmei
3.744% -737,670.96 417,073.88
Technology
Zhongke Meiling 33.13% 5,122,879.24 -1,364,418.00 45,495,664.06
Hongyuan Ground
49.00% -5,568,076.55 17,135,411.07
Energy
Changhong Ridian 1.145% 175,896.21 1,556,765.22
(3) Financial information for major non-wholly-owned subsidiary
Balance atyear-end
Subsidiary Non-current
Current assets Non-current assets Total assets Current liability Totalliabilities
liability
Meiling
208,478,686.47 633,265.82 209,111,952.29 111,545,406.70 6,422,353.48 117,967,760.18
CANDY
Changmei
8,459,569.81 12,071,248.03 20,530,817.84 8,889,062.92 501,961.24 9,391,024.16
Technology
ZhongkeMeiling 147,911,974.23 128,385,679.37 276,297,653.60 132,039,203.60 6,932,380.00 138,971,583.60
Hongyuan Ground
153,302,595.60 34,694,234.27 187,996,829.87 148,809,162.62 4,217,440.58 153,026,603.20
Energy
Changhong
307,995,738.66 59,236,288.32 367,232,026.98 231,048,365.86 171,540.98 231,219,906.84
Ridian
(Continued)
Balance atyear-begin
Subsidiary Non-current
Current assets Non-current assets Total assets Current liability Totalliabilities
liability
Meiling
186,327,159.16 595,603.59 186,922,762.75 114,009,813.05 114,009,813.05
CANDY
Changmei
14,227,901.53 7,276,673.50 21,504,575.03 7,839,977.68 446,504.35 8,286,482.03
Technology
ZhongkeMeiling 137,621,171.43 129,960,368.99 267,581,540.42 136,808,504.89 4,791,666.67 141,600,171.56
Hongyuan Ground
153,447,662.99 20,035,926.82 173,483,589.81 153,196,254.08 3,953,687.53 157,149,941.61
Energy
326
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Subsidiary Balance atyear-begin
Changhong
258,631,530.72 58,759,575.56 317,391,106.28 196,746,760.43 196,746,760.43
Ridian
(Continued)
Current Year
Subsidiary Total comprehensive Cash flow from
Operation income Net profit
income operation activity
Meiling
468,389,142.46 -6,768,757.59 -6,768,757.59 -24,223,592.67
CANDY
Changmei
26,839,141.37 -17,947,299.32 -17,947,299.32 -17,689,892.58
Technology
ZhongkeMeiling 185,678,757.29 15,463,119.14 15,463,119.14 32,609,413.80
Hongyuan Ground
448,481,933.01 -11,363,421.53 -11,363,421.53 -7,732,643.87
Energy
Changhong
525,992,095.11 15,367,774.29 15,367,774.29 57,919,926.89
Ridian
Last Year
Subsidiary Total comprehensive Cash flow from
Operation income Net profit
income operation activity
Meiling
277,854,553.21 -2,087,050.30 -2,087,050.30 -39,773,751.02
CANDY
Changmei
17,810,174.84 -13,495,001.36 -13,495,001.36 -15,043,776.44
Technology
ZhongkeMeiling 143,090,796.12 12,482,579.70 12,482,579.70 57,581,102.60
Hongyuan Ground
558,282,516.59 -3,509,163.01 -3,509,163.01 7,690,824.95
Energy
Changhong
475,756,667.69 11,526,478.55 11,526,478.55 -1,322,277.27
Ridian
(Continued)
(4) Major limitation on using enterprise group’s assets and liquidate debts of enterprise group: Nil
(5) Offering financial supporting or other supports for structured entity that included in consolidation
statement scope: Nil
2. Changes of owner’ equity shares in subsidiary and its impacts
Item ChangmeiTechnology ChengduMeiling Total
Original ratio of shares held 95.00% 94.80%
Equity purchased from
1.256% 1.20%
minority
Share issuance
Ratio of shares held at
96.256% 96.00%
period-end
327
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Cost of purchasing minority
1.00 1.00
equity
Less: Ratio of the net assets
measured by equity ratio
-328,665.92 -108,078.69 -436,744.61
while acquiring the
subsidiary
Equity dilution for shares
issuance
Balance 328,665.92 108,079.69 436,745.61
Including: Capital public
-328,665.92 -108,079.69 -436,745.61
reserve adjusted
In 2018, the subsidiary Changmei Technology Co., Ltd. received the subscribed capital contribution in the current period,
which led to an increase in the company’s shareholding ratio, the balance between the newly acquired long-term equity
investment and the share of net assets that the subsidiary should continuously calculate from the date of purchase according to
the newly increased shareholding ratio was 328,665.92 yuan and was included in the capital reserve.
The rest was the acquisition of the minority shareholder’s stock equity of Chengdu marketing subsidiaries; the balance between
the newly acquired long-term equity investment and the share of net assets that the subsidiary should continuously calculate
from the date of purchase according to the newly increased shareholding ratio was 108,079.69 yuan and was included in the
capital reserve.
3. Equity in joint venture or associate enterprise
(1) Major joint venture or associate enterprise
Shareholding Accounting
ratio(%) treatment for
Main office Registe Business investment of
Joint venture or associate enterprise place r place nature Direct Indire joint venture or
ly ctly associate
enterprise
associate enterprise:
1.ChanghongRubaElectricCompany Lahore, Manufactures,
Lahore 40.00 Equity
(Private)Ltd. Pakistan sales
2.Hefei Xingmei Assets Management Co., Rental,
Hefei Hefei 48.28 Equity
Ltd. agency
3.Sichuan Zhiyijia Network Technology
Mianyang Mianyang Sales 30.00 Equity
Co., Ltd.
4.Hongyuan Ground Energy Heat Tech. R & D, sales,
Mianyang Mianyang 49.00 Equity
Co., Ltd. after-sales
5.Sichuan Tianyou Guigu Technology Co., Manufactures,
Mianyang Mianyang 25.00 Equity
Ltd. sales
R&D,
6.Chengdu Guigu Environmental Tech. Co.,
Chengdu Chengdu manufacturin 25.00 Equity
Ltd.
g and sales
(2) Financial information for major Joint venture: Nil
(3) Financial information for associate enterprise
328
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance atyear-end /CurrentYear
HefeiXingmei Sichuan Zhiyijia Hongyuan SichuanTianyou
Item ChanghongRubaEl Chengdu Guigu
Assets Network Ground Guigu
ectricCompany(Pri Environmental
Management Technology Co., Energy Heat Technology Co.,
vate)Ltd. Tech. Co.,Ltd.
Co.,Ltd. Ltd. Tech. Co.,Ltd. Ltd.
Current assets 91,897,615.22 2,675,645.87 2,183,231,308.63 58,433,074.33 21,327,002.48 14,543,169.26
Including: cash and
2,226,184.18 2,568,442.61 1,051,202,920.87 1,874,763.97 14,337,275.36 2,753,804.68
cash equivalent
Non-current assets 61,362,584.22 18,201,870.67 9,053,276.55 15,117,799.85 17,218,667.66 15,241,625.80
Total assets 153,260,199.44 20,877,516.54 2,192,284,585.18 73,550,874.18 38,545,670.14 29,784,795.06
Current liability 122,588,154.92 1,366,126.17 2,151,196,374.07 26,304,400.02 10,083,081.69 8,538,705.26
Non-current liability 685,260.00
Total liabilities 122,588,154.92 1,366,126.17 2,151,881,634.07 26,304,400.02 10,083,081.69 8,538,705.26
Minority's interest
Equity attributable to
shareholder of parent 30,672,044.52 19,511,390.37 40,402,951.11 47,246,474.16 28,462,588.45 21,246,089.80
company
Share of net assets
measured by 14,069,807.22 9,420,099.27 12,120,885.32 23,150,772.34 7,115,647.11 5,311,522.45
shareholding
Adjustment
--Goodwill 3,887,027.34
Unrealized profit of
the internal
5,020,111.59 8,138,518.55 1,835.80 4,693.04 41,161.52
downstream
transactions
Unrealized profit of
the internal upstream
transactions
Other
Book value of the
equity investment for 9,049,695.63 9,420,099.27 3,982,366.77 23,148,936.54 7,110,954.07 9,157,388.27
associate enterprise
Fair value of equity
investment for the
affiliates with
consideration
publicly
Operation income 126,228,221.53 13,454.00 5,175,169,302.80 39,721,874.63 183,198.16 10,363,359.09
Financial expenses 255,291.28 -8,196.38 -3,389,797.02 94,474.40 -506,304.50 -77,635.70
Income tax expenses 1,968,285.62 3,209,840.03
Net profit -37,897,887.71 -2,644,744.77 -11,083,431.22 562,504.24 -5,354,573.64 -9,683,757.18
Net profit of
discontinuing
operation
Other comprehensive
-9,379,706.16
income
Total comprehensive
-47,277,593.87 -2,644,744.77 -11,083,431.22 562,504.24 -5,354,573.64 -9,683,757.18
income
Dividend received
from associate
enterprise in the year
329
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(Continued)
Balance atyear-begin/LastYear
HefeiXingmei Sichuan Zhiyijia Hongyuan SichuanTianyou
Item ChanghongRubaEl Chengdu Guigu
Assets Network Ground Guigu
ectricCompany(Pri Environmental
Management Technology Co., Energy Heat Technology Co.,
vate)Ltd. Tech. Co.,Ltd.
Co.,Ltd. Ltd. Tech. Co.,Ltd. Ltd.
Current assets 101,602,298.41 3,458,484.59 2,008,498,235.31 60,968,256.51 21,724,066.16 21,783,093.01
Including: cash and
1,684,706.95 3,286,834.15 1,060,479,965.90 371,164.93 16,267,337.47 10,662,530.54
cash equivalent
Non-current assets 78,294,101.64 19,165,528.20 12,785,020.28 22,196,510.71 22,653,214.86 14,763,246.75
Total assets 179,896,400.05 22,624,012.79 2,021,283,255.59 83,164,767.22 44,377,281.02 36,546,339.76
Current liability 101,946,761.66 467,877.65 1,968,696,873.26 36,418,439.29 10,560,118.93 5,616,492.78
Non-current liability 1,100,000.00
Total liabilities 101,946,761.66 467,877.65 1,969,796,873.26 36,418,439.29 10,560,118.93 5,616,492.78
Minority's interest 94,732.30
Equity attributable to
shareholder of parent 77,949,638.39 22,156,135.14 51,486,382.33 46,651,595.63 33,817,162.09 30,929,846.98
company
Share of net assets
measured by 32,980,844.78 10,696,982.04 15,445,914.69 22,859,281.86 8,454,290.52 7,732,461.75
shareholding
Adjustment
--Goodwill 3,887,027.34
Unrealized profit of
the internal
5,088,527.78 4,750,343.71 1,714,308.77 5,425.01 1,843.72
downstream
transactions
Unrealized profit of
the internal upstream 38,317.94
transactions
Other
Book value of the
equity investment for 27,930,634.94 10,696,982.04 10,695,570.98 21,144,973.09 8,ent448,865.51 11,617,645.36
associate enterprise
Fair value of equity
investment for the
affiliates with
consideration
publicly
Operation income 212,999,989.11 300,194.18 4,370,072,582.79 58,655,187.06 2,795,228.37 10,528,831.02
Financial expenses 5,983,098.16 -10,564.98 -21,149,435.34 310,303.64 -617,995.91 -296,615.91
Income tax expenses 2,420,332.80 9,953,258.77 24,574.36
Net profit -5,238,761.17 -3,516,608.01 14,491,149.92 -6,449,734.18 2,720,616.95 -5,097,364.17
Net profit of
discontinuing
operation
Other comprehensive
-9,395,466.24
income
Total comprehensive
-14,634,227.41 -3,516,608.01 14,491,149.92 -6,449,734.18 2,720,616.95 -5,097,364.17
income
330
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance atyear-begin/LastYear
HefeiXingmei Sichuan Zhiyijia Hongyuan SichuanTianyou
Item ChanghongRubaEl Chengdu Guigu
Assets Network Ground Guigu
ectricCompany(Pri Environmental
Management Technology Co., Energy Heat Technology Co.,
vate)Ltd. Tech. Co.,Ltd.
Co.,Ltd. Ltd. Tech. Co.,Ltd. Ltd.
Dividend received
from associate
enterprise in the year
(4) Financial summary for non-important Joint venture and associate enterprise
Balance at year-end /Current
Item Balance at year-begin /Last Year
Year
associate enterprise
Total book value of investment
Total amount measured by shareholding
ratio
--net profit -1,780,729.52 -6,505,292.40
--Other comprehensiveincome
-- Total comprehensiveincome -1,780,729.52 -6,505,292.40
(5) Major limitation on capital transfer ability to the Company from joint venture or affiliates: Nil
(6) Excess loss occurred in joint venture or affiliates: Nil
(7) Unconfirmed commitment with joint venture investment concerned: Nil
(8) Intangible liability with joint venture or affiliates investment concerned: Nil
4. Major conduct joint operation: Nil
5. Structured body excluding in consolidate financial statement: Nil
IX. Relevant risks related with financial instrument
The major financial instruments of the Company include borrowings, account receivables, account payable,
tradable financial assets, tradable financial liability, the details of which are set out in Note VI. Risks related
to these financial instruments include exchange risks and interest rate risks. The management of the
Company controls and monitors the risk exposures to ensure the above risks are under control.
In connection with exchange risks, in order to prevent from exchange risks arising from foreign currency
transaction amount, foreign currency dominated loans and interest expenditure, the Company entered into
several forward exchange contracts with banks. Fair value of the forward exchange contract which has been
recognized as derivative financial instrument has been included in profits and losses. As export business is
increasing, if risks that are out of control of the Company occur such as appreciation of RMB, the Company
will mitigate the relevant risks by adjusting its sales policy.
The Company’s interest rate risk arises from bank borrowings and interest-bearing debt. Financial liabilities
at floating rate expose the Company to cash flow interest rate risk, and financial liabilities at fixed rate
expose the Company to fair value interest rate risk. The Company will determine the respective proportion of
331
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
contracts at fixed and floating rates based on the prevailing market conditions. As of 31 December 2018, the
interest-bearing debts mainly referred to borrowing contracts at floating rate denominated in RMB with total
amount of 2,022,674,350.10 Yuan, the floating rate loan contract measured by RMB amounted as
9,200,000.00 Yuan in total; borrowing contracts at fixed rate denominated in USD with total amount of
556,719,579.52 Yuan. Risks relating to change of fair value of financial instruments arising from movement
of interest rate mainly related to bank borrowings at fixed rate. As for borrowings at fixed rate, the Company
aims to keep its floating rate. Risks relating to change of cash flow of financial instruments arising from
movement of interest rate mainly related to bank borrowings at floating rate. The Company establishes its
policy to keep floating rate for these borrowings so as to eliminate fair value risk arising from movement of
interest rate.
X. Fair value disclosure
1. Asset and liability measured by fair value at end of the period and fair value measurement level
F ai r v al u e at y e ar- e n d
Item
1st level 2nd level 3rd level Total
Financial assets measured by fair value and with variation reckoned into current gains/losses
1.Tradable financial assets
(1)Derivative financial assets 9,253,635.59 9,253,635.59
Financial liabilities measured by fair value and with variation reckoned into current gains/losses
1.Tradable financial liability
(1)Derivative financial liability 55,586,666.70 55,586,666.70
The derivative contract is measured by fair value on 2nd level, which is the real-time quote on foreign
exchange market on balance sheet date
XI. Related parties and related transaction
(I) Relationship of related parties
1. Controlling shareholder and ultimate controller
(1) Controlling shareholder and ultimate controller
Registr Share-holdin Voting rights
Controlling shareholder and Business Registered
ation g ratio in the ratio in the
ultimate controller nature capital
place Company Company
Mianya Manufactur
Sichuan Changhong Electric Co., Ltd. 4,616,244,222.00 26.73% 26.73%
ng e and sales
Sichuan Changhong Electronic Holding Group is the controlling shareholder of Sichuan Changhong Electric Co., LTD, and the
SASAC Mianyang office holds 100.00% equity interests of Sichuan Changhong Electronic Holding Group, which means that
SASAC Mianyang office is the ultimate controller of the Company.
332
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
(2) Register capital and change thereof of controlling shareholder
Balance at Increased in Decreased in
Controlling shareholder Balance at year-end
year-begin the Year the Year
Sichuan Changhong Electric Co., Ltd. 4,616,244,222.00 4,616,244,222.00
(3) Shares held by the controlling shareholder and its changes on equity
Amount of shares held Shareholding ratio
Controlling shareholder Balance at Balance at Ratio at Ratio at
year-end year-begin year-end year-beginning
Sichuan Changhong Electric Co., Ltd. 279,200,104.00 265,601,410.00 26.73% 25.43%
2. Subsidiary
Found more in Note “VIII. 1 (1) Enterprise group composition”
3. Joint venture and associated enterprise
Major Joint venture and associated enterprise of the Company found more in Note “VIII. 3 (1) major joint
venture and associated enterprise”. Other Joint venture and associated enterprise that have related
transactions occurred with the Company in the period or occurred in last period, and with balance results:
Joint venture and associated enterprise Relationship with the company
Hefei Meiling Solar Energy Technology Co., Ltd. Associated enterprise of subsidiary Meiling Group
ChanghongRubaElectricCompany(Private)Ltd. Associated enterprise of subsidiary Zhongshan Changhong
Hefei Xingmei Assets Management Co., Ltd. Associated enterprise of the Company
Associated enterprise of the Company, has the same controlling
Sichuan Zhiyijia Network Technology Co., Ltd.
shareholder and actual control of the Company
Hongyuan Ground Energy Heat Tech. Co., Ltd. Associated enterprise of subsidiary Changhong Air-conditioner
Sichuan Tianyou Guigu Technology Co., Ltd. Associated enterprise of subsidiary Changhong Air-conditioner
Chengdu Guigu Environmental Tech. Co., Ltd. Associated enterprise of subsidiary Changhong Air-conditioner
4. Other related parties
Related party Relationship with the company
Associated enterprise of other enterprise that have the same
Sichuan Yunyou Internet Tech. Co., Ltd.
controlling shareholder
Control by same controlling shareholder and ultimate
Changhong Huayi Compressor Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Mold Plastic Tech. Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Jijia Fine Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Package Printing Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Precision Electronics Tech. Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong New Energy Technology Co., Ltd.
controller
333
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Related party Relationship with the company
Control by same controlling shareholder and ultimate
081 Electronic Group
controller
Control by same controlling shareholder and ultimate
Guangdong Changhong Electronics Co., Ltd.
controller
Sichuan Changhong Intelligent Manufacturing Tech. Co., Control by same controlling shareholder and ultimate
Ltd. controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Device Tech. Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Xinrui Tech. Co. Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Jiahong Industrial Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Huafeng Corp. Group
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Property Service Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Ailian Science & Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Education Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Electronic System Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Communication Tech. Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Aichuang Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Hunan Grand-Pro Intelligent Tech. Company
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Electronic Products Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Minsheng Logistics Co., LTD
controller
Control by same controlling shareholder and ultimate
Sichuan Service Exp. Appliance Service Chain Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Hongxin Software Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong International Hotel Co., Ltd.
controller
Control by same controlling shareholder and ultimate
CHANGHONG(HK)TRADINGLIMITED
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong International Travel Service Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Hongwei Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Lejiayi Chain Management Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Network Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Shenzhen YijEn Technology Co., Ltd.
controller
Sichuan Changhong Gerun Environmental Protection Tech. Control by same controlling shareholder and ultimate
Co., Ltd. controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Jiahua Information Products Co., Ltd.
controller
334
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Related party Relationship with the company
Control by same controlling shareholder and ultimate
BVCH Optronics (Sichuan) Co., Ltd.
controller
Hefei Changhong New Energy Science & Technology Co., Control by same controlling shareholder and ultimate
Ltd. controller
Control by same controlling shareholder and ultimate
PT.CHANGHONGELECTRICINDONESIA
controller
Control by same controlling shareholder and ultimate
CHANGHONGELECTRIC(AUSTRALIA)
controller
Control by same controlling shareholder and ultimate
Hefei Changhong Industrial Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Property Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Chengdu Changhong Electronic Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Wisdom Health Tech. Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Huanyu Industrial Co. Ltd.
controller
Mianyang Technology Town Big Data Technology Co., Control by same controlling shareholder and ultimate
Ltd. controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Group Finance Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Power Source Co., Ltd.
controller
Control by same controlling shareholder and ultimate
GuangYuan Changhong Electronic Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Venture Investment Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Guangyuan Hongcheng Industrial Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Energy Sunshine Technology Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Changhong Electronics Tech. Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Sichuan Hongcheng Real Estate Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Orion.PDP.Co.,ltd
controller
Control by same controlling shareholder and ultimate
Changhong International Holdings (Hong Kong) Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Changhong Europe Electric s.r.o
controller
Control by same controlling shareholder and ultimate
Yibin Red-Star Electronics Co., Ltd.
controller
Control by same controlling shareholder and ultimate
CHANGHONG ELECTRIC MIDDLEEASTFZE
controller
Control by same controlling shareholder and ultimate
Yuanxin Financial Lease Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Beijing Changhong Tech. Co. Ltd,
controller
Control by same controlling shareholder and ultimate
Sichuan Hongcheng Construction Engineering Co., Ltd.
controller
Control by same controlling shareholder and ultimate
Anhui Xinhao Plasma Display Panel Co., Ltd.
controller
335
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Related party Relationship with the company
Sichuan Changhong Electronics Holding Group Co., Ltd. Parent company of controlling shareholder
Sichuan Hongyu Metal Manufacturing Co., Ltd. Associated enterprise of controlling shareholder
Note
Sichuan Changhe Technology Co., Ltd. Associated enterprise of controlling shareholder
Sichuan Changxin Refrigeration Parts Co., Ltd. Associated enterprise of controlling shareholder
Mianyang Highly Electric Co., Ltd. Associated enterprise of controlling shareholder
Chengdu HOPE Testing Tech. Co. Ltd. Associated enterprise of controlling shareholder
Sichuan Family Help Electric Service Co., Ltd. Associated enterprise of controlling shareholder
In July 2018, Sichuan Changhong Innovation Investment Co., Ltd. sold all shareholdings of Sichuan
Changhe Technology Co., Ltd., Sichuan Changhe Technology Co., Ltd. is no longer a related party of
the Company.
(ii) Related transactions
1. Purchasing commodity
Current Year Last Year
Related party Content (10 thousand (10 thousand
Yuan) Yuan)
Purchasing
Sichuan Changhong Electric Co., Ltd. 33,040.87 35,306.58
commodity
Purchasing
Sichuan Changhong Electronics Holding Group Co., Ltd. 0.49
commodity
Purchasing
Changhong Huayi Compressor Co., Ltd. 53,248.03 37,169.68
commodity
Purchasing
Sichuan Changhong Mold Plastic Tech. Co., Ltd. 73,348.73 69,088.66
commodity
Purchasing
Sichuan Changhong Jijia Fine Co., Ltd. 30,669.97 36,871.44
commodity
Purchasing
Sichuan Changhong Package Printing Co., Ltd. 10,413.66 11,148.32
commodity
Purchasing
Sichuan Changhong Precision Electronics Tech. Co., Ltd. 6,325.00 5,904.39
commodity
Purchasing
Sichuan Changhong New Energy Technology Co., Ltd. 4.18 3.09
commodity
Purchasing
081 Electronic Group 184.39 334.84
commodity
Purchasing
Guangdong Changhong Electronics Co., Ltd. 423.80 1,460.11
commodity
Sichuan Changhong Intelligent Manufacturing Tech. Co., Purchasing
47.03 253.85
Ltd. commodity
Purchasing
Sichuan Changhong Device Tech. Co., Ltd. 4,112.64
commodity
Purchasing
Sichuan Changhong Xinrui Tech. Co. Ltd. 4,902.37
commodity
Purchasing
Sichuan Jiahong Industrial Co., Ltd. 17.65
commodity
Purchasing
Sichuan Zhiyijia Network Technology Co., Ltd. 20.78 0.92
commodity
Purchasing
Sichuan Huafeng Corp. Group 1.40
commodity
336
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Current Year Last Year
Related party Content (10 thousand (10 thousand
Yuan) Yuan)
Purchasing
Sichuan Changhong Property Service Co., Ltd. 0.04 0.04
commodity
Purchasing
Sichuan Ailian Science & Technology Co., Ltd. 1,167.16 677.33
commodity
Purchasing
Sichuan Changhong Education Technology Co., Ltd. 5.03
commodity
Purchasing
Sichuan Hongyu Metal Manufacturing Co., Ltd. 134.82 120.38
commodity
Purchasing
Sichuan Changhe Technology Co., Ltd. 378.56 813.46
commodity
Purchasing
Sichuan Changxin Refrigeration Parts Co., Ltd. 32,083.39 35,945.19
commodity
Purchasing
Mianyang Highly Electric Co., Ltd. 33,607.77 33,122.52
commodity
Purchasing
ChanghongRubaElectricCompany(Private)Ltd. 14,566.51 18,285.58
commodity
Purchasing
Chengdu Guigu Environmental Tech. Co., Ltd. 3.71 5.81
commodity
Purchasing
Sichuan Yunyou Internet Tech. Co., Ltd. 13.31
commodity
Purchasing
Sichuan Changhong Electronic System Co., Ltd. 4.74
commodity
Purchasing
Sichuan Changhong Communication Tech. Co., Ltd. 2.58
commodity
Purchasing
Sichuan Aichuang Technology Co., Ltd. 5,211.18
commodity
Purchasing
Hunan Grand-Pro Intelligent Tech. Company 230.21
commodity
Purchasing
Sichuan Changhong Electronic Products Co., Ltd. 2,885.43
commodity
Total 298,033.50 295,534.12
2.Accept the services
Related party Content Current Year Last Year
Sichuan Changhong Electronics Holding Group Co., Ltd. Accept the services 921,617.88 197,190.60
Sichuan Changhong Electric Co., Ltd. Accept the services 23,257,377.60 19,837,460.29
Sichuan Changhong Minsheng Logistics Co., LTD Accept the services 537,900,775.75 557,786,009.24
Sichuan Changhong Mold Plastic Tech. Co., Ltd. Accept the services 165,894.20
Sichuan Service Exp. Appliance Service Chain Co., Ltd. Accept the services 194,960,696.99 135,965,733.59
Sichuan Hongxin Software Co., Ltd. Accept the services 1,130,201.88 1,335,284.55
Guangdong Changhong Electronics Co., Ltd. Accept the services 1,032,427.98 854,778.18
Sichuan Jiahong Industrial Co., Ltd. Accept the services 219,734.50 517,553.29
Sichuan Changhong International Hotel Co., Ltd. Accept the services 388,596.83 349,358.51
CHANGHONG(HK)TRADINGLIMITED Accept the services 237,531.09
Sichuan Changhong International Travel Service Co., Ltd. Accept the services 869,951.89 226,030.00
Sichuan Changhong Property Service Co., Ltd. Accept the services 836,614.81 944,958.16
337
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Related party Content Current Year Last Year
Sichuan Hongwei Technology Co., Ltd. Accept the services 518,742.29 497,192.43
Sichuan Zhiyijia Network Technology Co., Ltd. Accept the services 7,409,344.17 3,973,704.63
Lejiayi Chain Management Co., Ltd. Accept the services 22,641.51
Sichuan Changhong Network Technology Co., Ltd. Accept the services 78,651.34 50,798.90
Sichuan Changhong Intelligent Manufacturing Tech. Co.,
Accept the services 5,900,756.90 196,581.20
Ltd.
Sichuan Changhong Jijia Fine Co., Ltd. Accept the services 1,794.87
Shenzhen YijEn Technology Co., Ltd. Accept the services 210,207.55
Sichuan Changhong Gerun Environmental Protection Tech.
Accept the services 115,580.94 73,226.50
Co., Ltd.
Sichuan Changhong Jiahua Information Products Co., Ltd. Accept the services 6,037.74
BVCH Optronics (Sichuan) Co., Ltd. Accept the services 67,935.00
Sichuan Changhong Electronic Products Co., Ltd. Accept the services 388,574.88
Chengdu HOPE Testing Tech. Co. Ltd. Accept the services 7,566.04
Sichuan Yunyou Internet Tech. Co., Ltd. Accept the services 55,440.01
Total 776,232,519.62 723,278,035.09
3.Purchase fuel and power
Related party Content Current Year Last Year
Purchase fuel and
Sichuan Changhong Electric Co., Ltd. 20,264,380.43 19,879,944.22
power
Purchase fuel and
Changhong Huayi Compressor Co., Ltd. 720,372.91 590,999.14
power
Purchase fuel and
Guangdong Changhong Electronics Co., Ltd. 1,680,446.20 1,305,660.00
power
Purchase fuel and
Sichuan Jiahong Industrial Co., Ltd. 4,781.60
power
Hefei Changhong New Energy Science & Technology Co., Purchase fuel and
377,466.06 395,539.19
Ltd. power
Purchase fuel and
Sichuan Changhong Property Service Co., Ltd. 50,683.70 37,569.05
power
Total 23,093,349.30 22,214,493.20
4.Sales of goods/offering labor service
Current Year Last Year
Related party Content
(10 thousand Yuan) (10 thousand Yuan)
Sichuan Changhong Electric Co., Ltd. Sales of goods 5,163.23 127,288.97
Sichuan Changhong Electronics Holding Group Co., Ltd. Sales of goods 148.96 102.53
Sichuan Changhong Jijia Fine Co., Ltd. Sales of goods 5,847.80 6,714.31
Sales of goods/offering
Sichuan Changhong Mold Plastic Tech. Co., Ltd. 19,906.13 11,200.34
labor service
Lejiayi Chain Management Co., Ltd. Sales of goods 2,324.80 744.44
PT.CHANGHONGELECTRICINDONESIA Sales of goods 711.24 2.62
CHANGHONG(HK)TRADINGLIMITED Sales of goods 21,867.52 36,525.50
338
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Current Year Last Year
Related party Content
(10 thousand Yuan) (10 thousand Yuan)
CHANGHONGELECTRIC(AUSTRALIA) Sales of goods 2,557.96 1,946.83
Sichuan Hongwei Technology Co., Ltd. Sales of goods 17.24 13.50
Sichuan Changhong Device Tech. Co., Ltd. Sales of goods 19.10 28.13
Sichuan Changhong Minsheng Logistics Co., LTD Sales of goods 252.69 285.09
Sichuan Service Exp. Appliance Service Chain Co., Ltd. Sales of goods 1,443.58 1,780.47
Sichuan Changhong Gerun Environmental Protection
Sales of goods 1,585.49 1,579.82
Tech. Co., Ltd.
Hefei Changhong Industrial Co., Ltd. Sales of goods 205.04 70.56
Sichuan Huafeng Corp. Group Sales of goods 29.84 18.34
Sichuan Zhiyijia Network Technology Co., Ltd. Sales of goods 254,723.26 225,620.35
Sichuan Changhong Property Co., Ltd. Sales of goods 112.08 322.07
Sichuan Changhong Network Technology Co., Ltd. Sales of goods 29.41 20.30
Chengdu Changhong Electronic Technology Co., Ltd. Sales of goods 0.12
Sichuan Changhong Wisdom Health Tech. Co., Ltd. Sales of goods 1.02 0.75
Sichuan Changhong Property Service Co., Ltd. Sales of goods 2.71 5.17
Guangdong Changhong Electronics Co., Ltd. Sales of goods 298.73
Sichuan Huanyu Industrial Co. Ltd. Sales of goods 16.84 12.10
Sichuan Changhong Xinrui Tech. Co. Ltd. Sales of goods 0.14 2.97
Sichuan Changhong Intelligent Manufacturing Tech. Co.,
Sales of goods 52.65 2.76
Ltd.
Mianyang Technology Town Big Data Technology Co.,
Sales of goods 0.26 0.37
Ltd.
BVCH Optronics (Sichuan) Co., Ltd. Sales of goods 3.35 3.13
Sichuan Changhong Group Finance Co., Ltd. Sales of goods 5.72 4.05
Sales of goods/offering
Changhong Huayi Compressor Co., Ltd. 62.05
labor service
Sichuan Changhong Package Printing Co., Ltd. Sales of goods 7.93 5.80
Sichuan Changhong Power Source Co., Ltd. Sales of goods 10.64 36.02
Sichuan Changhong Education Technology Co., Ltd. Sales of goods 59.29 330.36
081 Electronic Group Sales of goods 434.53 12.78
GuangYuan Changhong Electronic Technology Co., Ltd. Sales of goods 160.00 122.00
Sichuan Ailian Science & Technology Co., Ltd. Sales of goods 27.80 33.97
Sichuan Changhong Venture Investment Co., Ltd. Sales of goods 0.20 0.06
Guangyuan Hongcheng Industrial Co., Ltd. Sales of goods 14.68 0.10
Sichuan Changhong Energy Sunshine Technology Co.,
Sales of goods 2.45 1.45
Ltd.
Sichuan Changhong Electronics Tech. Co., Ltd. Sales of goods 1.54 1.18
Sichuan Hongxin Software Co., Ltd. Sales of goods 3.80 2.35
Sichuan Hongcheng Real Estate Co., Ltd. Sales of goods 9.46 13.34
Sichuan Jiahong Industrial Co., Ltd. Sales of goods 11.50
Sichuan Changhong New Energy Technology Co., Ltd. Sales of goods 35.22 147.86
339
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Current Year Last Year
Related party Content
(10 thousand Yuan) (10 thousand Yuan)
Sichuan Changhong International Hotel Co., Ltd. Sales of goods 36.19 24.24
Sichuan Changhong Electronic System Co., Ltd. Sales of goods 2.60 3.23
Sichuan Changhong Precision Electronics Tech. Co., Ltd. Sales of goods 18.06 12.09
Orion.PDP.Co.,ltd Sales of goods 2,626.30 1,785.99
Changhong International Holdings (Hong Kong) Co.,
Sales of goods 58.92 0.24
Ltd.
Sichuan Changxin Refrigeration Parts Co., Ltd. Sales of goods 8,483.30 10,302.52
Hongyuan Ground Energy Heat Tech. Co., Ltd. Sales of goods 1,930.51 2,859.77
Sichuan Tianyou Guigu Technology Co., Ltd. Sales of goods 36.18
Chengdu Guigu Environmental Tech. Co., Ltd. Sales of goods 356.37 344.04
ChanghongRubaElectricCompany(Private)Ltd. Sales of goods 5,155.69 2,426.80
Sichuan Changhong Electronic Products Co., Ltd. Sales of goods 27.04
ChanghongEuropeElectrics.r.o Sales of goods 14.14
Yibin Red-Star Electronics Co., Ltd. Sales of goods 91.74
CHANGHONGELECTRICMIDDLEEASTFZE Sales of goods 1,125.27
Sichuan Aichuang Technology Co., Ltd. Sales of goods 247.39
Yuanxin Financial Lease Co., Ltd. Sales of goods 0.08
Hunan Grand-Pro Intelligent Tech. Company Sales of goods 0.72
Mianyang Highly Electric Co., Ltd. Sales of goods 246.13
Sichuan Family Help Electric Service Co., Ltd. Sales of goods 0.21
Total 338,577.16 432,809.34
Businesses between the Company and its connected persons are generally conducted under market operation rules as if they
were the same as other business counter parties. For price of sale or purchase and provision of other labor service between the
Company and its related parties, the state pricing is applicable if the pricing do exists; in case of absence of such state pricing,
price is determined under market price; in case of absence of such market price, price is determined by both parties at actual
cost plus reasonable expenses; for some special services, the price of which cannot be determined under the rule of cost plus
expense, the price shall be determined by both parties by negotiation.
5. Provide fuels
Related party Content Current Year Last Year
Guangdong Changhong Electronics Co., Ltd. Provide fuels 307,238.26 1,026,102.62
Sichuan Changhong Minsheng Logistics Co., LTD Provide fuels 29,159.87 103,684.29
Sichuan Changhong Jijia Fine Co., Ltd. Provide fuels 143,889.85 112,448.30
Sichuan Changhong Mold Plastic Tech. Co., Ltd. Provide fuels 7,853,859.29 6,941,010.76
Sichuan Hongwei Technology Co., Ltd. Provide fuels 7,793.08 8,533.42
Sichuan Changhong Device Tech. Co., Ltd. Provide fuels 1,015,274.30 832,738.52
Sichuan Changhong Precision Electronics Tech. Co., Ltd. Provide fuels 9,223.08
Sichuan Service Exp. Appliance Service Chain Co., Ltd. Provide fuels 3,230.61
Shenzhen YijEn Technology Co., Ltd. Provide fuels 5,846.68
340
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Related party Content Current Year Last Year
Changhong International Holdings (Hong Kong) Co., Ltd. Provide fuels 4,430.19
Total 9,379,945.21 9,024,517.91
6. Related rental
(1) Rent out
Leasing income Leasing income
Lessor Lessee Type of assets
in this year in last year
Changhong
Sichuan Changhong Jijia Fine Co., Ltd. forklift 7,696.70 4,837.26
Meiling
Changhong
Sichuan Changhong Jijia Fine Co., Ltd. Warehouse 79,184.30 40,618.87
Meiling
Changhong
Sichuan Changhong Jijia Fine Co., Ltd. Apartment 99,247.94 81,670.08
Meiling
Changhong
Sichuan Changhong Jijia Fine Co., Ltd. Workshop 523,746.18 507,360.00
Meiling
Changhong
Sichuan Changhong Jijia Fine Co., Ltd. Appliance 556.61
Meiling
Changhong Sichuan Changhong Mold Plastic Tech.
Warehouse 330,729.23 260,422.64
Meiling Co., Ltd.
Changhong Sichuan Changhong Mold Plastic Tech.
Workshop 1,410,924.28 1,404,540.00
Meiling Co., Ltd.
Changhong Sichuan Changhong Mold Plastic Tech.
Apartment 282,190.49 375,219.05
Meiling Co., Ltd.
Changhong Sichuan Changhong Minsheng Logistics
office 18,969.98 21,216.00
Meiling Co., LTD
Changhong Sichuan Changhong Minsheng Logistics
Apartment 176,666.67 211,489.53
Meiling Co., LTD
Changhong Sichuan Service Exp. Appliance Service
Apartment 176,352.63 200,087.60
Meiling Chain Co., Ltd.
Changhong Sichuan Service Exp. Appliance Service
office 42,378.38 42,378.38
Meiling Chain Co., Ltd.
Changhong Sichuan Service Exp. Appliance Service
Workshop 174,545.46
Meiling Chain Co., Ltd.
Changhong Sichuan Service Exp. Appliance Service
forklift 3,200.00
Meiling Chain Co., Ltd.
Changhong
Sichuan Changhong Xinrui Tech. Co. Ltd. forklift 2,016.51
Meiling
Changhong
Sichuan Changhong Xinrui Tech. Co. Ltd. Warehouse 14,867.93
Meiling
Changhong
Sichuan Changhe Technology Co., Ltd. Warehouse 3,591.96 14,862.27
Meiling
Changhong
Hefei Changhong Industrial Co., Ltd. Apartment 313,664.77 321,493.34
Meiling
Changhong
Sichuan Changhong Electric Co., Ltd. Apartment 69,668.58
Meiling
Changhong Sichuan Changhong Precision Electronics
forklift 2,344.80 1,515.57
Meiling Tech. Co., Ltd.
Changhong Sichuan Changhong Precision Electronics
Warehouse 20,125.56 47,207.55
Meiling Tech. Co., Ltd.
Changhong Sichuan Changhong Precision Electronics
Apartment 69,339.25 58,975.23
Meiling Tech. Co., Ltd.
341
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Leasing income Leasing income
Lessor Lessee Type of assets
in this year in last year
Changhong Sichuan Ailian Science & Technology Co.,
Warehouse 2,208.00 84.91
Meiling Ltd.
Changhong
Sichuan Aichuang Technology Co., Ltd. Warehouse 7,232.60
Meiling
Changhong
Sichuan Aichuang Technology Co., Ltd. forklift 790.57
Meiling
Zhongke Sichuan Changhong Minsheng Logistics
Workshop 2,575,560.01
Meiling Co., LTD
Changhong
Air-conditio BVCH Optronics (Sichuan) Co., Ltd. Freight elevator 52,480.00 52,480.00
ner
Changhong
Sichuan Changhong Mold Plastic Tech. Machinery
Air-conditio 24,702.55 25,433.40
Co., Ltd. equipment
ner
Changhong
Air-conditio Sichuan Changhong Jijia Fine Co., Ltd. Driving 7,000.00 7,000.00
ner
Changhong
Sichuan Changxin Refrigeration Parts Co., Processing
Air-conditio 300,000.00 300,000.00
Ltd. equipment of U
ner
Zhongshan Guangdong Changhong Electronics Co.,
Office building 996,579.63 1,968,611.69
Changhong Ltd.
Zhongshan Sichuan Changhong Minsheng Logistics Parts of the office
55,958.48 75,356.98
Changhong Co., LTD building rent-out
Zhongshan Sichuan Changhong Mold Plastic Tech.
2# living area 137,152.72 154,992.85
Changhong Co., Ltd.
Zhongshan
Shenzhen YijEn Technology Co., Ltd. 2# living area 25,428.15
Changhong
Zhongshan
Sichuan Changhong Device Tech. Co., Ltd. 2# living area 1,012.07 14,401.17
Changhong
Zhongshan Sichuan Changhong Precision Electronics
2# living area 24,780.88 7,652.88
Changhong Tech. Co., Ltd.
Zhongshan Changhong International Holdings (Hong
2# living area 13,902.33
Changhong Kong) Co., Ltd.
Zhongshan
Sichuan Hongwei Technology Co., Ltd. 2# living area 15,092.52
Changhong
Jiangxi Sichuan Changhong Mold Plastic Tech.
Workshop 680,062.00 444,472.38
Meiling Co., Ltd.
Mianyang Sichuan Changhong Mold Plastic Tech.
Warehouse 60,091.95 62,342.34
Refrigerator Co., Ltd.
Mianyang Sichuan Changhong Package Printing Co.,
Warehouse 540.56
Refrigerator Ltd.
Mianyang
Sichuan Changhe Technology Co., Ltd. Warehouse 162.16 243.24
Refrigerator
Sichuan Changhong Minsheng Logistics
Changhong Workshop 777,386.70
Co., LTD
Ridian
Changhong Sichuan Changhong Device Tech. Co., Ltd. Workshop 1,061,129.66 943,041.61
Ridian
Changhong Sichuan Hongwei Technology Co., Ltd. Workshop 35,218.29 35,218.29
Ridian
Changhong International Holdings (Hong
office 149,724.36 105,853.52
Changhong Kong) Co., Ltd.
342
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Leasing income Leasing income
Lessor Lessee Type of assets
in this year in last year
Ridian
Total 9,936,836.53 8,680,446.50
(2) Lessee of related parties
Leasing
Leasing expense
Lessor Lessee Type of assets expense last
in this year
year
Sichuan Changhong Electronics Holding Changhong
Staff dormitory 124,807.63
Group Co., Ltd. Air-conditioner
Sichuan Changhong Property Service Changhong Workshop,
2,055,453.33 1,968,811.61
Co., Ltd. Air-conditioner office
Changhong Workshop,
Sichuan Changhong Electric Co., Ltd. 9,194,056.12 8,814,057.30
Air-conditioner office
Hongmei Workshop,
Sichuan Changhong Electric Co., Ltd. 152,546.40 151,172.10
Intelligent office
Chengdu Changhong Electronic Hongmei
office 325,957.61 192,550.12
Technology Co., Ltd. Intelligent
Guangdong Changhong Electronics Co., Ground Energy
Staff dormitory 315,135.70 4,763.20
Ltd. Heat Pump
Guangdong Changhong Electronics Co., Ground Energy Workshop
303,721.21
Ltd. Heat Pump leasing
Mianyang Workshop
Sichuan Changhong Electric Co., Ltd. 2,953,516.48 3,522,008.93
Refrigerator leasing
Sichuan Changhong Electronics Holding Mianyang
Staff dormitory 55,877.94 40,476.00
Group Co., Ltd. Refrigerator
Sichuan Changhong Property Service Mianyang
Flower lease 8,624.14 2,561.11
Co., Ltd. Refrigerator
Electric
Sichuan Changhong Electric Co., Ltd. office 207,723.40
Marketing
Sichuan Changhong Property Service Changmei
office 13,207.55
Co., Ltd. Technology
Sichuan Changhong Property Service Changmei
Space rental 24,435.56
Co., Ltd. Technology
Chengdu Changhong Electronic Changmei
office 153,687.60 160,097.46
Technology Co., Ltd. Technology
Changmei
Sichuan Hongwei Technology Co., Ltd. Server leasing 136,667.56
Technology
Sichuan Changhong Electronics Holding Changmei
office 98,316.65
Group Co., Ltd. Technology
Guangdong Changhong Electronics Co., Changhong
Staff dormitory 434,916.54 426,053.39
Ltd. Ridian
Changhong
Sichuan Changhong Electric Co., Ltd. Staff dormitory 138,965.00 210,390.57
Ridian
Beijing Changhong Tech. Co. Ltd, Meiling Group office 364,688.55 364,688.55
Sichuan Changhong Electric Co., Ltd. Meiling Group office 933,023.62 841,571.05
Changhong Huayi Compressor Co., Ltd. Jiangxi Meiling Staff dormitory 33,809.52
Total 17,683,399.53 17,044,939.97
7. Related guarantee
343
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Maximum guarantee
Completed
Secured party Sponsored party amount (in 10 Start Date due
(Y/N)
thousand Yuan)
Changhong Changhong
4,500.00 2017.08.13 2018.08.13 Y
Meiling Ridian
Changhong Changhong
4,000.00 2017.09.01 2018.08.31 Y
Meiling Ridian
Changhong Changhong
2,000.00 2017.11.05 2018.11.05 Y
Meiling Ridian
Changhong
Zhongke Meiling 2,000.00 2017.02.16 2018.01.05 Y
Meiling
Changhong
Zhongke Meiling 1,000.00 2017.06.23 2018.06.22 Y
Meiling
Changhong
Zhongke Meiling 2,000.00 2018.01.30 2018.12.31 Y
Meiling
Changhong Zhongshan
6,000.00 2017.01.03 2018.01.03 Y
Meiling Changhong
Changhong Zhongshan
5,500.00 2017.01.22 2018.01.22 Y
Meiling Changhong
Changhong Zhongshan
20,000.00 2017.03.01 2018.03.31 Y
Meiling Changhong
Changhong Zhongshan
10,000.00 2017.03.29 2018.03.29 Y
Meiling Changhong
Changhong Zhongshan
5,000.00 2017.07.24 2018.07.24 Y
Meiling Changhong
Changhong Zhongshan
10,000.00 2017.11.06 2018.11.06 Y
Meiling Changhong
Changhong Changhong
4,500.00 2018.08.21 2019.08.21 N
Meiling Ridian
Changhong Changhong
4,000.00 2018.08.31 2019.03.30 N
Meiling Ridian
Changhong
Zhongke Meiling 2,000.00 2018.07.20 2019.05.25 N
Meiling
Changhong
Zhongke Meiling 1,000.00 2018.06.29 2019.06.29 N
Meiling
Changhong Zhongshan
10,000.00 2018.08.22 2019.08.21 N
Meiling Changhong
Changhong Zhongshan
10,000.00 2018.08.09 2019.08.09 N
Meiling Changhong
Changhong Zhongshan
10,000.00 2018.03.30 2019.03.30 N
Meiling Changhong
Changhong Zhongshan
5,500.00 2018.04.18 2019.04.19 N
Meiling Changhong
Changhong Zhongshan
5,000.00 2018.04.12 2019.04.11 N
Meiling Changhong
Changhong Zhongshan
6,000.00 2018.03.07 2019.03.07 N
Meiling Changhong
Changhong Zhongshan
5,000.00 2018.08.21 2019.08.20 N
Meiling Changhong
Changhong Zhongshan
5,000.00 2018.10.23 2019.10.23 N
Meiling Changhong
Counter
guarantee:
Changhong Changhong
4,500.00 2017.08.13 2018.08.13 Y
Ridian Meiling
344
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Maximum guarantee
Completed
Secured party Sponsored party amount (in 10 Start Date due
(Y/N)
thousand Yuan)
Changhong Changhong
4,000.00 2017.09.01 2018.08.31 Y
Ridian Meiling
Changhong Changhong
2,000.00 2017.11.05 2018.11.05 Y
Ridian Meiling
Changhong
Zhongke Meiling 2,000.00 2017.02.16 2018.01.05 Y
Meiling
Changhong
Zhongke Meiling 1,000.00 2017.06.23 2018.06.22 Y
Meiling
Changhong
Zhongke Meiling 2,000.00 2018.01.30 2018.12.31 Y
Meiling
Zhongshan Changhong
6,000.00 2017.01.03 2018.01.03 Y
Changhong Meiling
Zhongshan Changhong
5,500.00 2017.01.22 2018.01.22 Y
Changhong Meiling
Zhongshan Changhong
20,000.00 2017.03.01 2018.03.31 Y
Changhong Meiling
Zhongshan Changhong
10,000.00 2017.03.29 2018.03.29 Y
Changhong Meiling
Zhongshan Changhong
5,000.00 2017.07.24 2018.07.24 Y
Changhong Meiling
Zhongshan Changhong
10,000.00 2017.11.06 2018.11.06 Y
Changhong Meiling
Changhong Changhong
4,500.00 2018.08.21 2019.08.21 N
Ridian Meiling
Changhong Changhong
4,000.00 2018.08.31 2019.03.30 N
Ridian Meiling
Changhong
Zhongke Meiling 2,000.00 2018.07.20 2019.05.25 N
Meiling
Changhong
Zhongke Meiling 1,000.00 2018.06.29 2019.06.28 N
Meiling
Zhongshan Changhong
10,000.00 2018.08.22 2019.08.21 N
Changhong Meiling
Zhongshan Changhong
10,000.00 2018.08.09 2019.08.09 N
Changhong Meiling
Zhongshan Changhong
10,000.00 2018.03.30 2019.03.30 N
Changhong Meiling
Zhongshan Changhong
5,500.00 2018.04.18 2019.04.19 N
Changhong Meiling
Zhongshan Changhong
5,000.00 2018.04.12 2019.04.11 N
Changhong Meiling
Zhongshan Changhong
6,000.00 2018.03.07 2019.03.07 N
Changhong Meiling
Zhongshan Changhong
5,000.00 2018.08.21 2019.08.20 N
Changhong Meiling
Zhongshan Changhong
5,000.00 2018.10.23 2019.10.23 N
Changhong Meiling
8. Assets transfer, debt restructuring of related parties
Related party Type Current Year Last Year
Sichuan Changhong Intelligent Manufacturing Tech.
Purchasing fixed assets 32,909,220.60 26,591,007.01
Co., Ltd.
345
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Related party Type Current Year Last Year
Sichuan Hongcheng Construction Engineering Co.,
Purchasing fixed assets 450,450.45 4,261,765.77
Ltd.
Sichuan Hongcheng Real Estate Co., Ltd. Purchasing fixed assets 393,162.39 509,433.94
Sichuan Changhong Electric Co., Ltd. Purchasing fixed assets 538,473.18 154,743.58
Sichuan Hongxin Software Co., Ltd. Purchasing fixed assets 4,958,562.11 6,259,421.70
Purchasing intangible
Sichuan Hongxin Software Co., Ltd. 245,283.02 150,943.40
assets
Sichuan Changhong Jijia Fine Co., Ltd. Purchasing fixed assets 119,658.12
Sichuan Changhong Network Technology Co., Ltd. Purchasing fixed assets 310,745.57 221,657.02
Sichuan Changhong Electronic System Co., Ltd. Purchasing fixed assets 97,883.40
Sichuan Zhiyijia Network Technology Co., Ltd. Purchasing fixed assets 2,990.60
Sichuan Huanyu Industrial Co. Ltd. Purchasing fixed assets 5,648,270.69
Sichuan Changhong Electronics Holding Group Co.,
Purchasing fixed assets 3,876,784.91
Ltd.
Sichuan Changhong Electric Co., Ltd. Purchasing fixed assets 7,205,155.83
Sichuan Aichuang Technology Co., Ltd. Purchasing fixed assets 1,943,572.07
Mianyang Technology Town Big Data Technology
Purchasing fixed assets 260,084.81
Co., Ltd.
Sichuan Changhong Energy Sunshine Technology
Purchasing fixed assets 912,954.96
Co., Ltd.
Hongyuan Ground Energy Heat Tech. Co., Ltd. Purchasing fixed assets 1,330,818.96
Sichuan Changhong Gerun Environmental Protection
Sales of fixed assets 28,999.51 44,752.67
Tech. Co., Ltd.
Total 61,015,529.66 38,411,266.61
9.other
Current Year (in 10
Name of company Transaction content Last Year
thousand Yuan)
Yuanxin Financial Lease financial reconciliation
168.68
Co., Ltd. business
10. Related transaction with Changhong Finance Company
(1) Saving balance
Balance at Balance at Interest income from
Name of company
period-end period-begin bank saving
Mianyang Meiling Refrigeration Co., Ltd. 522.79 58,727.73 1,958.33
Sichuan Changhong Air-conditioner Co., Ltd. 824,399,079.98 931,489,096.17 36,103,835.98
Hongyuan Ground Energy Heat Pump Tech.
8,201.52 101,216.24 205,049.50
Co., Ltd.
Hongyuan Ground Energy Heat Pump Tech.
31,976,494.27 144,240.29
(Zhongshan) Co., Ltd.
Guangdong Changhong Ridian Technology
41,461,210.41 1,404,653.78 804,373.76
Co., Ltd.
Zhongshan Changhong Electric Co., LTD 5,578,868.71 13,293,776.63 252,284.58
Changhong Meiling Co., Ltd. 2,138,883,580.37 1,767,413,631.40 63,295,879.52
346
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Jiangxi Meiling Electric Appliance Co., Ltd. 946.27 7,488,946.73 31,630.59
Hefei Meiling Group Holdings Limited 795.30 555,029.59 795.30
Zhongke Meiling Cryogenic Technology Co.,
76,807,508.29 40,708,625.61 2,692,171.38
Ltd.
Total 3,119,117,207.91 2,762,513,703.88 103,532,219.23
(2) Notes discounted
Bank acceptance
Bank acceptance
Name of company book discounted Expenses of discounted
discounted amount
amount
Sichuan Changhong Air-conditioner Co., Ltd. 692,766,091.76 682,302,017.80 10,464,073.96
Hongyuan Ground Energy Heat Pump Tech.
8,151,906.51 7,964,210.65 187,695.86
(Zhongshan) Co., Ltd.
Guangdong Changhong Ridian Technology
1,001,205.88 1,001,205.88
Co., Ltd.
Changhong Meiling Co., Ltd. 610,747,607.84 607,865,861.99 2,881,745.85
Total 1,312,666,811.99 1,299,133,296.32 13,533,515.67
(3) Notes issued
Name of company Issuing unit Note amount Type
Mianyang Meiling Refrigeration Sichuan Changhong Group Finance
4,726,538.54 Bank acceptance
Co., Ltd. Co., Ltd.
Sichuan Changhong Sichuan Changhong Group Finance
1,023,954,131.74 Bank acceptance
Air-conditioner Co., Ltd. Co., Ltd.
Hongyuan Ground Energy Heat Sichuan Changhong Group Finance
31,966,421.78 Bank acceptance
Pump Tech. (Zhongshan) Co., Ltd. Co., Ltd.
Guangdong Changhong Ridian Sichuan Changhong Group Finance
88,923,019.14 Bank acceptance
Technology Co., Ltd. Co., Ltd.
Zhongshan Changhong Electric Sichuan Changhong Group Finance
162,543,629.60 Bank acceptance
Co., LTD Co., Ltd.
Sichuan Changhong Group Finance
Changhong Meiling Co., Ltd. 443,447,379.69 Bank acceptance
Co., Ltd.
Zhongke Meiling Cryogenic Sichuan Changhong Group Finance
34,827,161.56 Bank acceptance
Technology Co., Ltd. Co., Ltd.
Total 1,790,388,282.05
(4) Borrowing
Balance at Borrowed in the
Name of company Payment in the period Balance atperiod-end
period-begin period
Sichuan Changhong
15,600,000.00 15,600,000.00
Air-conditioner Co., Ltd.
Sichuan Changhong
62,000,000.00 62,000,000.00
Air-conditioner Co., Ltd.
Sichuan Changhong
11,000,000.00 11,000,000.00
Air-conditioner Co., Ltd.
Sichuan Changhong
11,500,000.00 11,500,000.00
Air-conditioner Co., Ltd.
Sichuan Changhong
6,900,000.00 6,900,000.00
Air-conditioner Co., Ltd.
347
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at Borrowed in the
Name of company Payment in the period Balance atperiod-end
period-begin period
Sichuan Changhong
6,400,000.00 6,400,000.00
Air-conditioner Co., Ltd.
Total 113,400,000.00 113,400,000.00
(Continued)
Loan interest Interest
Name of company Borrowing date Date due Repayment date
costs rate
Sichuan Changhong
2018-05-21 2019-05-21 2018-12-28 517,140.00 5.40%
Air-conditioner Co., Ltd.
Sichuan Changhong
2018-05-30 2019-05-30 2018-12-28 1,971,600.00 5.40%
Air-conditioner Co., Ltd.
Sichuan Changhong
2018-08-10 2019-08-09 2018-12-28 231,000.00 5.40%
Air-conditioner Co., Ltd.
Sichuan Changhong
2018-09-27 2019-09-27 2018-12-28 158,700.00 5.40%
Air-conditioner Co., Ltd.
Sichuan Changhong
2018-10-26 2019-10-26 2018-12-28 65,205.00 5.40%
Air-conditioner Co., Ltd.
Sichuan Changhong
2018-11-19 2019-11-19 2018-12-28 37,440.00 5.40%
Air-conditioner Co., Ltd.
Total 2,981,085.00
(5) Accounts receivable factoring: Nil
11. Remuneration for key management
Current Year (10 thousand Last Year(10 thousand
Item
Yuan) Yuan)
Total remuneration 358.72 1,352.60
Including: performance incentive fund 944.00
(iii) Come and go balance with related parties
1. Receivable account
Balance at year-end Balance at year-begin
Bad Bad
Item Related party debt debt
Book balance Book balance
provis prov
ion ision
Account
Sichuan Changhong Electric Co., Ltd. 2,943,118.96 1,814,632.38
receivable
Account Sichuan Changhong Electronics Holding Group
5,700.00
receivable Co., Ltd.
Account
Orion.PDP.Co.,ltd 22,430,223.12 10,083,028.46
receivable
Account
Sichuan Changhong Mold Plastic Tech. Co., Ltd. 997,299.16 168,406.71
receivable
Account
CHANGHONGELECTRIC(AUSTRALIA) 16,782,905.91 8,966,037.32
receivable
348
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at year-end Balance at year-begin
Bad Bad
Item Related party debt debt
Book balance Book balance
provis prov
ion ision
Account
Changhong Huayi Compressor Co., Ltd. 363,524.00 19,800.00
receivable
Account
Sichuan Changhong Jijia Fine Co., Ltd. 8,318.75 1,989,845.25
receivable
Account
Sichuan Hongcheng Real Estate Co., Ltd. 147,354.00
receivable
Account Sichuan Service Exp. Appliance Service Chain Co.,
225,967.73 51,528.01
receivable Ltd.
Account Sichuan Changhong Precision Electronics Tech.
36,056.54 14,951.00
receivable Co., Ltd.
Account
PT.CHANGHONGELECTRICINDONESIA 3,795,261.09 25,614.05
receivable
Account
CHANGHONG(HK)TRADINGLIMITED 29,884,304.94 92,041,204.28
receivable
Account
Sichuan Changhong International Hotel Co., Ltd. 2,850.00
receivable
Account Chengdu Changhong Electronic Technology Co.,
1,656.00 434,509.01
receivable Ltd.
Account
Lejiayi Chain Management Co., Ltd. 2,810,087.88 867,119.47
receivable
Account
Sichuan Zhiyijia Network Technology Co., Ltd. 505,717,212.18 292,557,278.83
receivable
Account
Sichuan Hongwei Technology Co., Ltd. 1,200.00
receivable
Account
Shenzhen YijEn Technology Co., Ltd. 14,274.78 1,777.90
receivable
Account
Anhui Xinhao Plasma Display Panel Co., Ltd. 63,000.00
receivable
Account
Sichuan Changhong Power Source Co., Ltd. 30,389.18
receivable
Account
Sichuan Changhong Property Co., Ltd. 112,151.48 48,664.00
receivable
Account Sichuan Changhong New Energy Technology Co.,
248,132.64 173,213.95
receivable Ltd.
Account Changhong International Holdings (Hong Kong)
21,772.79 111,146.18
receivable Co., Ltd.
Account
Sichuan Jiahong Industrial Co., Ltd. 3,700.00
receivable
Account
Sichuan Changhong Group Finance Co., Ltd. 9,270.00
receivable
Account
Hongyuan Ground Energy Heat Tech. Co., Ltd. 25,559,118.66 2,179,945.63
receivable
Account
ChanghongRubaElectricCompany(Private)Ltd. 75,910,256.75 34,423,460.27
receivable
Account
ChanghongEuropeElectrics.r.o 131,552.00
receivable
Account
Sichuan Changhong Minsheng Logistics Co., LTD 275,734.13
receivable
Account
CHANGHONGELECTRICMIDDLEEASTFZE 3,391,982.77
receivable
349
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at year-end Balance at year-begin
Bad Bad
Item Related party debt debt
Book balance Book balance
provis prov
ion ision
Account
Sichuan Aichuang Technology Co., Ltd. 964,432.39
receivable
Account
Guangdong Changhong Electronics Co., Ltd. 290,418.22
receivable
Account Sichuan Changhong Intelligent Manufacturing
547,276.70
receivable Tech. Co., Ltd.
Account paid Sichuan Changhong Electronics Holding Group
49,632.00 94,861.98
in advance Co., Ltd.
Account paid
Sichuan Changhong Electric Co., Ltd. 11,324,475.95
in advance
Account paid Sichuan Service Exp. Appliance Service Chain Co.,
101,945.29
in advance Ltd.
Account paid
Sichuan Hongwei Technology Co., Ltd. 113,168.00 363,948.00
in advance
Account paid
Sichuan Hongxin Software Co., Ltd. 45,000.00
in advance
Account paid
Guangdong Changhong Electronics Co., Ltd. 0.20 10,579.20
in advance
Account paid
Sichuan Zhiyijia Network Technology Co., Ltd. 3,071.23 12,721.94
in advance
Account paid Sichuan Changhong Intelligent Manufacturing
15,423,229.03 527,923.64
in advance Tech. Co., Ltd.
Account paid
081 Electronic Group 6.94
in advance
Account paid Sichuan Changhong Precision Electronics Tech.
7,797.42
in advance Co., Ltd.
Account paid
Chengdu Guigu Environmental Tech. Co., Ltd. 58,281.92
in advance
Other
Sichuan Service Exp. Appliance Service Chain Co.,
account 600,000.00 500,000.00
Ltd.
receivable
Other
account Sichuan Changhong Property Co., Ltd. 150,000.00 150,000.00
receivable
Other
account Sichuan Changhong Property Service Co., Ltd. 2,952.00 7,720.80
receivable
Other
Chengdu Changhong Electronic Technology Co.,
account 434,509.01
Ltd.
receivable
Other
account Sichuan Changhong International Hotel Co., Ltd. 27,589.45
receivable
Other
account Sichuan Huanyu Industrial Co. Ltd. 3,150.35
receivable
Other
account 081 Electronic Group 252,027.35
receivable
Total 721,916,980.42 448,046,276.73
350
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
2. Payable account
Balance at Balance at
Item Related party
year-end year-begin
Account
received in Sichuan Changhong Electric Co., Ltd. 234.16 234.16
advance
Account
received in Sichuan Changhong Electronics Holding Group Co., Ltd. 5,080.00 5,080.00
advance
Account
received in Lejiayi Chain Management Co., Ltd. 20,258.00 82,193.00
advance
Account
received in Sichuan Changhong Precision Electronics Tech. Co., Ltd. 0.01 0.01
advance
Account
received in Sichuan Changhong Mold Plastic Tech. Co., Ltd. 126,849.97
advance
Account
received in CHANGHONGELECTRICMIDDLEEASTFZE 1,636.49
advance
Account
received in 081 Electronic Group 25.55 3,050,425.55
advance
Account
received in Sichuan Service Exp. Appliance Service Chain Co., Ltd. 81,015.05 36,614.59
advance
Account
received in GuangYuan Changhong Electronic Technology Co., Ltd. 310,437.76 37,061.00
advance
Account
Sichuan Changhong Gerun Environmental Protection
received in 578,537.58 1,128,252.00
Tech. Co., Ltd.
advance
Account
received in Yibin Red-Star Electronics Co., Ltd. 582,000.00
advance
Account
received in Hefei Changhong Industrial Co., Ltd. 23,593.21 2,297.00
advance
Account
received in Sichuan Zhiyijia Network Technology Co., Ltd. 1,122.20 571,946.94
advance
Account
received in Sichuan Changhong Education Technology Co., Ltd. 211,325.00
advance
Account
received in CHANGHONG(HK)TRADINGLIMITED 994.96
advance
Account
received in ChanghongEuropeElectrics.r.o 4,367.63
advance
Account
received in Chengdu Guigu Environmental Tech. Co., Ltd. 87,460.00
advance
Account
received in Hongyuan Ground Energy Heat Tech. Co., Ltd. 426,247.52 1,960,358.42
advance
351
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at Balance at
Item Related party
year-end year-begin
Account
received in Sichuan Tianyou Guigu Technology Co., Ltd. 0.06 0.06
advance
Account pay
Sichuan Changhong Electric Co., Ltd. 14,019,713.93 57,983,674.93
able
Account pay
Sichuan Changhong Mold Plastic Tech. Co., Ltd. 27,891,091.24 177,772,335.72
able
Account pay
Changhong Huayi Compressor Co., Ltd. 105,062,188.37 104,051,402.67
able
Account pay
Sichuan Changhong Jijia Fine Co., Ltd. 17,324,860.79 105,724,786.63
able
Account pay
Sichuan Changhong Minsheng Logistics Co., LTD 46,671,482.99 32,100,658.75
able
Account pay
Sichuan Changhong Package Printing Co., Ltd. 9,305,115.20 34,588,936.01
able
Account pay
Sichuan Changhong Device Tech. Co., Ltd. 23,275.25 9,360,926.77
able
Account pay
Sichuan Changhong Precision Electronics Tech. Co., Ltd. 834,733.87 37,900,637.60
able
Account pay
081 Electronic Group 25,025.52 484,442.91
able
Account pay
Guangdong Changhong Electronics Co., Ltd. 2,220,471.94
able
Account pay
Sichuan Changhong Power Source Co., Ltd. 4,910.82
able
Account pay
Sichuan Hongyu Metal Manufacturing Co., Ltd. 14,662.40 893,867.03
able
Account pay
Sichuan Service Exp. Appliance Service Chain Co., Ltd. 177,728.16 5,547,924.93
able
Account pay
Sichuan Hongwei Technology Co., Ltd. 1,658,396.58
able
Account pay
Sichuan Hongxin Software Co., Ltd. 21,226.42 564,650.00
able
Account pay Sichuan Changhong Gerun Environmental Protection
10,503.63
able Tech. Co., Ltd.
Account pay
Sichuan Changhong International Hotel Co., Ltd. 121,538.10 42,802.10
able
Account pay
Sichuan Changhong Xinrui Tech. Co. Ltd. 106,912.99
able
Account pay Sichuan Changhong Intelligent Manufacturing Tech. Co.,
11,377,605.65 10,039,595.23
able Ltd.
Account pay
Sichuan Jiahong Industrial Co., Ltd. 21,109.00 28,314.00
able
Account pay
Sichuan Changhong Network Technology Co., Ltd. 13,456.92 227.83
able
Account pay
Sichuan Changhong Property Service Co., Ltd. 4,121.00
able
Account pay
CHANGHONG(HK)TRADINGLIMITED 1,998,987.22 2,401,351.66
able
Account pay
Sichuan Ailian Science & Technology Co., Ltd. 1,701,913.57 1,816,576.71
able
Account pay
Sichuan Family Help Electric Service Co., Ltd. 2,325.00
able
352
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at Balance at
Item Related party
year-end year-begin
Account pay
Sichuan Changxin Refrigeration Parts Co., Ltd. 883,369.88 23,428,798.70
able
Account pay
Mianyang Highly Electric Co., Ltd. 12,868,088.45 33,261,889.61
able
Account pay
ChanghongRubaElectricCompany(Private)Ltd. 29,257,116.05 69,845,918.08
able
Account pay
Sichuan Changhe Technology Co., Ltd. 2,242,158.00
able
Account pay
Chengdu Guigu Environmental Tech. Co., Ltd. 409,067.47
able
Account pay
Sichuan Changhong Electronics Holding Group Co., Ltd. 796,408.02
able
Account pay Sichuan Changhong Energy Sunshine Technology Co.,
52,951.39
able Ltd.
Account pay
Sichuan Changhong Electronic Products Co., Ltd. 2,054,864.41
able
Account pay
Sichuan Zhiyijia Network Technology Co., Ltd. 6,274.34
able
Account pay
Sichuan Aichuang Technology Co., Ltd. 9,023,993.17
able
Account pay
Hunan Grand-Pro Intelligent Tech. Company 287,486.83
able
Account pay
Sichuan Huanyu Industrial Co. Ltd. 3,000,000.00
able
Account pay Mianyang Technology Town Big Data Technology Co.,
1,430.47
able Ltd.
Other account
Sichuan Changhong Electric Co., Ltd. 1,514,578.28 3,971,074.18
payable
Other account
Sichuan Changhong Mold Plastic Tech. Co., Ltd. 1,648,151.88 1,742,341.02
payable
Other account
Sichuan Changhong Jijia Fine Co., Ltd. 400,500.00 400,500.00
payable
Other account Sichuan Changhong Gerun Environmental Protection
10,000.00 10,000.00
payable Tech. Co., Ltd.
Other account
Changhong Huayi Compressor Co., Ltd. 1,050,000.00 1,598,900.00
payable
Other account
Sichuan Changhong Package Printing Co., Ltd. 50,000.00 50,000.00
payable
Other account
Sichuan Changhong Precision Electronics Tech. Co., Ltd. 200,000.00 145.16
payable
Other account
Sichuan Changhong Minsheng Logistics Co., LTD 500,500.00 586,504.95
payable
Other account
CHANGHONG(HK)TRADINGLIMITED 76,036.96 65,200.87
payable
Other account
Sichuan Changhong Device Tech. Co., Ltd. 50,013.43
payable
Other account
Sichuan Changhong Xinrui Tech. Co. Ltd. 200,000.00
payable
Other account
081 Electronic Group 169.00
payable
Other account
Sichuan Jiahong Industrial Co., Ltd. 22,218.04
payable
Other account Guangdong Changhong Electronics Co., Ltd. 18,442.44
353
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at Balance at
Item Related party
year-end year-begin
payable
Other account Sichuan Changhong Intelligent Manufacturing Tech. Co.,
343,586.81 272,961.00
payable Ltd.
Other account
Mianyang Highly Electric Co., Ltd. 109,709.75
payable
Other account
Sichuan Changhe Technology Co., Ltd. 100,000.00
payable
Other account
Sichuan Changxin Refrigeration Parts Co., Ltd. 50,000.00 50,000.00
payable
Other account
Sichuan Changhong Electronics Holding Group Co., Ltd. 1,090.65
payable
Other account
Hunan Grand-Pro Intelligent Tech. Company 200,000.00
payable
Other account
Yuanxin Financial Lease Co., Ltd. 1,686,849.14
payable
Other account Mianyang Technology Town Big Data Technology Co.,
100,000.00
payable Ltd.
Other account
Sichuan Yunyou Internet Tech. Co., Ltd. 139,862.42
payable
Total 304,283,528.67 731,607,738.10
(iv) Commitments from related parties: Nil
XII. Share-based payment: Nil
XIII. Contingency
1. Pending action or possible liabilities formed from arbitration: Nil
2. Contingency from external guarantee: Nil
3. Other contingency: Nil
XIV. Commitments: Nil
XV. Events occurring after the balance sheet date
1. Important non-adjustment items: Nil
2. Profit distribution:
For year of 2018, the individual statement of the parent company show net profit of 96,445,731.69 Yuan,
according to the auditing from ShinWing CPA (LLP). In accordance with relevant regulations, the retained
profit at beginning of the year amounted as 893,442,648.28 Yuan, deducted the 2017 profit distributed
62,675,872.86 Yuan and after extract for statutory surplus reserve 9,644,573.17 Yuan, the retained profit in
individual statement of the parent company cumulative counted as 917,567,933.94 Yuan at end of 2018. In
addition, for year of 2018, the net profit attributable to owners of parent company amounted as
38,658,256.97 Yuan, the retained profit for end of the 2018 counted as 904,232,582.87 Yuan.
Pursuit to relevant rules and regulation of Article of Association, and considering the interest of
shareholders and long-term development needs of the Company, Board of Directors agrees that, based on
total share capital 1,044,597,881 of the Company dated 31 December 2018, distributed 0.6 Yuan (tax
included) in cash for every 10 shares held by shareholders, totally 62,675,872.86 Yuan distributed in
354
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
total(tax included). Total share capital of the Company has no changes after distribution, the retained profit
of the parent company amounted as 854,892,061.08Yuan, rests of the retained profit will carry-over for
distribute in later years.
The aforesaid pre-plan has been deliberated and approved by the 20th session of 9th BOD, and ready for
approval from the shareholders general meeting.
3. Maj or sales return: Nil
4. Other than the above mentioned events, the Company have no other events occurred after balance
sheet date.
XVI. Other significant matters
1. Correction of previ ous periods and influence: Nil
2. Debt restructuring: Nil
3. Assets replacement: Nil
4. Pension plan: Nil
5. Discontinuing operation: Nil
6. Branch infor mation
In 10 thousand Yuan
Refrigerator,
Small home
freezer Air-conditi Marketing Other Salesin branch
Item Total
Washing oner appliances
machine
Operation income 953,734.56 723,361.74 89,974.38 52,599.21 28,262.18 98,914.57 1,749,017.50
Including: foreign
873,627.94 723,097.62 89,974.29 52,415.94 9,901.71 1,749,017.50
trade income
Income from
transactions between 80,106.62 264.12 0.09 183.27 18,360.47 98,914.57
divisions
Operation income 951,642.66 724,565.89 82,976.84 51,453.30 26,995.74 94,998.81 1,742,635.62
Operation profit 2,091.90 -1,204.15 6,997.54 1,145.91 1,266.44 3,915.76 6,381.88
Total assets 1,251,593.13 434,796.65 6,944.22 36,723.20 15,839.24 189,715.41 1,556,181.03
Total liability 748,863.07 295,781.44 21,302.66 23,121.99 7,683.94 54,127.09 1,042,626.01
Supplementary
information
Depreciation and
15,515.58 7,011.51 14.09 452.04 459.15 -364.99 23,817.36
amortization expenses
Capital expenditure 9,115.98 35,812.07 7.34 219.22 982.62 46,137.23
Non-cash expenses
except for
114,890.89 87,265.51 2,211.35 3,497.89 4,012.95 -738.30 212,616.89
depreciation and
amortization
7. Other major transactions and events shows impact on investor’s decision-making: Nil
355
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
XVII. Notes to main items of financial statement of parent company
1. Note receivable and account receivable
Item Balance at year-end Balance at year-begin
Note receivable 2,183,243,800.03 1,748,615,925.92
Account receivable 1,050,282,023.37 1,372,870,968.26
Total 3,233,525,823.40 3,121,486,894.18
1.1Note receivable
(1) Category of note receivable
Item Balance at year-end Balance at year-begin
Bank acceptance 2,003,243,800.03 1,572,527,077.43
Trade acceptance 430,000,146.61 176,088,848.49
Total 2,433,243,946.64 1,748,615,925.92
(2) Note receivable pledge at year-end
Item Amount pledge at year-end
Bank acceptance 648,113,616.79
Note: with purpose of improving the note utilization, the Company draw up bank acceptance by pledge
parts of the outstanding notes receivable to the bank
(3) Note receivable which has endorsed or discounted at year-end but hasn’t expired yet on balance
sheet date
Amount derecognition at Amount without
Item
year-end derecognition at year-end
Bank acceptance 482,315,162.49
Trade acceptance 250,000,146.61
Total 482,315,162.49 250,000,146.61
(4) No notes transfer to account receivable due to the failure performance by drawer at year-end
1.2Account receivable
(1)Category of account receivable
Ending amount
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Account receivable with single
significant amount and withdrawal
356
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Ending amount
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
single item bad debt provision
Account receivable withdrawal bad
debt provision by combination
Combination 1 65,143,837.99 6.16% 3,586,078.09 5.50% 61,557,759.90
Combination 2 985,798,275.42 93.27% 985,798,275.42
Combination Subtotal 1,050,942,113.41 99.43% 3,586,078.09 0.34% 1,047,356,035.32
Account receivable with single minor
amount but withdrawal single item bad 5,980,586.84 0.57% 3,054,598.79 51.08% 2,925,988.05
debt provision
Total 1,056,922,700.25 100.00% 6,640,676.88 0.63% 1,050,282,023.37
(Continued)
Opening amount
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Account receivable with single
significant amount and withdrawal single
item bad debt provision
Account receivable withdrawal bad debt
provision by combination
Combination 1 60,561,254.24 4.40% 3,219,635.79 5.32% 57,341,618.45
Combination 2 1,311,301,579.72 95.23% 0.00% 1,311,301,579.72
Combination Subtotal 1,371,862,833.96 99.63% 3,219,635.79 0.23% 1,368,643,198.17
Account receivable with single minor
amount but withdrawal single item bad 5,118,727.55 0.37% 890,957.46 17.41% 4,227,770.09
debt provision
Total 1,376,981,561.51 100.00% 4,110,593.25 0.30% 1,372,870,968.26
1) No account receivable with single significant amount and withdrawal bad debt provision single at
year-end.
2) Account receivable with bad debt provision accrual by aging account in combination 1
Balance at year-end
Account age
Account receivable Bad debt provision Provision ratio (%)
Within one year 64,517,786.22 3,225,889.31 5%
1-2 years 215,517.04 32,327.56 15%
2-3 years 34,041.49 11,914.52 35%
3-4 years 62,665.03 34,465.77 55%
4-5 years 215,648.53 183,301.25 85%
Over 5 years 98,179.68 98,179.68 100%
Total 65,143,837.99 3,586,078.09
357
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
3)Account receivable without bad debt provision withdrawal in combination 2
Combination Book balance
Connected amount between related parties 798,250,556.57
Account receivable with L/C 45,978,287.55
Account receivable already insured 141,569,431.30
Total 985,798,275.42
4) As for the receivable with single minor amount at period-end, and withdrawal bad debt provision
independently, they includes the account receivables with single minor amount, and after accrual bad
debts by combination, the amount did not reflects the risks characteristics, there are 6 clients included
(2)Bad debt provision of account receivable
Bad debt provision of 2,543,193.93 Yuan accrual in the year; bad debt provision has 13,110.30 Yuan
collected and no collection for accounts charge off previous year
(3)No account receivable actually written-off in the year。
(4) No arrears of the shareholders holding more than 5% (including 5%) shares with voting rights of the
Company at period-end.
(5) The top five account receivable at year-end has RMB 715,924,840.12 in total, a 67.74% in total
account receivable, bad debt provision accrual at year-end amounted as RMB 275,069.43
(6) Account receivable de-recognized: Nil
2. Other account receivable
Item Balance at year-end Balance at year-begin
Interest receivable 2,653,712.36
Other account receivable 180,090,321.16 39,849,732.36
Total 182,744,033.52 39,849,732.36
2.1 Interest receivable
(1)Category of interest receivable
Item Balance at year-end Balance at year-begin
Interest receivable of time deposit 1,892,948.46
Interest receivable of financing products 760,763.90
Total 2,653,712.36
(2)Major overdue interest: nil
358
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
2.2 Other account receivable
(1)Category of other account receivable
Ending amount
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Other account receivable with single
significant amount and withdrawal single
item bad debt provision
Other account receivable withdrawal bad
debt provision by combination
Combination 1 716,362.08 0.40% 131,318.10 18.33% 585,043.98
Combination 2 179,505,277.18 99.60% 179,505,277.18
Combination Subtotal 180,221,639.26 100.00% 131,318.10 0.07% 180,090,321.16
Other account receivable with single
minor amount but withdrawal single item
bad debt provision
Total 180,221,639.26 100.00% 131,318.10 0.07% 180,090,321.16
(Continued)
Opening amount
Category Book balance Bad debt provision
Book value
Amount Ratio Amount Ratio
Other account receivable with single
significant amount and withdrawal single
item bad debt provision
Other account receivable withdrawal bad
debt provision by combination
Combination 1 1,384,957.79 3.45% 261,120.97 18.85% 1,123,836.82
Combination 2 38,725,895.54 96.55% 38,725,895.54
Combination Subtotal 40,110,853.33 100.00% 261,120.97 0.65% 39,849,732.36
Other account receivable with single minor
amount but withdrawal single item bad debt
provision
Total 40,110,853.33 100.00% 261,120.97 0.65% 39,849,732.36
1) No other account receivable with single significant amount and no withdrawal bad debt provision single at
year-end
2) Other account receivable with withdrawal bad debt provision by aging account for combination 1
Balance at year-end
Account age
Other account receivable Bad debt provision Provision ratio (%)
Within one year 246,362.08 12,318.10 5%
1-2 years 260,000.00 39,000.00 15%
2-3 years 200,000.00 70,000.00 35%
3-4 years 55%
4-5 years 85%
359
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at year-end
Account age
Other account receivable Bad debt provision Provision ratio (%)
Over 5 years 10,000.00 10,000.00 100%
Total 716,362.08 131,318.10
3) Other receivable without bad debt provision withdrawal in combination 2
Combination Book balance
Connected amount between related parties 161,430,695.50
Loans of employee’s pretty cash 5,779,671.00
Export rebate and other refundable tax 12,294,910.68
Total 179,505,277.18
4)No other account receivable with single minor amount but withdrawal bad debt provision singly,
refers to the minor single receivables at year-end。
(2) Bad debt provision of other receivable
Reversal of bad debt provision amounted as 129,802.87 Yuan in the year and no bad debts collected in
the year
(3)Other account receivable charge off in this period: nil
(4)No areas from shareholders’ unit with over 5 percent (5 percent included) voting rights held at
year-end。
(5) Top 5 other account receivable has RMB 174,073,435.18 in total, a 96.59% in total account
receivable at year-end, bad debts accrual correspondingly at end of the year was RMB 0.00
(6) Other receivables classify by nature
Nature Ending book balance Opening book balance
Related party 161,430,695.50 7,896,779.76
Loans of employee’s pretty cash 5,779,671.00 4,507,472.94
Cash deposit 610,000.00 640,306.68
Other 106,362.08 744,651.11
Export rebate and other refundable tax 12,294,910.68 26,321,642.84
Total 180,221,639.26 40,110,853.33
(7) Other receivable de-recognized: Nil
360
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
3. Long-term equity investments
(1) Classification of long-term equity investments
Balance at year-end Balance at year-begin
Item
Book balance Impairment loss Book value Book balance Impairment loss Book value
Investment in subsidiaries
ZhongkeMeilingCryogenicTechnologyCo., Ltd. 42,652,000.00 42,652,000.00 42,652,000.00 42,652,000.00
Mianyang Meiling Refrigeration Co., Ltd. 95,000,000.00 95,000,000.00 95,000,000.00 95,000,000.00
Hefei Meiling Electric Marketing Co.,
54,900,000.00 54,900,000.00 54,900,000.00 54,900,000.00
Ltd.
Zhongshan Changhong Electric Co., LTD 169,856,419.37 169,856,419.37 169,856,419.37 169,856,419.37
Sichuan Changhong Air-conditioner Co.,
955,600,437.79 955,600,437.79 955,600,437.79 955,600,437.79
Ltd.
Hefei Meiling Group Holdings Limited 113,630,000.00 113,630,000.00 113,630,000.00 113,630,000.00
Jiangxi Meiling Electric Appliance Co.,
79,000,000.00 79,000,000.00 79,000,000.00 79,000,000.00
Ltd.
Guangdong Changhong Ridian
90,802,061.95 90,802,061.95 90,802,061.95 90,802,061.95
Technology Co., Ltd.
Changmei Technology Co., Ltd. 48,128,000.00 48,128,000.00 32,424,000.00 32,424,000.00
Meiling CANDY Washing Machine Co.,
60,000,000.00 60,000,000.00 45,000,000.00 45,000,000.00
Ltd.
Investment in associates
Hefei Xingmei Assets Management Co.,
9,420,099.27 9,420,099.27 10,696,982.04 10,696,982.04
Ltd.
Sichuan Zhiyijia Network Technology
12,120,885.32 12,120,885.32 15,445,914.69 15,445,914.69
Co., Ltd.
Total 1,731,109,903.70 1,731,109,903.70 1,705,007,815.84 1,705,007,815.84
(2) Investment in subsidiaries
361
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Balance at Decreased in the Provision forimpairment Ending balance of
Invested enterprise Increased in the Year Balance at year-end
year-begin Year losses impairment
Zhongke Meiling Cryogenic Technology
42,652,000.00 42,652,000.00
Co., Ltd.
Mianyang Meiling Refrigeration Co., Ltd. 95,000,000.00 95,000,000.00
Hefei Meiling Electric Marketing Co.,
54,900,000.00 54,900,000.00
Ltd.
Zhongshan Changhong Electric Co., LTD 169,856,419.37 169,856,419.37
Sichuan Changhong Air-conditioner Co.,
955,600,437.79 955,600,437.79
Ltd.
Hefei Meiling Group Holdings Limited 113,630,000.00 113,630,000.00
Jiangxi Meiling Electric Appliance Co.,
79,000,000.00 79,000,000.00
Ltd.
Guangdong Changhong Ridian
90,802,061.95 90,802,061.95
Technology Co., Ltd.
Changmei Technology Co., Ltd. 32,424,000.00 15,704,000.00 48,128,000.00
Meiling CANDY Washing Machine Co.,
45,000,000.00 15,000,000.00 60,000,000.00
Ltd.
Total 1,678,864,919.11 30,704,000.00 1,709,568,919.11
(3) Investment in associates
Changes intheyear
Adjustment Ending
Balance at Investment income Other Cash dividend or Balance at
Invested enterprise Additional Negative for other Provision for balance of
year-begin recognizedunder equity profitannounced Other year-end
Investment Investment comprehensiv impairment loss impairment
equity change to issued
e income
Hefei Xingmei Assets Management Co.,
10,696,982.04 -1,276,882.77 9,420,099.27
Ltd.
Sichuan Zhiyijia Network Technology Co.,
15,445,914.69 -3,325,029.37 12,120,885.32
Ltd.
Total 26,142,896.73 -4,601,912.14 21,540,984.59
362
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
4. Operation income and operation cost
Current Year Last Year
Item
Income Cost Income Cost
Main business 7,634,344,339.63 6,551,561,605.76 7,279,491,408.48 6,427,777,165.64
Other business 1,892,851,622.99 1,852,134,266.74 1,238,178,104.98 1,210,971,868.04
Total 9,527,195,962.62 8,403,695,872.50 8,517,669,513.46 7,638,749,033.68
(1) Classified according to product
Current Year Last Year
Product
Operation income Operation cost Operation income Operation cost
Main Business 7,634,344,339.63 6,551,561,605.76 7,279,491,408.48 6,427,777,165.64
Refrigerator,
7,303,827,940.51 6,259,064,481.80 6,899,366,427.27 6,101,569,927.76
freezer
Washing
53,438,809.25 47,794,996.27 190,179,642.05 163,208,239.33
machine
Small household
appliances and
276,833,964.23 244,634,846.30 189,674,315.89 162,885,099.06
kitchen and
bathroom
Other 243,625.64 67,281.39 271,023.27 113,899.49
Other business 1,892,851,622.99 1,852,134,266.74 1,238,178,104.98 1,210,971,868.04
Sales of raw
1,850,282,886.72 1,836,432,815.71 1,221,126,139.76 1,208,004,434.83
material
Other income 42,568,736.27 15,701,451.03 17,051,965.22 2,967,433.21
Total 9,527,195,962.62 8,403,695,872.50 8,517,669,513.46 7,638,749,033.68
(2) Classified according to region
Current Year Last Year
Regions
Operation income Operation cost Operation income Operation cost
Domestic 7,415,870,086.00 6,598,484,227.76 6,406,577,042.20 5,643,877,798.01
Overseas 2,111,325,876.62 1,805,211,644.74 2,111,092,471.26 1,994,871,235.67
Total 9,527,195,962.62 8,403,695,872.50 8,517,669,513.46 7,638,749,033.68
Top five clients in sales revenue amounted as RMB5,690,602,086.10 yuan, a 59.73% in total
operation income.
5. Investment income
Item Current Year Last Year
Long-term equity investment income by equity method -4,601,912.14 2,649,526.63
Investment income arising from disposal of the long-term equity
2,506.98
investment
Investment income from disposal of financial assets, which is
measured by fair value and with its variation reckoned into current -26,793,572.57 -20,754,720.43
gains/losses
363
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Last Year
Investment income during holding the financial assets available for
73,719,846.12 77,684,013.71
sale
Long-term equity investment income by cost method 2,754,000.00
Total 45,078,361.41 59,581,326.89
XVIII. Approval of financial statement
The financial statement has already been approved from the board of directors of the Company for
reporting dated 27 March 2019.
364
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Supplementary information for financial statement
1. Non-recurring gains and losses for this year
(1) Non-recurring gains and losses regulated by Explanation Announcement of Information Disclosure on
Stock Issuance Enterprise No.1—Non-recurring gains/losses (2008) from CSRC:
Item Current Year Note
Gains and losses from disposal of non-current assets 787,721.32
Tax refund or mitigate due to examination-and-approval beyond power or without official
approval document or accident
Government subsidy recorded in current gains and losses 90,401,997.63
Capital occupancy expense, collected from non-financial enterprises and recorded in
current gains and losses
Income from the exceeding part between investment cost of the Company paid for
obtaining subsidiaries, associates and joint-ventures and recognizable net assets fair value
attributable to the Company when acquiring the investment
Gains and losses from exchange of non-monetary assets
Gains and losses from assets under trusted investment or management
Various provision for impairment of assets withdrew due to act of God, such as natural
disaster
Gains and losses from debt restructuring
Enterprise reorganization expense
Gains and losses of the part arising from transaction in which price is not fair and
exceeding fair value
Current net gains and losses occurred from period-begin to combination day by
subsidiaries resulting from business combination under common control
Gains and losses arising from contingent proceedings irrelevant to normal operation of the
-13,050,649.33
Company
Except for effective hedge business relevant to normal operation of the Company, gains
and losses arising from fair value change of tradable financial assets and tradable financial
-18,928,688.87
liabilities, and investment income from disposal of tradable financial assets, tradable
financial liabilities and financial assets available for sale
Switch-back of provision of impairment of account receivable which are treated with
2,543,553.45
separate depreciation test
Gains and losses obtained from external trusted loans
Gains and losses arising from change of fair value of investment real estate whose
follow-up measurement are conducted according to fair value pattern
Affect on current gains and losses after an one-time adjustment according to requirements
365
Annotations to Financial Statements of Changhong Meiling Co., Ltd.
From 1 January 2018 to 31 December 2018
(Unless otherwise specified. RMB for record in the statement)
Item Current Year Note
of laws and regulations regarding to taxation and accounting
Trust fee obtained from trust operation
Other non-operating income and expenditure except for the aforementioned ones -2,614,761.68
Other gains and losses items complying with definition for non-recurring gains and losses
Subtotal 59,139,172.52
Impact on income tax 16,236,806.66
Impact on minority equity(after taxation) 1,101,317.88
Total 41,801,047.98
2. Return on equity and earnings per share
In accordance with requirement of the No. 9 Rule of Information Disclosure Compiling of Public Listed
Companies: Calculation and Disclosure of Return on Equity and Earnings per Share (revised in 2010), the
weighted average return on equity, basic earnings per share and diluted earnings per share of the Company in
2018 are as follow:
Weighted Earnings per share/EPS
Profit during the report period average return (RMB/Share)
on equity Basic EPS Diluted EPS
Net profit attributable to shareholders of parent company 0.77% 0.0370 0.0370
Net profit attributable to shareholders of parent company
-0.06% -0.0030 -0.0030
after deduction of non-recurring gains and losses
3. Accounting difference under the accounting rules in and out of China: Nil
4. Supplementary information for accounting policy changed: Nil
366
CHANGHONG MEILING CO.,LTD. Annual Report 2018
Section XII. Documents available for Reference
I. Financial statement carrying the signatures and seals of the Chairman, principal of the accounting works and
person in charge of accounting organ;
II. Original auditing report carrying the seal of CPA and autography and seal of the accountants;
III. Original documents of the Company and manuscripts of public notices that disclosed in the website designated
by CSRC in the report period;
The aforesaid documents are all available at headquarter of the Company. The Company would provide them
timely when CSRC and Shenzhen Stock Exchange require or the shareholders need consultation according to the
regulations and Articles of Association.
Chairman: Li Wei
Changhong Meiling Co., Ltd.
29 March 2019
367
