Konka Group Co., Ltd. Interim Report 2023
KONKA GROUP CO., LTD.
INTERIM REPORT 2023
2023-54
August 2023
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Konka Group Co., Ltd. Interim Report 2023
Part I Important Notes, Table of Contents and Definitions
The Board of Directors (or the “Board”), the Supervisory Committee as well as the directors,
supervisors and senior management of Konka Group Co., Ltd. (hereinafter referred to as the
“Company”) hereby guarantee the factuality, accuracy and completeness of the contents of
this Report and its summary, and shall be jointly and severally liable for any
misrepresentations, misleading statements or material omissions therein.
Zhou Bin, the Company’s legal representative, Li Chunlei, the Company’s Chief Financial
Officer (CFO), and Ping Heng, the head of the Company’s financial department (equivalent to
financial manager) hereby guarantee that the Financial Statements carried in this Report are
factual, accurate and complete.
All the Company’s directors have attended the Board meeting for the review of this Report
and its summary.
Any plans for the future or other forward-looking statements mentioned in this Report and its
summary shall NOT be considered as absolute promises of the Company to investors.
Therefore, investors are reminded to exercise caution when making investment decisions.
The Company has no interim dividend plan, either in the form of cash or stock.
This Report and its summary have been prepared in both Chinese and English. Should there
be any discrepancies or misunderstandings between the two versions, the Chinese versions
shall prevail.
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Konka Group Co., Ltd. Interim Report 2023
Table of Contents
Part I Important Notes, Table of Contents and Definitions........................................................... 2
Part II Corporate Information and Key Financial Information................................................. 10
Part III Management Discussion and Analysis..............................................................................14
Part IV Corporate Governance.......................................................................................................28
Part V Environmental and Social Responsibility.......................................................................... 29
Part VI Significant Events............................................................................................................... 41
Part VII Share Changes and Shareholder Information................................................................61
Part VIII Preferred Shares.............................................................................................................. 65
Part IX Corporate Bonds.................................................................................................................66
Part X Financial Statements............................................................................................................69
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Konka Group Co., Ltd. Interim Report 2023
Documents Available for Reference
1. The financial statements with the signatures and seals of the Company’s legal representative,
Chief Financial Officer and head of the financial department;
2. The originals of all the Company’s documents and announcements disclosed to the public in the
Reporting Period; and
3. The documents above are available at the Secretariat of the Board.
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Konka Group Co., Ltd. Interim Report 2023
Definitions
Term Definition
The “Company”, the “Group”, Konka Group Co., Ltd. and its consolidated subsidiaries, except where the context otherwise
“Konka Group” or “we” requires
Electronics Technology Shenzhen Konka Electronics Technology Co., Ltd.
Anhui Zhilian Anhui Konka Zhilian E-Commerce Co., Ltd.
Haimen Konka Nantong Haimen Konka Smart Technology Co., Ltd.
Chengdu Konka Smart Chengdu Konka Smart Technology Co., Ltd.
Chengdu Konka Electronic Chengdu Konka Electronic Co., Ltd.
Nantong Hongdin Nantong Hongdin Smart Technology Co., Ltd.
Shenzhen Kangcheng Shenzhen Kangcheng Technology Innovation and Development Co., Ltd.
Xiaojia Technology Xiaojia Technology Co., Ltd.
Liaoyang Kangshun Smart Liaoyang Kangshun Smart Technology Co., Ltd.
Liaoyang Kangshun Renewable Liaoyang Kangshun Renewable Resources Co., Ltd.
Nanjing Konka Nanjing Konka Electronics Co., Ltd.
Chuzhou Konka Chuzhou Konka Precision Intelligent Manufacturing Technology Co., Ltd.
XingDa HongYe GuangDong XingDa HongYe Electronic Co., Ltd.
Konka Circuit Shenzhen Konka Circuit Co., Ltd.
Konka Flexible Electronic Suining Konka Flexible Electronic Technology Co., Ltd.
Konka Hongye Electronics Suining Konka Hongye Electronics Co., Ltd.
Boluo Precision Boluo Konka Precision Technology Co., Ltd.
Boluo Konka Boluo Konka PCB Co., Ltd.
Anhui Tongchuang Anhui Konka Tongchuang Electrical Appliances Co., Ltd.
Jiangsu Konka Smart Jiangsu Konka Smart Electrical Appliances Co., Ltd.
Anhui Electrical Appliance Anhui Konka Electrical Appliance Technology Co., Ltd.
Frestec Refrigeration Henan Frestec Refrigeration Appliance Co., Ltd.
Frestec Electrical Appliances Henan Frestec Electrical Appliances Co., Ltd.
Frestec Household Appliances Henan Frestec Household Appliances Co., Ltd.
Frestec Smart Home Henan Frestec Smart Home Technology Co., Ltd.
Konka Investment Shenzhen Konka Investment Holdings Co., Ltd.
Yibin Konka Technology Park Yibin Konka Technology Park Operation Co., Ltd.
Konka Capital Shenzhen Konka Capital Equity Investment Management Co., Ltd.
Konka Suiyong Konka Suiyong Investment (Shenzhen) Co., Ltd.
Shengxing Industrial Shenzhen Konka Shengxing Industrial Co., Ltd.
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Konka Group Co., Ltd. Interim Report 2023
Zhitong Technology Shenzhen Konka Zhitong Technology Co., Ltd.
Konka Factoring Konka Factoring (Shenzhen) Co., Ltd.
Beijing Konka Electronic Beijing Konka Electronic Co., Ltd.
Tianjin Konka Tianjin Konka Technology Co., Ltd.
Suining Konka Industrial Park Suining Konka Industrial Park Development Co., Ltd.
Suining Electronic Technological
Suining Konka Electronic Technological Innovation Co., Ltd.
Innovation
Shanghai Konka Shanghai Konka Industrial Co., Ltd.
Yantai Kangjin Yantai Kangjin Technology Development Co., Ltd.
Mobile Interconnection Shenzhen Konka Mobile Interconnection Technology Co., Ltd.
Sichuan Konka Sichuan Konka Smart Terminal Technology Co., Ltd
Yibin Smart Yibin Konka Smart Technology Co., Ltd.
Shenzhen KONSEMI Shenzhen KONSEMI Co., Ltd.
Chongqing Konka Chongqing Konka Technology Development Co., Ltd.
Kowin Memory (Shenzhen) Kowin Memory Technology (Shenzhen) Co., Limited
Kowin Memory (Hong Kong) Kowin Memory Technology (Hong Kong) Co., Limited
Konka Xinyun Semiconductor Konka Xinyun Semiconductor Technology (Yancheng) Co., Ltd.
Industrial and Trade Technology Konka Industrial and Trade Technology (Shenzhen) Co., Ltd.
Shenzhen Nianhua Shenzhen Nianhua Enterprise Management Co., Ltd.
Konka Huazhong Konka Huazhong (Hunan) Technology Co., Ltd.
Wankaida Shenzhen Wankaida Science and Technology Co., Ltd.
Shenzhen Chuangzhi Electrical
Shenzhen Konka Chuangzhi Electrical Appliances Co., Ltd.
Appliances
Suining Jiarun Property Suining Jiarun Property Co., Ltd.
Anhui Konka Anhui Konka Electronic Co., Ltd.
Kangzhi Trade Anhui Kangzhi Trade Co., Ltd.
Telecommunication Technology Shenzhen Konka Telecommunications Technology Co., Ltd.
Konka Mobility Konka Mobility Co., Limited
Dongguan Konka Dongguan Konka Electronic Co., Ltd.
Suining Konka Smart Suining Konka Smart Technology Co., Ltd.
Chongqing Optoelectronic
Chongqing Konka Optoelectronic Technology Research Institute Co., Ltd.
Technology Research Institute
Yibin Kangrun Yibin Kangrun Environmental Technology Co., Ltd.
Yibin Kangrun Medical Yibin Kangrun Medical Waste Centralized Treatment Co., Ltd.
Yibin Kangrun Environmental
Yibin Kangrun Environmental Protection Power Generation Co., Ltd.
Protection
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Konka Group Co., Ltd. Interim Report 2023
Ningbo Khr Electric Appliance Ningbo Khr Electric Appliance Co., Ltd.
Jiangxi Konka Jiangxi Konka New Material Technology Co., Ltd.
Jiangxi High Transparent Substrate Jiangxi High Transparent Substrate Material Technology Co., Ltd.
Jiangsu Konka Special Material Jiangsu Konka Special Material Technology Co., Ltd.
Xinfeng Microcrystalline Jiangxi Xinfeng Microcrystalline Jade Co., Ltd.
Konka Huanjia Konka Huanjia Environmental Technology Co., Ltd.
Konka Huanjia (Henan) Konka Huanjia (Henan) Environmental Technology Co., Ltd.
Shaanxi Konka Intelligent Shaanxi Konka Intelligent Appliance Co., Ltd.
Pengrun Technology Shenzhen Konka Pengrun Technology & Industry Co., Ltd.
Jiaxin Technology Jiaxin Technology Co., Ltd.
Konka Ronghe Konka Ronghe Industrial Technology (Zhejiang) Co., Ltd.
Chongqing Kangxingrui Chongqing Kangxingrui Environmental Technology Co., Ltd.
Chongqing Kangxingrui Automobile
Chongqing Kangxingrui Scraped Automobile Recycling Co., Ltd.
Recycling
Konka Unifortune Shenzhen Konka Unifortune Technology Co., Ltd.
Jiali International Jiali International (Hong Kong) Limited
Kangjiatong Sichuan Kangjiatong Technology Co., Ltd.
Kanghong (Yantai) Environmental Kanghong (Yantai) Environmental Technology Co., Ltd.
Jiangkang (Shanghai) Technology Jiangkang (Shanghai) Technology Co., Ltd.
Konka Intelligent Manufacturing Shenzhen Konka Intelligent Manufacturing Technology Co., Ltd.
Konka Material Hainan Konka Material Technology Co., Ltd.
Konka Ventures Konka Ventures Development (Shenzhen) Co., Ltd.
Yibin Konka Incubator Yibin Konka Incubator Management Co., Ltd.
Yantai Konka Yantai Konka Healthcare Enterprise Service Co., Ltd.
Chengdu Anren Chengdu Anren Konka Cultural and Creative Incubator Management Co., Ltd.
Konka Enterprise Service Guiyang Konka Enterprise Service Co., Ltd.
Konka Eco-Development Shenzhen Konka Eco-Development Investment Co., Ltd.
Konka Europe Konka (Europe) Co., Ltd.
Hong Kong Konka Hong Kong Konka Limited
Hongdin Trading Hongdin International Trading Limited
Konka North America Konka North America LLC
Kanghao Technology Kanghao Technology Co., Ltd.
Hongdin Invest Hongdin Invest Development Limited
Chain Kingdom Memory
Chain Kingdom Memory Technologies Co., Limited
Technologies
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Konka Group Co., Ltd. Interim Report 2023
Chain Kingdom Memory
Chain Kingdom Memory Technologies (Shenzhen) Co., Limited
Technologies (Shenzhen)
Hongjet Hongjet (Hong Kong) Company Limited
Chongqing Xinyuan Semiconductor Chongqing Xinyuan Semiconductor Co., Ltd.
Anlu Konka Anlu Konka Industrial Operation Service Co., Ltd.
Kanghong Dongsheng Shenzhen Kanghong Dongsheng Investment Partnership (Limited Partnership)
Guizhou Konka New Material
Guizhou Konka New Material Technology Co., Ltd.
Technology
Guizhou Kanggui Energy Guizhou Kanggui Energy Co., Ltd.
Guangdong Xinwei Guangdong Xinwei Semiconductor Co., Ltd.
Kangxinrun Renewable Resources Chongqing Kangxingrui Renewable Resources Co., Ltd.
Guizhou Kanggui Material
Guizhou Kanggui Material Technology Co., Ltd.
Technology
Nantong Kanghai Nantong Kanghai Technology Industry Development Co., Ltd.
Chongqing Kangyiyun Chongqing Kangyiyun Business Operation Management Co., Ltd.
Jiangxi Konka High-tech Park Jiangxi Konka High-tech Park Operation and Management Co., Ltd.
Shangrao Konka Electronic
Shangrao Konka Electronic Technology Innovation Co., Ltd.
Technology Innovation
Guizhou Konka New Energy Guizhou Konka New Energy Material Technology Co., Ltd.
Zhejiang Konka Electronic Zhejiang Konka Electronic Technology Co., Ltd.
Zhejiang Konka Technology
Zhejiang Konka Technology Industry Development Co., Ltd.
Industry
Sichuan Hongxinchen Sichuan Hongxinchen Real Estate Development Co., Ltd.
Xi'an Konka Intelligent Xi'an Konka Intelligent Appliance Co., Ltd.
Xi'an Konka Network Xi'an Konka Network Technology Co., Ltd.
Xi'an Kanghong Technology
Xi'an Kanghong Technology Industry Development Co., Ltd.
Industry
Xi'an Konka Intelligent Technology Xi'an Konka Intelligent Technology Development Co., Ltd.
Chongqing Fangbing Real Estate Chongqing Fangbing Real Estate Co., Ltd.
Chongqing Konka Low Carbon Chongqing Konka Low Carbon Technology Co., Ltd.
Kanghong Xintong Shenzhen Kanghong Xintong Investment Partnership (Limited Partnership)
Songyang Industry Operation Songyang Konka Smart Industry Operation Management Co., Ltd.
Kangyan Technology Shenzhen Kangyan Technology Co., Ltd.
Konka Photovoltaic Technology Konka Photovoltaic Technology Co., Ltd.
Songyang Konka Intelligent Songyang Konka Intelligent Technology Development Co., Ltd.
Konka North China Konka North China (Tianjin) Technology Co., Ltd.
Zhongshan Kanghong Zhongshan Kanghong Electronic Technology Co., Ltd.
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Konka Group Co., Ltd. Interim Report 2023
Digital Technology Shenzhen Konka Digital Technology Development Co., Ltd.
CSRC The China Securities Regulatory Commission
SZSE The Shenzhen Stock Exchange
CSRC Shenzhen The Shenzhen Bureau of the China Securities Regulatory Commission
RMB, RMB’0,000, Expressed in the Chinese currency of RMB, expressed in tens of thousands of RMB,
RMB’00,000,000 expressed in hundreds of millions of RMB
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Konka Group Co., Ltd. Interim Report 2023
Part II Corporate Information and Key Financial Information
I Corporate Information
Stock name Konka Group-A, Konka Group-B Stock code 000016, 200016
Changed stock name (if any) N/A
Stock exchange for stock listing Shenzhen Stock Exchange
Company name in Chinese 康佳集团股份有限公司
Abbr. (if any) 康佳集团
Company name in English (if any) KONKA GROUP CO.,LTD
Abbr. (if any) KONKA GROUP
Legal representative Zhou Bin
II Contact Information
Board Secretary Securities Representative
Name Wu Yongjun Miao Leiqiang
Board Secretariat, 24/F, Konka R&D Center, 28 Keji Board Secretariat, 24/F, Konka R&D Center, 28 Keji
South Twelfth Road, Science and Technology Park, South Twelfth Road, Science and Technology Park,
Address
Yuehai Street, Nanshan District, Shenzhen, Guangdong Yuehai Street, Nanshan District, Shenzhen, Guangdong
Province, China Province, China
Tel. 0755-26609138 0755-26609138
Fax 0755-26601139 0755-26601139
Email
szkonka@konka.com szkonka@konka.com
address
III Other Information
1. Contact Information of the Company
Indicate by tick mark whether any change occurred to the registered address, office address and
their zip codes, website address, email address and other contact information of the Company in
the Reporting Period.
□ Applicable √ Not applicable
No change occurred to the said information in the Reporting Period, which can be found in the
2022 Annual Report.
2. Media for Information Disclosure and Place where this Report is Lodged
Indicate by tick mark whether any change occurred to the information disclosure media and the
place for lodging the Company’s periodic reports in the Reporting Period.
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Konka Group Co., Ltd. Interim Report 2023
□ Applicable √ Not applicable
The website of the stock exchange, the media and other websites where the Company’s periodic
reports are disclosed, as well as the place for lodging such reports did not change in the Reporting
Period. The said information can be found in the 2022Annual Report.
3. Other Information
Indicate by tick mark whether any change occurred to other information in the Reporting Period.
□ Applicable √ Not applicable
IV Key Financial Information
Indicate by tick mark whether there is any retrospectively restated datum in the table below.
√ Yes □ No
Reason for retrospective restatement:
Change to accounting policies
H1 2022 Change (%)
H1 2023
Before Restated Restated
Operating revenue (RMB) 10,472,061,171.94 16,895,470,276.81 16,895,470,276.81 -38.02%
Net profit attributable to the listed
-193,240,232.33 172,818,438.83 173,266,442.52 -211.53%
company’s shareholders (RMB)
Net profit attributable to the listed
company’s shareholders before
-891,594,370.41 -742,356,181.71 -741,908,178.02 -20.18%
exceptional gains and losses
(RMB)
Net cash generated from/used in
-201,550,105.24 -421,259,506.73 -421,259,506.73 52.16%
operating activities (RMB)
Basic earnings per share
-0.0803 0.0718 0.0720 -211.53%
(RMB/share)
Diluted earnings per share
-0.0803 0.0718 0.0720 -211.53%
(RMB/share)
Weighted average return on equity
-2.55% 1.87% 1.87% -4.42%
(%)
31 December 2022 Change (%)
30 June 2023
Before Restated Restated
Total assets (RMB) 38,925,419,822.05 38,016,368,073.05 38,027,575,163.66 2.36%
Equity attributable to the listed
7,522,168,237.68 764,039,9721.99 7,641,975,956.16 -1.57%
company’s shareholders (RMB)
Reason for change to accounting policies and correction of accounting errors:
On 30 November 2022, the Ministry of Finance issued Interpretation No. 16 for the Accounting
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Konka Group Co., Ltd. Interim Report 2023
Standards for Business Enterprises, which stipulates the “accounting treatments for deferred
income taxes associated with assets and liabilities arising from a single transaction to which the
initial recognition exemption does not apply”, effective for the Company as of 1 January 2023.
For lease liabilities and right-of-use assets recognised at the beginning of the earliest period of
financial statement presentation in which the provision is first implemented that give rise to
taxable temporary differences and deductible temporary differences as a result of a single
transaction to which the provision applies, the Company has adjusted the cumulative effect to
retained earnings at the beginning of the earliest period of financial statement presentation and
other relevant financial statement items in accordance with the said provision and Accounting
Standard No. 18 for Business Enterprises—Income Tax.
V Accounting Data Differences under China’s Accounting Standards for Business
Enterprises (CAS) and International Financial Reporting Standards (IFRS) and Foreign
Accounting Standards
1. Net Profit and Equity under CAS and IFRS
□ Applicable √ Not applicable
No such differences for the Reporting Period.
2. Net Profit and Equity Differences under CAS and Foreign Accounting Standards
□ Applicable √ Not applicable
No such differences for the Reporting Period.
VI Exceptional Gains and Losses
√ Applicable □ Not applicable
Unit: RMB
Item Amount Note
Gain or loss on disposal of non-current assets (inclusive of impairment allowance write-offs) 234,443,700.65
Government subsidies through profit or loss (exclusive of government subsidies consistently given
in the Company’s ordinary course of business at fixed quotas or amounts as per governmental 143,191,046.27
policies or standards)
Gain or loss on fair-value changes in held-for-trading financial assets and liabilities & income from
disposal of held-for-trading financial assets and liabilities and available-for-sale financial assets
-95,971,002.08
(exclusive of the effective portion of hedges that arise in the Company’s ordinary course of
business)
Gain or loss on loan entrustments 62,144,007.08
Non-operating income and expense other than the above 5,709,807.68
Other gains and losses that meet the definition of exceptional gain/loss 584,664,150.75
Less: Income tax effects 226,223,116.92
Non-controlling interests effects (net of tax) 9,604,455.35
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Konka Group Co., Ltd. Interim Report 2023
Total 698,354,138.08
Particulars about other gains and losses that meet the definition of exceptional gain/loss:
√ Applicable □ Not applicable
Amount involved
Item Reason
(RMB)
Shareholdin
As the Company reduced part of its shareholding in Chutian Dragon Co., Ltd., the
g in
measurement of its investment in Chutian Dragon Co., Ltd. was adjusted in the current
Chutian 584,164,150.75
period from a long-term equity investment (under the equity method) to a held-for-
Dragon
trading financial asset, which incurred an exceptional gain.
Co., Ltd.
Explanation of why the Company reclassifies as recurrent an exceptional gain/loss item listed in
the Explanatory Announcement No. 1 on Information Disclosure for Companies Offering Their
Securities to the Public—Exceptional Gain/Loss Items:
√ Applicable □ Not applicable
Amount involved
Item Reason
(RMB)
Tax rebates on Government subsidies given in the Company’s ordinary course of business at fixed
3,434,829.42
software quotas or amounts as per government’s uniform standards
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Konka Group Co., Ltd. Interim Report 2023
Part III Management Discussion and Analysis
I Principal Activity of the Company in the Reporting Period
At present, the principal operations of the Company include consumer electronics, semiconductors,
material technology, industry trade, etc. Among them, for the industry trade business, the Company
conducts procurement, processing and distribution of materials at the upstream and downstream
ends of the consumer electronics and semiconductor businesses. Thus, this business can fall into the
consumer electronics industry or the semiconductor industry. As such, the industries in which the
Company operated during the Reporting Period are the consumer electronics industry, the
semiconductor industry and the material technology industry. Relevant information is provided as
follows:
(I) The consumer electronics business
This division primarily comprises the multimedia sub-division and the white goods sub-division,
with details as follows:
1. The multimedia business
The Company's multimedia business faces the global market, mainly including domestic color TV
business and export color TV business.
The domestic sales of the Company’s colour TVs are realized mainly through B2B (Business-to-
Business) and B2C (Business-to-Consumer), with its branch companies, business departments
and after-sales maintenance points operating across the country. And the Company profits from
the margins between the costs and the selling prices of its colour TVs.
As for selling its colour TVs abroad, the Company mainly relies on B2B. Its colour TVs are sold
to Asia Pacific, Middle East, Central & South America, East Europe, etc. And operating profit
source is also the differences between the costs and the selling prices of its colour TVs.
In the first half of 2023, affected by factors such as increasingly fierce market competition, and
sluggish scale growth, the gross profit level of the colour TV industry continued to be diluted.
According to statistics from All View Cloud (AVC for short), the omni-channel retail sales
volume in China's colour TV market was 14.61 million units in the first half of 2023, declining by
12.2% year-on-year, and the retail sales value was RMB48.7 billion, decreasing by 8.5% year-on-
year. With the intelligent upgrade of electronic products and iterative update of display
technologies, the colour TV industry is expected to enter the stage of upgrade guided by science
and technology, and the market scale of the industry is expected to grow.
2. The white goods business
The white goods produced by the Company mainly include refrigerators, washing machines, air
conditioners, freezers, etc. In the domestic market, these products are sold through B2B and B2C
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Konka Group Co., Ltd. Interim Report 2023
models. And the Company profits from the margins between the costs and the selling prices of its
white goods. The Company strengthened the foundation of our white goods brands through the
acquisition of the Frestec brand. Meanwhile, the establishment of the Ningbo A/C production base
as a joint venture has helped the Company build its own A/C manufacturing capability. The
weakness in the front-loading washing machine technology has been overcome by the acquisition of
Beko (Front-loading Washing Machine) China Factory. In addition, the Company went on a new
path of exploring the dishwasher world by setting up Xi’an Smart Appliances Park. The Company
also optimized the internal R&D, production, procurement, sales, and services processes, integrated
the external channel resources to enable channel sharing between the upstream procurement
processes and downstream sales processes, and improved the product sales structure and
competitiveness of the white goods business.
In the overseas market, the white goods are sold mainly through a B2B model, covering Europe,
Asia-Pacific, Middle East, Africa, Latin America, etc. And the Company profits from the margins
between the costs and the selling prices of these products.
In terms of the air-conditioning industry, statistics from AVC show that the omni-channel retail sales
volume of China's air-conditioning market was 37.27 million units in the first half of 2023,
increasing by 18.8% year-on-year, and the retail sales value was RMB130.2 billion, increasing by
19.5% year-on-year. With the industrial upgrade driven by relevant policies and the recovery of
consumer demand for trade-in, the air-conditioning industry is expected to maintain a steady growth
trend in the future. In terms of the refrigerator industry, statistics from AVC show that the omni-
channel retail sales volume of China's refrigerator market was 14.69 million units in the first half of
2023, decreasing by 2.6% year-on-year, and the retail sales value was RMB47.9 billion, increasing
by 5.2% year-on-year. As people become increasingly concerned about health and food preservation,
and the upgrade trend of life quality is continuously advanced, steady development and product
upgrade will become the main characteristics of the refrigerator market in the future, and health
function, aesthetic appearance and differentiated door body will become the new premium direction
of refrigerator products. In terms of the washing machine industry, statistics from AVC show that
the omni-channel retail sales volume of China's washing machine market was 15.05 million units in
the first half of 2023, decreasing by 4.6% year-on-year, and the retail sales value was RMB47.9
billion, increasing by 5.2% year-on-year. The downturn in the offline market affected the overall
market performance of the washing machine industry. However, with the rise of new media
channels and the improvement of enterprise cost pressure, the high-end trend of the washing
machine market remained unchanged, and the market is expected to maintain a stable development
trend in the future.
(II) The semiconductor business
Currently, the Company is engaged in storage, optoelectronics, etc. with respect to the semi-
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Konka Group Co., Ltd. Interim Report 2023
conductor business. In storage, the Company primarily engages in packaging, testing and marketing
of storage products. In optoelectronics, the Company primarily develops, produces and markets
Micro LED-related products.
The semiconductor industry is a strategic, fundamental and leading industry that supports economic
and social development and safeguards national security. Among them, semiconductor storage is the
largest subdivision in the semiconductor industry in recent years. At present, South Korean
companies represented by Samsung and Hynix are in the leading position in the field of
semiconductor storage. China has also accelerated in boosting the production capacity of
semiconductor storage in recent years. It is expected that the self-sufficiency rate will continue to
increase.
Micro LED is the prevailing trend and development direction of future display technology. The
industrial chain is divided into four main links: upstream chip manufacturing and mass transfer,
midstream panel manufacturing, and downstream complete machine application. The Micro LED
has wide industrial application and a broad market.
(III) The material technology business
Currently, this business focuses on collecting, sorting, processing, distributing and marketing
renewable resources.
With the introduction of a series of favorable policies to encourage the recycling and utilization of
renewable resources and the continuous enhancement of environmental protection supervision, the
development scale of the domestic renewable resource recycling industry will grow steadily.
(IV) The industry trade business
The Company's industry trade business mainly focuses on the procurement, processing and
distribution of IC chip storage, LCD and other materials involved in its consumer electronics and
semiconductor businesses. The operating profit comes from the processing fee and the price
difference between upstream procurement and downstream sales. The industry trade business can
help the Company establish good relationships with its upstream suppliers and downstream
customers, and keep it informed of prices of the materials used in its production for better cost
control over its existing products. Additionally, it is able to facilitate the development of the
semiconductor business by helping accumulate customer resources for the semiconductor and chip
business, provide sales channels, and achieve accurate matching of market demand, with a
shortened product development period and a lower risk of mismatching of R&D and market
demand.
II Core Competitiveness Analysis
The Company’s core competitiveness lies in its manufacturing ability, R&D ability, brand,
marketing network and human resources. In terms of manufacturing ability, the Company has
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Konka Group Co., Ltd. Interim Report 2023
carried out intelligent upgrading of manufacturing bases in Anhui, Dongguan, Suining, Xinxiang,
etc., of which the Anhui Konka plant has been awarded the title of "National Intelligent
Manufacturing Demonstration Factory", with an advanced intelligent manufacturing level in the
industry. It has developed a three-tier R&D system of “Research institute+key labs+product
development centers”, established artificial intelligence internet of things comprehensive laboratory
and 5G Ultra HD laboratory with major universities or scientific research institutions, established
academician workstation, and built a technology research alliance matching the industrial layout,
with nearly 100 core technologies and about 1,500 R&D talents. The Company has introduced
around 100 experts on the micro LED project. In terms of brand, the Company continues to
promote brand strategy construction, system construction, image construction and cultural
construction, focuses on improving the scientific and international image of the enterprise,
strengthens the brand status, has a certain brand awareness and reputation in the consumer group,
and has good brand credit in banks and other financing channels. In terms of marketing channels,
the Company innovates channel reform, cooperates online and offline for win-win results, and
strives for development at home and abroad. Regarding offline channels, the Company has 33
branches, more than 100 offices, and more than 3,000 after-sales service shops across China, and
the marketing and service network is all over the country; as for online channels, the Company has
settled in Tmall, JD, Suning, VIPshop, Pinduoduo and other mainstream e-commerce platforms to
innovate and develop live e-commerce business, and seek a new growth pole for business
development; overseas channel, the company The Company's business covers Latin America,
Europe, Asia Pacific and other countries and regions, with a sound marketing network. In terms of
human resources, the Company boasts a leadership team of many years of management and
industry experience, as well as a high quality execution team.
III Analysis of Main Businesses
(I) Overview
During the Reporting Period, the Company focused on the core businesses of "Consumer
Electronics + Semiconductor", adhered to professional platform-based operation, implemented lean
management, advocated long-term value and worked to improve its financial results. Also, efforts
were made to strengthen competitiveness in the market and accelerate the transformation from
"Konka Electronics" to "Konka Technology". The Company, during the Reporting Period, promoted
business restructuring by optimising part of non-core business which failed to coordinate with the
main business and had low gross margin. The scale of the industry trade business dropped
significantly year-on-year, resulting in a certain decrease of the Company's operating revenue.
Affected by the following factors, the Company recorded a net loss attributable to its shareholders
in the first half of 2023:
17
Konka Group Co., Ltd. Interim Report 2023
1. The gross margin of the colour TV business declined year-on-year, due to shrunken industry scale,
increased cost of the supply chain, the product sales structure in the adjustment phase.
(1) The domestic scale of the colour TV industry kept decreasing. The recovery of the domestic
scale of the colour TV industry in the first half of 2023 did not meet expectations. Due to the
decreased market scale, both the revenue and total gross margin of the Company's colour TV
business in China fell year-on-year in the first half of 2023.
(2) The increased cost of the upstream supply chain led to a decrease in the Company's gross
margin in the colour TV OEM business: The first half of 2023 witnessed an increase in the income
scale of the Company's colour TV OEM business. Nevertheless, the orders delivered in the period
suffered from decreased gross margin, due to the increased cost of the upstream supply chain, which
resulted in a decrease in the total gross margin of the Company's OEM business.
(3) The product sales structure of colour TVs is in the adjustment phase. In order to keep up with
market demands, for the colour TV business, the Company is gradually adjusting its product
planning and sales strategies toward highly frequent demands, such as big screens, high fresh rates,
and new display technologies. (Big screens are bigger than 65 inches (inclusive). High fresh rates
exceed 120Hz (inclusive). Examples of new display technologies are Micro LEDs and Mini LEDs.)
Even so, the sales scale and total gross margin of the colour TV business were influenced, as new
colour TV products were in the introduction phase and marketing strategies were in the adjustment
phase in the first half of 2023.
2. The Company's semiconductor business was still at the initial phase of industrialisation during
the Reporting Period. In other words, the output did not meet the requirements in scale and benefits,
which affected the Company's overall operating profit.
3. Income was gained from the Company's projects in the industrial parks in Shangrao City, Jiangxi
Province, Shaoxing City, Zhejiang Province, and Yibin City, Sichuan Province in the first half of
2023. The Company reduced its business in industrial parks in this period, in combination of its
development strategies and the macro-economic environment. Therefore, the relevant income
decreased year-on-year.
(II) Year-on-year changes in key financial data:
Unit: RMB
H1 2023 H1 2022 Change (%) Main reason for change
Operating Considerably decreased size of the
10,472,061,171.94 16,895,470,276.81 -38.02%
revenue industry trade business in the
Cost of sales 10,079,343,784.11 16,482,440,621.84 -38.85% Reporting Period
Selling expense 558,536,665.53 560,225,684.28 -0.30%
Administrative
390,244,567.77 354,308,684.51 10.14%
expense
Finance costs 199,075,624.50 267,115,327.58 -25.47%
Income tax -16,710,667.58 -89,346,442.11 81.30% Increased deferred income tax
18
Konka Group Co., Ltd. Interim Report 2023
expense expense in the Reporting Period
R&D investments 237,033,893.11 241,660,483.14 -1.91%
Net cash
generated
Decreased cash payments for goods
from/used in -201,550,105.24 -421,259,506.73 52.16%
in the Reporting Period
operating
activities
Net cash
Decreased cash payments for the
generated construction and acquisition of
from/used in 433,888,761.35 114,321,239.48 279.53% fixed assets, intangible assets and
investing other long-term assets in the
Reporting Period
activities
Net cash
generated Decreased payments for dividends,
from/used in 291,683,622.46 212,673,169.75 37.15% profit or interest in the Reporting
financing Period
activities
Net increase in Increased net cash flows from
cash and cash 568,156,645.67 -64,827,416.56 976.41% operating and investing activities in
equivalents the Reporting Period
Return on
826,829,010.88 737,803,536.05 12.07%
investment
Material changes to the profit structure or sources of the Company in the Reporting Period:
□ Applicable √ Not applicable
No such changes.
(III) Breakdown of operating revenue:
Unit: RMB
H1 2023 H1 2022
As % of total As % of total Change (%)
Operating revenue Operating revenue
operating revenue (%) operating revenue (%)
Total 10,472,061,171.94 100% 16,895,470,276.81 100% -38.02%
By operating division
Consumer electronics 4,839,485,602.27 46.21% 5,246,599,004.00 31.06% -7.76%
Industry trade 4,350,074,427.45 41.54% 10,171,407,159.62 60.20% -57.23%
Material technology 793,973,411.72 7.58% 774,458,509.72 4.58% 2.52%
Semiconductor 5,850,208.69 0.06% 50,916,083.90 0.30% -88.51%
Other 482,677,521.81 4.61% 652,089,519.57 3.86% -25.98%
By product category
Color TVs 1,919,054,194.60 18.33% 2,389,828,778.20 14.15% -19.70%
White goods 2,285,781,923.95 21.83% 1,900,207,771.57 11.25% 20.29%
Industry trade 4,350,074,427.45 41.54% 10,171,407,159.62 60.20% -57.23%
Material technology 793,973,411.72 7.58% 774,458,509.72 4.58% 2.52%
19
Konka Group Co., Ltd. Interim Report 2023
Semiconductor 5,850,208.69 0.06% 50,916,083.90 0.30% -88.51%
PCB 245,209,214.94 2.34% 291,397,810.91 1.72% -15.85%
Other 872,117,790.59 8.32% 1,317,254,162.89 7.80% -33.79%
By operating segment
Overseas 3,900,990,088.37 37.25% 7,238,742,630.40 42.84% -46.11%
Domestic 6,571,071,083.57 62.75% 9,656,727,646.41 57.16% -31.95%
Operating division, product category or operating segment contributing over 10% of operating
revenue or operating profit:
√ Applicable □ Not applicable
Unit: RMB
YoY change in YoY change in
Gross profit YoY change in
Operating revenue Cost of sales operating revenue gross profit margin
margin cost of sales (%)
(%) (%)
By operating division
Consumer
4,839,485,602.27 4,559,163,199.50 5.79% -7.76% -10.44% 2.82%
electronics
Industry trade 4,350,074,427.45 4,306,025,179.35 1.01% -57.23% -57.45% 0.51%
By product category
Color TVs 1,919,054,194.60 1,950,631,109.94 -1.65% -19.70% -19.35% -0.44%
White goods 2,285,781,923.95 2,020,436,028.43 11.61% 20.29% 18.04% 1.69%
Industry trade 4,350,074,427.45 4,306,025,179.35 1.01% -57.23% -57.45% 0.51%
By operating segment
Domestic 6,571,071,083.57 6,259,263,269.06 4.75% -31.95% -32.77% 1.17%
Overseas 3,900,990,088.37 3,820,080,515.05 2.07% -46.11% -46.73% 1.14%
Core business data of the prior year restated according to the changed statistical caliber for the
Reporting Period:
□ Applicable √ Not applicable
IV Analysis of Non-Core Businesses
√ Applicable □ Not applicable
Unit: RMB
As % of total
Amount Source/Reason Recurrent or not
profit
Change in accounting method
Return on investment 826,829,010.88 -239.56% for investees in the current Not recurrent
period
Change in accounting method
Gain/loss on changes
-132,580,077.43 38.41% for investees in the current Not recurrent
in fair value
period
Impairment losses on
Asset impairments -155,476,176.12 45.05% Not recurrent
receivables and inventories
Mainly for the company's daily
Non-operating income 17,325,617.18 -5.02% Not recurrent
business activities are not
20
Konka Group Co., Ltd. Interim Report 2023
directly related to the increase
in profits
Non-operating expense 4,326,608.02 -1.25% Not recurrent
V Analysis of Assets and Liabilities
1. Material Changes in Asset Composition
Unit: RMB
30 June 2023 31 December 2022
Change in Reason for
As %
percentage material
Amount As % of total assets Amount of total
(%) change
assets
Monetary
6,908,338,806.16 17.75% 5,988,095,490.71 15.75% 2.00%
assets
Accounts
2,087,994,555.53 5.36% 2,036,734,836.22 5.36% 0.00%
receivable
Contract
432,779.46 0.00% 0.00 0.00% 0.00%
assets
Inventories 4,658,743,334.04 11.97% 4,409,767,756.22 11.60% 0.37%
Investment
1,412,201,694.76 3.63% 802,407,844.60 2.11% 1.52%
property
Long-term
equity 5,888,122,429.28 15.13% 6,351,232,955.58 16.70% -1.57%
investments
Fixed assets 4,021,128,223.39 10.33% 4,114,029,693.38 10.82% -0.49%
Constructio
n in 1,496,059,340.20 3.84% 1,990,361,377.07 5.23% -1.39%
progress
Right-of-
33,487,798.25 0.09% 50,019,838.68 0.13% -0.04%
use assets
Short-term
6,779,845,746.13 17.42% 7,579,559,304.97 19.93% -2.51%
borrowings
Contract
698,842,722.45 1.80% 601,044,358.35 1.58% 0.22%
liabilities
Long-term
7,173,408,500.74 18.43% 8,906,931,402.89 23.42% -4.99%
borrowings
Lease
31,184,490.59 0.08% 36,586,639.16 0.10% -0.02%
liabilities
2. Major Assets Overseas
□ Applicable √ Not applicable
3. Assets and Liabilities at Fair Value
√ Applicable □ Not applicable
Unit: RMB
Beginning Gain/loss on Cumula Impai Purchased in the Sold in the Other Ending
Item
amount fair-value tive rment Reporting Period Reporting change amount
21
Konka Group Co., Ltd. Interim Report 2023
changes in the fair- allow Period s
Reporting value ance
Period changes for
charged the
to Repor
equity ting
Period
Financial
assets
1. Trading
financial
assets
32,279,520.0 743,307,489
(derivative -199,310,420.92 974,897,430.42
0 .50
financial
assets
excluded)
4.
Investments
23,841,337.
in other 23,841,337.16
16
equity
instruments
Subtotal of
32,279,520.0 767,148,826
financial 23,841,337.16 -199,310,420.92 974,897,430.42
0 .66
assets
753,149,202. 2,457,726,4
Other 2,876,849,501.76 -10,129,725.67 344,155,903.39
07 77.41
Total of the 817,708,242. 3,992,024,1
2,924,532,176.08 -408,750,567.51 2,293,950,764.23
above 07 30.73
Financial
0.00 0.00 0.00 0.00 0.00
liabilities
Other changes
Unit: RMB
Gain/loss on Cumulative Impairment
fair-value fair-value allowance Purchased in Sold in the
Beginning Other
Item changes in the changes for the the Reporting Reporting Ending amount
amount changes
Reporting charged to Reporting Period Period
Period equity Period
Other non-
-
current 2,639,662,273.32 515,961,973.63 2,113,570,574.02
10,129,725.67
financial assets
Accounts
receivable 237,187,228.44 344,155,903.39 237,187,228.44 344,155,903.39
financing
Significant changes to the measurement attributes of the major assets in the Reporting Period:
□ Yes √ No
4. Restricted Asset Rights as at the Period-End
Ending carrying value
Item Reason for restriction
(RMB)
Of which, RMB440,390,112.54 is security deposits put in pledge for loans or the
issuance of bank acceptance bills; RMB307,603.35 is in the fiscal custody account;
Monetary assets 878,270,149.59
RMB226,700,000.00 is term deposits that cannot be withdrawn in advance; and
RMB210,872,433.70 is restricted for other reasons.
Notes 217,674,323.25 In pledge for the issuance of bank acceptance bill
22
Konka Group Co., Ltd. Interim Report 2023
receivable
The rectification measures were affected by the minority shareholder case of the
Inventories 149,679,547.48 subsidiary, the inventory was sealed up, and the company did not waive its claims, as
collateral for loan
Investment
101,798,700.19 As collateral for loan
property
Fixed assets 1,393,456,049.65 Mortgage loan, financial lease mortgage, original shareholder guarantee mortgage
Intangible
506,091,816.68 Mortgage loan, original shareholder guarantee mortgage, financial lease mortgage
assets
Construction in
262,754,573.95 As collateral for finance lease, mortgage loan
progress
Total 3,509,725,160.79
VI Investments Made
1. Total Investment Amount
√ Applicable □ Not applicable
Total investment amount in the Total investment amount in the same
Change
Reporting Period (RMB) period of last year (RMB)
541,154,096.54 2,650,070,931.19 -79.58%
2. Major Equity Investments Made in the Reporting Period
□ Applicable √ Not applicable
3. Major Non-Equity Investments Ongoing in the Reporting Period
√ Applicable □ Not applicable
Unit: RMB
Es
Accumu Reason
Input ti Accumu
lative for not
Inve Fixed amoun Capi P m lative
Indu actual meeting
stm assets t in tal ro at realized Disclosu Disclosu
stry input the
Item ent invest the reso gr ed revenues re date re index
invol amount schedule
met ment or Report urce es re as of the (if any) (if any)
ved as of the and
hod not ing s s ve period-
period- expected
Period nu end
end revenues
es
Dongguan Self-
Self Elect and
Konka 11
- ronic 44,781 bank
589,267,
Intelligent Yes ,913.5 loan N/A March
buil indu 990.05
6 - http://w
Industrial fund 2017
d stry ww.cnin
Park ed fo.com.c
Suining n/new/in
Self Elect dex
Konka 17
- ronic 60,729 Self-
544,124,
Electronic Yes ,906.3 fund N/A October
buil indu 993.92
4 ed
Technology 2018
d stry
Industrial
23
Konka Group Co., Ltd. Interim Report 2023
Park
Chongqing
Konka Self-
Self Elect and
Semiconduct
- ronic 44,423 bank 14 June
550,050,
or Yes ,444.6 loan N/A
buil indu 794.85 2019
6 -
Photoelectric fund
d stry
Industrial ed
Park
Self-
Self Elect and
Frestec
- ronic 87,026 bank 21 July
334,824,
Refrigeration Yes ,048.9 loan N/A
buil indu 378.52 2020
7 -
Park fund
d stry
ed
Xi’an Konka
Self Elect
Smart 10
- ronic 12,475 Self-
192,137,
Appliances Yes ,631.7 fund N/A February
buil indu 567.58
0 ed
Headquarters 2021
d stry
Project
249,43
2,210,40
Total -- -- -- 6,945. -- -- -- -- --
5,724.92
23
Note: Xi’an Konka Smart Appliances Headquarters Project has been put into use. Dongguan Konka
Intelligent Industrial Park, Suining Konka Electronic Technology Industrial Park and Frestec
Refrigeration Park are under construction. Regarding the Semiconductor Photoelectric Research
Institute of Chongqing Konka Semiconductor Photoelectric Industrial Park, the infrastructure of the
first phase has been completed and accepted, with the remaining infrastructure project ongoing.
4. Financial Investments
(1) Securities Investments
√ Applicable □ Not applicable
Unit: RMB
Sou
Co Acc Accu rce
ount Beg Gain/Loss mulat
Variet de Name Initial Purch of
ing inni on fair ed fair Sold Gain/l Endin
ased
y of of of mea ng value value in oss in g Accoun inve
investme in
sure carr changes chang Repor Repor carryi
securi sec securit Repor ting title stm
men ying in es ting ting ng
nt cost ting
ty uri y t valu Reporting charg Period Period value ent
Period
met e Period ed to
ty hod equity fund
s
Fair
Dome Chutia Self
00 valu - 974,8 32,27 5,589, 743,3 Trading
stic/F n 974,897, -
30 e 0.00 199,310,4 0.00 97,43 9,520. 065.0 07,48 financia
oreign Drago 430.42 fund
40 met 20.92 0.42 00 2 9.50 l assets
stock n ed
hod
Other securities
0.00 -- 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -- --
investments held at the
24
Konka Group Co., Ltd. Interim Report 2023
period-end
- 974,8 32,27 5,589, 743,3
974,897,
Total -- 0.00 199,310,4 0.00 97,43 9,520. 065.0 07,48 -- --
430.42
20.92 0.42 00 2 9.50
Disclosure date of announcement on board’s
4 April 2023
approving securities investment (if any)
Disclosure date of announcement on
shareholders’ meeting approving securities N/A
investment (if any)
(2) Investments in Derivative Financial Instruments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
5. Use of Raised Funds
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VII Sale of Major Assets and Equity Investments
1. Sale of Major Assets
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Sale of Major Equity Investments
□ Applicable √ Not applicable
VIII Principal Subsidiaries and Joint Stock Companies
√ Applicable □ Not applicable
Principal subsidiaries and joint stock companies with an over 10% effect on the Company’s net
profit:
Unit: RMB
Relationshi Principal Registered Operating Operating
Name p with the activity Total assets Net assets Net profit
capital revenue profit
Company
Enterprise
Konka
manageme
Ventures
nt
Developme RMB5,000, 137,325,02 57,685,673. 36,360,406. 3,645,771.2 2,601,224.9
Subsidiary consulting
nt 000 6.74 78 66 6 4
and
(Shenzhen)
incubation
Co., Ltd.
services
Anhui
Konka Production
Tongchuan and sales of RMB800,0 2,147,514,1 812,469,00 2,204,033,4 27,217,716. 36,150,189.
Subsidiary
g Electrical home 00,000 57.97 3.69 52.38 92 19
Appliances appliances
Co., Ltd.
Hong Kong Export &
HKD500,0 3,348,680,0 432,126,78 1,289,444,1 28,384,130. 23,103,062.
Konka Co., Subsidiary import of
00 70.05 2.36 13.25 48 37
Ltd. electronics
25
Konka Group Co., Ltd. Interim Report 2023
Ningbo
Production
Khr
and sales of RMB150,0 554,423,83 78,146,437. 408,883,16 8,210,721.8 8,236,084.8
Electric Subsidiary
home 00,000 7.47 71 1.82 6 7
Appliance
appliances
Co., Ltd.
Hongdin
Export & -
Internation HKD500,0 2,115,392,0 226,631,61 55,033,875. 55,033,875.
Subsidiary import of 31,006,929.
al Trading 00 84.19 2.97 39 39
electronics 06
Limited
Subsidiaries obtained or disposed of in the Reporting Period:
√ Applicable □ Not applicable
How subsidiary was obtained or disposed Effects on overall operations and
Subsidiary
in the Reporting Period operating performance
Anhui Konka Zhilian E-Commerce Co.,
De-registered For better allocation of assets
Ltd.
Sichuan Hongxinchen Real Estate Beneficial to the development of the
Equity transfer
Development Co., Ltd.
Company’s relevant business and bring
Chongqing Fangbing Real Estate Co.,
Equity transfer about a certain amount of gains
Ltd.
Information about principal subsidiaries and joint stock companies:
None
IX Structured Bodies Controlled by the Company
□ Applicable √ Not applicable
X Risks Facing the Company and Countermeasures
In regard to the consumer electronics business, due to the sluggish consumer demand and
increasingly fierce market competition the Company's scale in the consumer electronics business
fell somewhat. With respect to the semiconductor business, economies of scale have not been
gained, despite the breakthroughs in core technologies, as it is still at the initial phase of
industrialisation. In response to the above risks, the Company will focus on main business
development, promote lean management, optimise asset allocation, accelerate to expand the scale
of the semiconductor business, and effectively strengthen profitability.
Consumer electronics business: In regard to the color TV business, the Company will promote the
upgrade of the color TV business and improve the profitability thereof through the following
measures: First, build technical barriers. The Company will make use of the advantages of the
Micro LED business to extend to the upstream of the business, so as to form the advantages of
advanced manufacturing and precision manufacturing, and drive the upgrade of the color TV
business with the improvement of technical efficiency as the core. Second, consolidate high-end
manufacturing. The Company will give full play to its manufacturing advantages, consolidate
high-end manufacturing, and actively integrate into the third-party ecological chain. In the short
run, the Company will focus on key components centering around the advantages of intelligent
manufacturing; in the long run, it will build an intelligent manufacturing platform based on
scientific and technological R&D, high-end manufacturing and supply chain, so as to incubate
26
Konka Group Co., Ltd. Interim Report 2023
diversified intelligent hardware businesses. Third, restructure efficient channels. The Company
will optimize "online + offline" high-margin channels, focus on expand emerging channels such
as interest e-commerce, strengthen band construction towards young consumers, and improve the
efficiency of both operation and channel. Fourth, expand segmented markets. The Company will
explore barrier-based segmented markets centering around high-frequency demand technologies
such as 5G, 8K and high refresh rate, in combination with user portrait, expand the application
opportunities of multiple scenarios such as HD screen and smart screen, and differentiate the
layout of smart terminals such as smart health care, smart medical treatment and smart
community. In terms of the white goods business, the Company will take the following measures
to accelerate the scale growth of white goods and build a new growth pole for the consumer
electronics business: First, promote brand upgrade. The Company is promoting the diversified
development of brands through the "Konka + Frestec" dual-brand operation strategy, in an effort
to build the first-class brand image of refrigerators, comprehensively improve the brand operation
capability of air-conditioners and washing machines and, through the synergetic development of
the two brands of Konka and Frestec, expand the Company's industrial scale in the field of white
goods. Second, ensure diversified category layout. The company will, with the three core product
lines of "washing machine + refrigerator + air-conditioner" as the core, accelerate the production
of kitchen and sanitation products such as dish-washing machine, and, taking Frestec as a
breakthrough point, realize the diversified layout of white goods categories, and actively explore
the new direction for integrated development of household appliances categories. Third, create
high-end products. The Company will promote the strategy of high-end products and, centering
around the improvement of structure and the enhancement of R&D capability for high-end
products, accelerate the construction of medium- and high-end product lines, improve export
product lines, and strive to promote the comprehensive upgrade of the quality and high-end
orientation of products. Fourth, expand international market. The company will intensify efforts
on the layout of international market, adopt targeted layout strategies in combination with the
characteristics of overseas market, further improve both domestic and foreign marketing systems,
strengthen the layout of domestic blank market and international market, and maximize the
efficiency of channels.
In regard to the semiconductor business: first, the Company needs to maintain its technology
leadership and drive the industrialisation of Micro LEDs in a market-oriented manner. Difficulties
in chip and mass transfer technologies should continue to be tackled, based on customer demand.
Second, we are expected to expand the scale of sales of Mini LEDs in a customer-oriented
manner.
27
Konka Group Co., Ltd. Interim Report 2023
Part IV Corporate Governance
I Annual and Extraordinary General Meeting Convened during the Reporting Period
1. General Meetings Convened during the Reporting Period
Investor
Date of the
Meeting Type participa Date of disclosure Resolutions of the meeting
meeting
tion ratio
Extraordinar
The 1st Extraordinary Resolutions of the 1st
y General 24.47% 13 March 2023 14 March 2023 Extraordinary General
General Meeting of 2023 Meeting of 2023
Meeting
Annual
The 2022 Annual Resolutions of the 2022
General 24.37% 19 June 2023 20 June 2023
General Meeting Annual General Meeting
Meeting
2. Extraordinary General Meetings Convened at the Request of Preference Shareholders
with Resumed Voting Rights
□ Applicable √ Not applicable
II Change of Directors, Supervisors and Senior Management
□ Applicable √ Not applicable
No such cases in the Reporting Period. For details, please refer to the Annual Report 2022.
III Interim Dividend Plan
□ Applicable √ Not applicable
The Company has no interim dividend plan, either in the form of cash or stock.
IV Equity Incentive Plans, Employee Stock Ownership Plans or Other Incentive Measures
for Employees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
28
Konka Group Co., Ltd. Interim Report 2023
Part V Environmental and Social Responsibility
I Major Environmental Issues
Indicate by tick mark whether the Company or any of its subsidiaries is identified as a major
polluter by the environmental protection authorities.
√ Yes □ No
Policies and industry standards pertaining to environmental protection
The Company abides by environmental protection laws and regulations, such as the Environmental
Protection Law of the People’s Republic of China, Water Pollution Prevention and Control Law of
the People’s Republic of China, Air Pollution Prevention and Control Law of the People’s Republic
of China, Noise Pollution Prevention and Control Law of the People’s Republic of China, Solid
Waste Pollution Prevention and Control Law of the People’s Republic of China, Zhongshan
Ecological Environment Protection “14th Five-Year”, Huizhou Ecological Environment Protection
“14th Five-Year”and others. The water pollutant discharge standards include the Emission Standard
of Water Pollutants for Electroplating DB44/1597-2015 and the Water Pollutant Discharge Limit
Standard of Guangdong Province DB44/26-2001. The air pollutant emission standards include the
Emission Standard of Volatile Organic Compounds for Printing Industry DB44/27-2001, Emission
Standard of Electroplating Pollutants GB21900-2008, Emission Standard of Odorous Pollutants
GB14554-93, and Emission Control Standard of Volatile Organic Compounds for Unorganized
Emissions GB37822-2019.
Status of Environmental Protection Administrative License
1. XingDa HongYe
XingDa HongYe received approval from the Zhongshan Environmental Protection Bureau to
establish and construct its facility in 2004 (ZH.H.J. [2004] No. 61), followed by subsequent
approvals under ZH.H.J.D. [2008] 06250 and ZH.H.J.D. [2010] 04469 in 2008 and 2010
respectively. After the original project of XingDa HongYe was put into production, it underwent
two acceptance stages: the first stage in 2008 (H.Y [2008] 02) and the second stage in 2012
(ZH.H.Y. Report [2012] 000092).
Xingda Hongye enlisted the services of the Zhongshan Environmental Protection Science Research
Institute in December 2012 to perform an environmental impact evaluation for their proposed
technological upgrade and expansion initiative. Following this, on 31 December 2012, the
Environmental Protection Bureau of Zhongshan City granted No. ZH.H.J.SH. (2012) 115 Approval
on the Environmental Impact Assessment Report for Technological Upgrade and Expansion
Program of GuangDong XingDa HongYe Electronic Co., Ltd. The scheme allowed for an increased
production of six-layer circuit boards, eight-layer and above circuit boards, and HDI boards, while
29
Konka Group Co., Ltd. Interim Report 2023
reducing the production of single-sided circuit boards. After the completion of the technological
upgrade and expansion, the production capacity was expected to reach a total of 200,000 square
meters for single-sided circuit boards per year, 250,000 square meters for double-sided circuit
boards per year, 300,000 square meters for four-layer circuit boards per year, 200,000 square meters
for six-layer circuit boards per year, 150,000 square meters for eight-layer and above circuit boards
per year, and 100,000 square meters for HDI boards per year. The technical renovation and
expansion project maintained the original plating equipment and process unchanged and added a
browning process to the existing production process. The additional plating capacity was all
outsourced. The technical renovation and expansion project began construction in 2013, was
completed in January 2018, and was commissioned from 10 February to 8 July 2018. The
construction of the expansion project met the requirements of the environmental impact report
approval and the conditions for environmental protection acceptance of the completed construction
project. In 2021, the national pollutant discharge permit of XingDa HongYe was renewed/replaced
with certificate number 91442000768405216J001P. In 2022, the national pollutant discharge permit
of XingDa HongYe was replaced with certificate number 91442000768405216J001P.
2. Boluo Konka and Boluo Konka Precision
Boluo Konka Precision Technology Co., Ltd. was approved by the Huizhou Environmental
Protection Bureau in 2000 (H.S.H.J. [2000] No.23) and began production the same year. Its
pollution discharge permit number is 91441322721121283N001U.
Boluo Konka enlisted the services of Huizhou Environmental Science Research Institute in January
2007 to carry out an environmental impact assessment for its expansion project. No. H.SH.H.J.
[2007] J32 Approval on Environmental Impact Report for Boluo Konka’s Double-sided and
Multilayer Board Project was issued by the Environmental Protection Bureau of Huizhou City on 8
February 2007. The approved expansion project included the installation of electroplating
equipment and processes, allowing for an increase in production capacity to 1 million square meters
for single-sided circuit boards per year and 650,000 square meters for double-sided and multilayer
circuit boards per year. Upon completion, the project underwent an environmental protection
acceptance inspection, satisfying the requirements of the environmental impact assessment approval.
The company also obtained a pollutant discharge permit in the same year and underwent a name
change to Boluo Konka Precision Technology Co., Ltd.. In 2020, the company received a national
pollutant discharge permit bearing certificate number 91441322799316208F001V. Boluo Konka
Precision will produce 1.65 million square meters per year of double-sided and multilayer circuit
boards, upon the Department of Ecology and Environment of Guangdong Province's approval of the
Report on the Environmental Impact of the Circuit Boards Expansion Project with an Annual
Capacity of 1 Million Square Meters (Y.H.SH. [2023] No. 124) in June 2023.
The regulations for industrial emissions and the particular requirements for controlling pollutant
30
Konka Group Co., Ltd. Interim Report 2023
emissions those are associated with production and operational activities.
E
x
c
N
e
u
s
m
s
be
i
r Tota
Nam Type of Way Distributi v
Name of of Discharge l Approved
e of major of on of Discharge standards e
major dis concentration/inte disc total
poll pollutan disch discharge implemented d
pollutants ch nsity harg discharge
uter ts arge outlets i
ar e
s
ge
c
ou
h
tle
a
ts
r
g
e
PH, total
copper, PH 6-9; total
COD, copper≤0.3mg/L; Total
ammonia COD≤50mg/L; discharge:
nitrogen, ammonia COD
total nitrogen≤8mg/L; 19.061250
nitrogen, Disc total tons/year;
total harge nitrogen≤15mg/L; ammonia n
Main
Pollutio phosphor of total itrogen
Xin discharge GB 21900-2008 497, N
n us, total statio phosphorus≤0.5m 3.0498
gDa outlet of Discharge Standard 835 o
sources cyanide, nary 1 g/L; total tons/year;
Hon the waste For Pollutants From tons/ n
of waste total pollu cyanide≤0.2mg/L; total
gYe water Electroplating year e
water nickel, tion total nitrogen
station
total iron, sourc nickel≤0.1mg/L; 32.9792
total es total iron≤2mg/L; tons/year;
aluminu total total
m, aluminum≤2mg/L; phosphorus
petroleu petroleum≤2mg/L; 0.2082
m, suspended tons/year
suspende solids≤30mg/L
d solids
Sulfuric sulfuric acid Emission Standard Total
acid fume≤30mg/m3; for Electroplating discharge:
fume, nitrogen Pollutants GB21900- 2,986,560,
hydrogen Three on oxide≤200mg/m3; 2008 Air Emission 000
chloride, Disc the roof hydrogen Limits Table 5, standard
2,98
formalde harge of plant chloride≤30mg/m Emission standard of cube/year
6,56
hyde, of 1, ten on 3; hydrogen Volatile Organic (note: the
Xin Waste 0,00 N
hydrogen statio the roof cyanide≤0.5mg/m Compounds for total
gDa gas 0 o
cyanide, nary 14 of plant 2 3; Printing Industry discharge
Hon pollutan stan n
nitrogen pollu and one TVOC≤90mg/m3; DB44/815-2010; is not
gYe ts dard e
oxide, tion on the benzene≤1mg/m3; Guangdong Air stated in
cube
ammonia, sourc roof of toluene+xylene≤1 Pollutant Emission the latest
/year
benzene, es the 5mg/m3; tin and Standard DB44/27- version of
toluene+x canteen its 2001 the Second national
ylene, compounds≤8.5m Level Standard in discharge
TVOC, g/m3; the Second Period, permit in
tin and its PM(dust)≤120mg/ Emission standard 2021; two
31
Konka Group Co., Ltd. Interim Report 2023
compoun m3 for Odor Pollutants exhaust
ds, (GB 14554-1993) towers
PM(dust) Table 2 Standard were added
in 2021;
calculated
based on
air volume
in
environme
ntal impact
assessment
)
1. Discharge
standard of
discharge permit:
1. Emission
Discharge Standard
standard for
of Electroplating Total
pollution
Water Pollutant for discharge
discharge
Electroplating amount is
certificate:
DB44/1597-2015 318,300
copper≤0.5mg/L; 318,
Table 1 Pearl River tons/year;
COD≤80mg/L; 300
Bolu Delta Discharge COD is
PH, ammonia tons/
o Disc Standard; 2. Local 19.2
copper, nitrogen≤10mg/L; year
Kon harge discharge standard: tons/year;
COD, Main total Note
ka Pollutio of BFBH [2019] No. 58 ammonia
ammonia discharge nitrogen≤20mg/L; : N
and n statio Document: COD, nitrogen is
nitrogen, outlet of total acco o
Bolu sources nary 1 ammonia nitrogen, 2.4
total the waste phosphorus≤0.5m rdin n
o of waste pollu total phosphorus tons/year;
nitrogen, water g/L; 2. local g to e
Kon water tion based on total
total station emission standard: disc
ka sourc "Environmental nitrogen is
phosphor copper≤0.5mg /L; harg
Prec es Quality Standards 4.8
us COD≤30mg/L; e
ision for Surface Water tons/year.
ammonia per
GB3838-2002 " Note:
nitrogen≤1.5mg/L; mit
Category IV water according
total
standard, the total to the
nitrogen≤10mg/L;
nitrogen discharge discharge
total
reaches 50% of certificate
phosphorus≤0.3m
discharge limit
g/L
requirement of the
corresponding
industry
Sulfuric sulfuric acid Emission Standard
acid fume≤30mg/m3； for Electroplating
fume, nitrogen Pollutants GB21900-
Six on
Bolu hydrogen oxide≤200mg/m3 2008 Air Emission
the roof The total
o chloride, Disc ；hydrogen Limits Table 5,
of plant discharge
Kon formalde harge chloride≤30mg/m Guangdong Air
1, is not
ka hyde,hydr of 3；TVOCogen Pollutant Emission
fourteen stated in N
and Waste ogen statio chl；benzenen Standard DB44/27-
on the the latest o
Bolu gas poll cyanide, nary 20 chlori； 2001 the Second /
roof of version of n
o utants nitrogen pollu methylbenzenorid Level Standard in
plant 2 national e
Kon oxide, tion e≤30； the Second Period,
and one discharge
ka ammonia, sourc dimethylbenzened Emission standard
in permit in
Prec benzene es e≤30mg/；tin and for Odor Pollutants
sewage 2020
ision , its (GB 14554-1993)
station
methylbe compounds≤8.5m Table 2 Standard,
nzene, g/m3；PM Emission standard of
TVOC, （dust）≤≤stand cooking fume
32
Konka Group Co., Ltd. Interim Report 2023
tin and its i；oil (GB18483-2001)
compoun fume≤2mg/m3
ds, PM
(dust), oil
fume
Treatment of pollutants
1. XingDa HongYe
All production equipment of Guangdong Xingda Hongye Electronics Co., Ltd. has been set up with
supporting environmental protection facilities according to the requirements of environmental
impact assessment. The discharge of wastewater, waste gas and noise as well as the disposal of all
solid wastes in the Company all met the standards during the Reporting Period.
The sewage treatment centre of Guangdong Xingda Hongye Electronics Co., Ltd. with an
investment of about RMB15 million was formally put into production in June 2007, and the
treatment capacity of the sewage treatment facility was 2,566 tons/day. After technical improvement
and expansion, the capacity increased to 2,900 tons/day with the treatment process remaining
unchanged. In 2022, RMB20 million was invested to increase a set of sewage treatment facility
which had been put into operation so as to ensure stable discharge of sewage up to standard.
Currently, the sewage treatment facilities are functioning well and the main pollutant discharge
meets the discharge standards and environmental assessment standards. The pollutants are
discharged to Fushachong after being treated at the self-built sewage treatment station.
2. Boluo Konka and Boluo Konka Precision
All production equipment of Boluo Konka and Boluo Konka Precision has been reported for
environmental assessment, review and approval. The supporting environmental protection and
pollution control facilities have been designed by pollutant type and concentration and effectively
operated in a targeted manner. During the Reporting Period, the discharge standards were met in
terms of industrial waste water, exhaust and factory noise, and all industrial waste generated was
disposed of in compliance with environmental laws and regulations.
Boluo Konka was established in 2000. To manufacture single sided PCBs, it invested approximately
RMB 5 million in constructing a sewage treatment station without the biochemical treatment
function and featuring a discharge capacity of 300 tons per day. In 2007, Boluo Konka expanded its
factory by starting the Phase II project, which was submitted for environmental assessment as
Boluo Konka PCB Double Sided and Multi-Layer PCB Project (later the project owner was
changed into Boluo Konka Precision). It spent about RMB 10 million on constructing the Phase II
sewage treatment station to add the biochemical treatment function with a discharge capacity of 800
tons per day.
In 2019, according to the requirements in the documents issued by Boluo County Ecology and
Environment Bureau, the two sewage treatment stations of Boluo Konka and Boluo Konka
Precision must be upgraded towards higher standards. Through comprehensive assessment of the
33
Konka Group Co., Ltd. Interim Report 2023
professional environmental protection company, it was decided that the sewage treatment stations of
the said companies be combined to meet the upgrading requirements. Boluo County Ecology and
Environment Bureau approved the combination of the discharge outlets of the aforementioned
companies, and Boluo Konka would appoint Boluo Konka Precision to treat sewage. After the
combination, the discharge capacity would reach 1,100 tons per day. The aforementioned
companies spent about RMB 20 million between 2019 and 2020 on upgrading the sewage treatment
stations towards higher standards, and added industrial advanced processes and treatment systems,
such as RO water treatment, Fenton oxidation and MBR films. After the technological
improvements and expansion, the sewage treatment reaches 2,200 tons per day (with a discharge
capacity of 1,100 tons per day) with a reuse rate of more than 60%. At present, the waste water
treatment facilities are operating in good conditions; the discharge of major pollutants meets the
discharge standards. After advanced treatment of the water reuse facilities, the water treated by the
sewage stations that meets the standards will be reused in the plants, while the remaining water will
be discharged to the municipal pipe network to be processed by the urban and rural water treatment
factory before being discharged to the Dongjiang River.
Contingency plan for emergent environmental incident
1. XingDa HongYe
In strict accordance with requirements of laws, regulations and relevant documents, such as Law of
the People’s Republic of China on Emergency Response and Interim Measures on Environmental
Emergency Response Plan, Guangdong Xingda Hongye Electronics Co., Ltd. has established risk
prevention measures and emergency response plans, kept its emergency equipment in a normal state,
formulated the Contingency Plan for Emergent Environmental Incident, and put on records at
Zhongshan Environmental Protection Bureau, Guangdong Province, record No.: 442000-2020-
0348-M. In addition, the Company conducts a drill of major environmental pollution incident on its
factory to enhance its emergency response capabilities for emergent environmental pollution
incidents.
Furthermore, Guangdong Xingda Hongye Electronics Co., Ltd. has built an emergency pool (which
is the comprehensive water tank in the sewage treatment station covering an area of 800m3) and set
up a fire pool (500m3 and located on Floor 1 of Factory Building No. 2), which serve as temporary
storage pools for exterior drainage or fire drainage to eradicate accidental discharge of wastewater
in the case of failed operation of the sewage transmission pipeline or fire accident due to outage or
other special circumstances. The sewage transmission pipeline has been equipped with anti-
corrosion and cathodic protection using anti-corrosion pipes and carbon steel pipes. Pursuant to the
new discharge standards, the related discharge pipeline has been modified and the production
department has been required to discharge strictly in accordance with discharge standards to cut the
costs of wastewater treatment. Different types of wastewater are normally and properly treated
34
Konka Group Co., Ltd. Interim Report 2023
through fine shunting. Personnel have been specially arranged to manage the chemical liquid
warehouse and exert reasonable control and requirements over the liquid discharge by the plant and
timely transportation of the liquid by suppliers; emergency tools such as protective masks, boots
and immiscible pumps have been equipped.
2. Boluo Konka and Boluo Konka Precision
Boluo Konka and Boluo Konka Precision strictly abides by Emergency Response Law of the
People's Republic of China, Interim Measures for the Management of Emergency Plans for
Unexpected Environmental Incidents, other related laws and regulations as well as the requirements
of relevant documents. They have established risk prevention measures and emergency plans, such
as Emergency Plan for Unexpected Environmental Incidents, and have their emergency equipment
run in a normal status. In addition, they have filed with Boluo County Branch of Ecology and
Environment Bureau in Huizhou, Guangdong and Huizhou Ecology and Environment Bureau
respectively with the file No. 441322-2020-0073-M and 441301-2021-004-M. They organize all
staff to conduct drills for major environmental pollution incidents every year to improve their
ability for the emergency response to unexpected environmental pollution incidents.
Boluo Konka and Boluo Konka Precision are well equipped with all necessary facilities for
emergency response to unexpected incidents, including an emergency response pool of industrial
waste water (500m3, under the ground of the sewage treatment station) and a firefighting reservoir
(300m3, located beside the staff dormitory building). In the event of an unexpected environmental
incident, such as leakage or failure of a waste water transporting pipe, the emergency response pool
will prevent any accident of industrial waste water; in the event of a fire safety accident, the
firefighting reservoir will be put into use. All departments are required to discharge pollutants
strictly in accordance with pollutant discharge standards to reduce the costs of waste water
treatment by properly and reasonably dividing solution and waste water discharged from the plants.
The chemical warehouses are managed by designated personnel, with standard control and
requirements over the loading and unloading of chemical products by suppliers. In terms of
emergency response supplies, a full set of emergency rescue tools are prepared, including gas masks,
acid and alkaline resistant boots, gloves, goggles, safety ropes, helmets, fire sand and submersible
pumps.
Input in environmental governance and protection and payment of environmental protection tax
Nearly RMB14.7 million was input in environmental governance and protection and RMB33,700 of
environmental protection tax was paid in H1 2023 in total.
Environmental self-monitoring plan
1. XingDa HongYe
According to the requirements of the Environmental Protection Administration, Xingda Hongye
attaches great importance to environmental monitoring management. Thus, pursuant to the
35
Konka Group Co., Ltd. Interim Report 2023
Measures for Self-Monitoring and Information Disclosure of National Key Monitored Enterprises,
the Report on the Environmental Impact of the Technical Improvement and Expansion Project of
Guangdong Xingda Hongye Electronics Co., Ltd. and the reply opinions for environmental impact
assessment, the Company has formulated the Environmental Self-Monitoring Plan and reported to
the municipal environmental protection bureau for approval and record. It implements online
monitoring for the PH, COD and ammonia nitrogen pollutants discharged in wastewater through
real-time monitoring and an automatic frequency of every two hours, entrusts the qualified third-
party online monitoring equipment operation and maintenance institute to carry out periodic
maintenance on automatic monitoring equipment and monitoring data networking equipment, and
entrusts the qualified third-party monitoring unit to carry out the “three wastes” project monitoring.
All self-monitoring plan results will be reported and disclosed on public platforms on a periodic
basis.
In the case of normal production, the results will be updated on a daily basis, with online
monitoring data disclosed in real time and manual monitoring data disclosed on the Real time
publicity or every 2 hours after completion. Items monitored on a monthly basis will be disclosed
by the 10th day of the month. In the case of public holidays, the operation monitoring data for the
holiday period will be disclosed on the first working day after the holiday. The annual self-
monitoring report for the previous year will be disclosed at the end of January each year. In the case
of shutdown with days off, the number of days off will be indicated in the information bar and
related proofs will be submitted to the monitoring center of the municipal environmental bureau for
record. The results are disclosed on Guangdong Province Key Pollution Source Regulatory
Information Platform and on National Pollution Source Monitoring Information Management and
Sharing Platform for public monitoring.
2. Boluo Konka
In accordance with the laws and regulations of environmental protection as well as the post-
certification management requirements related to the pollutant discharge permit, Boluo Konka
attaches great importance to environmental monitoring management. Thus, pursuant to the
Measures for Self-Monitoring and Information Disclosure of National Key Monitored Enterprises,
the Report on the Environmental Impact of the Technical Improvement and Expansion Project of
Boluo Konka Precision Technology Co., Ltd. and the reply opinions for environmental impact
assessment, the Company has formulated the Environmental Self-Monitoring Plan and reported to
the Huizhou Municipal Environment Protection Bureau for approval and record. Meanwhile, in
terms of the parameters and pollutants in waste water, such as PH, flow rate, COD,
ammonia nitrogen, and total nitrogen, it connects its online monitor, featuring automatic monitoring,
to the environmental protection platform of the National Development and Reform Commission to
upload data every two hours. Furthermore, it entrusts the qualified third-party online monitoring
36
Konka Group Co., Ltd. Interim Report 2023
equipment operation and maintenance institute to carry out periodic maintenance on automatic
monitoring equipment and monitoring data networking equipment, and entrusts the qualified third-
party monitoring unit to carry out the "three wastes" project monitoring, in line with the newly
released national pollutant discharge permit and the corporate self-monitoring plans that have been
filed. All self-monitoring plan results will be reported and disclosed on public platforms on a
periodic basis. In the case of normal production, the results will be updated on a daily basis, with
online monitoring data are disclosed in real time, or manual monitoring data on a monthly and
quarterly basis are disclosed every two hours.
Administrative punishments received in the Reporting Period due to environmental issues
Impact of
Reason for Rectification
Subsidiary Violations Penalty results production and
punishment measures
operation
N/A N/A N/A N/A N/A N/A
Other environmental information that should be disclosed
1. XingDa HongYe
The environmental protection investment of Guangdong Xingda Hongye Electronics Co., Ltd. for
H1 2023 was approximately RMB10.5 million, mainly used for the investment in Environmental
governance equipment and facilities, treatment of sewage, waste gas and solid waste, as well as the
maintenance and upgrading of environmental protection equipment.
2. Boluo Konka and Boluo Konka Precision
Boluo Konka and Boluo Konka Precision invested approximately RMB4.2 million on
environmental protection in H1 2023 in total, mainly used for the daily operation and management
of waste water and gas as well as the maintenance and upgrading of equipment.
Measures taken to decrease carbon emission in the Reporting Period and corresponding effects
□ Applicable √ Not applicable
Other Environmental Information.
According to the examination, the Company and its other holding subsidiaries are not key pollutant
units. All have faithfully implemented the laws and regulations related to environmental protection,
such as Environmental Protection Law of the People's Republic of China, Water Pollution
Prevention and Control Law of the People's Republic of China, Law of the People's Republic of
China on the Prevention and Control of Atmospheric Pollution, Law of the People's Republic of
China on Prevention and Control of Pollution From Environmental Noise, Law of the People's
Republic of China on the Prevention and Control of Environmental Pollution by Solid Waste in the
daily production and operation, without being punished for violations of laws and regulations
during the Reporting Period.
II Social Responsibility
The Company insists the principle of health, stability and sustainable development to benefit
37
Konka Group Co., Ltd. Interim Report 2023
shareholders and employees and satisfy customers. In pursuit of economic profits and protection of
shareholders’ profits, the Company is active in protecting legal rights of debtors and employees,
treating suppliers, customers and consumers in good faith, and participating in environmental
protection and community establishment for harmonious development of the Company and society.
1. To protect rights of shareholders and creditors
(1) The Company protects rights of shareholders
The Company insists protection of rights for all shareholders, especially equal status and legal
rights for medium and small shareholders, and make insurance of rights to be informed,
participation and vote.
The Company would perform all obligations of information disclosure to ensure timely, accurate
and complete information and strictly execute confidential system of registrar and insider
information to guarantee justice.
The Company pays attention to repay to shareholders, and insists mutual development with
investors. In the previous three years, the Company shares dividends with all shareholders. The
Company strict executes dividend policies regulated in Articles of Association. All cash dividends
comply with regulations in Articles of Association and requirements in shareholders’ conference.
(2) The Company protects rights of creditors
In full consideration of legal rights of creditors, the Company complies with strict business rules of
credit cooperation to guarantee legal rights of creditors. No damages upon rights of creditors
happened.
2. The Company performs responsibilities to suppliers and customers
(1) It is devoted to improve customer service quality.
The Company is insisting philosophy of customer orientation to strengthen customer service
management, service consciousness for employees, service levels and to protect rights for
customers. Through customer service hot-line, field visit and follow-up service, the Company has
set a good corporate image for customers.
(2) Be honest to suppliers
Following the principle of integrity and mutually beneficial cooperation, the Company keeps good
cooperative relations with suppliers at each level. The corporate principle is open, fair and impartial
to standardize procurement, protect suppliers’ legal rights and lay solid foundation for further
cooperation.
3. Be enthusiastic to social and public welfare undertakings
Based on the principle of appreciating and repaying the society, the Company has participated in all
kinds of activities for public welfare, cooperated with society, undertaken social responsibilities
actively and promoted harmonious development between enterprise and society.
4. Be responsible for employees
38
Konka Group Co., Ltd. Interim Report 2023
The Company insists the principle of people orientation to improve working environment, promote
occupational skills, provide opportunity and platform for development and growth and encourage
self upgradation and realization for employees. Mutual improvement for employees and enterprise
could be achieved.
(1) Be honest and law-abiding to protect legal rights for employees
The Company would strictly comply with laws and regulations in Labor Law and Labor Contract
Law to sign labor contract with employees with fair treatment in employment, payment, promotion,
training, demission and retirement. Also, the Company would pay all kinds of insurances and
housing fund for employees. Regular physical examination would be organized for each year. Any
problems found would require re-examination and consultation from a doctor.
The Company would improve living quality; enhance cohesive force and sense of belongings
through a series of safeguard measures.
(2) To protect occupational health for employees
The Company would establish and perfect training, safety assessment by security system to
guarantee the safety and occupational health for employees. On the other hand, by promotion of the
importance of safety, safety awareness would be rooted in the heart to make all employees abide by
safety standards and fully play subjective initiative in protecting self-occupational safety and
production safety.
(3) To promote occupational skills by diversified professional training
The Company has always paid great attention on diversified training for employees. On the one
hand, the Company would be meticulous in training of regular business and occupational skills and
carry out all requirements positively to improve professional levels by normal training management.
On the other hand, the Company would establish methods of self-training platform, training
instructor, theme training and lectures to provide colorful training activities. Besides the work,
professional and comprehensive quality would be fully promoted.
5. Be responsible for environment
The Company concerns about environmental changes and close relationships with environment by
creating low carbon economy in technical innovation, from green manufacturing, green products to
green industry circular economy. The Company would provide efforts in protecting global
ecological environment. In June 2012, subsidized products catalogue had been released jointly by
National Development and Reform Commission, Ministry of Industry and Information and Ministry
of Finance.
Subsequently, the Company would undertake all social responsibilities by improving strategic
management, sustainable development and enterprise economic efficiency. It would reattribute all
shareholders and would protect legal rights for creditors and employees. To be honest to suppliers
and customers, the Company would serve local economic development and participate in social
39
Konka Group Co., Ltd. Interim Report 2023
public welfare activities and environment protection. It would undertake all responsibilities in many
fields and make attributions to social, economic, and environmental sustainable development for a
socialism harmonious society.
40
Konka Group Co., Ltd. Interim Report 2023
Part VI Significant Events
I Commitments of the Company’s De Facto Controller, Shareholders, Related Parties and
Acquirers, as well as the Company Itself and Other Entities Fulfilled in the Reporting
Period or Ongoing at the Period-End
□ Applicable √ Not applicable
No such cases in the Reporting Period.
II Occupation of the Company’s Capital by the Controlling Shareholder or any of Its
Related Parties for Non-Operating Purposes
□ Applicable √ Not applicable
No such cases in the Reporting Period.
III Irregularities in the Provision of Guarantees
□ Applicable √ Not applicable
No such cases in the Reporting Period.
IV Engagement and Disengagement of Independent Auditor
Are the interim financial statements audited?
□ Yes √ No
The interim financial statements of the Company have not been audited.
V Explanations Given by the Board of Directors and the Supervisory Committee Regarding
the Independent Auditor's “Modified Opinion” on the Financial Statements of the
Reporting Period
□ Applicable √ Not applicable
VI Explanations Given by the Board of Directors Regarding the Independent Auditor's
“Modified Opinion” on the Financial Statements of Last Year
□ Applicable √ Not applicable
VII Insolvency and Reorganization
□ Applicable √ Not applicable
No such cases in the Reporting Period.
VIII Legal Matters
Significant lawsuits and arbitrations:
√ Applicable □ Not applicable
Index
Involved Executi
Discl to
amount Provisio Decisions and on of
General information Progress osure disclos
(RMB’0,000 n effects decision
date ed
) s
inform
41
Konka Group Co., Ltd. Interim Report 2023
ation
Since Jiangxi Xinxin Jianan
Engineering Co., Ltd. (hereinafter
referred to as "Jiangxi Xinxin"),
Jiangxi Shining Stone Technology
Development Company Limited
(hereinafter referred to as "Jiangxi
Shining Stone"), Jiangxi Zhongyi
Decorative Materials Co., Ltd.
(hereinafter referred to as "Jiangxi
Zhongyi") failed to repay the loan
http://
and its interest to Jiangxi Branch The case is
25 www.c
of China Great Wall Asset being The case is being The
ninfo.c
Management Co., Ltd. (hereinafter 31,375.8 No heard in heard in the case is June
om.cn/
referred to as “Jiangxi Branch of the second second instance. in trial
2019 new/in
Great Wall Asset”) who sued the instance.
dex
court for a judgment to repay the
loan of RMB300 million, default
penalty of RMB108,000 and
interest of RMB13.65 million, and
at the same time, nine guarantors
including Jiangxi Kangjia, Xinfeng
Microcrystalline and Nano
Microcrystalline were requested to
undertake joint and several liability
guarantee.
The case is
reheard and in the
Because of a dispute over a
first instance.
purchase and sales contract, the
Based on the
Company's subsidiary, Konka
principle of 19 http://
Huanjia Environmental The case is
prudence, the www.c
Technology Co., Ltd., sued Dalian reheard The Septe
Company has ninfo.c
Jinshunda Materials Recycling 9,383.08 No and in the case is
accrued mber om.cn/
Co., Ltd., Huanjia Group, Wang first in trial
corresponding new/in
Bingde, Zhang Xueyin and Wang instance. 2020
impairment dex
Renping, requiring them to return
reserves in
prepayment and pay liquidated
accordance with
damages.
accounting
policies.
The case is
reheard and in the
Because of a dispute over a first instance.
purchase and sales contract, the Based on the
Company's subsidiary, Konka principle of 19 http://
The case is
Huanjia, sued Dalian Xinjie prudence, the www.c
reheard The Septe
Renewable Resources Co., Ltd., Company has ninfo.c
9,383.08 No and in the case is
Huanjia Group, Wang Bingde, accrued mber om.cn/
first in trial
Zhang Xueyin and Wang Renping, corresponding new/in
instance. 2020
requiring them to return impairment dex
prepayment and pay liquidated reserves in
damages. accordance with
accounting
policies.
The case is
reheard and in the
Because of a dispute over a first instance.
purchase and sales contract, the Based on the
Company's subsidiary, Konka principle of 19 http://
The case is
Huanjia, sued Dalian Tianxing prudence, the www.c
reheard The Septe
Renewable Resources Co., Ltd., Company has ninfo.c
2,307.9 No and in the case is
Huanjia Group, Wang Bingde, accrued mber om.cn/
first in trial
Zhang Xueyin and Wang Renping, corresponding new/in
instance. 2020
requiring them to return impairment dex
prepayment and pay liquidated reserves in
damages. accordance with
accounting
policies.
42
Konka Group Co., Ltd. Interim Report 2023
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of 19 http://
The case is
Technology Co., Ltd., sued prudence, the www.c
reheard The Septe
Huanjia Mingtai (Dalian) Company has ninfo.c
3,302.64 No and in the case is
Renewable Resources Co., Ltd., accrued mber om.cn/
first in trial
Huanjia Group, Wang Bingde, corresponding new/in
instance. 2020
Zhang Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of 19 http://
The case is
Technology Co., Ltd., sued Lankao prudence, the www.c
reheard The Septe
Shunjia Renewable Resources Company has ninfo.c
3,358.8 No and in the case is
Recycling Co., Ltd., Huanjia accrued mber om.cn/
first in trial
Group, Wang Bingde, Zhang corresponding new/in
instance. 2020
Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of 19 http://
The case is
Technology Co., Ltd., sued Henan prudence, the www.c
reheard The Septe
Shunhenghui Renewable Company has ninfo.c
3,337.29 No and in the case is
Resources Recycling Co., Ltd., accrued mber om.cn/
first in trial
Huanjia Group, Wang Bingde, corresponding new/in
instance. 2020
Zhang Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of 19 http://
The case is
Technology Co., Ltd., sued Henan prudence, the www.c
reheard The Septe
Jiaxin Renewable Resources Company has ninfo.c
3,358.08 No and in the case is
Recycling Co., Ltd., Huanjia accrued mber om.cn/
first in trial
Group, Wang Bingde, Zhang corresponding new/in
instance. 2020
Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
The case is
Because of a dispute over a
reheard and in the
purchase and sales contract, the
first instance.
Company's subsidiary, Konka
Based on the
Huanjia Environmental 19 http://
The case is principle of
Technology Co., Ltd., sued Henan www.c
reheard prudence, the The Septe
Shengxiang Renewable Resources ninfo.c
2,922 No and in the Company has case is
Recycling Co., Ltd., Huanjia mber om.cn/
first accrued in trial
Group, Wang Bingde, Zhang new/in
instance. corresponding 2020
Xueyin and Wang Renping, dex
impairment
requiring them to return
reserves in
prepayment and pay liquidated
accordance with
damages.
accounting
43
Konka Group Co., Ltd. Interim Report 2023
policies.
The case is retired
and is pending.
As the bills held by the Company Based on the
failed to be paid upon maturity, the principle of
19 http://
Company filed a lawsuit with the prudence, the
www.c
court, requesting the latter to order The case is Company has The Septe ninfo.c
Wuhan Jialian Agricultural 20,000 No retired and accrued case is
mber om.cn/
Technology Development Co., is pending. corresponding in trial
new/in
Ltd. to pay the aforesaid bills and impairment 2020 dex
corresponding interest to the reserves in
Company. accordance with
accounting
policies.
Because of a dispute over a
purchase and sales contract, the The Company
Company's subsidiary, Dongguan won and the case
Konka Electronic Co., Ltd. filed a is in execution.
lawsuit with Shenzhen Nanshan Based on the
District People's Court, requesting principle of http://
The
the latter to order Dong Guan Gao prudence, the 1 www.c
The case is case is
Neng Polymer Limited Company, Company has ninfo.c
9,010.1 No in in June
Wang Dong, Shenzhen Xinlian accrued om.cn/
execution. executio
Xingyao Trading Co., Ltd., corresponding 2021 new/in
n.
Shenzhen Jinchuan Qianchao impairment dex
Network Technology Co., Ltd., reserves in
Puning Junlong Trading Co., Ltd., accordance with
Huang Zhihao to pay the overdue accounting
payment and corresponding policies.
liquidated damages.
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of http://
The case is
Technology Co., Ltd., sued prudence, the 1 www.c
reheard The
Zhejiang Jiade Renewable Company has ninfo.c
3,562.89 No and in the case is June
Resources Recycling Co., Ltd., accrued om.cn/
first in trial
Huanjia Group, Wang Bingde, corresponding 2021 new/in
instance.
Zhang Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of http://
The case is
Technology Co., Ltd., sued prudence, the 1 www.c
reheard The
Zhejiang Zhijie Renewable Company has ninfo.c
3,562.89 No and in the case is June
Resources Recycling Co., Ltd., accrued om.cn/
first in trial
Huanjia Group, Wang Bingde, corresponding 2021 new/in
instance.
Zhang Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
Because of a dispute over a The case is
purchase and sales contract, the reheard and in the
Company's subsidiary, Konka first instance.
http://
Huanjia Environmental The case is Based on the
1 www.c
Technology Co., Ltd., sued reheard principle of The
ninfo.c
Zhejiang Xinkai Renewable 3,562.89 No and in the prudence, the case is June
om.cn/
Resources Recycling Co., Ltd., first Company has in trial
2021 new/in
Huanjia Group, Wang Bingde, instance. accrued
dex
Zhang Xueyin and Wang Renping, corresponding
requiring them to return impairment
prepayment and pay liquidated reserves in
44
Konka Group Co., Ltd. Interim Report 2023
damages. accordance with
accounting
policies.
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of http://
The case is
Technology Co., Ltd., sued Henan prudence, the 1 www.c
reheard The
Huanjia Trust Environmental Company has ninfo.c
3,358.8 No and in the case is June
Protection Technology Co., Ltd., accrued om.cn/
first in trial
Huanjia Group, Wang Bingde, corresponding 2021 new/in
instance.
Zhang Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of http://
The case is
Technology Co., Ltd., sued Henan prudence, the 1 www.c
reheard The
Xincheng Renewable Resources Company has ninfo.c
3,358.8 No and in the case is June
Recycling Co., Ltd., Huanjia accrued om.cn/
first in trial
Group, Wang Bingde, Zhang corresponding 2021 new/in
instance.
Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
The case is
Because of a dispute over a reheard and in the
purchase and sales contract, the first instance.
Company's subsidiary, Konka Based on the
Huanjia Environmental principle of http://
The case is
Technology Co., Ltd., sued Henan prudence, the 1 www.c
reheard The
Guozheng Environmental Company has ninfo.c
2,090 No and in the case is June
Technology Co., Ltd., Huanjia accrued om.cn/
first in trial
Group, Wang Bingde, Zhang corresponding 2021 new/in
instance.
Xueyin and Wang Renping, impairment dex
requiring them to return reserves in
prepayment and pay liquidated accordance with
damages. accounting
policies.
Because of a dispute over a trust
contract, the Company’s
subsidiary, Henan Frestec
Refrigeration Appliance Co., Ltd.
sued Shenzhen Meisenyuan Plastic
Electronics Co., Ltd., Shantou 1 http://
The case The
Meisen Technology Co.,Ltd., Lin www.c
has entered The Company case is Decem
Yuanqin, Huang Ruirong, ninfo.c
4,211.33 No the won and the case in
Chuangfu Commerce&Trade Plaza ber om.cn/
execution is in execution. executio
Real Estate new/in
phase. n. 2021
Development(Huizhou)Co.,Ltd., dex
requiring an order to terminate the
contract, and them return the
payment for goods, pay liquidated
damages and give priority to the
mortgaged property.
Because of a dispute over a trust
contract, the Company’s 1 http://
The case is
subsidiary, Hainan Konka Material www.c
being The case is being The Decem
Technology Co., Ltd. sued ninfo.c
6,806.6 No heard in heard in the case is
Shenzhen Meisenyuan Plastic ber om.cn/
the second second instance. in trial
Electronics Co., Ltd., Shantou new/in
instance. 2021
Meisen Technology Co.,Ltd., dex
Jiangsu East China Hardware City
45
Konka Group Co., Ltd. Interim Report 2023
Co., Ltd., requiring an order to
terminate the contract, and them
return the payment for goods, pay
liquidated damages and give
priority to the mortgaged property.
Because of a dispute over
1 http://
repurchase, the Company sued Luo The case The
www.c
Zaotong, Luo Jingxia, Luo has entered The Company case is Decem ninfo.c
Zongyin, Luo Zongwu and 24,875.22 No the won and the case in
ber om.cn/
Shenzhen Yaode Technology Co., execution is in execution. executio
new/in
Ltd., requiring an order to pay the phase. n. 2021 dex
share repurchase and interests.
Note: Courts or arbitration bodies ruled in favor of the Company in the following cases which are currently under enforcement. Details of these cases
can be found in the Company's Announcement on Large Amount Pending Lawsuits and Arbitrations disclosed on 25 June 2019 (Announcement No.
2019-63), the Announcement on Accumulative Lawsuits and Arbitrations disclosed on 19 September 2020 (Announcement No. 2020-97), the
Announcement on Accumulative Lawsuits and Arbitrations disclosed on 1 June 2021 (Announcement No. 2021-48), the Announcement on
Accumulative Lawsuits and Arbitrations disclosed on 1 December 2021 (Announcement No. 2021-101), the Announcement on Accumulative
Lawsuits and Arbitrations disclosed on 24 November 2022 (Announcement No. 2022-89), the Announcement on Accumulative Lawsuits and
Arbitrations disclosed on 1 June 2023 (Announcement No. 2023-37), the Announcement on Accumulative Lawsuits and Arbitrations disclosed on 22
June 2023 (Announcement No. 2023-39) and the Company's periodic reports: 1. As matured notes were failed to be accepted, the Company has filed
a lawsuit with the court to request China Energy Electric Fuel Co., Ltd., China Energy (Shanghai) Enterprise Co., Ltd.., Shanghai Nengping industrial
Co., Ltd., and Shenzhen Qianhai Baoying Factoring Co., Ltd. to pay the bill and the corresponding interest to the Company; 2. As matured notes were
failed to be accepted, the Company has filed a lawsuit with the court to request Shanghai Huaxin International Group Co., Ltd. and Tianjin
International Trade Petrochemical Co., Ltd. to pay the bill and the corresponding interest to the Company; 3. As matured notes were failed to be
accepted, the Company has filed a lawsuit with the court to request Shanghai Huaxin International Group Co., Ltd. Qingdao Bonded Zhongshe
International Trading Co., Ltd. and Shenzhen Qianhai Benniu Agricultural Technology Co., Ltd. to pay the bill and the corresponding interest to the
Company; 4. As a consequence of the non-payment of a bill upon its expiry, Kongka Factoring has instituted legal proceedings before the court. The
lawsuit seeks an injunctive order mandating Tahe Group Co., Ltd., Fuzhou Taijia Industrial Co., Ltd., and Xiamen Lianchuang Microelectronics Co.,
Ltd. to remit payment for the bill amount, along with the corresponding interest, to Kongka Factoring.; 5. As matured notes were failed to be accepted,
the Company has filed a lawsuit with the court to request Hefei Huajun Trading Co., Ltd. and Wuhan Jialian Agricultural Technology Development
Co., Ltd. to pay the bill and the corresponding interest to the Company; 6. Due to dispute arisen from a logistics contract, the Company’s subsidiary
Anhui Konka filed a lawsuit to request the freight forwarder Shanghai Triangle Link Logistics Co., Ltd. Shenzhen Branch to make compensation; 7.
Due to contract dispute, the Company’s subsidiary Shenzhen Nianhua applied for arbitration to request the respondent Fang Xianglong and Jiang Yan
to make compensation for corresponding annual profit and fund possession cost; 8. Due to payment dispute, the Company’s subsidiary Hong Kong
Konka applied for an arbitration to Shenzhen Court of International Arbitration to request the respondent Makena Electronic (Hong Kong) to pay for
goods and liquidated damages; 9. Because of a dispute over capital increase, the Company's subsidiary, Shenzhen Konka Investment Holding Co.,
Ltd., applied for arbitration with the Shenzhen Court of International Arbitration (SCIA), requesting the respondents, Elion Resources Group and
Elion Ecological Co., Ltd., to perform the repurchase obligation; 10. As a result of a dispute stemming from an international sale of goods contract,
Anhui Konka Electronic Co., Ltd., a subsidiary of the Company, has initiated legal proceedings against Maoxinyuan Electronics (Hong Kong) Co.,
Ltd. The lawsuit seeks an injunctive order compelling the respondent to pay the applicant the overdue payment interest losses; 11. As a result of a
dispute arising from an international sale of goods contract, Anhui Kangzhi Trade Co., Ltd., a subsidiary of the Company, has initiated legal
proceedings against B&L TECHNOLOGY CO., LIMITED. The lawsuit seeks an injunctive order compelling the respondent to pay the purchase
price, as well as any penalties for breach of contract. 12. Because of a dispute over a purchase and sales contract, the Company's subsidiary, Konka
Huanjia Environmental Technology Co., Ltd., sued Dalian Guangxin Environmental Protection Equipment Technology Development Co., Ltd.,
requiring the latter to return equipment payment already made and pay liquidated damages. 13. Because of a dispute over a contract, the Company
filed a lawsuit with Zhengzou Intermediate People's Court, requiring Henan Radio and Television Network Co., Ltd. to take delivery of goods, make
payment for goods, and pay interest and liquidated damages according to the contract. 14. As a result of contractual disputes, Shenzhen Konka
Unifortune Technology Co., Ltd., a subsidiary of the Company, has initiated legal proceedings against Shenzhen Yaode Technology Co., Ltd.,
46
Konka Group Co., Ltd. Interim Report 2023
Dongsheng Xinluo Technology (Shenzhen) Co., Ltd., Shenzhen Hongyao Dingsheng Investment Management Limited Partnership, Shenzhen
Xiangrui Yingtong Investment Management Limited Partnership, Luo Jingxia, Luo Zongwu, Luo Zongyin, Luo Zaotong, and Luo Saiyin, seeking
restitution for goods received and claiming damages for breach of contract. 15. On account of the infringement of the Company’s trademark rights
and the practice of unfair competition, a lawsuit has been instituted by the Company against Xinshang Electronics Co., Ltd., located in Fu’an City, as
well as Fujian Zhaoguan Industry and Trade Co., Ltd., Jinhua Kangjia Medical Equipment Factory, and Wang Jun, seeking an injunctive order to halt
the infringement, and claiming compensation for any incurred losses.
The following cases have been disclosed in current announcements and periodic reports and are currently in trial. Details of these cases can be found
in the Company's Announcement on Large Amount Pending Lawsuits and Arbitrations disclosed on 25 June 2019 (Announcement No. 2020-97) and
the Announcement on Accumulated Lawsuits and Arbitrations disclosed on 1 June 2021 (Announcement No. 2021-48) and the Announcement on
Accumulative Lawsuits and Arbitrations disclosed on 1 December 2021 (Announcement No. 2021-101), the Announcement on Accumulative
Lawsuits and Arbitrations disclosed on 24 November 2022 (Announcement No. 2022-89), the Announcement on Accumulative Lawsuits and
Arbitrations disclosed on 1 June 2023 (Announcement No. 2023-37), the Announcement on Accumulative Lawsuits and Arbitrations disclosed on 22
June 2023 (Announcement No. 2023-39) and the Company's periodic reports: 1. The customer of Hong Kong Konka, H-BUSTER SAO PAULO
INDUSTRIAE COMERCIO S.A (Brazil) was insolvent, and obtained the approval of the judicial reorganization application of Cotia Third Civil
Court of the Court of Sao Paulo, Brazil in May 2013. As the creditor of H-BUSTER, Hong Kong Konka filed the debt declaration documents, and in
August 2014, the amount confirmed of debt was USD2.78 million. 2. Because of a dispute over an agency agreement, the Company's subsidiary,
Henan Frestec Refrigeration Appliance Co., Ltd., sued Shantou Meisen Technology Co., Ltd., Shenzhen Meisenyuan Plastic Electronics Co., Ltd.,
Lin Yuanqin, Huang Ruirong, Jiangsu Huadong Hardware Zone Co., Ltd., and Chuangfu Commerce & Trade Plaza Real Estate Development
(Huizhou) Co., Ltd., requesting to terminate the contract and requesting them to return the payment of goods and liquidated damages and priority
shall be given to the payment for the secured assets, and the case was heard in the second trial; 3. Because of a dispute over an Agency Agreement,
the Company's subsidiary, Anhui Konka Electronics Technology Co., Ltd. sued Shenzhen Meisenyuan Plastic Electronics Co., Ltd., Shantou Meisen
Technology Co., Ltd., Lin Yuanqin, Huang Ruirong, Jiangsu Huadong Hardware Zone Co., Ltd., requesting to terminate the contract and requesting
them to return the payment of goods and liquidated damages and priority shall be given to the payment for the secured assets; 4. Because of a dispute
over an Agency Agreement, the Company's subsidiary, Anhui Konka Electronics Technology Co., Ltd. sued Shantou Meisen Technology Co., Ltd.,
Shenzhen Meisenyuan Plastic Electronics Co., Ltd., Lin Yuanqin, Huang Ruirong, Jiangsu Huadong Hardware Zone Co., Ltd., requesting to terminate
the contract and requesting them to return the payment of goods and liquidated damages and priority shall be given to the payment for the secured
assets; 5. In view of a dispute arising from a commission contract, Shenzhen Konka Pengrun Technology & Industry Co., Ltd., a subsidiary of the
Company, has instituted legal proceedings against Guang’an Ouchishi Electronic Technology Co., Ltd., Guan Hongshao, Huaying Gaoke De
Electronic Technology Co., Ltd., Huaying Gaoke Long Electronic Technology Co., Ltd., Guizhou Jiaguida Technology Co., Ltd., Sichuan
Hongrongyuan Property Co., Ltd., Du Xinyu, Lin Bolong, and Wang Shisheng, seeking an order for the defendants to pay the purchase price and
claiming damages for breach of contract; 6. In view of a dispute arising from a loan contract, the Company has initiated legal proceedings against
Yantai Kangyue Investment Co., Ltd., seeking an order for the defendant to repay the loan and interest; 7. Due to a dispute arising from a guarantee
contract, Hong Kong Konka Limited, a subsidiary of the Company, has initiated legal proceedings against Xu Xiang, Zheng Baoyao, Ke Hanhua, and
Shenzhen Jinzhong Industry Co., Ltd., seeking an order for the defendants to assume guarantee liability; 8 As a result of a dispute arising from an
international sale of goods contract, Jiaxin Technology Co., Ltd., a subsidiary of the Company, has initiated legal proceedings against Dingxin
Electronic Technology (Hong Kong) Co., Ltd., Chen Wenhuan, and Chen Baohong, seeking an order for the defendants to pay for the goods and
claiming damages for breach of contract; 9. As a result of a dispute arising from a guarantee contract, Anhui Konka Electronic Co., Ltd., a subsidiary
of the Company, has initiated legal proceedings against Maoxinyuan Electronics (Shenzhen) Co., Ltd., seeking an order for the defendant to assume
joint guarantee liability to the plaintiff; 10. Due to a dispute arising from an installment purchase contract, Wu Rong has instituted legal proceedings
against the Company and its subsidiary, Shenzhen Konka Electronics Technology Co., Ltd., seeking an order for the payment of the purchase price
and overdue payment interest to the plaintiff; 11. As a result of a dispute arising from a contract, Shenzhen Oriental Entrepreneurship Investment Co.,
Ltd. has initiated legal proceedings against the Company, seeking an order for the payment of the repurchase amount and claiming damages for
breach of contract. 12. As a result of a dispute arising from a third-party objection to execution, Konka Huanjia Environmental Technology Co., Ltd.,
a subsidiary of the Company, has instituted legal proceedings against Fuxin Bank Co., Ltd. and Huanjia Group Co., Ltd., seeking an order from the
47
Konka Group Co., Ltd. Interim Report 2023
court to affirm the plaintiff’s ownership of the goods and to exclude the defendant’s execution. 13. As a result of a dispute arising from a third-party
objection to execution, Konka Huanjia Environmental Technology Co., Ltd., a subsidiary of the Company, has instituted legal proceedings against
Fuxin Bank Co., Ltd. and Dalian Jinjia Materials Recycling Co., Ltd., seeking an order from the court to affirm the plaintiff’s ownership of the goods
and to exclude the defendant’s execution. 14. Due to a dispute arising from a third-party objection to execution, Konka Huanjia Environmental
Technology Co., Ltd., a subsidiary of the Company, has instituted legal proceedings against Fuxin Bank Co., Ltd., Dalian Jinkaisxuan Renewable
Resource Acquisition Chain Co., Ltd., Dalian Yingtai Paper Co., Ltd., Dalian Zhanhong Renewable Resource Recycling Co., Ltd., and Wang Jinping,
seeking an order from the court to affirm the plaintiff’s ownership of the goods and to exclude the defendant’s execution. 15. Due to a contractual
dispute, Shenzhen Konka Unifortune Technology Co., Ltd., a subsidiary of the Company, filed a lawsuit against Shenzhen Junxing Communication
Technology Co., Ltd., Gumei Electronics (Hongkong) Technology Limited, Shenzhen Hongxingfengda Industrial Development Co., Ltd., Shenzhen
Junxing Junye Electronics Co., Ltd., Zeng Jiankai, Zhang Zhenyu, Herewin Technology Group (HK) Co., Ltd., Zhang Lixia, Anhui Baolin Industrial
Co., Ltd., Zeng Qingpeng, and Zhong Yuhua to return the payment for goods and pay the corresponding liquidated damages. 16. Due to an equity
repurchase dispute, the Company’s subsidiary Shenzhen Nianhua Enterprise Management Co., Ltd. has initiated legal proceedings against Fang
Xianglong and Jiang Yan to repurchase the equity and pay the corresponding repurchase price. 17. Due to a purchase and sales contract, the
Company’s subsidiary Konka Huanjia Environmental Technology Co., Ltd. appealed against Xu Jianhua and Guangxi BG New Materials Co., Ltd. to
request the court to refuse Xu Jianhua's all claims and request Guangxi BG New Materials Co., Ltd. to make payment for goods and pay liquidated
damages. 18. Due to a purchase and sales contract, the Company’s subsidiary Sichuan Konka Smart Terminal Technology Co., Ltd. filed a lawsuit
against Shenzhen Junxing Communication Technology Co., Ltd., Shenzhen Hongxingfengda Industrial Development Co., Ltd., Shenzhen Junxing
Junye Electronics Co., Ltd., Liuyang Huaichuan Heyuanshanzhuang Co., Ltd., Zeng Jiankai, and Zhong Yuhua, requesting them to make payment for
goods and pay liquidated damages. 19. Due to a dispute over an equity transfer agreement, the Company filed a lawsuit against Beijing
Langruihaoteng Technology Development Co., Ltd., Beijing Beida Jade Bird Security System Engineering Technical Co., Ltd., and Beijing
Jingruihaoteng Technology Development Co., Ltd., seeking the final payment of the equity transfer. 20. Due to a contractual dispute, the Company’s
subsidiary Konka Mobility Co., Limited filed a lawsuit against Hong Kong Join Star Electronics International Limited, Zeng Jiankai, and Zhong
Yuhua, requesting them to make payment for goods and pay liquidated damages. 21. Due to a dispute over the cancellation of creditor's rights, the
Company’s subsidiary Anhui Konka Electronic Co., Ltd. filed a lawsuit against Wu Rong and Makena Electronic (Shenzhen) Co., Ltd., seeking for
the cancellation of the Agreement on the Transfer of Creditor's Rights and the relevant supplemental agreement previously signed by the defendants.
22. Due to a purchase and sales contract, Sichuan Shuwu Guangrun Logistics Co., Ltd. filed a lawsuit against the Company’s subsidiary Dongguan
Konka Electronic Co., Ltd., requesting the latter to make payment for goods and pay liquidated damages. 23. Due to a dispute over bankruptcy,
Xinxiang Jiahui Dakeluo Crafts Products Co., Ltd. filed a lawsuit against the Company’s subsidiary Henan Frestec Refrigeration Appliance Co., Ltd.,
requesting a confirmation that the period-end excess VAT paid that had been returned by the tax authority to the defendant should have been other
properties to be distributed. 24. Due to a purchase and sales contract of international goods, Micro Crystal Transfer Group Ltd. filed a lawsuit against
the Company’s subsidiary Chongqing Konka Optoelectronic Technology Research Institute Co., Ltd., requesting the latter to make payment for goods
and pay liquidated damages. 25. Due to a contractual dispute, the Company filed a lawsuit against Zhu Xinming, Leng Sumin, Gongqingcheng
Jinzhuanrong Investment Management Partnership (Limited Partnership), and Gongqingcheng Xinrui Investment Management Partnership (Limited
Partnership), requesting them to pay the performance compensation.
Other legal matters:
□ Applicable √ Not applicable
IX Punishments and Rectifications
√ Applicable □ Not applicable
Type of
Disclosure Disclosure
Name Type Reason punishme Conclusion (if any)
date index
nt
Some purchase and sale Therefore, the Shenzhen
Konka http://www.cni
transactions, conducted Charging Bureau of the China Securities 4 January
Group Co., Other nfo.com.cn/new
by the Company's correction Regulatory Commission 2023
Ltd. /index
relevant subsidiaries (CSRC Shenzhen) decided to
48
Konka Group Co., Ltd. Interim Report 2023
from 2020 to 2021, did take a regulatory measure,
not have commercial requesting the Company to
substance, the make a correction, in
recognition of income accordance with Item 1,
and costs of which was Article 52 of the Measures for
short of evidence. the Administration of
Consequently, financial Information Disclosure by
data disclosed in the Listed Companies and Article
corresponding periodic 21 of the Rules for the On-site
report of the Company Inspection of Listed
were inaccurate. Companies (ZH.J.H.G.G.
[2022] No. 21).
Information on rectification
√ Applicable □ Not applicable
As of the end of the Reporting Period, the Company had completed all remediation tasks in line
with the relevant regulatory requirements. For details, see the Report on the Remediation Based on
the Corrective Measures of the Shenzhen Bureau of the China Securities Regulatory Commission
against the Company (Announcement No.: 2023-09) disclosed by the Company on
http://www.cninfo.com.cn/new/index on 25 February 2023.
X Credit Quality of the Company as well as its Controlling Shareholder and De Facto
Controller
□ Applicable √ Not applicable
XI Major Related-Party Transactions
1. Continuing Related-Party Transactions
√ Applicable □ Not applicable
As % Obtai
Appro
Rela of nable Index
ved Over
tions Type Total total marke to
Pricin transa the Metho
Relate hip of Specific Trans value value t price Disclo disclo
g ction appro d of
d with trans transacti action (RMB of all for sure sed
princi line ved settle
party the actio on price ’0,000 same- same- date infor
ple (RMB line or ment
Com n ) type type matio
’0,000 not
pany transa transa n
)
ctions ctions
OCT Und
Enter er Purch
Property
prises the ase of
sam com manage http://
Co., Negot 28 www.
e modit ment, Marke 3,400. 10,00
Ltd iated 0.70% Not Cash N/A March cninfo
actu ies utilities, t price 78 0.00
.com.
and price 2023 cn/ne
al and office
its w/ind
cont servi leases ex
subsid rolle ces
iaries r
20,00
OCT Und Sales Sale of Negot Marke 3,184. 0.66% 0.00 Not Cash N/A 28
49
Konka Group Co., Ltd. Interim Report 2023
Enter er of TVs, iated t price 81 March
prises the good intellige price 2023
Co., sam s and nt
e servi
Ltd terminal
actu ces
and s, etc.
al
its and
cont
subsid collectio
rolle
iaries r n of
installati
on
charges
for
smart
TV
terminal
s
6,585. 30,00
Total -- -- -- -- -- -- -- --
59 0.00
Large-amount sales return in detail N/A
Give the actual situation in the
The Company has published the Forecasting Public Notice on Routine Related-party
Reporting Period (if any) where an Transaction for Y2023 on Securities Times, Shanghai Securities News, and China
estimate had been made for the Securities Journal as well as the Internet website designated by CSRC
http://http://www.cninfo.com.cn/new/index on 28 March 2023. In the Reporting Period, the
total value of continuing related- basis for pricing, transaction price, transaction amount and settlement methods of raw
party transactions by type to occur materials purchased by the Company were basically in accordance with the forecast. The
total amount incurred was RMB65.8559 million.
in the Reporting Period
Reason for any significant
difference between the transaction
N/A
price and the market reference
price (if applicable)
2. Related-Party Transactions Regarding Purchase or Disposal of Assets or Equity
Investments
□ Applicable √ Not applicable
No such cases in the Reporting Period.
3. Related-Party Transactions Regarding Joint Investments in Third Parties
□ Applicable √ Not applicable
No such cases in the Reporting Period.
4. Credits and Liabilities with Related Parties
√ Applicable □ Not applicable
Indicate by tick mark whether there were any credits and liabilities with related parties for non-
operating purposes.
50
Konka Group Co., Ltd. Interim Report 2023
√ Yes □ No
No credits receivable with related parties
Liabilities payable to related parties:
Increased in Recovered in Interest in
Beginning the the the Ending
Related
Related Forming balance Reporting Reporting Interest Reporting balance
relation
party reason (RMB’0,000 Period Period rate Period (RMB’0,000
ship
) (RMB’0,000 (RMB’0,000 (RMB’0,0 )
) ) 00)
The 131,091.00 0.00 0.00 3.45% 2,273.88 131,091.00
OCT Control
Company
Enterprise ling 50,000.00 0.00 0.00 3.45% 867.29 50,000.00
applies
s Co., shareh
entrusted
Ltd. older
loan to it 70,000.00 0.00 0.00 3.45% 1,214.21 70,000.00
Effects of liabilities with related
The Company applies entrusted loan from OCT Enterprises Co., Ltd. which meets the
parties on the Company’s operating
needs of the company's existing business development and reduces the financing cost.
results and financial conditions
5. Transactions with Related Finance Companies
□ Applicable √ Not applicable
The Company did not make deposits in, receive loans or credit from and was not involved in any
other finance business with any related finance company or any other related parties.
6. Transactions with Related Parties by Finance Companies Controlled by the Company
□ Applicable √ Not applicable
The finance company controlled by the Company did not make deposits, receive loans or credit
from and was not involved in any other finance business with any related parties.
7. Other Major Related-Party Transactions
√Applicable □ Not applicable
(1) Guarantee Limits for Affiliated Companies: The 7th meeting of the 10th Board of Directors on
24 February 2023 and the First Extraordinary General Meeting of Shareholders in 2023 on 13
March 2023, passed the proposal Providing Guarantee Limits for Chuzhou Kangjin Health Industry
Development Co., Ltd. The Company provided a credit guarantee limit of RMB259.7 million for
Chuzhou Kangjin Health Industry Development Co., Ltd. according to its shareholding proportion,
with a guarantee limit valid for fourteen years. This credit guarantee limit was used to apply for
loans from banks by Chuzhou Kangjin Health Industry Development Co., Ltd. Other shareholders
of Chuzhou Kangjin Health Industry Development Co., Ltd. will provide guarantees for it based on
their respective shareholding proportions, together with the Company.
(2) Application for Comprehensive Credit Limit from China Everbright Bank Co., Ltd.: The 7th
meeting of the 10th Board of Directors on 24 February 2023, approved the proposal Application for
Comprehensive Credit Limit from China Everbright Bank Co., Ltd. The Company applied for a
51
Konka Group Co., Ltd. Interim Report 2023
comprehensive credit limit not exceeding RMB1.5 billion from China Everbright Bank Co., Ltd. to
meet its daily operating capital needs. During the reporting period, the ongoing credit amount of the
Company with China Everbright Bank Co., Ltd. was RMB1 billion.
(3) Counter-guarantees for Bank Credit Facilities Application: The 7th meeting of the 10th Board of
Directors on 24 February 2023 and the First Extraordinary General Meeting of Shareholders in
2023 on 13 March 2023, approved the proposal Providing Counter-guarantees for Bank Credit
Facilities Application by the Company. To reduce financing costs, Overseas Chinese Town
Holdings Company provided a guarantee for the Company’s bank credit facilities application, not
exceeding RMB1 billion. In turn, the Company offered counter-guarantees to Overseas Chinese
Town Group of an equal amount and term, with an counter-guarantee amount not exceeding RMB1
billion, and a guarantee limit valid for a maximum of three years.
Index to the public announcements about the said related-party transactions disclosed
Title of public announcement Disclosure date Disclosure website
Announcement on the Provision of Guarantee Line for Joint Stock Company
25 February 2023
and the Related-party Transaction
Announcement on the Application to China Everbright Bank for http://www.cninfo.com.c
25 February 2023
Comprehensive Credit Line & the Related-party Transaction n/new/index
Announcement on the Provision of Counter-guarantee for the Application to
25 February 2023
Bank for Credit Line & the Related-party Transaction
XII Major Contracts and Execution thereof
1. Entrustment, Contracting and Leases
(1) Entrustment
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(2) Contracting
□ Applicable √ Not applicable
No such cases in the Reporting Period.
(3) Leases
√ Applicable □ Not applicable
Note to leases
No significant leases in the Reporting Period.
The rental revenue of Konka R&D Building was approximately RMB33,880,986.04 in the
Reporting Period.
The project bringing about gains or losses as over 10% of total profit in the Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
2. Major Guarantees
√ Applicable □ Not applicable
Unit: RMB'0,000
52
Konka Group Co., Ltd. Interim Report 2023
Guarantees provided by the Company and its subsidiaries for external parties (exclusive of those for subsidiaries)
Guar
Act
Disclosure antee
ual Havi
date of the Collat Counter for a
Actual guar ng
guarantee Line of Type of eral guarant Term of relate
Obligor occurrence ante expir
line guarantee guarantee (if ee (if guarantee d
date e ed or
announce any) any) party
amo not
ment or
unt
not
2,49 Joint-
8 July 2022 No Not One year Not Not
8 liability
Joint-
27 July 2022 749 No Not One year Not Not
liability
16 August Joint-
25 No Not One year Not Not
2022 liability
6 September Joint-
200 No Not One year Not Not
Econ 2022 liability
28 April
Technolo 50,000
2022 30 September
gy 3,74 Joint-
No Not Two years Not Not
2022 7 liability
23 November 2,74 Joint- One and a
No Not Not Not
2022 8 liability half years
1,49 Joint-
22 May 2023 No Not One year Not Not
9 liability
3,74 Joint-
10 May 2023 No Not One year Not Not
7 liability
Foshan
Pearl
River
Media
Creative 28 April Joint-
1,372 17 May 2022 980 No Not Six years Not Not
Park 2022 liability
Culture
Developm
ent Co.,
Ltd.
Jiangxi
Xinxin
Jian’an 12 December 10,0 Joint-
10,000 No Not Not Not
Engineeri 2016 00 liability
ng Co.,
Ltd.
Jiangxi
Zhongyi
Decoratio 12 December 10,0 Joint-
10,000 No Not Not Not
n 2016 00 liability
Materials
Co., Ltd.
Jiangxi
Shanshi
Technolo 12 December 10,0 Joint-
gical 10,000 No Not Not Not
2016 00 liability
Developm
ent Co.,
Ltd.
8 September 60,0 Joint- Three
No Not Not Yes
OCT 30 March 2022 00 liability years
270,000
Group 2022
60,0 Joint- Three
18 October No Not Not Yes
00 liability years
53
Konka Group Co., Ltd. Interim Report 2023
2022
Total approved line for such
Total actual amount of such guarantees in the Reporting
guarantees in the Reporting Period 131,770 5,246
Period (A2)
(A1)
Total approved line for such
Total actual balance of such guarantees at the end of the
guarantees at the end of the 878,142 166,193
Reporting Period (A4)
Reporting Period (A3)
Guarantees provided between the Company and subsidiaries
Guara
Disclosure Actu Havi
Lin ntee
date of the al Term ng
e of Collat Counter for a
guarantee Actual guara Type of of expi
Obligor gua eral (if guarantee (if relate
line occurrence date ntee guarantee guaran red
rant any) any) d
announce amou tee or
ee party
ment nt not
or not
One
Joint- year
2 June 2022 3,000 No Not Not Not
liability and a
half
Joint- One
Anhui 25 5 July 2022 5,000 No Not Not Not
55,0 liability year
Tongchua February
00 19 October
ng 2023 10,00 Joint- One
No Not Not Not
2022 0 liability year
6 February 10,00 Joint- One
No Not Not Not
2023 0 liability year
Joint- Three
19 August 2020 2,480 No Not Not Not
liability years
28 April Joint- One
25 August 2022 3,000 No Not Not Not
2022 and liability year
Boluo 12,5
25 19 January
Precision 00 Joint- One
February 4,000 No Not Not Not
2023 liability year
2023
Joint- Three
2 March 2023 3,000 No Not Not Not
liability years
24 November Joint- One
Electroni 8,500 No Not Not Not
25 2022 liability year
cs 100,
February
Technolo 000 10 October
2023 50,00 Joint- One
gy No Not Not Not
2022 0 liability year
24 March Joint- One
24 March 2023 5,000 No Not Not Not
2021 and liability year
Donggua 90,0
25
n Konka 00 80,00 Joint- Ten
February 23 June 2021 No Not Not Not
0 liability years
2023
25 December Other
Joint- shareholder of Three
2,000 No Not Not
2020 liability XingDa years
19 HongYe
XingDa 10,0 provides a
September Two
HongYe 00 counter
Joint- guarantee for years
2018 31 May 2021 750 No Not Not
liability the Company and a
for 49% of the half
guarantee line
31 6 November Other
Jiangxi 60,0 10,00 Joint- Three
No shareholder of Not Not
Konka October 00 2020 0 liability years
Jiangxi Konka
54
Konka Group Co., Ltd. Interim Report 2023
2018 Joint- provides a Two
26 June 2022 6,000 No Not Not
liability counter years
29 September guarantee for
10,00 Joint- the Company Three
No Not Not
2020 0 liability for 49% of the years
Joint- guarantee line Two
10 March 2022 990 No Not Not
liability years
30 December Joint- Three
1,000 No Not Not
2020 liability years
8 December Other
Joint- shareholder of Three
2,100 No Not Not
2020 liability Xinfeng years
Microcrystalli
Xinfeng 30 March 29 December Joint- One
25,0 7,200 No ne provides a Not Not
Microcry liability year
2019 00 2022 counter
stalline
guarantee for
Joint- the Company One
30 June 2023 7,200 No for 49% of the Not Not
liability year
guarantee line
Other
shareholder of
Jiangxi High
Jiangxi Transparent
High 30 March Substrate
45,0 Joint- Two
Transpare 10 March 2022 990 No provides a Not Not
2019 00 liability years
nt counter
Substrate guarantee for
the Company
for 49% of the
guarantee line
24 March
2021 and
Sichuan 20,0 Joint- Three
25 23 May 2023 4,000 No No Not Not
Konka 00 liability years
February
2023
Ningbo Joint- Two
12 August 2021 6,000 No No Not Not
Khr 28 April liability years
12,0
Electric
2022 00 Joint- One
Applianc 12 July 2022 6,000 No No Not Not
liability year
e
Other
shareholder of
Yibin Kangrun
24
13 November provides a
Yibin 10,0 10,00 Joint- Four
October No counter Not Not
Kangrun 00 2020 0 liability years
guarantee for
2020 the Company
for 33% of the
guarantee line
Telecom
One
municatio 28 April 20,0 Joint- and a
n 20 May 2022 7,500 No No Not Not
2022 00 liability half
Technolo
years
gy
28,00 Joint- Ten
10 August 2021 No Not Not
0 liability years
Other
29 October Joint- shareholder of Five
7,000 No Not Not
2021 liability Anhui Konka years
28 April provides a
Anhui 110, 13 September 10,00 Joint- counter One
Konka 2022 000 No Not Not
2022 0 liability guarantee for year
the Company
Joint- for 22% of the One
18 August 2022 5,500 No Not Not
liability guarantee line year
18,00 Joint- One
22 August 2022 No Not Not
0 liability year
55
Konka Group Co., Ltd. Interim Report 2023
24 October Joint- Four
7,000 No Not Not
2022 liability years
19 September Joint- One
7,000 No Not Not
2022 liability year
Joint- Five
25 June 2023 5,000 No Not Not
liability years
Three
20,00 Joint- and a
24 May 2021 No Not Not
24 March 0 liability half
Konka 50,0 years
No
Circuit 2021 00
14 September Joint- One
5,000 No Not Not
2022 liability year
28 April
Mobile 2022 and
15,0 Joint- One
Interconn 25 11 August 2022 7,000 No No Not Not
00 liability year
ection February
2023
24 March
Liaoyang
2021 and 20,0 Joint- One
Kangshu 6 January 2023 5,000 No No Not Not
28 April 00 liability year
n
2022
Konka 20,00 Joint- Five
24 March 12 July 2021 No No Not Not
Xinyun 30,0 0 liability years
Semicond 2021 00 Joint- Two
26 May 2022 6,000 No No Not Not
uctor liability years
Yibin One
Konka 24 March 10,0 Joint- year
23 May 2023 980 No No Not Not
Intelligen 2021 00 liability and a
t half
Chongqin 24 March 55,6 13 December 38,00 Joint- Fifteen
No No Not Not
g Konka 2021 00 2022 0 liability years
Frestec 28 April 12,2 10,20 Joint- Eight
Smart 6 July 2022 No No Not Not
2022 40 0 liability years
Home
Konka
Soft 28 April 19,0 19 December Joint- Four
975 No No Not Not
Electroni 2022 00 2022 liability years
c
Xi'an
Kanghon
g
25
Technolo
30,0 30,00 Joint- Ten
gy February 26 May 2023 No No Not Not
00 0 liability years
Industry
Develop 2023
ment Co.,
Ltd.
Total actual amount of such
Total approved line for such guarantees in the Reporting
275,845 guarantees in the Reporting Period 74,180
Period (B1)
(B2)
Total actual balance of such
Total approved line for such guarantees at the end of the
1,789,147 guarantees at the end of the 496,365
Reporting Period (B3)
Reporting Period (B4)
Guarantees provided between subsidiaries
Disclosure Lin Act Type Term Havi Guara
Collat Counter
date of the e of Actual occurrence ual of of ng ntee
Obligor eral (if guarantee (if
guarantee gua date guar guara guaran expi for a
any) any)
line rant ante ntee tee red relate
56
Konka Group Co., Ltd. Interim Report 2023
announce ee e or d
ment amo not party
unt or not
Lands,
house
Anhui Mortg proper
Electrical 13,5 13,5 Three
3 July 2020 age, ty, No Not Not
Applianc 00 00 years
e pledge equity
interes
ts
Total approved line for such guarantees in the Reporting Period Total actual amount of such guarantees in
1,530 0
(C1) the Reporting Period (C2)
Total approved line for such guarantees at the end of the 15,03 Total actual balance of such guarantees at 13,50
Reporting Period (C3) 0 the end of the Reporting Period (C4) 0
Total guarantee amount (total of the three kinds of guarantees above)
Total guarantee line approved in the Reporting Period Total actual guarantee amount in the
409,145 79,426
(A1+B1+C1) Reporting Period (A2+B2+C2)
Total actual guarantee balance at the
Total approved guarantee line at the end of the Reporting 2,682,31
end of the Reporting Period 676,058
Period (A3+B3+C3) 9
(A4+B4+C4)
Total actual guarantee amount (A4+B4+C4) as % of the
89.88%
Company’s net assets
Of which:
Balance of guarantees provided for shareholders, actual controller and their related parties (D) 120,000
Balance of debt guarantees provided directly or indirectly for obligors with an over 70% debt/asset ratio (E) 676,058
Amount by which the total guarantee amount exceeds 50% of the Company’s net assets (F) 299,950
Total of the three amounts above (D+E+F) 676,058
Joint responsibilities possibly borne in the Reporting Period for undue guarantees (if any) N/A
Provision of external guarantees in breach of the prescribed procedures (if any) N/A
Compound guarantees:
None
3. Cash Entrusted for Wealth Management
√ Applicable □ Not applicable
Overview of cash entrusted for wealth management in the Reporting Period
Unit: RMB’0,000
Unrecovered
Unrecovered overdue amount
Type Funding source Amount Undue amount
overdue amount with provision for
impairment
Trust financial
Self-owned 10,000.00 10,000.00 0.00 0.00
products
Total 10,000.00 10,000.00 0.00 0.00
57
Konka Group Co., Ltd. Interim Report 2023
High-risk entrusted wealth management with significant single amount or low security and poor
liquidity:
□ Applicable √ Not applicable
Whether there is the case where the principal cannot be recovered at maturity or other case which
may cause impairment for entrusted wealth management
□ Applicable √ Not applicable
4. Other Major Contracts
□ Applicable √ Not applicable
No such cases in the Reporting Period.
XIII Other Significant Events
√ Applicable □ Not applicable
(I) Initiation and establishment of funds: The total scale of the Oriental-Konka Industry M&A Fund
was RMB1,001,000,000. Shenzhen Konka Investment Holding Co., Ltd. contributed RMB500
million, accounting for 49.95% of the total units. By the date of this report, Shenzhen Konka
Investment Holding Co., Ltd. has contributed RMB487,344,000. The fund invested in Jiangxi
Yahua Electronic Materials Co., Ltd., Genew Technologies Co., Ltd., etc.
The total scale of the Kunshan-CITIC-Konka Emerging Industry Development Investment Fund
was RMB1,006,000,000. Shenzhen Konka Investment Holding Co., Ltd. contributed RMB500
million, accounting for 49.70% of the total units. By the date of this report, Shenzhen Konka
Investment Holding Co., Ltd. has contributed RMB195.21 million. The fund invested in
UNIONTECH, Hercules Microsystems (HME), etc.
The total scale of the Tongxiang Wuzhen Jiayu Digital Economic Industry Fund was RMB500
million. Shenzhen Konka Investment Holding Co., Ltd. contributed RMB200 million, accounting
for 40% of the total units. By the date of this report, Shenzhen Konka Investment Holding Co., Ltd.
has contributed RMB200,000,000. The fund invested in Feidi Technology (Shenzhen) Co., Ltd.,
Allystar Technology (Shenzhen) Co., Ltd., etc.
The total scale of Yancheng Kangyan Industry Investment Fun was RMB3,000 million. Shenzhen
Konka Investment Holding Co., Ltd. and Shenzhen Konka Capital Equity Investment Management
Co., Ltd. contributed RMB1201,500,000, accounting for 40.05% of the total units. By the date of
this report, Shenzhen Konka Investment Holding Co., Ltd. and Shenzhen Konka Capital Equity
Investment Management Co., Ltd. have contributed RMB217.36 million. The fund invested in
Anhui Zhongdian Xingfa and Xinlong Co., Ltd., Chongqing E2info Technology Co., Ltd., etc.
The total scale of Yibin Kanghui Electronic Information Industry Equity Investment Fund was
RMB1,002,000,000. Shenzhen Konka Investment Holding Co., Ltd. and Shenzhen Konka Capital
Equity Investment Management Co., Ltd. contributed RMB401 million, accounting for 40.02% of
the total units. By the issuance date of this report, Shenzhen Konka Investment Holding Co., Ltd.
58
Konka Group Co., Ltd. Interim Report 2023
has contributed RMB104 million. The fund invested in Chongqing E2info Technology Co., Ltd., etc.
The total scale of Chongqing Kangxin Equity Investment Fund was RMB2 billion. Shenzhen
Konka Investment Holding Co., Ltd. and Shenzhen Konka Capital Equity Investment Management
Co., Ltd. contributed RMB1 billion, accounting for 50% of the total units. By the date of this report,
Shenzhen Konka Investment Holding Co., Ltd. and Shenzhen Konka Capital Equity Investment
Management Co., Ltd. have contributed RMB148,248,300. The fund invested in Shanghai VEIGLO
Information System Co., Ltd., Jiangxi Taide Wisdom Technology Co., Ltd., etc.
(II) Disclosure index of significant information
Announce Website
Date Title Page on newspaper
ment No. link
Announcement on Receiving the Shenzhen Bureau of the China Securities http://ww
Securities Daily B108, Shanghai Securities
2023-01 2023/1/4 Regulatory Commission's Decision to Take Corrective Measures against w.cninfo.c
News 116, etc.
Konka Group Co., Ltd. om.cn/ne
Announcement on Resolutions of the Sixth Meeting of the Tenth Board of Securities Daily B31, Shanghai Securities News w/index
2023-02 2023/1/17
Directors 17, etc.
Announcement on Proposed Sale of Some of Equity in Chutian Dragon Co., Securities Daily B31, Shanghai Securities News
2023-03 2023/1/17
Ltd. 17, etc.
Announcement on Proposed Sale of Some of Equity in Wuhan Tianyuan Securities Daily B26, Shanghai Securities News
2023-04 2023/1/17
Environmental Protection Co., Ltd. 17, etc.
Securities Daily B75, Shanghai Securities News
2023-05 2023/1/18 Announcement on Progress in the Provision of External Guarantee
81, etc.
Securities Daily B143, Shanghai Securities
2023-06 2023/1/31 2022 Result Forecast
News 148, etc.
Announcement on Resolutions of the Seventh Meeting of the Tenth Board of Securities Daily B57, Shanghai Securities News
2023-07 2023/2/25
Directors 41, etc.
Announcement on Resolutions of the Fourth Meeting of the Tenth Board of Securities Daily B58, Shanghai Securities News
2023-08 2023/2/25
Supervisors 41, etc.
Report on the Remediation Based on the Corrective Measures of the Shenzhen Securities Daily B58, Shanghai Securities News
2023-09 2023/2/25
Bureau of the China Securities Regulatory Commission against the Company 41, etc.
Securities Daily B57, Shanghai Securities News
2023-10 2023/2/25 Announcement on External Guarantee
41, etc.
Announcement on Providing Security Limit to and Conducting Connected Securities Daily B57, Shanghai Securities News
2023-11 2023/2/25
Transaction with Shareholding Company 41, etc.
Securities Daily B57, Shanghai Securities News
2023-12 2023/2/25 Notice on Convening 2023 First Extraordinary General Meeting
41, etc.
Announcement on Providing Financial Assistance to Shandong Econ Securities Daily B58, Shanghai Securities News
2023-13 2023/2/25
Technology Co., Ltd. at Shareholding Ratio 41, etc.
Announcement on Applying for a Comprehensive Line of Credit to and Securities Daily B57, Shanghai Securities News
2023-14 2023/2/25
Conducting Connected Transactions with China Everbright Bank 41, etc.
Announcement on Providing Counter Guarantee and Conducting Connected Securities Daily B50, Shanghai Securities News
2023-15 2023/2/25
Transaction for Applying for Bank Credit Business 41, etc.
Announcement on Progress of Guarantee Provision for Wholly-owned Securities Daily B58, Shanghai Securities News
2023-16 2023/2/25
Company 41, etc.
Securities Daily B49, Shanghai Securities News
2023-17 2023/3/14 Announcement on Resolutions of 2023 First Extraordinary General Meeting
41, etc.
59
Konka Group Co., Ltd. Interim Report 2023
Securities Daily B178, Shanghai Securities
2023-18 2023/3/28 2022 Annual Report
News 177, etc.
Securities Daily B178, Shanghai Securities
2023-19 2023/3/28 Abstract of 2022 Annual Report
News 177, etc.
Announcement on Resolutions of the Eighth Meeting of the Tenth Board of Securities Daily B178, Shanghai Securities
2023-20 2023/3/28
Directors News 177, etc.
Announcement on Resolutions of the Fifth Meeting of the Tenth Board of Securities Daily B178, Shanghai Securities
2023-21 2023/3/28
Supervisors News 177, etc.
Securities Daily B178, Shanghai Securities
2023-22 2023/3/28 Announcement on Expected Routine Connected Transactions in 2023
News 177, etc.
Securities Daily B178, Shanghai Securities
2023-23 2023/3/28 Announcement on Plan of Profit Distribution for 2022
News 177, etc.
Securities Daily B178, Shanghai Securities
2023-24 2023/3/28 Announcement on Accrual of Asset Impairment Reserves for 2022
News 177, etc.
Securities Daily B90, Shanghai Securities News
2023-25 2023/4/4 Announcement on Change in Accounting Method of Shareholding Company
65, etc.
Announcement on Proposed Sale of Some of Equity in Chutian Dragon Co., Securities Daily B90, Shanghai Securities News
2023-26 2023/4/4
Ltd. 65, etc.
Announcement on Resolutions of the Ninth Meeting of the Tenth Board of Securities Daily B90, Shanghai Securities News
2023-27 2023/4/4
Directors 65, etc.
Securities Daily B90, Shanghai Securities News
2023-28 2023/4/4 Announcement on Holding 2022 Online Result Release
65, etc.
Securities Daily B1204, Shanghai Securities
2023-29 2023/4/29 2023Q1 Report
News 988, etc.
Announcement on Progress of Guarantee Provision for Wholly-owned Securities Daily B1204, Shanghai Securities
2023-30 2023/4/29
Company News 988, etc.
Securities Daily B1204, Shanghai Securities
2023-31 2023/4/29 Announcement on Some Accounting Policy Changes
News 988, etc.
Announcement on the Postponement of Reply to Inquiry Letter on 2022 Securities Daily B128, Shanghai Securities
2023-32 2023/5/13
Annual Report from Shenzhen Stock Exchange News 12, etc.
Announcement on Resolutions of 11th Meeting of the Tenth Board of Securities Daily B21, Shanghai Securities News
2023-33 2023/5/19
Directors 36, etc.
Announcement on Reply to Inquiry Letter on 2022 Annual Report from Securities Daily B173-B174, Shanghai
2023-34 2023/5/20
Shenzhen Stock Exchange Securities News 161, etc.
Announcement on Resolutions of 12th Meeting of the Tenth Board of Securities Daily B42, Shanghai Securities News
2023-35 2023/5/27
Directors 100, etc.
Securities Daily B42, Shanghai Securities News
2023-36 2023/5/27 Notice on Convening 2022 Shareholders' General Meeting
100, etc.
Securities Daily B32, Shanghai Securities News
2023-37 2023/6/1 Announcement on Accumulative Lawsuits and Arbitrations
41, etc.
Securities Daily B100, Shanghai Securities
2023-38 2023/6/20 Announcement on Resolutions of 2022 Shareholders' General Meeting
News 57, etc.
Securities Daily B93, Shanghai Securities News
2023-39 2023/6/22 Announcement on Accumulative Lawsuits and Arbitrations
73, etc.
Securities Daily B93, Shanghai Securities News
2023-40 2023/6/22 Announcement on Progress in the Provision of External Guarantee
73, etc.
XIV Significant Events of Subsidiaries
□ Applicable √ Not applicable
60
Konka Group Co., Ltd. Interim Report 2023
Part VII Share Changes and Shareholder Information
I Share Changes
1. Share Changes
Unit: share
Before Increase/decrease in the Reporting Period (+/-) After
Shares
Shares as
as
dividend Percent
Percenta New dividend
Shares converted Other Subtotal Shares age
ge (%) issues converte
from capital (%)
d from
reserves
profit
1. Restricted
0 0.00% 0 0.00%
shares
2. Unrestricted 2,407,919,40 2,407,9 100.00
100.00%
shares 8 19,408 %
2.1 RMB-
denominated 1,596,567,80 1,596,5 66.31
66.31%
ordinary 0 67,800 %
shares
2.2
Domestically 811,351 33.69
811,351,608 33.69%
listed foreign ,608 %
shares
2,407,945,40 2,407,9 100.00
3. Total shares 100.00%
8 45,408 %
Reasons for the share changes:
□ Applicable √ Not applicable
Approval of the share changes:
□ Applicable √ Not applicable
Transfer of share ownership:
□ Applicable √ Not applicable
Progress on any share repurchase:
□ Applicable √ Not applicable
Progress on reducing the repurchased shares by means of centralized bidding:
□ Applicable √ Not applicable
Effects of the share changes on the basic and diluted earnings per share, equity per share
attributable to the Company’s ordinary shareholders and other financial indicators of the prior year
and the prior accounting period, respectively:
□ Applicable √ Not applicable
61
Konka Group Co., Ltd. Interim Report 2023
Other information that the Company considers necessary or is required by the securities regulator to
be disclosed:
□ Applicable √ Not applicable
2. Changes in Restricted Shares
□ Applicable √ Not applicable
II Issuance and Listing of Securities
□ Applicable √ Not applicable
III Shareholders and Their Holdings as at the Period-End
Unit: share
Number of preferred shareholders with resumed voting rights (if
Number of ordinary shareholders 85,260 0
any) (see note 8)
5% or greater ordinary shareholders or top 10 ordinary shareholders
Shares in
pledge,
Shareh Increase/decrea marked or
Total ordinary Restricted Unrestricted
Nature of olding se in the frozen
Name of shareholder shares held at ordinary ordinary
shareholder percent Reporting S
the period-end shares held shares held
age Period h
Status
ar
es
OVERSEAS CHINESE TOWN State-owned
21.75% 523,746,932 0 0 523,746,932
HOLDINGS COMPANY legal person
CITIC SECURITIES
Foreign legal
BROKERAGE (HONG KONG) 7.48% 180,001,110 0 0 180,001,110
person
CO., LTD.
Domestic
WANG JINGFENG natural 4.15% 100,000,000 -5,000,000 0 100,000,000
person
GUOYUAN SECURITIES Foreign legal
2.45% 58,927,225 -300,000 0 58,927,225
BROKER (HK) CO., LTD. person
Foreign legal
HOLY TIME GROUP LIMITED 2.38% 57,289,100 0 0 57,289,100
person
Foreign legal
GAOLING FUND,L.P. 2.19% 52,801,250 0 0 52,801,250
person
Foreign
NAM NGAI natural 0.96% 23,000,000 -19,800 0 23,000,000
person
CHINA MERCHANTS State-owned
0.80% 19,314,220 -143,500 0 19,314,220
SECURITIES (HK) LIMITED legal person
BOCOM INTERNATIONAL Foreign legal
0.78% 18,896,037 0 0 18,896,037
SECURITIES LIMITED person
Domestic
ZHANG SUFEN natural 0.55% 13,360,000 13,360,000 0 13,360,000
person
Strategic investor or general legal person becoming a top-10 ordinary shareholder due to rights issue (if N/A
62
Konka Group Co., Ltd. Interim Report 2023
any) (see note 3)
Happy Bloom Investment Limited, a wholly-owned subsidiary of the Company’s first majority shareholder
Overseas Chinese Town Holdings Company (OCT Group), holds 180,001,110 and 18,360,000 ordinary
Related or acting-in-concert parties shares in the Company respectively through CITIC Securities Brokerage (Hong Kong) Co., Ltd. and China
among the shareholders above Merchants Securities (HK) Limited. Happy Bloom Investment Limited and OCT Group are parties acting in
concert. Other than that, it is unknown whether the other shareholders are related parties or acting-in-concert
parties or not.
Explain if any of the shareholders above was involved in
N/A
entrusting/being entrusted with voting rights or waiving voting rights
Special account for share repurchases (if any) among the top 10
None
shareholders (see note 11)
Top 10 unrestricted ordinary shareholders
Shares by type
Name of shareholder Unrestricted ordinary shares held at the period-end
Type Shares
OVERSEAS CHINESE TOWN HOLDINGS RMB-denominated
523,746,932 523,746,932
COMPANY ordinary stock
CITIC SECURITIES BROKERAGE (HONG Domestically listed
180,001,110 180,001,110
KONG) CO., LTD. foreign stock
RMB-denominated
WANG JINGFENG 100,000,000 100,000,000
ordinary stock
GUOYUAN SECURITIES BROKER (HK) Domestically listed
58,927,225 58,927,225
CO., LTD. foreign stock
Domestically listed
HOLY TIME GROUP LIMITED 57,289,100 57,289,100
foreign stock
Domestically listed
GAOLING FUND,L.P. 52,801,250 52,801,250
foreign stock
Domestically listed
NAM NGAI 23,000,000 23,000,000
foreign stock
CHINA MERCHANTS SECURITIES (HK) Domestically listed
19,314,220 19,314,220
LIMITED foreign stock
BOCOM INTERNATIONAL SECURITIES Domestically listed
18,896,037 18,896,037
LIMITED foreign stock
RMB-denominated
ZHANG SUFEN 13,360,000 13,360,000
ordinary stock
Happy Bloom Investment Limited, a wholly-owned subsidiary of the Company’s first majority
Related or acting-in-concert parties among top shareholder Overseas Chinese Town Holdings Company (OCT Group), holds 180,001,110 and
10 unrestricted ordinary shareholders, as well 18,360,000 ordinary shares in the Company respectively through CITIC Securities Brokerage (Hong
as between top 10 unrestricted ordinary Kong) Co., Ltd. and China Merchants Securities (HK) Limited. Happy Bloom Investment Limited and
shareholders and top 10 shareholders OCT Group are parties acting in concert. Other than that, it is unknown whether the other shareholders
are related parties or acting-in-concert parties or not.
Top 10 ordinary shareholders involved in Wang Jingfeng holds 100,000,000 A-shares in the Company through his securities account for customer
securities margin trading (if any) (see note 4) credit trading guarantee in Guotai Junan Securities Co., Ltd.
Indicate by tick mark whether any of the top 10 ordinary shareholders or the top 10 unrestricted
ordinary shareholders of the Company conducted any promissory repo during the Reporting Period.
63
Konka Group Co., Ltd. Interim Report 2023
□ Yes √ No
No such cases in the Reporting Period.
IV Change in Shareholdings of Directors, Supervisors and Senior Management
□ Applicable √ Not applicable
No changes occurred to the shareholdings of the directors, supervisors and senior management in
the Reporting Period. See the 2022 Annual Report for more details.
V Change of the Controlling Shareholder or the De Facto Controller
Change of the controlling shareholder in the Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
Change of the de facto controller in the Reporting Period
□ Applicable √ Not applicable
No such cases in the Reporting Period.
64
Konka Group Co., Ltd. Interim Report 2023
Part VIII Preference Shares
□ Applicable √ Not applicable
No Preference shares in the Reporting Period.
65
Konka Group Co., Ltd. Interim Report 2023
Part IX Bonds
√ Applicable □ Not applicable
I Enterprise Bonds
□ Applicable √ Not applicable
No enterprise bonds in the Reporting Period.
II Corporate Bonds
√ Applicable □ Not applicable
1. Basic Information of the Corporate Bonds
Unit: RMB’0,000
Bonds
balance Interest Way of Trade
Name Abbr. Code Issue date Value date Due date
(RMB’0 rate redemption place
,000)
Interests
shall be
Shenzh
Privately placed paid every
21 8 en
corporate bonds in 11489 8 January 8 January 100,000 year and the
Konk January 4.46% Stock
2021 of Konka Group 4 2021 2021 .00 principals
a 01 2024 Exchan
Co., Ltd (Tranche I) shall be
ge
repaid when
expired.
Interests
shall be
Shenzh
Privately placed paid every
21 en
corporate bonds in 13300 21 May 21 May 21 May 50,000. year and the
Konk 4.00% Stock
2021 of Konka Group 3 2021 2021 2024 00 principals
a 02 Exchan
Co., Ltd (Tranche II) shall be
ge
repaid when
expired.
Interests
shall be
Shenzh
Privately placed paid every
21 en
corporate bonds in 13304 9 July 9 July 9 July 80,000. year and the
Konk 3.95% Stock
2021 of Konka Group 0 2021 2021 2024 00 principals
a 03 Exchan
Co., Ltd (Tranche III) shall be
ge
repaid when
expired.
Interests Shenzh
Corporate bonds 22 14998 14 July 14 July 14 July 120,000
3.23% shall be en
publicly offered to Konk 7 2022 2022 2025 .00
paid every Stock
66
Konka Group Co., Ltd. Interim Report 2023
professional investors a 01 year and the Exchan
in 2022 of Konka principals ge
Group Co., Ltd. shall be
(Tranche I) (Variety I) repaid when
expired.
Interests
Privately placed shall be
Shenzh
corporate bonds paid every
22 8 8 8 en
offered to professional 13330 60,000. year and the
Konk September September Septemb 3.30% Stock
investors in 2022 of 6 00 principals
a 03 2022 2022 er 2025 Exchan
Konka Group Co., Ltd shall be
ge
(Tranche I) (Variety I) repaid when
expired.
Interests
Privately placed shall be
Shenzh
corporate bonds paid every
22 18 18 18 en
offered to professional 13333 60,000. year and the
Konk October October October 3.50% Stock
investors in 2022 of 3 00 principals
a 05 2022 2022 2025 Exchan
Konka Group Co., Ltd shall be
ge
(Tranche II) repaid when
expired.
“21 Konka 01”, “21 Konka 02”, “21 Konka 03”, “22 Konka 03” and “22 Konka 05”
were placed privately to professional investors meeting the requirements of
management method for investors eligibility of Shenzhen Stock Exchange, which not
Appropriate arrangement of the exceeding 200 persons. “22 Konka 01” was offered publicly to professional
investors (if any) institutional investors meeting the requirements of Measures for the Administration of
Issuing and Trading Corporate Bonds and opening a qualified A-share securities
account in Shenzhen Branch of China Securities Depository and Clearing Corporation
Limited.
Comprehensive protocol trading platform: Match-and-deal, click-and-deal, inquire-
Applicable trade mechanism
and-deal, bid-and-deal, and negotiate-and-deal
Risk of delisting (if any) and
No
countermeasures
Overdue bonds
□ Applicable √ Not applicable
2. The Trigger and Execution of the Option Clause of the Issuers or Investors and the
Investor Protection Clause
□ Applicable √ Not applicable
3. Adjustment of Credit Rating Results during the Reporting Period
□ Applicable √ Not applicable
67
Konka Group Co., Ltd. Interim Report 2023
4. Execution and Changes of Guarantee, Repayment Plan and Other Repayment Guarantee
Measures as well as Influence on Equity of Bond Investors during the Reporting Period
□ Applicable √ Not applicable
III Debt Financing Instruments of Non-financial Enterprises
□ Applicable √ Not applicable
No such cases in the Reporting Period.
IV Convertible Corporate Bonds
□ Applicable √ Not applicable
No such cases in the Reporting Period.
V Losses of Scope of Consolidated Financial Statements during the Reporting Period
Exceeding 10% of Net Assets up the Period-end of Last Year
□ Applicable √ Not applicable
VI The Major Accounting Data and the Financial Indicators of the Recent 2 Years of the
Company up the Period-end
Unit: RMB’0,000
Item 30 June 2023 31 December 2022 Change
Current ratio 103.35% 118.17% -12.54%
Debt/asset ratio 78.92% 77.74% 1.18%
Quick ratio 78.90% 88.59% -10.94%
H1 2023 H1 2022 Change
Net profit before exceptional
-89,159.44 -74,190.82 -20.18%
gains and losses
EBITDA/debt ratio 1.19% 2.74% -1.55%
Interest cover (times) -0.11 0.89 -112.36%
Cash-to-interest cover (times) 0.76 -0.03 2,633.33%
EBITDA-to-interest cover
0.89 1.72 -48.26%
(times)
Debt repayment ratio (%) 100.00% 100.00% 0.00%
Interest payment ratio (%) 100.00% 100.00% 0.00%
68
Konka Group Co., Ltd. Interim Report 2023
Part X Financial Statements
I Independent Auditor’s Report
Are these interim financial statements audited by an independent auditor?
□ Yes √ No
The interim financial statements of the Company have not been audited by an independent auditor.
II Financial Statements
Currency unit for the financial statements and the notes thereto: RMB
1. Consolidated Balance Sheet
Prepared by Konka Group Co., Ltd. 30 June 2023 Unit: RMB
Item 30 June 2023 1 January 2023
Current assets:
Monetary assets 6,908,338,806.16 5,988,095,490.71
Settlement reserve
Interbank loans granted
Held-for-trading financial assets 743,307,489.50
Derivative financial assets
Notes receivable 593,966,294.88 1,059,737,243.54
Accounts receivable 2,087,994,555.53 2,036,734,836.22
Accounts receivable financing 344,155,903.39 237,187,228.44
Prepayments 516,386,493.09 389,947,652.39
Premiums receivable
Reinsurance receivables
Receivable reinsurance contract reserve
Other receivables 1,415,702,711.35 1,442,124,845.58
Including: Interest receivable 5,279,505.89 3,878,580.64
Dividends receivable 272,999.43
Financial assets purchased under resale agreements
Inventories 4,658,743,334.04 4,409,767,756.22
Contract assets 432,779.46
Assets held for sale
Current portion of non-current assets 3,630,000.00 14,630,000.00
Other current assets 2,418,192,160.84 2,038,841,225.83
Total current assets 19,690,850,528.24 17,617,066,278.93
Non-current assets:
Loans and advances to customers
Investments in debt obligations
Investments in other debt obligations
Long-term receivables 800,400.00 800,400.00
69
Konka Group Co., Ltd. Interim Report 2023
Long-term equity investments 5,888,122,429.28 6,351,232,955.58
Investments in other equity instruments 23,841,337.16 23,841,337.16
Other non-current financial assets 2,113,570,574.02 2,639,662,273.32
Investment property 1,412,201,694.76 802,407,844.60
Fixed assets 4,021,128,223.39 4,114,029,693.38
Construction in progress 1,496,059,340.20 1,990,361,377.07
Productive living assets
Oil and gas assets
Right-of-use assets 33,487,798.25 50,019,838.68
Intangible assets 1,073,118,003.41 1,116,739,707.27
Development costs
Goodwill 22,196,735.11 22,196,735.11
Long-term prepaid expense 499,711,935.37 387,309,503.07
Deferred income tax assets 1,356,529,756.06 1,201,661,841.23
Other non-current assets 1,293,801,066.80 1,710,245,378.26
Total non-current assets 19,234,569,293.81 20,410,508,884.73
Total assets 38,925,419,822.05 38,027,575,163.66
Current liabilities:
Short-term borrowings 6,779,845,746.13 7,579,559,304.97
Borrowings from the central bank
Interbank loans obtained
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 1,156,546,919.70 1,054,573,822.04
Accounts payable 2,926,985,886.32 2,659,946,562.93
Advances from customers 825.69
Contract liabilities 698,842,722.45 601,044,358.35
Financial assets sold under repurchase agreements
Customer deposits and interbank deposits
Payables for acting trading of securities
Payables for underwriting of securities
Employee benefits payable 182,043,941.42 348,608,204.05
Taxes payable 189,302,632.91 291,102,679.36
Other payables 1,728,637,840.76 1,895,711,373.34
Including: Interest payable 40,524.22 29,590,464.00
Dividends payable
Handling charges and commissions payable
Reinsurance payables
Liabilities directly associated with assets held for
sale
Current portion of non-current liabilities 5,320,279,660.98 409,220,030.69
Other current liabilities 69,644,865.51 68,449,783.71
Total current liabilities 19,052,130,216.18 14,908,216,945.13
Non-current liabilities:
70
Konka Group Co., Ltd. Interim Report 2023
Insurance contract reserve
Long-term borrowings 7,173,408,500.74 8,906,931,402.89
Bonds payable 3,295,556,876.26 4,792,392,044.13
Including: Preferred shares
Perpetual bonds
Lease liabilities 31,184,490.59 36,586,639.16
Long-term payables 6,873,122.51 7,964,127.18
Long-term employee benefits payable 4,794,271.77 4,894,209.73
Provisions 203,725,006.73 159,395,579.55
Deferred income 362,363,980.58 334,844,966.31
Deferred income tax liabilities 209,948,467.19 99,030,646.40
Other non-current liabilities 381,807,253.24 314,233,260.08
Total non-current liabilities 11,669,661,969.61 14,656,272,875.43
Total liabilities 30,721,792,185.79 29,564,489,820.56
Owners’ equity:
Share capital 2,407,945,408.00 2,407,945,408.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 438,115,032.07 365,247,361.05
Less: Treasury stock
Other comprehensive income -14,260,344.24 -14,265,181.63
Specific reserve
Surplus reserves 1,244,180,364.24 1,244,180,364.24
General reserve
Retained earnings 3,446,187,777.61 3,638,868,004.50
Total equity attributable to owners of the Company as
7,522,168,237.68 7,641,975,956.16
the parent
Non-controlling interests 681,459,398.58 821,109,386.94
Total owners’ equity 8,203,627,636.26 8,463,085,343.10
Total liabilities and owners’ equity 38,925,419,822.05 38,027,575,163.66
Legal representative: Zhou Bin CFO: Li Chunlei
Head of the financial department: Ping Heng
2. Balance Sheet of the Company as the Parent
Unit: RMB
Item 30 June 2023 1 January 2023
Current assets:
Monetary assets 4,681,364,336.59 3,987,295,740.42
Held-for-trading financial assets 743,307,489.50
Derivative financial assets
Notes receivable 137,750,227.16 353,764,106.66
Accounts receivable 5,226,685,955.04 4,473,878,994.50
Accounts receivable financing
71
Konka Group Co., Ltd. Interim Report 2023
Prepayments 3,812,656,118.80 2,105,477,988.44
Other receivables 9,603,382,043.11 10,342,326,355.05
Including: Interest receivable 5,279,505.89 3,878,580.64
Dividends receivable 397,213,312.02 393,563,347.61
Inventories 412,432,630.23 173,658,748.80
Contract assets
Assets held for sale
Current portion of non-current assets
Other current assets 1,901,808,323.47 1,581,440,821.79
Total current assets 26,519,387,123.90 23,017,842,755.66
Non-current assets:
Investments in debt obligations
Investments in other debt obligations
Long-term receivables
Long-term equity investments 8,680,774,584.31 9,100,689,137.42
Investments in other equity instruments 17,940,215.36 17,940,215.36
Other non-current financial assets 396,353,137.96 396,353,137.96
Investment property 919,329,277.65 439,835,051.61
Fixed assets 414,004,752.58 418,021,638.28
Construction in progress 19,589,149.08 481,659,536.66
Productive living assets
Oil and gas assets
Right-of-use assets 1,341,125.40
Intangible assets 43,852,430.31 65,620,126.31
Development costs
Goodwill
Long-term prepaid expense 31,771,125.50 36,665,581.09
Deferred income tax assets 1,165,446,351.89 1,127,531,647.49
Other non-current assets 1,346,901.65 458,931.60
Total non-current assets 11,690,407,926.29 12,086,116,129.18
Total assets 38,209,795,050.19 35,103,958,884.84
Current liabilities:
Short-term borrowings 2,239,120,555.52 2,217,049,472.22
Held-for-trading financial liabilities
Derivative financial liabilities
Notes payable 245,691,757.67 890,526,510.04
Accounts payable 6,684,025,548.31 6,918,579,963.57
Advances from customers
Contract liabilities 4,402,224,447.61 2,445,363,632.98
Employee benefits payable 30,355,802.08 90,137,022.47
Taxes payable 6,531,359.88 4,095,684.11
Other payables 4,064,658,632.17 3,941,891,644.62
Including: Interest payable 29,271,307.22
Dividends payable
72
Konka Group Co., Ltd. Interim Report 2023
Liabilities directly associated with assets held for
sale
Current portion of non-current liabilities 5,177,362,257.45 151,933,839.55
Other current liabilities 13,581,709.44 7,129,729.38
Total current liabilities 22,863,552,070.13 16,666,707,498.94
Non-current liabilities:
Long-term borrowings 6,383,204,132.03 8,261,287,052.44
Bonds payable 3,295,556,876.26 4,792,392,044.13
Including: Preferred shares
Perpetual bonds
Lease liabilities
Long-term payables
Long-term employee benefits payable
Provisions 83,683,992.86 83,666,032.25
Deferred income 41,982,311.04 43,377,324.62
Deferred income tax liabilities 102,663,652.38
Other non-current liabilities 47,145,817.65 42,948,698.55
Total non-current liabilities 9,954,236,782.22 13,223,671,151.99
Total liabilities 32,817,788,852.35 29,890,378,650.93
Owners’ equity:
Share capital 2,407,945,408.00 2,407,945,408.00
Other equity instruments
Including: Preferred shares
Perpetual bonds
Capital reserves 313,912,061.57 241,044,390.55
Less: Treasury stock
Other comprehensive income -1,500,000.00 -1,500,000.00
Specific reserve
Surplus reserves 1,260,024,039.76 1,260,024,039.76
Retained earnings 1,411,624,688.51 1,306,066,395.60
Total owners’ equity 5,392,006,197.84 5,213,580,233.91
Total liabilities and owners’ equity 38,209,795,050.19 35,103,958,884.84
3. Consolidated Income Statement
Unit: RMB
Item H1 2023 H1 2022
1. Revenue 10,472,061,171.94 16,895,470,276.81
Including: Operating revenue 10,472,061,171.94 16,895,470,276.81
Interest income
Insurance premium income
Handling charge and commission income
2. Costs and expenses 11,506,953,501.55 17,954,723,815.95
Including: Cost of sales 10,079,343,784.11 16,482,440,621.84
Interest expense
73
Konka Group Co., Ltd. Interim Report 2023
Handling charge and commission expense
Surrenders
Net insurance claims paid
Net amount provided as insurance contract reserve
Expenditure on policy dividends
Reinsurance premium expense
Taxes and surcharges 42,718,966.53 53,284,971.18
Selling expense 558,536,665.53 560,225,684.28
Administrative expense 390,244,567.77 354,308,684.51
R&D expense 237,033,893.11 237,348,526.56
Finance costs 199,075,624.50 267,115,327.58
Including: Interest expense 432,772,700.64 465,576,348.06
Interest income 123,908,981.38 109,353,054.39
Add: Other income 137,917,215.41 343,737,322.91
Return on investment (“-” for loss) 826,829,010.88 737,803,536.05
Including: Share of profit or loss of joint ventures and
-30,242,661.05 59,402,481.72
associates
Income from the derecognition of financial assets at
amortized cost (“-” for loss)
Exchange gain (“-” for loss)
Net gain on exposure hedges (“-” for loss)
Gain on changes in fair value (“-” for loss) -132,580,077.43 -638,799.36
Credit impairment loss (“-” for loss) -140,192,679.36 -78,608,313.56
Asset impairment loss (“-” for loss) -15,283,496.76 -13,309,988.75
Asset disposal income (“-” for loss) 64,713.62 12,782,328.52
3. Operating profit (“-” for loss) -358,137,643.25 -57,487,453.33
Add: Non-operating income 17,325,617.18 30,492,741.65
Less: Non-operating expense 4,326,608.02 3,860,945.80
4. Profit before tax (“-” for loss) -345,138,634.09 -30,855,657.48
Less: Income tax expense -16,710,667.58 -89,346,442.11
5. Net profit (“-” for net loss) -328,427,966.51 58,490,784.63
5.1 By operating continuity
5.1.1 Net profit from continuing operations (“-”
-328,427,966.51 58,490,784.63
for net loss)
5.1.2 Net profit from discontinued operations (“-”
for net loss)
5.2 By ownership
5.2.1 Net profit attributable to owners of the Company
-193,240,232.33 173,266,442.52
as the parent
5.2.2 Net profit attributable to non-controlling
-135,187,734.18 -114,775,657.89
interests
6. Other comprehensive income, net of tax -2,932,583.82 4,109,281.36
Attributable to owners of the Company as the parent 4,837.39 3,289,330.41
6.1 Items that will not be reclassified to profit or loss
74
Konka Group Co., Ltd. Interim Report 2023
6.1.1 Changes caused by remeasurements on defined
benefit schemes
6.1.2 Other comprehensive income that will not be
reclassified to profit or loss under the equity method
6.1.3 Changes in the fair value of investments in other
equity instruments
6.1.4 Changes in the fair value arising from changes in
own credit risk
6.1.5 Other
6.2 Items that will be reclassified to profit or loss 4,837.39 3,289,330.41
6.2.1 Other comprehensive income that will be
-38,929.34
reclassified to profit or loss under the equity method
6.2.2 Changes in the fair value of investments in other
debt obligations
6.2.3 Other comprehensive income arising from the
reclassification of financial assets
6.2.4 Credit impairment allowance for investments in
other debt obligations
6.2.5 Reserve for cash flow hedges
6.2.6 Differences arising from the translation of
4,837.39 3,328,259.75
foreign currency-denominated financial statements
6.2.7 Other
Attributable to non-controlling interests -2,937,421.21 819,950.95
7. Total comprehensive income -331,360,550.33 62,600,065.99
Attributable to owners of the Company as the parent -193,235,394.94 176,555,772.93
Attributable to non-controlling interests -138,125,155.39 -113,955,706.94
8. Earnings per share
8.1 Basic earnings per share -0.0803 0.0720
8.2 Diluted earnings per share -0.0803 0.0720
Legal representative: Zhou Bin CFO: Li Chunlei
Head of the financial department: Ping Heng
4. Income Statement of the Company as the Parent
Unit: RMB
Item H1 2023 H1 2022
1. Operating revenue 671,342,472.97 937,174,806.46
Less: Cost of sales 682,543,280.18 955,576,781.51
Taxes and surcharges 2,825,863.63 4,788,176.20
Selling expense 120,609,233.66 126,864,858.90
Administrative expense 136,536,029.86 112,153,504.59
R&D expense 15,002,427.03 51,468,275.26
Finance costs 158,153,694.90 162,133,403.85
Including: Interest expense 415,373,817.97 431,671,720.01
Interest income 181,172,038.86 175,006,649.97
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Konka Group Co., Ltd. Interim Report 2023
Add: Other income 45,777,006.94 16,852,496.81
Return on investment (“-” for loss) 749,413,182.91 231,113,070.86
Including: Share of profit or loss of joint ventures and
-17,573,675.23 76,488,083.68
associates
Income from the derecognition of financial assets at
amortized cost (“-” for loss)
Net gain on exposure hedges (“-” for loss)
Gain on changes in fair value (“-” for loss) -145,356,925.98
Credit impairment loss (“-” for loss) -22,515,556.31 -23,046,305.82
Asset impairment loss (“-” for loss) -5,669,387.21 -4,024,458.06
Asset disposal income (“-” for loss) 18,634.76 6,069,332.66
2. Operating profit (“-” for loss) 177,338,898.82 -248,846,057.40
Add: Non-operating income 1,209,609.70 13,060,831.55
Less: Non-operating expense 2,143,784.68 254,158.77
3. Profit before tax (“-” for loss) 176,404,723.84 -236,039,384.62
Less: Income tax expense 64,758,360.48 -80,204,459.87
4. Net profit (“-” for net loss) 111,646,363.36 -155,834,924.75
4.1 Net profit from continuing operations (“-” for
111,646,363.36 -155,834,924.75
net loss)
4.2 Net profit from discontinued operations (“-” for
net loss)
5. Other comprehensive income, net of tax
5.1 Items that will not be reclassified to profit or loss
5.1.1 Changes caused by remeasurements on defined
benefit schemes
5.1.2 Other comprehensive income that will not be
reclassified to profit or loss under the equity method
5.1.3 Changes in the fair value of investments in other
equity instruments
5.1.4 Changes in the fair value arising from changes
in own credit risk
5.1.5 Other
5.2 Items that will be reclassified to profit or loss
5.2.1 Other comprehensive income that will be
reclassified to profit or loss under the equity method
5.2.2 Changes in the fair value of investments in other
debt obligations
5.2.3 Other comprehensive income arising from the
reclassification of financial assets
5.2.4 Credit impairment allowance for investments in
other debt obligations
5.2.5 Reserve for cash flow hedges
5.2.6 Differences arising from the translation of
foreign currency-denominated financial statements
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Konka Group Co., Ltd. Interim Report 2023
5.2.7 Other
6. Total comprehensive income 111,646,363.36 -155,834,924.75
7. Earnings per share
7.1 Basic earnings per share
7.2 Diluted earnings per share
5. Consolidated Cash Flow Statement
Unit: RMB
Item H1 2023 H1 2022
1. Cash flows from operating activities:
Proceeds from sale of commodities and rendering of
10,257,069,599.77 16,657,583,444.03
services
Net increase in customer deposits and interbank
deposits
Net increase in borrowings from the central bank
Net increase in loans from other financial
institutions
Premiums received on original insurance contracts
Net proceeds from reinsurance
Net increase in deposits and investments of policy
holders
Interest, handling charges and commissions
received
Net increase in interbank loans obtained
Net increase in proceeds from repurchase
transactions
Net proceeds from acting trading of securities
Tax rebates 114,042,516.44 280,376,794.53
Cash generated from other operating activities 434,232,897.74 753,959,635.59
Subtotal of cash generated from operating activities 10,805,345,013.95 17,691,919,874.15
Payments for commodities and services 9,023,089,761.99 15,956,086,181.59
Net increase in loans and advances to customers
Net increase in deposits in the central bank and in
interbank loans granted
Payments for claims on original insurance contracts
Net increase in interbank loans granted
Interest, handling charges and commissions paid
Policy dividends paid
Cash paid to and for employees 961,152,003.48 1,001,094,352.68
Taxes paid 267,360,124.35 272,856,476.27
Cash used in other operating activities 755,293,229.37 883,142,370.34
Subtotal of cash used in operating activities 11,006,895,119.19 18,113,179,380.88
Net cash generated from/used in operating activities -201,550,105.24 -421,259,506.73
2. Cash flows from investing activities:
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Konka Group Co., Ltd. Interim Report 2023
Proceeds from disinvestment 889,008,792.86 311,914,738.68
Return on investment 102,906,034.84 66,252,680.29
Net proceeds from the disposal of fixed assets,
5,504,209.67 823,875.00
intangible assets and other long-lived assets
Net proceeds from the disposal of subsidiaries and
18,818,889.67 297,094,350.04
other business units
Cash generated from other investing activities 429,959,598.68 2,385,626,424.39
Subtotal of cash generated from investing activities 1,446,197,525.72 3,061,712,068.40
Payments for the acquisition of fixed assets,
541,154,096.54 2,368,866,405.13
intangible assets and other long-lived assets
Payments for investments 281,204,526.06
Net increase in pledged loans granted
Net payments for the acquisition of subsidiaries and
other business units
Cash used in other investing activities 471,154,667.83 297,319,897.73
Subtotal of cash used in investing activities 1,012,308,764.37 2,947,390,828.92
Net cash generated from/used in investing activities 433,888,761.35 114,321,239.48
3. Cash flows from financing activities:
Capital contributions received 600,000.05 73,710,000.00
Including: Capital contributions by non-controlling
600,000.05 73,710,000.00
interests to subsidiaries
Borrowings raised 6,347,967,876.40 13,247,484,343.89
Cash generated from other financing activities 270,299,841.72 98,773,506.85
Subtotal of cash generated from financing activities 6,618,867,718.17 13,419,967,850.74
Repayment of borrowings 5,423,409,343.95 12,164,709,671.44
Interest and dividends paid 417,032,889.60 629,096,420.22
Including: Dividends paid by subsidiaries to non-
735,000.00
controlling interests
Cash used in other financing activities 486,741,862.16 413,488,589.33
Subtotal of cash used in financing activities 6,327,184,095.71 13,207,294,680.99
Net cash generated from/used in financing activities 291,683,622.46 212,673,169.75
4. Effect of foreign exchange rates changes on cash
44,134,367.10 29,437,680.94
and cash equivalents
5. Net increase in cash and cash equivalents 568,156,645.67 -64,827,416.56
Add: Cash and cash equivalents, beginning of the
5,461,912,010.90 5,968,347,219.03
period
6. Cash and cash equivalents, end of the period 6,030,068,656.57 5,903,519,802.47
6. Cash Flow Statement of the Company as the Parent
Unit: RMB
Item H1 2023 H1 2022
1. Cash flows from operating activities:
Proceeds from sale of commodities and rendering of
1,612,906,405.48 2,354,844,176.86
services
Tax rebates 33,601,449.43 86,941,251.18
78
Konka Group Co., Ltd. Interim Report 2023
Cash generated from other operating activities 125,639,407.49 97,266,687.71
Subtotal of cash generated from operating activities 1,772,147,262.40 2,539,052,115.75
Payments for commodities and services 1,685,690,002.69 2,958,268,595.49
Cash paid to and for employees 163,714,700.87 177,343,007.79
Taxes paid 6,158,152.38 8,874,050.17
Cash used in other operating activities 258,237,321.10 570,856,154.42
Subtotal of cash used in operating activities 2,113,800,177.04 3,715,341,807.87
Net cash generated from/used in operating activities -341,652,914.64 -1,176,289,692.12
2. Cash flows from investing activities:
Proceeds from disinvestment 377,895,533.73 243,681,401.96
Return on investment 45,984,167.78 9,191,193.60
Net proceeds from the disposal of fixed assets,
463,991.29 2,335.00
intangible assets and other long-lived assets
Net proceeds from the disposal of subsidiaries and
other business units
Cash generated from other investing activities 2,247,236,977.19 4,144,985,356.98
Subtotal of cash generated from investing activities 2,671,580,669.99 4,397,860,287.54
Payments for the acquisition of fixed assets,
64,727,368.50 113,204,917.61
intangible assets and other long-lived assets
Payments for investments 77,400,000.00 181,192,000.00
Net payments for the acquisition of subsidiaries and
other business units
Cash used in other investing activities 1,822,125,825.03 3,667,215,872.05
Subtotal of cash used in investing activities 1,964,253,193.53 3,961,612,789.66
Net cash generated from/used in investing activities 707,327,476.46 436,247,497.88
3. Cash flows from financing activities:
Capital contributions received
Borrowings raised 5,060,000,000.00 11,015,317,707.33
Cash generated from other financing activities 4,539,539,207.19 6,900,804,389.29
Subtotal of cash generated from financing activities 9,599,539,207.19 17,916,122,096.62
Repayment of borrowings 3,708,306,940.22 9,787,500,000.00
Interest and dividends paid 439,526,690.78 569,130,713.71
Cash used in other financing activities 5,451,482,339.89 6,871,379,554.34
Subtotal of cash used in financing activities 9,599,315,970.89 17,228,010,268.05
Net cash generated from/used in financing activities 223,236.30 688,111,828.57
4. Effect of foreign exchange rates changes on cash
6,131,671.92 41,903.92
and cash equivalents
5. Net increase in cash and cash equivalents 372,029,470.04 -51,888,461.75
Add: Cash and cash equivalents, beginning of the
3,833,613,544.22 4,682,608,814.76
period
6. Cash and cash equivalents, end of the period 4,205,643,014.26 4,630,720,353.01
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Konka Group Co., Ltd. Interim Report 2023
7. Consolidated Statements of Changes in Owners’ Equity
H1 2023 Unit: RMB
H1 2023
Equity attributable to owners of the Company as the parent
Item Other equity instruments Less: Other Non-controlling Total owners’
Capital Specific General Retained
Share capital Preferred Perpetual Treasury comprehensive Surplus reserves Other Subtotal interests equity
Other reserves reserve reserve earnings
shares bonds stock income
1. Balance as at the
end of the period of 2,407,945,408.00 365,247,361.05 -14,265,181.63 1,244,180,364.24 3,637,291,770.33 7,640,399,721.99 820,973,239.93 8,461,372,961.92
prior year
Add: Adjustment for
change in accounting 1,576,234.17 1,576,234.17 136,147.01 1,712,381.18
policy
Adjustment for
correction of previous
error
Adjustment for
business combination
under common
control
Other adjustments
2. Balance as at the
beginning of the 2,407,945,408.00 365,247,361.05 -14,265,181.63 1,244,180,364.24 3,638,868,004.50 7,641,975,956.16 821,109,386.94 8,463,085,343.10
Reporting Period
3. Increase/ decrease
- - -
in the period (“-” for 72,867,671.02 4,837.39 -259,457,706.84
192,680,226.89 119,807,718.48 139,649,988.36
decrease)
3.1 Total
4,837.39 -193,240,232.33 -193,235,394.94 -138,125,155.39 -331,360,550.33
comprehensive
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Konka Group Co., Ltd. Interim Report 2023
income
3.2 Capital
increased and reduced 72,867,671.02 72,867,671.02 -789,832.97 72,077,838.05
by owners
3.2.1 Ordinary shares
600,000.03 600,000.03
increased by owners
3.2.2 Capital
increased by holders
of other equity
instruments
3.2.3 Share-based
payments included in
owners’ equity
3.2.4 Other 72,867,671.02 72,867,671.02 -1,389,833.00 71,477,838.02
3.3 Profit
-735,000.00 -735,000.00
distribution
3.3.1
Appropriation to
surplus reserves
3.3.2
Appropriation to
general reserve
3.3.3
Appropriation to
-735,000.00 -735,000.00
owners (or
shareholders)
3.3.4 Other
3.4 Transfers within
owners’ equity
3.4.1 Increase in
81
Konka Group Co., Ltd. Interim Report 2023
capital (or share
capital) from capital
reserves
3.4.2 Increase in
capital (or share
capital) from surplus
reserves
3.4.3 Loss offset
by surplus reserves
3.4.4 Changes in
defined benefit
schemes transferred to
retained earnings
3.4.5 Other
comprehensive
income transferred to
retained earnings
3.4.6 Other
3.5 Specific reserve
3.5.1 Increase in
the period
3.5.2 Used in the
period
3.6 Other 560,005.44 560,005.44 560,005.44
4. Balance as at the
end of the Reporting 2,407,945,408.00 438,115,032.07 -14,260,344.24 1,244,180,364.24 3,446,187,777.61 7,522,168,237.68 681,459,398.58 8,203,627,636.26
Period
H1 2022 Unit: RMB
H1 2022
Item
Equity attributable to owners of the Company as the parent Non-controlling Total owners’
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Konka Group Co., Ltd. Interim Report 2023
Other equity instruments Less: Other interests equity
Capital Specific General Retained
Share capital Preferred Perpetual Treasury comprehensive Surplus reserves Other Subtotal
Other reserves reserve reserve earnings
shares bonds stock income
1. Balance as at the
end of the period of 2,407,945,408.00 234,389,963.10 -20,336,087.87 1,244,180,364.24 5,229,098,788.94 9,095,278,436.41 1,105,670,912.02 10,200,949,348.43
prior year
Add: Adjustment for
change in 464,912.01 464,912.01 196,178.92 661,090.93
accounting policy
Adjustment for
correction of
previous error
Adjustment for
business
combination under
common control
Other adjustments
2. Balance as at the
beginning of the 2,407,945,408.00 234,389,963.10 -20,336,087.87 1,244,180,364.24 5,229,563,700.95 9,095,743,348.42 1,105,867,090.94 10,201,610,439.36
Reporting Period
3. Increase/ decrease
in the period (“-” for 132,442,151.79 3,289,330.41 52,869,172.12 188,600,654.32 -5,241,051.01 183,359,603.31
decrease)
3.1 Total
comprehensive 3,289,330.41 173,266,442.52 176,555,772.93 -113,955,706.94 62,600,065.99
income
3.2 Capital
increased and 132,442,151.79 132,442,151.79 109,449,655.93 241,891,807.72
reduced by owners
3.2.1 Ordinary 73,710,000.00 73,710,000.00
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Konka Group Co., Ltd. Interim Report 2023
shares increased by
owners
3.2.2 Capital
increased by holders
of other equity
instruments
3.2.3 Share-based
payments included
in owners’ equity
3.2.4 Other 132,442,151.79 132,442,151.79 35,739,655.93 168,181,807.72
3.3 Profit
-120,397,270.40 -120,397,270.40 -735,000.00 -121,132,270.40
distribution
3.3.1
Appropriation to
surplus reserves
3.3.2
Appropriation to
general reserve
3.3.3
Appropriation to
-120,397,270.40 -120,397,270.40 -735,000.00 -121,132,270.40
owners (or
shareholders)
3.3.4 Other
3.4 Transfers
within owners’
equity
3.4.1 Increase
in capital (or share
capital) from capital
reserves
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Konka Group Co., Ltd. Interim Report 2023
3.4.2 Increase
in capital (or share
capital) from surplus
reserves
3.4.3 Loss
offset by surplus
reserves
3.4.4 Changes
in defined benefit
schemes transferred
to retained earnings
3.4.5 Other
comprehensive
income transferred
to retained earnings
3.4.6 Other
3.5 Specific reserve
3.5.1 Increase
in the period
3.5.2 Used in
the period
3.6 Other
4. Balance as at the
end of the Reporting 2,407,945,408.00 366,832,114.89 -17,046,757.46 1,244,180,364.24 5,282,432,873.07 9,284,344,002.74 1,100,626,039.93 10,384,970,042.67
Period
8. Statements of Changes in Owners’ Equity of the Company as the Parent
H1 2023 Unit: RMB
H1 2023
Item
Share capital Other equity instruments Capital Less: Treasury Other comprehensive Specific Surplus reserves Retained Other Total owners’
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Konka Group Co., Ltd. Interim Report 2023
Preferred Perpetual reserves stock income reserve earnings equity
Other
shares bonds
1. Balance as at the end of the period of prior year 2,407,945,408.00 241,044,390.55 -1,500,000.00 1,260,024,039.76 1,306,066,395.60 5,213,580,233.91
Add: Adjustment for change in accounting policy
Adjustment for correction of previous error
Other adjustments -6,088,070.45 -6,088,070.45
2. Balance as at the beginning of the Reporting
2,407,945,408.00 241,044,390.55 -1,500,000.00 1,260,024,039.76 1,299,978,325.15 5,207,492,163.46
Period
3. Increase/ decrease in the period (“-” for decrease) 72,867,671.02 111,646,363.36 184,514,034.38
3.1 Total comprehensive income 111,646,363.36 111,646,363.36
3.2 Capital increased and reduced by owners 72,867,671.02 72,867,671.02
3.2.1 Ordinary shares increased by owners
3.2.2 Capital increased by holders of other equity
instruments
3.2.3 Share-based payments included in owners’
equity
3.2.4 Other 72,867,671.02 72,867,671.02
3.3 Profit distribution
3.3.1 Appropriation to surplus reserves
3.3.2 Appropriation to owners (or shareholders)
3.3.3 Other
3.4 Transfers within owners’ equity
3.4.1 Increase in capital (or share capital) from
capital reserves
3.4.2 Increase in capital (or share capital) from
surplus reserves
3.4.3 Loss offset by surplus reserves
3.4.4 Changes in defined benefit schemes
transferred to retained earnings
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Konka Group Co., Ltd. Interim Report 2023
3.4.5 Other comprehensive income transferred
to retained earnings
3.4.6 Other
3.5 Specific reserve
3.5.1 Increase in the period
3.5.2 Used in the period
3.6 Other
4. Balance as at the end of the Reporting Period 2,407,945,408.00 313,912,061.57 -1,500,000.00 1,260,024,039.76 1,411,624,688.51 5,392,006,197.84
H1 2022 Unit: RMB
H1 2022
Other equity instruments
Item Capital Less: Treasury Other comprehensive Specific Retained Total owners’
Share capital Preferred Perpetual Surplus reserves Other
Other reserves stock income reserve earnings equity
shares bonds
1. Balance as at the end of the period of prior year 2,407,945,408.00 110,696,992.60 -1,500,000.00 1,260,024,039.76 2,724,187,542.59 6,501,353,982.95
Add: Adjustment for change in accounting policy
Adjustment for correction of previous error
Other adjustments 23.10 23.10
2. Balance as at the beginning of the Reporting
2,407,945,408.00 110,696,992.60 -1,500,000.00 1,260,024,039.76 2,724,187,565.69 6,501,354,006.05
Period
3. Increase/ decrease in the period (“-” for decrease) 132,442,151.79 -276,232,195.15 -143,790,043.36
3.1 Total comprehensive income -155,834,924.75 -155,834,924.75
3.2 Capital increased and reduced by owners 132,442,151.79 132,442,151.79
3.2.1 Ordinary shares increased by owners
3.2.2 Capital increased by holders of other equity
instruments
3.2.3 Share-based payments included in owners’
equity
3.2.4 Other 132,442,151.79 132,442,151.79
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Konka Group Co., Ltd. Interim Report 2023
3.3 Profit distribution -120,397,270.40 -120,397,270.40
3.3.1 Appropriation to surplus reserves
3.3.2 Appropriation to owners (or shareholders) -120,397,270.40 -120,397,270.40
3.3.3 Other
3.4 Transfers within owners’ equity
3.4.1 Increase in capital (or share capital) from
capital reserves
3.4.2 Increase in capital (or share capital) from
surplus reserves
3.4.3 Loss offset by surplus reserves
3.4.4 Changes in defined benefit schemes
transferred to retained earnings
3.4.5 Other comprehensive income transferred
to retained earnings
3.4.6 Other
3.5 Specific reserve
3.5.1 Increase in the period
3.5.2 Used in the period
3.6 Other
4. Balance as at the end of the Reporting Period 2,407,945,408.00 243,139,144.39 -1,500,000.00 1,260,024,039.76 2,447,955,370.54 6,357,563,962.69
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Konka Group Co., Ltd. Interim Report 2023
Notes to the Financial Statements of Konka Group Co., Ltd.
For the Year from 1 January 2023 to 30 June 2023
(All amounts in RMB yuan unless otherwise stated)
I. Company Profile
1. Establishment
Konka Group Co., Ltd. (hereinafter referred to as “Company” or “the Company” and the “Group”
when including subsidiaries), is a joint-stock limited company reorganized from the former
Shenzhen Konka Electronic Co., Ltd. in August 1991 upon approval of the People’s Government
of Shenzhen Municipality, and has its ordinary shares (A-share and B-share) listed on Shenzhen
Stock Exchange with prior consent from the People’s Bank of China Shenzhen Special Economic
Zone Branch. On 29 August 1995, the Company was renamed to “Konka Group Co., Ltd.”
(Credibility code: 914403006188155783) with its main business electronic industry. And now the
headquarters locates in No. 28 of No. 12 of Keji South Rd., Science & Technology Park, Yuehai
Street, Nanshan District, Shenzhen, Guangdong Province.
2. Share capital
After the distribution of bonus shares, allotments, increased share capital and new shares issued
over the years, as of 30 June 2023, the Company has issued a total of 2,407,945,408.00 shares
(denomination of RMB1 per share) with a registered capital of RMB2,407,945,408.00.
3. The nature of the company's business and main operating activities
The Group was mainly engaged in the production and sales of colour TVs, white goods, etc.; as
well as the operation of industry trade business, material technology business, semi-conductor, etc.
4. The financial statements contained herein have been approved for issue by the Board of
Directors of the Company on 25 August 2023.
II. Consolidation scope
The Company has a total of 124 subsidiaries included in the consolidation scope including
Shenzhen Konka Electronics Technology Co., Ltd., Anhui Konka Electronic Co., Ltd. and
Dongguan Konka Electronic Co., Ltd. The consolidation scope of the Company for the Reporting
Period decreased by 3 households including Sichuan Hongxinchen Real Estate Development Co.,
Ltd ., Anhui Konka Zhilian E-Commerce Co., Ltd., etc. due to losing control or cancellation
compared to the same period of last year.
For details, please refer to Note 7 “Changes in the consolidation scope” and Note 8 "Equity in
Other Entities".
A check list of corporate names and their abbreviations mentioned in this Report
No. Corporate name Abbreviation
1 Shenzhen Konka Electronics Technology Co., Ltd. Electronics Technology
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Konka Group Co., Ltd. Interim Report 2023
No. Corporate name Abbreviation
2 Anhui Konka Zhilian E-Commerce Co., Ltd. Anhui Zhilian
3 Nantong Haimen Konka Smart Technology Co., Ltd. Haimen Konka
4 Chengdu Konka Smart Technology Co., Ltd. Chengdu Konka Smart
5 Chengdu Konka Electronic Co., Ltd. Chengdu Konka Electronic
6 Nantong Hongdin Smart Technology Co., Ltd. Nantong Hongdin
Shenzhen Kangcheng Technology Innovation and Development Co.,
7 Shenzhen Kangcheng
Ltd.
8 Xiaojia Technology Co., Ltd. Xiaojia Technology
9 Liaoyang Kangshun Smart Technology Co., Ltd. Liaoyang Kangshun Smart
10 Liaoyang Kangshun Renewable Resources Co., Ltd. Liaoyang Kangshun Renewable
11 Nanjing Konka Electronics Co., Ltd. Nanjing Konka
Chuzhou Konka Precision Intelligent Manufacturing Technology Co.,
12 Chuzhou Konka
Ltd.
13 GuangDong XingDa HongYe Electronic Co., Ltd. XingDa HongYe
14 Shenzhen Konka Circuit Co., Ltd. Konka Circuit
15 Suining Konka Flexible Electronic Technology Co., Ltd. Konka Flexible Electronic
16 Suining Konka Hongye Electronics Co., Ltd. Konka Hongye Electronics
17 Boluo Konka Precision Technology Co., Ltd. Boluo Precision
18 Boluo Konka PCB Co., Ltd. Boluo Konka
19 Anhui Konka Tongchuang Electrical Appliances Co., Ltd. Anhui Tongchuang
20 Jiangsu Konka Smart Electrical Appliances Co., Ltd. Jiangsu Konka Smart
21 Anhui Konka Electrical Appliance Technology Co., Ltd. Anhui Electrical Appliance
22 Henan Frestec Refrigeration Appliance Co., Ltd. Frestec Refrigeration
23 Henan Frestec Electrical Appliances Co., Ltd. Frestec Electrical Appliances
24 Henan Frestec Household Appliances Co., Ltd. Frestec Household Appliances
25 Henan Frestec Smart Home Technology Co., Ltd. Frestec Smart Home
26 Shenzhen Konka Investment Holdings Co., Ltd. Konka Investment
27 Yibin Konka Technology Park Operation Co., Ltd. Yibin Konka Technology Park
28 Shenzhen Konka Capital Equity Investment Management Co., Ltd. Konka Capital
29 Konka Suiyong Investment (Shenzhen) Co., Ltd. Konka Suiyong
30 Shenzhen Konka Shengxing Industrial Co., Ltd. Shengxing Industrial
31 Shenzhen Konka Zhitong Technology Co., Ltd. Zhitong Technology
32 Konka Factoring (Shenzhen) Co., Ltd. Konka Factoring
33 Beijing Konka Electronic Co., Ltd. Beijing Konka Electronic
34 Tianjin Konka Technology Co., Ltd. Tianjin Konka
35 Suining Konka Industrial Park Development Co., Ltd. Suining Konka Industrial Park
Suining Electronic Technological
36 Suining Konka Electronic Technological Innovation Co., Ltd.
Innovation
37 Shanghai Konka Industrial Co., Ltd. Shanghai Konka
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Konka Group Co., Ltd. Interim Report 2023
No. Corporate name Abbreviation
38 Yantai Kangjin Technology Development Co., Ltd. Yantai Kangjin
39 Shenzhen Konka Mobile Interconnection Technology Co., Ltd. Mobile Interconnection
40 Sichuan Konka Smart Terminal Technology Co., Ltd Sichuan Konka
41 Yibin Konka Smart Technology Co., Ltd. Yibin Smart
42 Shenzhen KONSEMI Co., Ltd. Shenzhen KONSEMI
43 Chongqing Konka Technology Development Co., Ltd. Chongqing Konka
44 Kowin Memory Technology (Shenzhen) Co., Limited Kowin Memory (Shenzhen)
45 Kowin Memory Technology (Hong Kong) Co., Limited Kowin Memory (Hong Kong)
46 Konka Xinyun Semiconductor Technology (Yancheng) Co., Ltd. Konka Xinyun Semiconductor
47 Konka Industrial and Trade Technology (Shenzhen) Co., Ltd. Industrial and Trade Technology
48 Shenzhen Nianhua Enterprise Management Co., Ltd. Shenzhen Nianhua
49 Konka Huazhong (Hunan) Technology Co., Ltd. Konka Huazhong
50 Shenzhen Wankaida Science and Technology Co., Ltd. Wankaida
Shenzhen Chuangzhi Electrical
51 Shenzhen Konka Chuangzhi Electrical Appliances Co., Ltd.
Appliances
52 Suining Jiarun Property Co., Ltd. Suining Jiarun Property
53 Anhui Konka Electronic Co., Ltd. Anhui Konka
54 Anhui Kangzhi Trade Co., Ltd. Kangzhi Trade
55 Shenzhen Konka Telecommunications Technology Co., Ltd. Telecommunication Technology
56 Konka Mobility Co., Limited Konka Mobility
57 Dongguan Konka Electronic Co., Ltd. Dongguan Konka
58 Suining Konka Smart Technology Co., Ltd. Suining Konka Smart
Chongqing Konka Optoelectronic Technology Research Institute Co., Chongqing Optoelectronic
59
Ltd. Technology Research Institute
60 Yibin Kangrun Environmental Technology Co., Ltd. Yibin Kangrun
61 Yibin Kangrun Medical Waste Centralized Treatment Co., Ltd. Yibin Kangrun Medical
Yibin Kangrun Environmental
62 Yibin Kangrun Environmental Protection Power Generation Co., Ltd.
Protection
63 Ningbo Khr Electric Appliance Co., Ltd. Ningbo Khr Electric Appliance
64 Jiangxi Konka New Material Technology Co., Ltd. Jiangxi Konka
65 Jiangxi High Transparent Substrate Material Technology Co., Ltd. Jiangxi High Transparent Substrate
66 Jiangsu Konka Special Material Technology Co., Ltd. Jiangsu Konka Special Material
67 Jiangxi Xinfeng Microcrystalline Jade Co., Ltd. Xinfeng Microcrystalline
68 Konka Huanjia Environmental Technology Co., Ltd. Konka Huanjia
69 Konka Huanjia (Henan) Environmental Technology Co., Ltd. Konka Huanjia (Henan)
70 Shaanxi Konka Intelligent Appliance Co., Ltd. Shaanxi Konka Intelligent
71 Shenzhen Konka Pengrun Technology & Industry Co., Ltd. Pengrun Technology
72 Jiaxin Technology Co., Ltd. Jiaxin Technology
73 Konka Ronghe Industrial Technology (Zhejiang) Co., Ltd. Konka Ronghe
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Konka Group Co., Ltd. Interim Report 2023
No. Corporate name Abbreviation
74 Chongqing Kangxingrui Environmental Technology Co., Ltd. Chongqing Kangxingrui
Chongqing Kangxingrui
75 Chongqing Kangxingrui Scraped Automobile Recycling Co., Ltd.
Automobile Recycling
76 Shenzhen Konka Unifortune Technology Co., Ltd. Konka Unifortune
77 Jiali International (Hong Kong) Limited Jiali International
78 Sichuan Kangjiatong Technology Co., Ltd. Kangjiatong
79 Kanghong (Yantai) Environmental Technology Co., Ltd. Kanghong (Yantai) Environmental
80 Jiangkang (Shanghai) Technology Co., Ltd. Jiangkang (Shanghai) Technology
81 Shenzhen Konka Intelligent Manufacturing Technology Co., Ltd. Konka Intelligent Manufacturing
82 Hainan Konka Material Technology Co., Ltd. Konka Material
83 Konka Ventures Development (Shenzhen) Co., Ltd. Konka Ventures
84 Yibin Konka Incubator Management Co., Ltd. Yibin Konka Incubator
85 Yantai Konka Healthcare Enterprise Service Co., Ltd. Yantai Konka
Chengdu Anren Konka Cultural and Creative Incubator Management
86 Chengdu Anren
Co., Ltd.
87 Guiyang Konka Enterprise Service Co., Ltd. Konka Enterprise Service
88 Shenzhen Konka Eco-Development Investment Co., Ltd. Konka Eco-Development
89 Konka (Europe) Co., Ltd. Konka Europe
90 Hong Kong Konka Limited Hong Kong Konka
91 Hongdin International Trading Limited Hongdin Trading
92 Konka North America LLC Konka North America
93 Kanghao Technology Co., Ltd. Kanghao Technology
94 Hongdin Invest Development Limited Hongdin Invest
Chain Kingdom Memory
95 Chain Kingdom Memory Technologies Co., Limited
Technologies
Chain Kingdom Memory
96 Chain Kingdom Memory Technologies (Shenzhen) Co., Limited
Technologies (Shenzhen)
97 Hongjet (Hong Kong) Company Limited Hongjet
Chongqing Xinyuan
98 Chongqing Xinyuan Semiconductor Co., Ltd.
Semiconductor
99 Anlu Konka Industrial Operation Service Co., Ltd. Anlu Konka
Shenzhen Kanghong Dongsheng Investment Partnership (Limited
100 Kanghong Dongsheng
Partnership)
Guizhou Konka New Material
101 Guizhou Konka New Material Technology Co., Ltd.
Technology
102 Guizhou Kanggui Energy Co., Ltd. Guizhou Kanggui Energy
103 Guangdong Xinwei Semiconductor Co., Ltd. Guangdong Xinwei
104 Chongqing Kangxingrui Renewable Resources Co., Ltd. Kangxinrun Renewable Resources
Guizhou Kanggui Material
105 Guizhou Kanggui Material Technology Co., Ltd.
Technology
106 Nantong Kanghai Technology Industry Development Co., Ltd. Nantong Kanghai
107 Chongqing Kangyiyun Business Operation Management Co., Ltd. Chongqing Kangyiyun
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Konka Group Co., Ltd. Interim Report 2023
No. Corporate name Abbreviation
108 Jiangxi Konka High-tech Park Operation and Management Co., Ltd. Jiangxi Konka High-tech Park
Shangrao Konka Electronic
109 Shangrao Konka Electronic Technology Innovation Co., Ltd.
Technology Innovation
110 Guizhou Konka New Energy Material Technology Co., Ltd. Guizhou Konka New Energy
111 Zhejiang Konka Electronic Technology Co., Ltd. Zhejiang Konka Electronic
Zhejiang Konka Technology
112 Zhejiang Konka Technology Industry Development Co., Ltd.
Industry
113 Sichuan Hongxinchen Real Estate Development Co., Ltd. Sichuan Hongxinchen
114 Xi'an Konka Intelligent Appliance Co., Ltd. Xi'an Konka Intelligent
115 Xi'an Konka Network Technology Co., Ltd. Xi'an Konka Network
Xi'an Kanghong Technology
116 Xi'an Kanghong Technology Industry Development Co., Ltd.
Industry
Xi'an Konka Intelligent
117 Xi'an Konka Intelligent Technology Development Co., Ltd.
Technology
118 Chongqing Fangbing Real Estate Co., Ltd. Chongqing Fangbing Real Estate
119 Chongqing Konka Low Carbon Technology Co., Ltd. Chongqing Konka Low Carbon
Shenzhen Kanghong Xintong Investment Partnership (Limited
120 Kanghong Xintong
Partnership)
121 Songyang Konka Smart Industry Operation Management Co., Ltd. Songyang Industry Operation
122 Shenzhen Kangyan Technology Co., Ltd. Kangyan Technology
123 Konka Photovoltaic Technology Co., Ltd. Konka Photovoltaic Technology
124 Songyang Konka Intelligent Technology Development Co., Ltd. Songyang Konka Intelligent
125 Konka North China (Tianjin) Technology Co., Ltd. Konka North China
126 Zhongshan Kanghong Electronic Technology Co., Ltd. Zhongshan Kanghong
127 Shenzhen Konka Digital Technology Development Co., Ltd. Digital Technology
III. Basis for the Preparation of Financial Statements
1. Basic for the preparation
With the going-concern assumption as the basis and based on transactions and other events that
actually occurred, the Group prepared financial statements in accordance with the Accounting
Standards for Business Enterprises issued by the Ministry of Finance and other regulations as
well as the accounting policies and estimations stipulated in the Note IV “Significant Accounting
Policies and Estimations”.
2. Going-concern
The Group has a recent history of profitable operations supported by financial resources and considers
it reasonable to prepare the financial statements on a going concern basis.
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Konka Group Co., Ltd. Interim Report 2023
IV. Important Accounting Policies and Estimations
1. Statement of Compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Group are in compliance with in compliance with the
Accounting Standards for Business Enterprises, which factually and completely present the
Group’s financial positions, business results and cash flows, and other relevant information.
2. Fiscal Period
The Group’s fiscal year starts on January 1 and ends on December 31 of every year according to
the Gregorian calendar.
3. Operating Cycle
The normal operating cycle refers to the period from the purchase of assets for processing to the
realization of cash or cash equivalents by the Group. An operating cycle for the Group is 12 months,
which is also the classification criterion for the liquidity of its assets and liabilities.
4. Recording Currency
The Group adopted RMB as the bookkeeping base currency.
5. Accounting Treatment Methods for Business Combinations under the Same Control or not
under the Same Control
As the combining party, the assets and liabilities obtained by the Group in a business combination
under the same control shall be measured on the basis of their carrying value in the final
controlling party on the combining date. As for the balance between the carrying value of the net
assets obtained and the carrying value of the consideration paid by it, the capital reserve shall be
adjusted. If the capital reserve is not sufficient to be offset, the retained earnings shall be adjusted.
The identifiable assets, liabilities and contingent liabilities of the acquiree acquired in the
business combination under different control shall be measured at fair value on the acquisition
date. The merger cost is the sum of the fair value of cash or non-cash assets, liabilities issued or
assumed, equity securities issued, etc. paid by the Group on the purchase date to gain control over
the purchased party and all directly related expenses incurred in the business combination (The
merge cost of business combination realized step by step through multiple transactions is the sum
of every single transaction’s cost). The balance that the combined cost greater than the fair value
share of the identifiable net assets of the purchased party obtained in the combination shall be
recognized as goodwill; When the merger cost is less than the fair value share of the identifiable
net assets of the acquiree acquired in the merger, the fair value of all identifiable assets, liabilities
and contingent liabilities acquired in the merger, and non-cash assets of the merger consideration
or equity securities issued, etc. shall be reviewed first. After review, if the merger cost is still less
than the fair value share of the identifiable net assets of the acquiree acquired in the merger, the
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Konka Group Co., Ltd. Interim Report 2023
difference shall be included in the non-operating income of the merger period.
6. Methods for Preparing Consolidated Financial Statements
The scope of consolidation includes all controlled subsidiaries and structural entities.
The financial statements of subsidiaries are adjusted in accordance with the accounting policies
and accounting period of the Group during the preparation of the consolidated financial
statements, where the accounting policies and the accounting periods are inconsistent between the
Group and subsidiaries.
All significant internal transactions, current balances and unrealized profits within the scope of
consolidation shall be offset when preparing the consolidated statement. The shares of the
subsidiary's owner's equity that do not belong to the parent Group and the shares of minority
shareholders' equity in current net profit and loss, other comprehensive income and total
comprehensive income shall be respectively listed in the consolidated financial statement
"Minority shareholders' equity, minority shareholders' profit and loss, other comprehensive
income that belongs to minority shareholders and total comprehensive income that belongs to
minority shareholders".
For subsidiaries acquired through merger of enterprises under the same control, their operating
results and cash flows are included in the consolidated financial statements from the beginning of
the current merger period. When preparing the comparative consolidated financial statements, the
relevant items in the financial statements of the previous year shall be adjusted as if the
consolidated reporting entity had existed since the final controlling party began to control it.
The treatment method of supplementary disclosure in consolidated financial statement for the
Reporting Period when the controlling right is acquired, if the equity of the invested organization
under the same control is successively obtained through several transactions and eventually the
enterprise merger is conducted. For example: At the occasion of the equity of the investee under
the same control is acquired step by step through multiple transactions, and finally form the
business combination, when preparing the consolidated statement, it shall be deemed as the
adjustment is made in the current state when the final controlling party starts to control. And
when compiling the comparative report, the assets and liabilities of the merged party shall be
merged into the comparative statement of the consolidated financial statements of the
consolidated Group without any earlier than the time when the Group and the merged party are
under the control of the ultimate controlling party, and the combined net increased assets shall be
adjusted to the relevant items under owners' equity in the comparative statements. In order to
avoid the re-calculation of the net assets value of the merged party, the long-term equity
investment held by the Group before the merger, the confirmed relevant profit and loss on the
same party with the Group and the merged party on the date of acquisition of the original equity
from the final control date to the merger date, and changes of other comprehensive income and
other net assets shall offset the beginning retained earnings and current profits and losses of the
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Konka Group Co., Ltd. Interim Report 2023
comparative statement period respectively.
For subsidiaries acquired through business combination under the different control, the operating
results and cash flow shall be included in the consolidated financial statements from the date
when the Group obtains the control right. When preparing the consolidated financial statements,
the financial statements of the subsidiaries shall be adjusted on the basis of the fair value of the
identifiable assets, liabilities and contingent liabilities determined on the acquisition date.
The treatment method of supplementary disclosure in consolidated financial statement for the
Reporting Period when the controlling right is acquired, if the equity of the invested organization
not under the same control is successively obtained through several transactions and eventually
the enterprise merger is conducted. For example: At the occasion of the equity of the investee
under different control is acquired step by step through multiple transactions and eventually form
the business combination, when preparing the consolidated statement, the equity of the investee
held before the purchase date is re-measured according to the fair value of the equity on the
purchase date, and the difference between the fair value and its book value is included in the
current investment income. The equity of the acquiree held before the relevant purchase date
involves other comprehensive income under the equity method and other changes in owner's
equity other than net profit and loss, other comprehensive income and profit distribution, which
are converted into investment profit and loss in the current period of the purchase date, except for
other comprehensive income arising from the remeasurement of defined benefit plans's net
liabilities or changes in net assets by the investee.
The Group partially disposes of long-term equity investments in subsidiaries without losing
control, when preparing the consolidated financial statements, the difference between the disposal
price and the share of net assets that the subsidiaries have continuously calculated since the date
of purchase or the date of consolidation is corresponding to the disposal of long-term equity
investments. The capital premium or equity premium is adjusted. If the capital reserve is
insufficient to offset, the retained earnings are adjusted.
If the Group loses control over the investee due to the disposal of some equity investments and
other reasons, the remaining equity shall be re-measured at its fair value on the date of loss of
control when preparing the consolidated financial statements. The difference between the sum of
the consideration obtained from the disposal of equity and the fair value of the remaining equity,
minus the share of the net assets of the original subsidiary calculated on the basis of the original
shareholding ratio and continuously calculated from the date of purchase or merger, is included in
the investment profit and loss of the current period when the control right is lost, and goodwill is
offset. Other comprehensive income related to the original subsidiary's equity investment, etc.,
will be transferred to the current investment profit and loss when the control right is lost.
If the Group disposes of the equity investment in a subsidiary Group step by step through
multiple transactions until the loss of control right, if the transactions of the disposal of the equity
investment in a subsidiary Group until the loss of control right belong to a package transaction,
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Konka Group Co., Ltd. Interim Report 2023
the transactions shall be treated as transactions of the disposal of the subsidiary Group and the
loss of control right for accounting. However, the difference between the disposal price and the
share of the subsidiary's net assets corresponding to the disposal investment before the loss of
control right is recognized as other comprehensive income in the consolidated financial
statements, and is transferred to the investment profit and loss of the current period when the
control right is lost.
7. Classification of Joint Arrangements and Accounting Treatment of Joint Operations
The Group classifies joint arrangements into joint operations and joint ventures. For a joint
operation, the Group, as a joint operator, recognizes the assets and liabilities that it holds and
bears in the joint operation, and recognizes the jointly-held assets and jointly-borne liabilities
according to the Group’s stake in the joint operation; recognizes relevant income and expense
according to the Group’s stake in the joint operation. When the Group purchases or sells the
assets not constituting business with the joint operation, the Group only recognized the share of
the other joint operators in the gains and losses arising from the transaction.
8. Cash and Cash Equivalents
In the Group’s understanding, the cash in the cash flow statement includes cash on hand and
deposits that can be used for cover, the cash equivalents in the cash flow statement include high
circulating investments held within three months which are easily convertible into known amount
of cash and whose risks in change of value are minimal.
9. Foreign Currency Businesses and Translation of Foreign Currency Financial Statements
(1) Foreign currency transaction
As for foreign currency transaction, the Group converted the foreign currency amount into RMB
amount at the exchange rate at the beginning of the month of transaction occurrence date
(normally referred to as the central parity rate of foreign exchange rate on the same day published
by the People’s Bank of China, the same below). On the balance sheet date, the monetary items in
foreign currency were converted into RMB at the spot exchange rate on balance sheet date.
Except the exchange difference arising from special foreign-currency borrowing for the purpose
of construction or production of assets meeting capitalization conditions treated in the principle of
capitalization, the conversion difference was directly included in the current profits and losses.
(2) Translation of foreign currency financial statement
The asset and liability items in foreign currency balance sheet were converted at the spot
exchange rate on balance sheet date; except for “undistributed profit”, owner’s equity items were
converted at the sport exchange rate at the time of business occurrence; income and expenditure
items in income statement were converted at the average exchange rate for the period (monthly
average exchange rate) of the transaction occurrence date. The conversion difference of foreign
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Konka Group Co., Ltd. Interim Report 2023
currency statements arising from the aforementioned conversion was presented in other
comprehensive income item. The foreign currency cash flow was converted at the average
exchange rate for the period (monthly average exchange rate) of the cash flow occurrence date.
The amount of exchange rate change influence on cash was independently presented in cash flow
statement.
10. Financial Assets and Financial Liabilities
The Group recognizes a financial asset or liability when it becomes a party of the relevant
financial instrument contract.
(1) Financial assets
1) Classification, recognition and measurement of financial assets
The Group classifies the financial assets into financial assets measured at amortized cost,
financial assets measured by the fair value and the changes recorded in other comprehensive
income and financial assets at fair value through profit or loss based on the business model for
financial assets management and characteristics of contractual cash flow of financial assets.
The Group classified the financial assets meeting the following conditions at the same time as
financial assets at amortized cost: ①The business mode of the Group to manage the financial
assets targets at collecting the contractual cash flow. ②The contract of the financial assets
stipulates that the cash flow generated in the specific date is the payment of the interest based on
the principal and outstanding principal amount. These financial assets initially measured at fair
value and relevant transaction cost shall be included into the initial recognized amount and
subsequently measured at amortized cost. Except for those designated to be hedge items, the
difference between the initial recognized amount and the amount due shall be amortized at actual
interest rate and their amortization, impairment and exchange gain and loss as well as gains or
losses arising from derecognition shall be recorded into the current profit or loss.
The Group classified the financial assets meeting the following conditions at the same time as
financial assets at fair value through other comprehensive income: ①The Business mode for
managing financial assets of the Group takes contract cash flow collected as target and selling as
target. ②The contract of the financial assets stipulates that the cash flow generated in the specific
date is the payment of the interest based on the principal and outstanding principal amount. These
financial assets initially measured at fair value and relevant transaction cost shall be included into
the initial recognized amount. Except for those designated as hedged items, as for these financial
assets, except for gains or losses on credit impairment, exchange gain and loss and interest of
financial assets measured at actual interest rate, other gains or losses generated shall be recorded
into other comprehensive income. When derecognized, the accumulated gains and losses
originally recorded into other comprehensive income shall be transferred out into the current
profit or loss.
The Group recognizes interest income according to the effective interest rate method. Interest
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Konka Group Co., Ltd. Interim Report 2023
income is calculated and determined according to the book balance of the financial asset
multiplied by the actual interest rate, except for the following circumstances: ① For the financial
asset with credit impairment that has been purchased or originated, from the initial recognition,
the interest income is calculated and determined according to the amortized cost of the financial
asset and the actual interest rate adjusted by credit. ② For financial assets purchased or originated
that have not suffered credit impairment but have suffered credit impairment in subsequent
periods, the interest income shall be calculated and determined according to the amortized cost
and actual interest rate of the financial assets in subsequent periods.
The Group designates non-transactional investment in equity instruments as financial assets at
fair value through other comprehensive income. Those designated non-transactional investment in
equity instruments by the Group is initially measured at fair value and relevant transaction cost
shall be recorded into the initial recognized amount. Except for dividends (excluding those
belonging to recovery of investment cost) which shall be recorded into the current profit or loss,
other relevant gains and losses (including exchange gains and losses) shall be recorded into other
comprehensive income and cannot be transferred into the current profit or loss subsequently.
When derecognized, the accumulated gains or losses originally recorded into other
comprehensive income shall be transferred out into retained earnings. Equity instrument
investments measured at fair value through other comprehensive income included: Equity
investments to be held in the long term as planned by the Group for strategic purpose, with no
control, joint control or significance influence, and with no active market quotation.
The Group classifies financial assets not belonging to above two as financial assets at fair value
through profit or loss which shall be initially measured at fair value and relevant transaction cost
shall be directly recorded into the current profit or loss. Gains or losses arising from these
financial assets shall be recorded into the current profit or loss.
The contingent consideration recognized by the Group in the business combination not under the
same control which constitutes a financial asset shall be classified as the financial asset at fair
value through profit or loss.
2) Recognition and measurement of financial assets transfer
The Group derecognizes a financial asset when one of the following conditions is met:
① the rights to receive cash flows from the asset have expired; ② the enterprise has transferred
its rights to receive cash flows from the asset to a third party under a pass-through arrangement;
or ③ the enterprise has transferred its rights to receive cash flows from the asset and either (a)
has transferred substantially all the risks and rewards of the asset, or (b) has neither transferred
nor retained substantially all the risks and rewards of the asset, but has transferred control of the
asset.
If the overall transfer of financial assets fulfills the requirements for derecognition, the difference
between the book value of the transferred financial assets and the sum of the consideration
received due to the transfer and the corresponding derecognition part of the accumulated amount
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Konka Group Co., Ltd. Interim Report 2023
of fair value changes originally directly included in other comprehensive income (the contract
terms involving the transferred financial assets stipulate that the cash flow generated on a specific
date is only the payment of the principal and interest based on the unpaid principal amount) shall
be included in the current profits and losses.
If the partial transfer of financial assets satisfies the conditions for termination confirmation, the
entire book value of the transferred financial assets will be apportioned between the termination
confirmation portion and the non-termination confirmation portion according to their relative fair
values, and the consideration received for the transfer And the amount corresponding to the
termination of the recognition of the cumulative amount of changes in fair value originally
included in other comprehensive income that should be apportioned to the derecognition part And
the payment of interest based on the outstanding principal amount), and the difference between
the total book value of the aforesaid financial assets allocated is included in the current profit and
loss.
(2) Financial liabilities
1) Classification, recognition and measurement of financial liabilities
The Group’s financial liabilities are, on initial recognition, classified into financial liabilities at
fair value through profit or loss and other financial liabilities.
Financial liabilities at fair value through profit or loss include held-for-trading financial liabilities
and financial liabilities designated at the initial recognition to be measured by the fair value and
their changes are recorded in the current profit or loss. The subsequent measurement shall be at
fair value and gains or losses arising from changes in fair value and the dividends and interest
expense related to the financial liability shall be the current profit or loss.
Other financial liabilities shall be subsequently measured at amortized cost with actual interest
rate. The Group classifies financial liabilities except for the following items as financial liabilities
at amortized cost: ①Financial liabilities at fair value through profit or loss including held-for-
trading financial liabilities (including the derivative instruments belonging to financial liabilities)
and designated financial liabilities at fair value through profit or loss. ②Financial liabilities
arising from the transfer of financial assets not meeting the derecognition conditions or
continuous involvement in the transferred financial assets. ③Financial guarantee contract not
belonging to cases of above ① or ② and loan commitments at interest rate lower than the market
rate not belonging to the case in ①.
The Group treats the financial liability arising from contingent consideration recognized as the
purchase party in the business combination not under the same control at fair value and changes
thereof shall be recorded into the current profit or loss.
2) Derecognition of financial liabilities
In case of current obligation of financial liabilities (or partial financial liabilities) being
terminated, derecognition of such financial liabilities (or partial financial liabilities) is conducted
by the Group. If the Group (borrower) concludes an agreement with the lender to replace existing
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Konka Group Co., Ltd. Interim Report 2023
financial liabilities with new ones and contact terms of new financial liabilities are different from
those of existing financial liabilities, derecognition of existing financial liabilities and recognition
of new financial liabilities shall be conducted. In case of material alteration of contract terms of
existing financial liabilities (partial financial liabilities) by the Group, derecognition of existing
financial liabilities and recognition of new financial liabilities as per modified terms shall be
conducted. In case of derecognition of financial liabilities (partial financial liabilities), the Group
includes the balance between its carrying value and payment consideration into the current profit
or loss.
(3) Determination of financial assets and liabilities’ fair value
The Group measured the fair value of financial assets and financial liabilities according to the
price at major market. If major market does not exist, the fair value of financial assets and
financial liabilities was measured according to the price at the most advantageous market through
applying valuation technique applicable at the time and with sufficient usable data and other
information support. The inputs for fair value measurement were classified into three levels.
Level 1 is the unadjusted quotation of the same assets or liabilities on active market available on
the measurement date. Level 2 is the input of relevant assets or liabilities other than that in level 1
that are observable either directly or indirectly. Level 3 is the unobservable input of relevant
assets or liabilities. The Group preferred level 1 input, and applied level 3 input at last. Level 1
input was applicable for listed stock and bond held by the Group, level 2 input for financing of
accounts receivable (mainly bank acceptance bill and trade acceptance bill meeting derecognition
requirements after transfer), and level 3 input for other non-current financial assets (unlisted
equity investment held by the Group) and held-for-trading financial assets (mainly financial
products held by the Group). The level attributed to the fair value measurement result was
determined according to the lowest level of the input with much significance to fair value
measurement in general.
The Group measured the investment of equity instruments at fair value. However, under limited
situation, if the recent information for determining the fair value was insufficient, or the potential
estimated amount of fair value was in wide range, and the cost represented the optimal estimation
of fair value in such range, such cost could represent appropriate estimation of fair value in such
range. Such equity instrument investments included: Equity investments held by the Group
measured at fair value with changes included in the current profits and losses with no control,
joint control or significance influence; non-trading equity instrument investments were designated
as financial assets measured at fair value through other comprehensive income.
(4) Offsetting financial assets and financial liabilities
The Group’s financial assets and liabilities shall be separately presented in the balance sheet and
not set off each other. But when meeting the following conditions at the same time, the net
amount after offset shall be presented in the balance sheet: (1) The Group has the statutory right
to set off recognized amount which is currently executable; (2) The Group plans to settle with the
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Konka Group Co., Ltd. Interim Report 2023
net amount or realize the financial asset and pay off the financial liability simultaneously.
(5) The distinction between financial liabilities and equity instruments and related treatment
methods
The Group distinguishes the financial liabilities and equity instruments according to the following
principles: (1) If the Group cannot unconditionally avoid performing a contractual obligation by
delivering cash or other financial assets, the contractual obligation meets the definition of
financial liabilities. Although some financial instruments do not explicitly include the terms and
conditions of the obligation to deliver cash or other financial assets, they may indirectly form
contractual obligations through other terms and conditions. (2) If a financial instrument must be
settled with or can be settled with the Group's own equity instrument, it is necessary to consider
whether the Group's own equity instrument used to settle the instrument is used as a substitute for
cash or other financial assets, or to enable the holder of the instrument to enjoy the residual equity
in the assets of the issuer after deducting all liabilities. If it belongs to the former condition, the
instrument is the financial liability of the issuer; if it belongs to the latter condition, the instrument
is the equity instrument of the issuer. In some cases, a financial instrument contract requires the
Group to use or use its own equity instrument to settle the financial instrument, in which the
amount of contractual rights or contractual obligations is equal to the number of its own equity
instruments available or to be delivered multiplied by its fair value at the time of settlement,
regardless of whether the amount of contractual rights or obligations is fixed, whether it is
entirely or partially based on changes in variables other than the market price of the Group's own
equity instruments, the contract shall be classified as a financial liability.
In classifying financial instruments (or their components) in the consolidated statement, the
Group has taken into account all terms and conditions reached between the Group members and
the holders of financial instruments. If the Group as a whole undertakes the obligation to deliver
cash, other financial assets or settle accounts in other ways that cause the instrument to become a
financial liability due to the instrument, the instrument shall be classified as a financial liability.
If financial instruments or their components are financial liabilities, the Group will include
interest, dividends (or dividends), gains or losses, and gains or losses arising from redemption or
refinancing, etc. in the current profits and losses.
If financial instruments or their components are equity instruments, when they are issued
(including refinancing), repurchased, sold or cancelled, the Group will treat them as changes in
equity and will not recognize changes in the fair value of equity instruments.
11. Impairment of Financial Assets
The Group needs to confirm that the financial assets subject to the impairment loss are the
financial assets measured based on the amortized cost, the debt instrument investment measured
based on the fair value with its variations included into other comprehensive incomes and the
lease outlay receivable, mainly including notes receivable, account receivable, other receivables,
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investment on creditor’s rights, other investments on creditor’s rights and long-term receivables
etc. Besides, in respect of the contract assets and partial financial guarantee contract,
corresponding impairment provisions shall be calculated and withdrawn and corresponding credit
impairment losses recognized according to various accounting policies mentioned in this part.
(1) Methods for the Recognition of Impairment Provisions
For all mentioned items above, the Group shall calculate and withdraw corresponding impairment
provisions and recognize corresponding credit impairment losses according to applicable
expected credit loss measurement methods (general methods or simplified methods) with the
expected credit loss as the basis.
Credit loss refers to the difference between all receivable contract cash flows and all expected
cash flows that are discounted to the present value based on the original actual interest rate -- the
present value of all cash shortfall. However, for the purchased or original financial assets subject
to the credit impairment, the Group shall realize the discounting based on the actual interest rate
subject to the credit adjustment.
General methods applied to measure the expected credit loss can be described as: the Group shall
evaluate whether the credit risk of the financial assets (including the contract assets and other
applicable items; the same below) increases remarkably after the initial recognition on the balance
sheet day; if the credit risk increases remarkably after the initial recognition, the Group shall
measure the provision for loss based on the specific expected credit loss amount during the entire
period of existence; if not, the Group shall measure the provision for loss based on the specific
expected credit loss amount in the following 12 months. While evaluating the expected credit loss,
the Group shall take all reasonable and well-founded information into consideration, including the
forward-looking information.
For the financial instrument of lower credit risk on the balance sheet day, the Group shall assume
that its credit risk does not increase remarkably after the initial recognition, and corresponding
provision for loss shall be measured according to the expected credit loss in the following 12
months.
(2) Standards for Judging Whether the Credit Risk Increases Remarkably after the Initial
Recognition
If any financial assets’ probability of default within the expected period of existence determined
on the balance sheet day is obviously higher than that within the expected period of existence
determined during the initial recognition, it shall indicate the remarkable increase of the financial
assets’ credit risk. Unless it is under special circumstances, the Group shall adopt various
variations in the default risk in the following 12 months as the reasonable basis for estimating
corresponding variations in the default risk within the entire period of existence and determining
whether the credit risk increases remarkably after the initial recognition.
(3) Combined Method for Evaluating the Expected Credit Risk based on Corresponding
Combination
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For the financial assets with remarkably different credit risk, the Group shall separately evaluate
its credit risk, including the receivables from related parties, receivables involved in any dispute
with the other party or any lawsuit and arbitration, and receivables with obvious evidence
showing that the debtor cannot fulfill the due payment obligation etc.
Except for the financial assets whose credit risk shall be separately evaluated, the Group shall
divide these financial assets into different combinations based on the specific risk features, on
which basis, corresponding credit risks can be evaluated.
(4) Accounting Treatment Methods Applied to the Impairment of Financial Assets
At the end of the period, the Group shall calculate the expected credit losses of various financial
assets. If the expected credit loss is higher than the carrying amount of its current impairment
provision, the difference shall be recognized as the impairment loss; if lower, the difference shall
be recognized as the gain from the impairment.
12. Notes Receivable
For notes receivable, the Group shall measure the provision for loss based on the specific
expected credit loss during the entire period of existence. According to the credit risk
characteristics thereof, except those with separate evaluation of credit risk, notes receivable can
be divided into different combinations:
Item Basis
The Accepter shall be the bank with high credit level and low
Bank Acceptance
risks
Classified by credit risk of acceptors (the same as accounts
Trade Acceptance
receivable)
13. Accounts Receivable
For account receivable and contract assets excluding significant financing composition, the Group
shall measure the provision for loss according to the specific expected credit loss amount within
the entire period of existence.
For account receivable, contract assets and lease payment receivable including significant
financing composition, the Group shall always measure the provision for loss according to the
specific expected credit loss amount within the period of existence.
Except the account receivable and contract assets whose credit risks shall be separately evaluated,
the Group shall divide them into different combinations based on the specific credit risks:
Item Basis
This portfolio is accounts receivable with aging as the credit risk
Aging Combination
feature.
Related party combination The accounts receivable from the other entities within the
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Item Basis
consolidation scope
14. Accounts Receivable Financing
The Group’s accounts receivable financing is based on expected credit losses, and provision is
made for depreciation reserves in accordance with the expected credit loss measurement method
for notes receivable.
15. Other Receivables
The Group measures the loss reserves on other receivables in accordance with the following
circumstances: a) For financial assets whose credit risk has not significantly increased since the
initial recognition, the Group measures the loss reserves at the amount of expected credit losses
for the next 12 months; b) For financial assets whose credit risk has increased significantly since
the initial recognition, the Group measures the loss reserves at an amount equal to the expected
credit losses for the entire period of the financial instrument; c) For financial assets purchased or
originated from credit impairment, the Group measures the loss reserves at an amount equal to the
expected credit losses over the entire period of the financial instrument. Except other receivables
whose credit risks shall be separately evaluated, the Group shall divide them into different
combinations based on the specific credit risk features:
Item Basis
This portfolio is accounts receivable with aging as the credit risk
Aging Combination
feature.
This combination shall regard other receivables of extremely low
Low Risk Combination risk (including the revolving fund, the cash deposit and the guarantee
deposit) as the credit risk feature.
Related party Other receivables from the other entities within the consolidation
combination scope
16. Long-term Receivables
By determining whether the credit risk of long-term account receivables increases remarkably
after the initial recognition, the Group shall measure the impairment loss based on the specific
expected credit loss in the following 12 months or during the entire period of existence. Except
long-term account receivables whose credit risks shall be separately evaluated, the Group shall
divide them into different combinations based on the specific credit risk features:
Item Basis
Financing Lease Regarding the long-term receivables related to the financing lease as the
Combination credit risk characteristics
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Item Basis
Franchise Regarding the long-term receivables related to the PPP Project as the
Combination credit risk characteristics
17. Inventories
The Group's inventories mainly include raw materials, products in process, semi-finished
products, Products on hand,and entrusted processing materials.
The perpetual inventory method is used for inventories. Inventories are priced at the actual cost at
the time of acquisition; the actual cost of inventories is determined by the weighted average
method when inventories are claimed or issued. Low-value consumables and packaging are
amortized through the one-off charge-off method.
The net realizable value of inventories of goods that are used directly for sale, such as inventory
goods, products in process, and materials for sale, is determined by the estimated selling price of
the inventory minus estimated sale expenses, and related taxes; the net realizable value of
inventories of materials held for production is determined by the estimated selling price of the
finished goods produced minus the estimated costs of completion, estimated sale expenses, and
related taxes.The inventories with various numbers and low unit price shall be made provisions
for depreciation reserves of inventories according to the category of inventories. For inventories
that are produced and sold in the same region with same or similar end use or purposes, and hard
to be measured separately from other items, it shall be made merger provisions for falling price of
inventories.
The net realizable value refers, in the ordinary course of business, to the account after deducting
the estimated cost of completion, estimated sale expense and relevant taxes from the estimated
sale price of inventories. The net realizable value of inventories shall be fixed on the basis of
valid evidence as well as under consideration of purpose of inventories and the effect of events
after balance-sheet-date.
After withdrawing the depreciation reserves for inventories, if the factors, which cause any write-
down of the inventories, have disappeared, causing the net realizable value of inventories is
higher than its carrying amount; the amount of write-down shall be reversed from the original
amount of depreciation reserve for inventories. The reversed amount shall be included in the
profits and losses of the current period.
18. Contract Assets
(1) Confirmation methods and standards of contract assets
Contract assets refer to the right of the Group to receive consideration after transferring goods to
customers, and this right depends on factors other than the passage of time. If the Group sells two
clearly distinguishable products to customers, it has the right to receive payment because one of
the products has been delivered, but the payment is also dependent on the delivery of the other
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product, the Group has the right to receive payment as a contract assets.
(2) Determination method and accounting treatment method of expected credit loss of contract
assets
For the method of determining the expected credit loss of contract assets, see the Note IV-11.
Impairment of Financial Assets, Note IV-12. Notes Receivable and Note IV-13. Accounts
Receivable.
The Group calculates the expected credit loss of contract assets on the balance sheet date. If the
expected credit loss is greater than the book value of the current contract asset impairment
provision, the Group will recognize the difference as an impairment loss and debit the "asset
impairment loss". Credited "Contract asset impairment provision". On the contrary, the Group
recognizes the difference as an impairment gain and keeps the opposite accounting records.
If the Group actually incurs credit losses and determines that the relevant contract assets cannot
be recovered, and the written-off is approved, the "contract asset impairment reserve" is debited
and the "contracted asset" is credited based on the approved write-off amount. If the written-off
amount is greater than the provision for loss that has been withdrawn, the "asset impairment loss"
is debited based on the difference.
19. Contract Costs
(1) The method of determining the amount of assets related to contract costs
The Group’s assets related to contract costs include contract performance costs and contract
acquisition costs.
The contract performance cost, that is, the cost incurred by the Group for the performance of the
contract, does not fall within the scope of other accounting standards and meets the following
conditions at the same time, as the contract performance cost is recognized as an asset: the cost
and a current or expected contract Directly related, including direct labor, direct materials,
manufacturing expenses, clearly the cost borne by the customer, and other costs incurred only due
to the contract; this cost increases the Group's future resources for fulfilling its performance
obligations; This cost is expected to be recovered.
The contract acquisition cost, that is, the incremental cost incurred by the Group to obtain the
contract is expected to be recovered, and is recognized as an asset as the contract acquisition cost;
if the asset amortization period does not exceed one year, it is included in the current profit and
loss when it occurs. Incremental cost refers to the cost (such as sales commission, etc.) that the
Group will not incur without obtaining the contract. The Group's expenses incurred in obtaining
the contract, other than the expected incremental cost that can be recovered (such as travel
expenses incurred regardless of whether the contract is obtained, etc.), are included in the current
profit and loss when they are incurred, but it is clearly borne by the customer except.
(2) Amortization of assets related to contract costs
The Group’s assets related to contract costs are amortized on the same basis as the commodity
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revenue recognition related to the asset and included in the current profit and loss.
(3) Impairment of assets related to contract costs
When the Group determines the impairment loss of assets related to contract costs, it first
determines the impairment loss of other assets related to the contract that are confirmed in
accordance with other relevant business accounting standards; then, based on their book value
higher than the Group’s transfer and If the difference between the remaining consideration that
the asset-related commodity is expected to obtain and the estimated cost incurred for the transfer
of the relevant commodity, the excess shall be provided for impairment and recognized as an
asset impairment loss.
If the depreciation factors of the previous period have changed, and the aforementioned difference
is higher than the book value of the asset, the original provision for asset impairment shall be
reversed and included in the current profit and loss, but the book value of the asset after the
reversal shall not exceed Assuming no provision for impairment is made, the book value of the
asset on the date of reversal.
20. Long-term Equity Investments
The Group's long-term equity investments mainly consist of investments in subsidiaries,
associated enterprises, and joint ventures.
The Group’s judgment on joint control is based on the fact that all participants or a combination
of participants collectively control the arrangement and that the policies of the activities related to
the arrangement shall be unanimously agreed by those participants who.
The Group is generally considered to have a significant influence on the investee when it owns,
directly or indirectly through a subsidiary, above 20% but below 50% of the voting rights of the
investee. If the Group holds less than 20% of the voting rights of the investee, it also needs to
judge whether the Group has a significant influence on the investee by taking into account the
facts and circumstances such as having representatives on the board of directors or similar
authority of the investee, or participating in the process of formulating financial and operating
policies of the investee, or having major transactions with the investee, or sending management
personnel to the investee, or providing key technical information to the investee.
If control over the investee is formed, it is a subsidiary of the Group. For long-term equity
investment acquired through business combination under the same control, the initial investment
cost of the long-term equity investments is recorded at the merger date based on the acquisition of
the merged party's share of the book value of the net assets of the ultimate controller in the
consolidated financial statement. If the book value of the net assets of the merged party on the
merger date is negative, the cost of long-term equity investments is determined as zero.
If the equity of the investee under the same control is acquired in stages through multiple
transactions to eventually result in a business combination, additional disclosures of the treatment
of long-term equity investments in the parent Group's financial statements shall be made in the
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Reporting Period in which control is obtained. For example, if the business combination that is
ultimately formed through multiple transactions to acquire the equity of the investee under the
same control belongs to a package deal, the Group shall conduct accounting treatment to treat
each transaction as a single transaction to acquire control. If the transaction is not a package deal,
the initial investment cost of the long-term equity investment is based on the share of the book
value of the net assets of the merged party in the consolidated financial statements of the ultimate
controller at the merger date. The difference between the initial investment cost and the sum of
the book value of the long-term equity investment before the merger plus the book value of the
new consideration paid for further acquisition of shares at the merger date shall offset against
capital reserve; and where capital reserve is insufficient to be offset, the retained earnings shall be
adjusted.
For long-term equity investment acquired through business combination not under the same
control, the initial investment cost shall be the consolidation cost.
If the equity of the investee not under the same control is acquired in stages through multiple
transactions to eventually result in a business combination, additional disclosures of the cost
treatment of long-term equity investments in the parent Group's financial statements shall be
made in the Reporting Period in which control is obtained. For example, if the business
combination that is ultimately formed through multiple transactions to acquire the equity of the
investee not under the same control belongs to a package deal, the Group shall conduct
accounting treatment to treat each transaction as a single transaction to acquire control. If the
transaction is not a package deal, the sum of the book value of the equity investment originally
held plus the cost of the new investment shall be the initial investment cost calculated in
accordance with the cost method. If the equity held prior to the purchase date is accounted by the
equity method, the relevant other comprehensive income accounted by the original equity method
shall not be adjusted. The same basis of accounting as that used for the direct disposal of the
related assets or liabilities by the investee is used for the disposal of the investment. If the equity
held prior to the purchase date is a financial asset designated to be measured at fair value with
fluctuations included in other comprehensive income, the cumulative profit or loss on the equity
previously recognized in other comprehensive income shall be transferred from other
comprehensive income to the retained earnings; if the equity is a financial asset measured at fair
value and the changes of which are included in profits and losses of the current period, the equity
previously recognized as profits and losses from the changes in fair value shall not be transferred
to investment income. If the equity held prior to the purchase date is an investment for other
equity instruments, the changes in fair value of the equity investment accumulated in other
comprehensive income before the purchase date shall be transferred to the retained earnings.
Except for the long-term equity investments acquired through business combination hereinabove,
long-term equity investments acquired by paying cash are recorded as investment cost based on
the actual purchase price paid; long-term equity investments acquired by issuing equity securities
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are recorded as investment cost based on the fair value of the equity securities issued; long-term
equity investments invested by investors are recorded as investment cost based on the value
agreed in the investment contract or agreement.
The Group calculates its investments in subsidiaries through the cost method and its investments
in joint ventures and associate enterprises through the equity method.
For long-term equity investments calculated by the cost method for subsequent measurement, the
book value of the cost of long-term equity investments shall be increased by the fair value of the
cost amount paid for the additional investment and relevant transaction costs incurred when the
additional investment is made. Cash dividends or profits declared by the investee are recognized
as investment income for the current period in accordance with the due amount.
In addition to the above-mentioned long-term equity investment obtained through business
combination, the long-term equity investment obtained by paying cash shall be regarded as the
investment cost according to the purchase price actually paid; the long-term equity investment
obtained by issuing equity securities shall be regarded as the investment cost according to the fair
value of issuing equity securities; the long-term equity investment invested by investors shall be
regarded as the investment cost according to the investment contract or agreement The value of
the Group is regarded as the cost of investment.
The Group adopts the cost method for investment in subsidiaries and the equity method for
investment in joint ventures and associated enterprises.
For the long-term equity investment whose subsequent measurement adopts the cost method,
when the additional investment is made, the book value of the long-term equity investment cost is
increased according to the fair value of the cost amount paid by the additional investment and the
relevant transaction expenses. The cash dividends or profits declared to be distributed by the
investee shall be recognized as the current investment income according to the amount that
should be enjoyed.
For the long-term equity investment with equity method for subsequent measurement, the book
value of the long-term equity investment will increase or decrease with the change of the owner's
equity of the invested entity. When confirming the share of the net profit and loss of the investee,
the net profit and loss of the investee shall be calculated based on the fair value of the identifiable
assets of the investee at the time of obtaining the investment, in accordance with the accounting
policies and accounting period of the Group, and offset the internal transaction profit and loss
between the joint venture and the joint venture according to the shareholding ratio Profit is
recognized after adjustment.
For disposal of long-term equity investment, the difference between the book value and the actual
price shall be included in the current investment income. For long-term equity investment
accounted by equity method, other comprehensive income accounted by the original equity
method shall be accounted on the same basis as the investee's direct disposal of relevant assets or
liabilities when the equity method is terminated, and the owner's equity shall be recognized due to
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other changes in owner's equity of the investee except net profit and loss, other comprehensive
income and profit distribution When the equity method is terminated, all of them shall be
transferred into the current investment income.
In case of loss of joint control or significant influence on the investee due to the disposal of part
of equity investment, the remaining equity after disposal shall be accounted according to the
relevant provisions of the recognition and measurement standards of financial instruments, and
the difference between the fair value and the book value of the remaining equity on the date of
loss of joint control or significant influence shall be included in the current profits and losses.
When the equity method is terminated, the other comprehensive income of the original equity
investment recognized as a result of its accounting with the equity method shall be handled on the
same basis as the investee's direct disposal of the relevant assets or liabilities and carried forward
in proportion. The owner's equity recognized as a result of the changes in the owner's equity of
the investee other than net profit and loss, other comprehensive income and profit distribution
shall be carried forward in proportion Transfer to current investment income.
If the control over the investee is lost due to the disposal of part of the long-term equity
investment, and the residual equity after disposal can jointly control or exert significant influence
on the investee, it shall be accounted according to the equity method, and the difference between
the book value of the disposal equity and the disposal consideration shall be included in the
investment income, and the residual equity shall be regarded as adjusted by the equity method
when it is obtained If the residual equity cannot exercise joint control or exert significant
influence on the investee, the accounting treatment shall be carried out according to the relevant
provisions of the recognition and measurement standards of financial instruments. The difference
between the book value of the disposal equity and the disposal consideration shall be included in
the investment income, and the difference between the fair value and the book value of the
residual equity on the day of losing control shall be included in the current profits and losses.
If the transaction from step-by-step disposal of equity to loss of control right does not belong to
package transaction, accounting treatment shall be carried out for each transaction separately. If it
is a "package deal", each transaction will be treated as a transaction of disposal of subsidiaries
and loss of control. However, before the loss of control, the difference between the disposal price
of each transaction and the book value of the long-term equity investment corresponding to the
disposed equity will be recognized as other comprehensive income, and when the control is lost,
it will be transferred to the current account of loss of control Period profit and loss
21. Investment Property
The term “investment property” refers to the real estate held for generating rent and/or capital
appreciation. Investment property of the Group include the right to use any land which has
already been rented; the right to use any land which is held and prepared for transfer after
appreciation; and the right to use any building which has already been rented. In addition, if the
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board of directors (or similar organizations) makes a written resolution to use the vacant buildings
held by the Group for operating lease and the holding intention will not change in a short time,
they will also be listed as investment real estate.
The initial measurement of the investment property shall be made at its cost. Subsequent
expenditures incurred for an investment property is included in the cost of the investment
property when it is probable that economic benefits associated with the investment property will
flow to the Group and the cost can be reliably measured, otherwise the expenditure is recognized
in profit or loss in the period in which they are incurred.
The Group shall make a follow-up measurement to the investment property by employing the cost
pattern on the date of the balance sheet. An accrual depreciation or amortization shall be made for
the investment property in the light of the accounting policies of the use right of buildings or
lands.
For details of impairment test method and withdrawal method of impairment provision of
investment property, please refer to Note IV. 27. “Long-term assets impairment”.
The Group's investment real estate adopts the average life method for depreciation or
amortization. The expected service life, net residual value rate and annual depreciation
(amortization) rate of all kinds of investment real estate shall refer to the depreciation policy of
buildings in fixed assets and the amortization policy of land use right in intangible assets.
When owner-occupied real estate or inventories are changed into investment property or
investment property is changed into owner-occupied real estate, of which book value prior to the
change shall be the entry value after the change.
When an investment property is changed to an owner-occupied real estate, it would be transferred
to fixed assets or intangible assets at the date of such change. When an owner-occupied real estate
is changed to be held to earn rental or for capital appreciation, the fixed asset or intangible asset is
transferred to investment property at the date of such change. If the fixed asset or intangible asset
is changed into investment property measured by adopting the cost pattern, whose book value
prior to the change shall be the entry value after the change; if the fixed asset or intangible asset is
changed into investment property measured by adopting the fair value pattern, whose fair value
on the date of such change shall be the entry value after the change.
An investment property is derecognized on disposal or when the investment property is
permanently withdrawn from use and no future economic benefits are expected from its disposal.
The amount of proceeds on sale, transfer, retirement or damage of an investment property less its
carrying amount and related taxes and expenses is recognized in profit or loss in the period in
which it is incurred.
22. Fixed Assets
The Group’s fixed assets are tangible assets held for the production of goods, provision of
services, rental or operation management and have a useful life of more than one year.
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Fixed assets should be recognized when it is probable that the economic benefits associated with
them will be incorporated into the Group and their cost can be measured reliably. The Group’s
fixed assets include buildings and constructions, machinery and equipment, electronic equipment,
transportation equipment, and other equipment.
The Group depreciates all fixed assets by straight-line method, except for fully depreciated fixed
assets that continue to be used and land that is separately valued. The categorized depreciable
lives, estimated net salvage rates and depreciation rates of the Group’s fixed assets are as follows.
Annual
Depreciation Expected net
No. Category Method deprecation
period (year) salvage value (%)
(%)
Housing and Straight-line
1 20-40 5-10.00 2.25-4.75
building depreciation
Machinery Straight-line
2 5-10 5-10.00 9.00-19.00
equipment depreciation
Electronic Straight-line
3 3-5 5-10.00 18.00-31.67
equipment depreciation
Transportation Straight-line
4 3-5 5-10.00 18.00-31.67
vehicle depreciation
Straight-line
5 Other equipment 5 5-10.00 18.00-19.00
depreciation
The estimated useful life, estimated net salvage value and depreciation method of fixed assets are
reviewed at the end of each year. Accounting estimation methods are used when changes are
required.
23. Construction in Progress
On the date when the construction in progress reaches its intended useable state, fixed assets are
carried forward at the estimated value based on the project budget, cost or actual cost of the
project, etc. Depreciation starts from the following month, and the difference in the original value
of fixed assets is adjusted after the completion of the final accounting procedures.
24. Borrowing Costs
For incurred borrowing costs, which can be directly attributed to fixed assets, investment real
estate and inventory that need more than one year of purchasing, construction or production
activities to reach the preset usable or sellable status, shall be capitalized when the asset
expenditure has occurred, the borrowing costs have occurred, and the purchasing, construction or
production activities necessary for the asset to reach the preset usable or sellable status have
begun; When the acquisition, construction or production of assets that meet the capitalization
conditions reach the intended usable or sellable status, capitalization is stopped, and the
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borrowing costs incurred thereafter are included in the profits and losses of the current period. If
there is an abnormal interruption in the acquisition, construction or production of assets that meet
the capitalization conditions and the interruption lasts for more than 3 consecutive months, the
capitalization of borrowing costs will be suspended until the acquisition, construction or
production of assets starts again.
The to-be-capitalized amount of interests shall be determined in light of the actual interests
incurred of the specially borrowed loan at the present period minus the income of interests earned
on the unused borrowing loans as a deposit in the bank or as a temporary investment; the
enterprise shall calculate and determine the to-be-capitalized amount on the general borrowing by
multiplying the weighted average asset disbursement of the part of the accumulative asset
disbursements minus the general borrowing by the capitalization rate of the general borrowing
used. The capitalization rate shall be calculated and determined in light of the weighted average
interest rate of the general borrowing.
25. Right-of-Use Assets
The right-of-use assets refer to the right of the Group as the lessee to use the leased assets during the
lease term.
(1) Initial measurement
After the commencement date of the lease term, the Group uses the cost for initial measurement of
right-of-use assets. The cost includes the following four items: a) The initial measurement amount of
lease liabilities; b) If there is a lease incentive for the lease payment paid on or before the
commencement date of the lease term, the relevant amount of the lease incentive already enjoyed shall
be deducted; c) The initial direct expenses incurred are the incremental costs incurred in reaching the
lease; d) The costs expected to be incurred for dismantling and removing the leased assets, restoring
the site where the leased assets are located or restoring the leased assets to the state agreed in the lease
terms, except those incurred for the production of inventories.
(2) Follow-up measurement
After the commencement date of the lease term, the Group adopts the cost model to carry out follow-
up measurement of the right-of-use assets, that is, the right-of-use assets are measured at cost less
accumulated depreciation and accumulated impairment losses. If the Group re-measures the lease
liabilities according to the relevant provisions of the lease standards, the book value of the right-of-use
assets shall be adjusted accordingly.
(3)Depreciation of right-of-use assets
From the commencement date of the lease term, the Group has accrued depreciation on the right-of-
use assets. Right-of-use assets are usually depreciated from the month when the lease term begins. The
accrued depreciation amount is included in the cost of related assets or current profits and losses
according to the use of the right-of-use assets.
When determining the depreciation method of the right-of-use assets, the Group makes a decision
based on the expected consumption mode of the economic benefits related to the right-of-use assets,
and accrues depreciation for the right-of-use assets on the straight-line method.
When determining the depreciation period of the right-of-use assets, the Group follows the following
principles: If the ownership of the leased assets can be reasonably determined when the lease term
expires, depreciation shall be accrued within the remaining service life of the leased assets; if it cannot
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be reasonably determined that the ownership of the leased asset can be obtained when the lease term
expires, depreciation shall be accrued within the shorter of the lease term and the remaining service
life of the leased asset.
(4)Impairment of right-of-use assets
If the right-of-use assets are impaired, the Group carries out subsequent depreciation according to the
book value of the right-of-use assets after deducting the impairment loss.
26. Intangible Assets
The Group’s intangible assets include land use rights, patented technology and non-proprietary
technology, which are measured at actual cost at the time of acquisition. Acquired intangible
assets are stated at actual cost based on the actual price paid and related other expenses. The
actual cost of intangible assets invested by investors is determined at the value agreed in the
investment contract or agreement, but if the agreed value in the contract or agreement is not fair,
the actual cost is determined at fair value. Intangible assets, such as patents, acquired in a merger
not under common control but owned by the acquiree but not recognized in its financial
statements, are recognized as intangible assets at fair value at the time of initial recognition of the
acquiree’s assets.
Land use rights are amortized equally over the years from the commencement date of the grant;
intangible assets such as software and patents are amortized equally over the shortest of the
estimated useful life, the contractual beneficiary life and the effective life prescribed by law. The
amortization amount is charged to the cost of the related assets and current profit or loss
according to their beneficiaries. The estimated useful life and amortization method of intangible
assets with finite useful lives are reviewed at the end of each year. Accounting estimation
methods are used when changes are required.
The main research and development projects of the Group include the performance improvement
project of Mini & Micro LED.
(1) Specific criteria for dividing the research phase and development phase
“Research” means an original and planned investigation to acquire and understand new scientific
or technical knowledge.
“Development” means the application of research results or other knowledge to one or more plans
or designs to produce new or substantially improved materials, devices, products, or to obtain
new processes, etc., prior to commercial production or use.
Expenses for the research phase are charged to current profit or loss as incurred.
(2) Specific criteria for capitalization of development stage expenditures
Expenditures in the development stage are capitalized when the following conditions are met.
① It is feasible technically to finish intangible assets for use or sale;
② It is intended to finish and use or sell the intangible assets;
③ The usefulness of methods for intangible assets to generate economic benefits shall be proved,
including being able to prove that there is a potential market for the products manufactured by
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applying the intangible assets or there is a potential market for the intangible assets itself or the
intangible assets will be used internally;
④ It is able to finish the development of the intangible assets, and able to use or sell the
intangible assets, with the support of sufficient technologies, financial resources and other
resources;
⑤ The development expenditures of the intangible assets can be reliably measured.
27. Impairment of Long-term Assets
For non-current financial Assets of fixed Assets, projects under construction, intangible Assets
with limited service life, investing real estate with cost model, long-term equity investment of
subsidiaries, cooperative enterprises and joint ventures, the Group should judge whether decrease
in value exists on the date of balance sheet. Recoverable amounts should be tested for decrease in
value if it exists. Other intangible Assets of reputation and uncertain service life and other non-
accessible intangible assets should be tested for decrease in value no matter whether it exists.
If the recoverable amount is less than carrying value in impairment test results, the provision for
impairment of differences should include in impairment loss. Recoverable amounts would be the
higher of net value of asset fair value deducting disposal charges or present value of predicted
cash flow. Asset fair value should be determined according to negotiated sales price of fair trade.
If no sales agreement exists but with asset active market, fair value should be determined
according to the Buyer’s price of the asset. If no sales agreement or asset active market exists,
asset fair value could be acquired on the basis of best information available. Disposal expenses
include legal fees, taxes, cartage or other direct expenses of merchantable Assets related to asset
disposal. Present value of predicted asset cash flow should be determined by the proper discount
rate according to Assets in service and predicted cash flow of final disposal. Asset depreciation
reserves should be calculated on the basis of single Assets. If it is difficult to predict the
recoverable amounts for single Assets, recoverable amounts should be determined according to
the belonging asset group. Asset group is the minimum asset combination producing cash flow
independently.
In impairment test, carrying value of the business reputation in financial report should be shared
to beneficial asset group and asset group combination in collaboration of business merger. It is
shown in the test that if recoverable amounts of shared business reputation asset group or asset
group combination are lower than book value, it should determine the impairment loss.
Impairment loss amount should firstly be deducted and shared to the carrying value of business
reputation of asset group or asset group combination, then deduct carrying value of all assets
according to proportions of other carrying value of above assets in asset group or asset group
combination except business reputation.
After the asset impairment loss is determined, recoverable value amounts would not be returned
in future.
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28. Long-term Deferred Expenses
The Long-term deferred expenses of the Group including renovation cost, mold cost and so on
shall be amortized evenly during the benefit period. If these long-term deferred expenses cannot
benefit the future accounting period, the amortized value of this item that has not been amortized
shall be transferred to the current profit and loss.
29. Contract Liabilities
Liabilities of contracts refer to the Group's obligation to transfer goods to customers due to the
consideration received or receivable from customers. Before the transfers, if the customer has
paid the consideration or if the Group has obtained the right to unconditionally collect the
contract consideration, the liabilities of contracts shall be recognized based on the amount
received or receivable at the earlier point between the actual payment by the customer and the
payment due.
30. Employee Compensation
Salaries of staff of the Group include short-term salary, post-employment benefits, termination
compensation, and other long-term benefits.
Short-term salary mainly includes wages, bonuses, allowances and subsidies, as well as employee
benefits, medical insurance, maternity insurance, employment injury insurance, housing provident
fund, labor union expenses, and staff education expenses, and non-monetary benefits. During the
accounting period when the employees provide services, the actual short-term compensation is
recognised as a liability that shall be included in the current profit and loss or the cost of related
assets according to the beneficiary.
The post-employment benefits mainly include the basic endowment insurance, etc. They are
divided into defined contribution plans and defined benefit plans in accordance with the risks and
obligations undertaken by the Group. According to the defined contribution plan, the deposit paid
to a separate entity in exchange for the services provided by the employees during the accounting
period on the balance sheet date is recognized as liabilities, and shall be included in the current
profit and loss or the cost of related assets according to the beneficiary. If the Group has a defined
benefit plan, the specific accounting method should be explained.
When terminating labour relations before expiration of contract, or layoffs with compensations,
and the Group cannot terminate the labour relations unilaterally or reduce the demission welfare,
remuneration and liabilities produced from the demission welfare should be determined and
included in current profits and losses when determining the costs of demission welfare and
recombination. However, demission welfare not fully paid within 12 months after annual
Reporting Period should be handled the same as other long-term employees’ payrolls.
The inside employee retirement plan is treated by adopting the same principle with the above
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dismiss ion welfare. The Group would recorded the salary and the social security insurance fees
paid and so on from the employee’s service termination date to normal retirement date into
current profits and losses (dismission welfare) under the condition that they meet the recognition
conditions of estimated liabilities.
The other long-term welfare that the Group offers to the staffs, if met with the setting drawing plan,
should be accounting disposed according to the setting drawing plan, while the rest should be disposed
according to the setting revenue plan.
31. Lease Liabilities
(1) Initial measurement
The Group initially measures the lease obligation at the present value of the lease payments
outstanding at the commencement date of the lease term.
1) Lease payments
Lease payments refer to the amount paid by the Group to the lessor related to the right to use the
leased assets during the lease term, including: a) Fixed payment amount and substantial fixed payment
amount. If there is lease incentive, deduct the amount related to lease incentive; b) The variable lease
payment amount depending on the index or ratio, which is determined according to the index or ratio
on the commencement date of the lease term at the initial measurement; c) When the Group
reasonably determines the exercise price of the purchase option when it will exercise it; d) The lease
term reflects the amount to be paid to exercise the termination option when the Group will exercise the
termination option; e) The amount expected to be paid based on the residual value of the guarantee
provided by the Group.
2) Rate of discount
When calculating the present value of the lease payments, the Group uses the interest rate implicit in
lease as the rate of discount, which is the interest rate at which the sum of the present value of the
lessor's lease receipts and the present value of the unsecured residual value equals the sum of the fair
value of the leased asset and the lessor's initial direct expenses. If the Group fails to determine the
interest rate implicit in lease, the incremental interest rate on borrowing will be used as the rate of
discount. The incremental interest rate on borrowing shall mean the interest rate payable by the Group
to borrow funds under similar mortgage conditions during similar periods to acquire assets close to the
value of the right-of-use assets under similar economic circumstances. The interest rate is related to
the following matters: a) The Group's own situation, that is, the Company's solvency and credit status;
b) The term of "loan", that is, the lease term; c) The amount of "borrowed" funds, that is, the amount
of lease liabilities; d) "Mortgage conditions", that is, the nature and quality of the underlying assets; e)
Economic environment, including the jurisdiction where the lessee is located, the valuation currency,
the time when the contract is signed, etc. The incremental borrowing rate is based on the Group's latest
asset-based lending interest rate for similar assets and adjusted to take into account the above factors.
(2) Follow-up measurement
After the commencement date of the lease term, the Group carries out follow-up measurement of lease
liabilities according to the following principles: a) When recognizing the interest of lease liabilities,
the Group will increase the carrying amount of lease liabilities; b) When paying the lease payments,
the Group will reduce the book amount of the lease liability; c) When the lease payments changes due
to revaluation or lease change, the Group will remeasure the book value of lease liability.
The Group calculates the interest expenses of the lease obligations during each period of the lease
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term at a fixed periodic interest rate, and includes them (except those that shall be capitalized) in profit
or loss for the current period. Periodic rate refers to the rate of discount adopted by the Group when
initially measuring lease liabilities, or the revised rate of discount adopted by the Group when lease
liabilities need to be remeasured according to the revised rate of discount due to changes in lease
payments or lease changes.
(3) Re-measurement
After the commencement date of the lease term, the Group re-measures the lease liability based on the
present value of the changed lease payment and adjusts the book value of the right-of-use assets
accordingly when the following circumstances occur. If the carrying value of the right-of-use assets
has been reduced to zero, but the lease obligations still need to be further reduced, the Group will
include the remaining amount in profit or loss for the current period. a) The actual fixed payment
amount changes (in this case, the original rate of discount is used for discount); b) The estimated
amount payable of the residual value changes (in this case, the original rate of discount is used for
discount); c) The index or ratio used to determine the lease payment changes (in this case, the revised
rate of discount is used for discount); d) The evaluation result of the purchase option changes (in this
case, the revised rate of discount is adopted for discount); e) The evaluation result or actual exercise of
the lease renewal option or the lease termination option changes (in this case, the revised rate of
discount is adopted for discount).
32. Provisions
The Group should recognize the related obligation as a provision for liability when the obligation
meets the following conditions: (1) That obligation is a present obligation of the enterprise; (2) It
is probable that an outflow of economic benefits from the enterprise will be required to settle the
obligation; (3) A reliable estimate can be made of the amount of the obligation.
On the balance sheet date, an enterprise shall take into full consideration of the risks, uncertainty,
time value of money, and other factors pertinent to the Contingencies to measure the provisions in
accordance with the best estimate of the necessary expenses for the performance of the current
obligation.
When all or some of the expenses necessary for the liquidation of an provisions of an enterprise is
expected to be compensated by a third party, the compensation should be separately recognized as
an asset only when it is virtually certain that the reimbursement will be obtained. Besides, the
amount recognized for the reimbursement should not exceed the carrying value of the estimated
liabilities.
33. Principles of Revenue Recognition and Measurement Method
The revenue of the Group mainly consists of the income from main business and the income from
other businesses.
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(1)Revenue recognition principle
The Group has fulfilled the performance obligations in the contract, that is, when the customer
obtains control of the relevant goods or services, revenue is recognized. Obtaining control over
related goods or services means being able to lead the use of the goods or the provision of such
services and obtain almost all of the economic benefits from it.
On the starting date of the contract, the Group evaluates the contract, identifies each individual
performance obligation contained in the contract, and determines whether each individual
performance obligation is performed within a certain period of time or at a certain point in time.
When one of the following conditions is met, it is a performance obligation within a certain
period of time, otherwise, it is a performance obligation at a certain point in time:
①The customer obtains and consumes the economic benefits brought by the Group's performance
at the same time the Group performs the contract.
②The customer can control the products under construction during the performance of the Group.
③The goods produced during the performance of the Group have irreplaceable uses, and the
Group has the right to collect payments for the cumulative performance of the contract during the
entire contract period.
For performance obligations performed within a certain period of time, the Group recognizes
revenue according to the performance progress during that period. When the performance
progress cannot be reasonably determined, if the cost incurred by the Group is expected to be
compensated, the revenue shall be recognized according to the amount of the cost incurred until
the performance progress can be reasonably determined.
For performance obligations performed at a certain point in time, the Group recognizes revenue at
the point when the customer obtains control of the relevant goods or services. When judging
whether a customer has obtained control of goods or services, the Group considers the following
signs:
①The Group enjoys the current right to receive payment for the goods or services.
②The Group has transferred the legal ownership of the product to the customer.
③The Group has transferred the goods in kind to the customer.
④The Group has transferred the main risks and rewards of the ownership of the product to the
customer.
⑤The customer has accepted the goods or services.
The Group has transferred goods or services to customers and the right to receive consideration is
listed as contract assets, and contract assets are devalued on the basis of expected credit losses.
The Group's unconditional right to collect consideration from customers is listed as receivables.
The Group’s obligation to transfer goods or services to customers due to the consideration
received from customers is listed as contract liabilities.
(2) Principles of income measurement
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① If the contract contains two or more performance obligations, at the beginning of the contract,
the Group will allocate the transaction price to each individual performance obligation based on
the relative proportion of the stand-alone selling price of the goods or services promised by each
individual performance obligation. Revenue is measured at the transaction price of each
individual performance obligation.
②The transaction price is the amount of consideration that the Group expects to be entitled to
receive due to the transfer of goods or services to customers, excluding payments collected on
behalf of third parties and payments expected to be returned to customers. The transaction price
confirmed by the Group does not exceed the amount at which the accumulated confirmed income
will most likely not undergo a significant reversal when the relevant uncertainty is eliminated. It
is expected that the money returned to the customer will not be included in the transaction price
as a liability.
③If there is variable consideration in the contract, such as cash discounts and price guarantees in
part of the contract between the Group and its customers, the Group determines the best estimate
of the variable consideration according to the expected value or the most likely amount, but
includes the variable The transaction price of the consideration shall not exceed the amount at
which the accumulated confirmed income is unlikely to be reversed significantly when the
relevant uncertainty is eliminated.
④For the consideration payable to customers, the Group offsets the transaction price from the
consideration payable to customers, and offsets the current income at the time when the relevant
income is recognized and the payment (or promised to pay) the customer consideration is later,
unless the consideration payable is for Obtain other clearly distinguishable products from
customers.
⑤For sales with a sales return clause, when the customer obtains control of the relevant product,
the Group recognizes revenue based on the amount of consideration expected to be received due
to the transfer of the product to the customer, and the expected return due to the sales return is
recognized as an estimated liability ; At the same time, according to the expected book value of
the returned goods at the time of transfer, the balance after deducting the estimated cost of
recovering the goods (including the value impairment of the returned goods) is recognized as an
asset, that is, the return cost receivable, according to the transferred goods The book value at the
time of the transfer, deducting the net carry-over cost of the aforementioned asset cost. On each
balance sheet date, the Group re-estimates the future sales returns and re-measures the
aforementioned assets and liabilities.
⑥ If there is a significant financing component in the contract, the Group shall determine the
transaction price based on the amount payable in cash when the customer assumes control of the
goods or services. Using the discount rate that discounts the nominal amount of the contract
consideration into the current commodity price, the difference between the determined transaction
price and the amount of the consideration promised in the contract is amortized by the actual
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interest method during the contract period. On the starting date of the contract, the Group expects
that the time between the customer's acquisition of control of the goods or services and the
customer's payment of the price will not exceed one year, regardless of the significant financing
components in the contract.
⑦According to contractual agreements, legal provisions, etc., the Group provides quality
assurance for the products sold and the assets built. For guarantee-type quality assurance to assure
customers that the goods sold meet the established standards, the Group conducts accounting
treatment in accordance with "contingent events-estimated liabilities". For the service quality
assurance that provides a separate service in order to assure customers that the goods sold meet
the established standards, the Group regards it as a single performance obligation, based on the
stand-alone selling price of the quality assurance of goods and services. In a relative proportion,
part of the transaction price is allocated to service quality assurance, and revenue is recognized
when the customer obtains control of the service. When assessing whether the quality assurance
provides a separate service in addition to ensuring that the products sold meet the established
standards, the Group considers whether the quality assurance is a legal requirement, the quality
assurance period, and the nature of the Group's commitment to perform the tasks.
⑧ When the construction contract between the Group and the customer is changed: ①If the
contract change adds clearly distinguishable construction services and contract prices, and the
new contract price reflects the stand-alone selling price of the new construction services, the
Group will The contract change shall be treated as a separate contract for accounting treatment;
②If the contract change does not fall into the above-mentioned circumstance ①, and there is a
clear distinction between the construction services that have been transferred and the construction
services that have not been transferred on the date of the contract change, the Group Treat it as
the termination of the original contract, and at the same time, merge the unfulfilled part of the
original contract and the changed part of the contract into a new contract for accounting treatment;
③If the contract change does not fall into the above situation ①, and the construction service has
been transferred on the date of contract change There is no clear distinction between the
construction service and the untransferred construction service. The Group accounts for the
changed part of the contract as a component of the original contract. The resulting impact on the
recognized revenue will be adjusted on the date of contract change.
(3) Specific methods of revenue recognition
① Revenue recognized on time
The Group's sales of household appliances, electronic components, etc., belong to the
performance obligation performed at a certain point in time.
Recognition conditions for income from domestic sales of goods and overseas direct sales of
goods: The Group has delivered the product to the customer in accordance with the contract and
the customer has received the product, the payment has been recovered or the receipt of payment
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has been obtained, and the relevant economic benefits are likely to flow in. The main risks and
rewards have been transferred, and the legal ownership of the goods has been transferred.
Conditions for confirming the income of exported goods: The Group has declared the products
for export according to the contract, obtained the bill of lading, and delivered the goods to the
carrier entrusted by the purchaser. The payment has been recovered or the receipt of payment has
been obtained and relevant economic benefits are likely to flow in. The main risks and rewards of
commodity ownership have been transferred, and the legal ownership of commodities has been
transferred.
②Income confirmed according to the performance progress
The Group's business contracts with customers for project construction, online advertising,
operating leases, etc. are performance obligations performed within a certain period of time, and
revenue is recognized according to the progress of the performance.
34. Government Grants
The government grants of the Group are divided into asset-based grants related to and income-
based grants. Asset-based grants refer to the government grants for long-term assets obtained by
the purchase, construction, and other ways. Income-based grants refer to other grants. If the
beneficiaries are not specified in government documents, the Group will make the distinction
according to the aforesaid principle. Beneficiaries which are difficult to categorize shall be
classified as an income-based government grant as a whole.
Current elements of government grants shall be measured based on the amount actually received.
Those shall be measured according to the amount receivable are grants paid according to a fixed
quota standard, or funds that meet the relevant conditions stipulated by the financial support
policy with conclusive evidence at the end of the year and which are expected as the financial
support. Non-monetary elements of the government grants shall be measured at fair value. Those
whose fair value cannot be obtained reliably shall be measured at its nominal amount (RMB1).
Asset-based grants shall be used to offset the carrying value of related assets or presented as
deferred income, and shall, over the life of the related asset, be included in the current profits and
losses by the equal amortization method.
If the related asset is sold, transferred, scrapped, or damaged before the end of its useful life, its
deferred income that has not been distributed shall be transferred to the current profit and loss of
asset disposal.
Income-based grants that are used to compensate related costs or losses in subsequent periods
shall be deemed as deferred income and shall be included in the current profits and losses during
the period when the related costs or losses are recognized. Government grants related to routine
activities shall be included in other income in accordance with the nature of the transaction.
Government grants not related to routine activities shall be included in non-operating income and
expenditure.
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The Group obtains interest grants on policy-related concessional loans in two different ways: the
interest subsidy funds are allocated by the government either to the lending bank or directly to the
Group. The respective accounting treatment is carried out as follows:
(1) Where the government allocates the funds to the lending bank, and the bank provides a loan to
the Group at a policy-related preferential interest rate, the actual amount of the loan received is
taken as the entry value, and the borrowing costs are calculated based on the loan principal and
the policy-related preferential interest rate.
(2) Where the government allocates the funds directly to the Group, the grants are offset against
borrowing costs.
Where the government grants that the Group has recognized in accounting need to be returned,
the accounting treatment in the current period is carried out as follows:
1) If the book value of an asset is offset on initial recognition, the book value will be adjusted;
2) If there is deferred income, the book balance of the deferred income will be offset, and the
excess will be included in profit or loss in the current period;
3) Under any other circumstances, the grants will be included in profit or loss in the current
period.
35. Deferred Income Tax Assets/Deferred Income Tax Liabilities
The Group's deferred tax assets and deferred tax liabilities are calculated and recognized based on
the difference (temporary difference) between the tax base and book value of the assets and
liabilities. In the case of deductible losses that can be deducted from taxable income in
subsequent years in accordance with the provisions of the tax laws, the corresponding deferred
income tax assets are recognized. In the case of temporary differences arising from the initial
recognition of goodwill, the corresponding deferred income tax liabilities are not recognized.
With respect to temporary differences arising from the initial recognition of an asset or liability in
a transaction which isn’t a business combination and which affects neither accounting profit nor
taxable income (or deductible losses), the corresponding deferred income tax assets and deferred
income tax liabilities are not recognized. On the balance sheet date, the deferred income tax assets
and deferred income tax liabilities are measured at the tax rate applicable to the period during
which the assets are expected to be recovered or the liabilities are expected to be settled.
The Group recognizes deferred income tax assets to the extent of the taxable income which it is
most likely to obtain and which can be deducted from deductible temporary differences,
deductible losses and tax credits.
36. Leasing
(1) Identification of leases
The term "lease" refers to a contract whereby the lessor transfers the right of use regarding the
leased asset(s) to the lessee within a specified time in exchange for consideration. On the
commencement date of the contract, the Group assesses whether the contract is a lease or contains
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a lease. If a party to the contract transfers the right allowing the control over the use of one or
more assets that have been identified within a certain period, in exchange for a consideration,
such contract is a lease or includes a lease. In order to determine whether a party to the contract
transfers the right allowing the control over the use of the identified assets for a certain period of
time, the Group assesses whether the customers in the contract are entitled to obtain almost all the
economic benefits arising from the use of the identified assets during the use period, and have the
right to dominate the use of the identified assets during the use period.
If a contract contains multiple single leases at the same time, the Group will split the contract, and
conduct accounting treatment of each single lease respectively. If a contract contains both lease
and non-lease parts at the same time, the Group will split the lease and non-lease parts for
accounting treatment.
(2) The Group as lessee
1) Lease recognition
On the commencement date of the lease term, the Group recognizes the right-of-use assets and
lease obligations in respect of the lease. For the recognition and measurement of right-of-use
assets and lease liabilities, please refer to Note IV "25. Right-of-use assets" and "31. Lease
liabilities".
2) Lease change
A lease change refers to a change in the scope, consideration, and term of lease outside the
original contract clauses, including the addition or termination of the one or several rights to use
lease assets, and the extension or reduction of the lease term specified in the contract. The
effective date of lease change refers to the date when both parties reach an agreement on lease
change.
If the lease changes and the following conditions are met at the same time, the Group will account
for the lease change as a separate lease: a) The lease change expands the lease scope or extends
the lease term by increasing the right to use one or more leased assets; b) The increased
consideration is equivalent to the separate price of the expanded lease scope or the extended lease
term adjusted according to the contract conditions.
If the lease change is not accounted for as a separate lease, on the effective date of the lease
change, the Group will allocate the consideration of the changed contract in accordance with the
relevant provisions of the lease standards and re-determine the changed lease term. The revised
rate of discount is used to discount the changed lease payments to remeasure the lease liability.
When calculating the present value of the changed lease payments, the Group uses the interest
rate implicit in lease as the rate of discount. If the interest rate implicit in lease cannot be
determined, the Group adopts the incremental borrowing rate of the lessee on the effective date of
the lease change as the rate of discount. With regard to the impact of the above-mentioned lease
liability adjustment, the Group conducts accounting treatment according to the following
situations: a) The lessee will correspondingly reduce the book value of the right-of-use assets and
include the profit or loss of the lease terminated in part or whole in the current profit or loss, if the
lease change narrows the scope of lease or shortens the lease term. b) The lessee will
correspondingly adjust the book value of the right-of-use assets, if other lease changes result in
the re-measurement of the lease obligation.
3) Short-term and low-value asset leases
For short-term leases with a lease term not exceeding 12 months and low-value asset leases with
lower value when single leased assets are brand new assets, the Group chooses not to recognize
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right-of-use assets and lease liabilities. The Group includes the payments of short-term and low-
value asset leases incurred during each period of the lease term in the profit or loss for the current
period or the cost of relevant assets by the straight-line method.
(3) The Group as lessor
On the basis that (1) the contract assessed is a lease or includes a lease, the Group, as the lessor,
classifies leases into finance leases and operating leases on the lease commencement date.
If a lease substantially transfers virtually all risks and rewards associated with ownership of the
leased asset, the lessor classifies the lease as a finance lease and leases other than finance leases
as operating leases.
The Group usually classifies a lease that falls under any one or more of the following
circumstances as a finance lease: a) When the lease term expires, the ownership of the leased
asset is transferred to the lessee; b) The lessee has the option to purchase the leased asset(s). As
the agreed purchase price is low enough compared with the fair value of the leased asset(s) at the
time the option is expected to be exercised, it can be reasonably determined at the inception of the
lease that the lessee will exercise the option; c) Although the ownership of the assets is not
transferred, the lease term accounts for most of the service life of the leased assets; d) On the
lease commencement date, the present value of lease receipts is almost equivalent to the fair value
of leased assets; e) The leased assets are special in nature, and only the lessee can use them
without major renovation. The Group may also classify a lease that falls under any one or more of
the following circumstances as a finance lease: a) If the lessee cancels the lease, losses to the
lessor caused by the cancellation will be borne by the lessee; b) The gains or losses arising from
the fluctuation of the fair value of the residual value of assets belong to the lessee; c) The lessee
has the ability to continue leasing until the next term at a rent far below the market level.
1) Accounting treatment of finance leases
Initial measurement
On the commencement date of the lease term, the Group recognizes the finance lease receivables
for the finance lease and derecognizes the leased asset of the finance lease. It recognizes the net
investment in the lease as the entry value of the finance lease, when initially measuring the
finance lease receivable.
The net investment in the lease is the sum of the net value of the unguaranteed residual value and
the lease receivable not received on the commencement date of the lease term at the interest rate
implicit in lease. Lease collection amount refers to the amount that the lessor should collect from
the lessee for transferring the right to use the leased assets during the lease term, including: a)
Fixed payment amount and substantial fixed payment amount that the lessee needs to pay. If there
is lease incentive, deduct the amount related to lease incentive; b) The variable lease payment
depending on the index or ratio, which is determined according to the index or ratio on the
commencement date of the lease term at the initial measurement; c) The exercise price of the
purchase option, provided that it is reasonably determined that the lessee will exercise the option;
d) The amount to be paid by the lessee to exercise the option to terminate the lease, provided that
the lease term reflects that the lessee will exercise the option to terminate the lease; e) The
residual value of guarantee provided to the lessor by the lessee, the party related to the lessee and
an independent third party that has the financial ability to fulfill the guarantee obligation.
Follow-up measurement
The Group calculates and confirms the interest income at a fixed periodic rate in each period in
the lease term. Periodic rate refers to the rate of discount implicit in lease adopted to determine
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Konka Group Co., Ltd. Interim Report 2023
the net investment in the lease (in the case of sublease, if the interest rate implicit in lease of
sublease cannot be determined, the rate of discount implicit in original lease is adopted (adjusted
according to the initial direct expenses related to sublease)), or the revised rate of discount
determined in accordance with the relevant provisions where the change of the finance lease is
not accounted for as a separate lease and meets the condition that the lease will be classified as a
finance lease if the change became effective on the lease commencement date.
Accounting treatment of lease change
If the lease changes and the following conditions are met at the same time, the Group will account
for the lease change as a separate lease: a) The lease change expands the lease scope by
increasing the right to use one or more leased assets; b) The increased consideration is equivalent
to the separate price of the expanded lease scope adjusted according to the contract conditions.
If the change of finance lease is not accounted for as a separate lease, and the condition that the
lease will be classified as an operating lease if the change takes effect on the lease
commencement date is met, the Group will account for it as a new lease from the effective date of
the lease change, and take the net lease investment before the effective date of the lease change as
the book value of the leased asset.
2) Accounting treatment of operating leases
Treatment of rent
The Group recognizes lease receipts from operating leases as rental income on a straight-line
basis during each period of the lease term.
Incentives provided
If the Group provides a rent-free period, it allocates the total rentals over the entire lease term
without deducting the rent-free period by the straight-line method, and also recognizes rental
income during the rent-free period. If certain expenses of the lessee are borne, the Group allocates
the balance of rental income over the lease term after such expenses are deducted from the gross
rental income.
Initial direct cost
Initial direct expenses incurred by the Group in connection with operating leases shall be
capitalized to the cost of the leased underlying asset and recorded in the profits and losses of the
current period in stages over the lease term on the same basis of recognition as rental income.
Depreciation
For the fixed assets in the assets under operating lease, the Group adopts the depreciation policy
of similar assets to calculate and distill depreciation. For other assets under operating lease, the
Group amortizes them in a systematic and reasonable manner.
Variable lease payments
Variable lease payments made by the Group in relation to operating leases that are not included in
the lease receivable are included in the current profit or loss when they are actually incurred.
Change of operating leases
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Konka Group Co., Ltd. Interim Report 2023
If an operating lease changes, the Group will regard it as a new lease for accounting treatment
from the effective date of the change. The advance receipt or the lease receivable related to the
lease prior to the change is recognized as the payment receivable of the new lease.
37. Changes in Main Accounting Policies and Estimates
(1) Changes of accounting policies
The Ministry of Finance released the Interpretation No. 16 of the Accounting Standards for
Business Enterprises on 30 November 2022, which took effect on the same day. The document
stipulates that "accounting processing under initial recognition and exemption is not applicable to
deferred income taxes related to assets and liabilities incurred from a single transaction". The
Company has implemented it since 1 January 2023. For taxable temporary differences and
deductible temporary differences arising from the lease liabilities and right-of-use assets
recognised based on single transactions that comply with the above provision, at the period-begin
of the earliest period presented in the financial statement that followed such provision for the first
time, the Company will adjust retained income brought forward in the earliest period presented in
the financial statement and other relevant items of the financial statement based on the figures
cumulatively affected in accordance with such provision and the Accounting Standards for
Business Enterprises No. 18 Income Taxes.
(2) Changes in Accounting Estimates
No such cases in the Reporting Period.
V. Taxation
1. Main Taxes and Tax Rate
Category of taxes Basis Specific situation of the taxes rate
Calculated the output tax at
the tax rate and paid the VAT
by the amount after deducting
the deductible withholding
VAT VAT at current period, of 1%, 3%, 5%, 6%, 9%, 13%
which the VAT applicable to
easy collection won’t belong
to the deductible withholding
VAT.
Paid at 5%: Dongguan Konka, XingDa
Urban HongYe, Xinfeng Microcrystalline, Boluo
The circulating tax actually Konka Precision, Boluo Konka, Ningbo
maintenance and
paid Kanghanrui, Jiangsu Konka Smart, Yibin
construction tax Kangrun, Yibin Kangrun Medical, Yibin
Kangrun Environmental Protection. Paid at
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Konka Group Co., Ltd. Interim Report 2023
Category of taxes Basis Specific situation of the taxes rate
1%: Jiangxi Konka, Jiangxi High
Transparent Substrate, Jiangkang
(Shanghai) Technology. Paid at 7%: other
subsidiaries.
The circulating tax actually
Education surtax 3%
paid
Local education The circulating tax actually
2%
surtax paid
Enterprise income 25%/ See 2.Tax Preference and Approved
Taxable income Documents for details
tax
The main taxpayers of different corporate income tax rates are explained as follows:
Name of entity Income tax rate
Electronics Technology, Anhui Konka, Anhui
Tongchuang, XingDa HongYe, Wankaida, Jiangxi
Konka, Xinfeng Microcrystalline, Jiangxi High
15%
Transparent Substrate, Boluo Precision,
Chongqing Kangxingrui, Kowin Memory
(Shenzhen), Xiaojia Technology
Hong Kong Konka, Hongdin Trading, Jiali
International, Hongjet, Jiaxin Technology,
16.5%
Hongdin Invest, Konka Mobility, Kowin Memory
(Hong Kong)
Chain Kingdom Memory Technologies 8.25%/16.5%
Konka Europe 15%
Kanghao Technology 22.5%
Konka North America 21%
The Company as the Parent and other subsidiaries 25%/5%
Note: According to regulations of Temporary Provisions of Income Tax of Trans-boundary Tax
Payment Enterprises by State Administration of Taxation, resident enterprises without business
establishment or places of legal persons should be tax payment enterprises with the administrative
measures of income tax of “unified computing, level-to-level administration, local prepayment,
liquidation summary, and finance transfer”. It came into force from 1 January 2008. According to
the above methods, the Company’s sales branch companies in each area will hand in the
corporate income taxes in advance from 1 January 2008 and will be final settled uniformly by the
Company at the year-end.
2. Tax Preference and Approved Documents
(1) According to the No 13 announcement in 2022 and No. 6 announcement in 2023 issued by
State Taxation Administration: Notice on the implementation of the inclusive tax reduction and
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Konka Group Co., Ltd. Interim Report 2023
exemption policy for small and micro enterprises, the annual taxable income of small and
profitable enterprises is not The portion exceeding RMB1 million will be reduced to 25% of the
taxable income, and the corporate income tax will be paid at the rate of 20%; the portion of the
annual taxable income exceeding RMB1 million but not exceeding RMB3 million will be reduced
by 25% Include the taxable income and pay corporate income tax at a rate of 20%.
(2) On 18 October 2022, Anhui Konka, a subsidiary of the Company, obtained the Certificate of
High-Tech Enterprise jointly issued by the Department of Science and Technology of Anhui
Province, the Department of Finance of Anhui Province and the Taxation Bureau of Anhui
Province of the State Administration of Taxation, with the certificate number GR202234002272,
which is valid for three years. In accordance with the relevant tax regulations, Anhui Konka is
entitled to the relevant tax incentives for three consecutive years from 2022 to 2024 to enjoy the
relevant tax preferential policies on high-tech enterprises and pay enterprise income tax at a
preferential tax rate of 15%.
(3) On 4 November 2022, Xinfeng Microcrystalline, a subsidiary of the Company, obtained the
Certificate of High-Tech Enterprise jointly issued by the Department of Science and Technology
of Jiangxi Province, the Department of Finance of Jiangxi Province and the Taxation Bureau of
Jiangxi Province of the State Administration of Taxation, with the certificate number
GR202236000999, which is valid for three years. According to the relevant tax regulations,
Xinfeng Microcrystalline is entitled to the relevant tax incentives for three consecutive years from
2022 to 2024 to enjoy the relevant tax preferential policies on high-tech enterprises and pay
enterprise income tax at a preferential tax rate of 15%.
(4) On 18 October 2022, Anhui Tongchuang, a subsidiary of the Company, obtained the
Certificate of High-Tech Enterprise jointly issued by the Department of Science and Technology
of Anhui Province, the Department of Finance of Anhui Province and the Taxation Bureau of
Anhui Province of the State Administration of Taxation, with the certificate number
GR202234000798, which is valid for three years. In accordance with the relevant tax regulations,
Anhui Tongchuang is entitled to the relevant tax incentives for three consecutive years from 2022
to 2024 to enjoy the relevant tax preferential policies on high-tech enterprises and pay enterprise
income tax at a preferential tax rate of 15%.
(5) On 22 December 2022, Boluo Precision, a subsidiary of the Company, obtained the "High-
tech Enterprise Certificate" jointly issued by Department of Science and Technology of
Guangdong Province, Department of Finance of Guangdong Province and Guangdong Provincial
Tax Service of State Taxation Administration (No. GR202244017658), which will be valid for
three years. According to relevant tax regulations, Boluo Precision enjoys relevant preferential
tax policies for high-tech enterprises for three consecutive years from 2022 to 2024, and pays
enterprise income tax at a reduced rate of 15%.
(6) On 19 December 2022, Electronic Technology, a subsidiary of the Company, received the
Certificate of High-Tech Enterprise jointly issued by Shenzhen Science and Technology
Innovation Committee, Shenzhen Finance Bureau and Shenzhen Taxation Bureau of the State
Administration of Taxation, with the certificate number GR202244205867, which is valid for
three years. In accordance with the relevant tax regulations, Electronic Technology is entitled to
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Konka Group Co., Ltd. Interim Report 2023
the relevant tax incentives for three consecutive years from 2022 to 2024 to enjoy the relevant tax
preferential policies on high-tech enterprises and pay enterprise income tax at a preferential tax
rate of 15%.
(7) On 14 September 2020, Jiangxi Konka, the subsidiary of the Company, obtained a high-tech
enterprise certificate jointly issued by Jiangxi Science and Technology Department, Jiangxi
Provincial Department of Finance and Jiangxi Provincial Tax Bureau of the State Administration
of Taxation. The certificate number is GR202036000802 and is valid for three years. According
to relevant tax regulations, Jiangxi Konka shall enjoy relevant preferential tax policies for high-
tech enterprises for three consecutive years from September 2020 to September 2023 and pay the
enterprise income tax at a preferential tax rate of 15%.
(8) On 14 September 2020, Jiangxi High Transparent Substrate, the subsidiary of the Company,
obtained a high-tech enterprise certificate jointly issued by Jiangxi Science and Technology
Department, Jiangxi Provincial Department of Finance and Jiangxi Provincial Tax Bureau of the
State Administration of Taxation. The certificate number is GR202036000568 and is valid for
three years. According to relevant tax regulations, Jiangxi High Transparent Substrate shall enjoy
relevant preferential tax policies for high-tech enterprises for three consecutive years from
September 2020 to September 2023 and pay the enterprise income tax at a preferential tax rate of
15%.
(9) On 11 December 2020, Wankaida, the subsidiary of this Company obtained the high-tech
enterprise certificate (certificate No.: GR202044201940) jointly issued by Shenzhen Technology
Innovation Committee, Finance Committee of Shenzhen Municipality, Shenzhen Taxation
Bureau of SAT with a valid period of three years. According to related taxation regulations,
Wankaida enjoys related taxation preferential policies as a high-tech enterprise from December
2020 to December 2023 and pays the enterprise income tax as per the preferential tax rate of 15%.
(10) On 20 December 2021, XingDa HongYe, a subsidiary of the Company, obtained the "High-
tech Enterprise Certificate" jointly issued by Department of Science and Technology of
Guangdong Province, Department of Finance of Guangdong Province and Guangdong Provincial
Tax Service of State Taxation Administration (No. GR202144002737), which will be valid for
three years. According to relevant tax regulations, XingDa HongYe enjoys relevant preferential
tax policies for high-tech enterprises for three consecutive years from 2021 to 2023, and pays
enterprise income tax at a reduced rate of 15%.
(11) On 23 December 2021, Kowin Memory (Shenzhen), a subsidiary of the Company, received
the Certificate of High-Tech Enterprise jointly issued by Shenzhen Science and Technology
Innovation Committee, Shenzhen Finance Bureau and Shenzhen Taxation Bureau of the State
Administration of Taxation, with the certificate number GR202144206630, which is valid for
three years. In accordance with the relevant tax regulations, Kowin Memory (Shenzhen) is
entitled to the relevant tax incentives for three consecutive years from 2021 to 2023 to enjoy the
relevant tax preferential policies on high-tech enterprises and pay enterprise income tax at a
preferential tax rate of 15%.
(12) On 19 December 2022, Xiaojia Technology, a subsidiary of the Company, received the
Certificate of High-Tech Enterprise jointly issued by Shenzhen Science and Technology
Innovation Committee, Shenzhen Finance Bureau and Shenzhen Taxation Bureau of the State
131
Konka Group Co., Ltd. Interim Report 2023
Administration of Taxation, with the certificate number GR202244203274, which is valid for
three years. In accordance with the relevant tax regulations, Xiaojia Technology is entitled to the
relevant tax incentives for three consecutive years from 2022 to 2024 to enjoy the relevant tax
preferential policies on high-tech enterprises and pay enterprise income tax at a preferential tax
rate of 15%.
(13) In accordance with the Notice on Tax Policy Issues Involved in the Further Implementation
of the Western Development Strategy (C.S. [2011] No. 58) and the Announcement on Corporate
Income Tax Issues Involved in the Further Implementation of the Western Development Strategy
(Announcement [2012] No. 12 by the State Taxation Administration), an enterprise established in
the western region who is mainly engaged in an industry specified in the Catalogue of
Encouraged Industries in the Western Region and whose main business income accounts for over
70% of its gross income in the current year, is entitled to a reduced corporate income tax rate of
15%. Chongqing Kangxingrui, a subsidiary of the Company, are eligible for this preferential tax
policy.
(14) According to the fiscal and taxation document [2011] No. 100 published by the Ministry of
Finance and the State Administration of Taxation, for the VAT general taxpayers who sell their
self-developed and produced software products, the VAT shall be levied at the rate of 13%, and
then the part that the actual tax burden on their VAT exceeds 3 will be implemented with the
policy of immediate withdrawal. The Company’s subsidiaries, Wankaida Technology, Shenzhen
Kangcheng, Electronics Technology and Anhui Tongchuang all enjoy this preferential policy.
VI. Notes to Major Items in the Consolidated Financial Statements of the Company
Unless otherwise noted, the following annotation project (including the main projects,
annotation of the financial statement of the Company), the period-begin refers to 1 January 2023,
the period-end refers to 30 June 2023, this period refers to the period from 1 January 2023 to 30
June 2023 and the previous period refers to the period from 1 January 2022 to 30 June 2022. The
monetary unit is renminbi.
1. Monetary assets
Item Closing balance Opening balance
Cash on hand 14.78
Bank deposits 6,222,912,818.42 5,473,400,175.52
Other monetary assets 685,425,987.74 514,695,300.41
Total 6,908,338,806.16 5,988,095,490.71
Of which: Total amount
116,037,645.61 137,008,617.40
deposited overseas
Note: The ending balance of other currency assets is mainly margin deposits, financial
supervision account funds and other deposits subject to usage restrictions. Refer to Note VI-67
Assets with restricted ownership or use right for details.
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Konka Group Co., Ltd. Interim Report 2023
2. Held-for-trading financial assets
Item Closing balance Opening balance
Financial assets at fair value
743,307,489.50
through profit or loss
Including: Investment in debt
instruments
Equity instrument investment 743,307,489.50
Structural deposits
Financial assets designated at
fair value through profit or loss
Including: Investment in debt
instruments
Hybrid instrument investment
Others
Total 743,307,489.50
3. Notes receivable
（1）Classified presentation of notes receivable
Item Closing balance Opening balance
Commercial acceptance draft 40,602,620.96 350,178,404.79
Banker's acceptance 553,363,673.92 709,558,838.75
Total 593,966,294.88 1,059,737,243.54
（2）Notes receivable pledged by the Company at the end of the Reporting Period
Item Amount pledged at the end of the Reporting Period
Banker's acceptance 217,674,323.25
Commercial acceptance draft
Total 217,674,323.25
（3）Notes Receivable which Had Endorsed by the Company or had Discounted and had
not Due on the Balance Sheet Date at the end of the Reporting Period
Amount derecognised at Amount not derecognised at
Item the end of the Reporting the end of the Reporting
Period Period
Banker's acceptance 1,000,963,671.86
Commercial acceptance draft 23,240,096.98
Total 1,000,963,671.86 23,240,096.98
（4）Notes transferred to accounts receivable because drawer of the notes failed to execute
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Konka Group Co., Ltd. Interim Report 2023
the contract or agreement
No such cases in the Reporting Period.
（5）Listed by withdrawal methods for provision for bad debts
Closing balance
Book balance Provision for bad debts
Category
Provision Carrying value
Proportion
Amount Amount percentage
(%)
(%)
Provision set
aside for bad
debts by the
single item
Provision set
aside for bad 100.00 845,542.52 0.14 593,966,294.88
594,811,837.40
debts by portfolio
Of which:
Banker's 93.03 553,363,673.92
553,363,673.92
acceptance
Commerci
al acceptance 41,448,163.48 6.97 845,542.52 2.04 40,602,620.96
draft
Total 594,811,837.40 100.00 845,542.52 0.14 593,966,294.88
(Continued)
Opening balance
Book balance Provision for bad debts
Category
Provision Carrying value
Proportion
Amount Amount percentage
(%)
(%)
Provision set
aside for bad
debts by the
single item
Provision set
aside for bad 1,067,029,648.07 100.00 7,292,404.53 0.68 1,059,737,243.54
debts by portfolio
Of which:
Banker's 709,558,838.75 66.50 709,558,838.75
acceptance
Commerci
al acceptance 357,470,809.32 33.50 7,292,404.53 2.04 350,178,404.79
draft
Total 1,067,029,648.07 100.00 7,292,404.53 0.68 1,059,737,243.54
1） In the group, notes receivable, for which the provision for expected credit loss was
made according to trade acceptance
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Konka Group Co., Ltd. Interim Report 2023
Closing balance
Name Provision for bad Provision
Book balance
debts percentage (%)
Within one year 41,448,163.48 845,542.52 2.04
Total 41,448,163.48 845,542.52 2.04
（6）Provision for bad debts for notes receivable withdrawn, collected or reversed during
the Reporting Period
Change in the Reporting Period
Opening Closing
Category Provision Recovery or Charge-off
balance balance
reclassification or write-off
Commercial 707,063.6
7,292,404.53 7,153,925.69 845,542.52
acceptance draft 8
Banker's
acceptance
707,063.6
Total 7,292,404.53 7,153,925.69 845,542.52
8
（7）Notes receivable actually written off in the Reporting Period
There was no notes receivable actually written off in the Reporting Period.
4. Accounts receivable
（1） Accounts receivable listed by withdrawal methods for bad debts
Closing balance
Book balance Provision for bad debts
Category Provision
Proportion Carrying value
Amount Amount percentage
(%)
(%)
Accounts
receivable of
expected credit
1,449,419,796 38.00 1,325,790,697.1 91.47 123,629,099.56
losses
.71 5
withdrawn
individually
Accounts
receivable of
expected credit
losses
withdrawn by
portfolio
Of which:
Aging 2,365,166,083 62.00 400,800,627.33 16.95 1,964,365,455.9
portfolio .30 7
Subtotal of
62.00 400,800,627.33 16.95
portfolio 2,365,166,083 1,964,365,455.9
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Konka Group Co., Ltd. Interim Report 2023
Closing balance
Book balance Provision for bad debts
Category Provision
Proportion Carrying value
Amount Amount percentage
(%)
(%)
.30 7
Total 3,814,585,880 100.00 1,726,591,324.4 45.26 2,087,994,555.5
.01 8 3
(Continued)
Opening balance
Book balance Provision for bad debts
Category
Provision Carrying value
Proportion
Amount Amount percentage
(%)
(%)
Accounts
receivable of
expected 1,350,460,284.2
1,487,466,561.80 40.11 90.79 137,006,277.53
credit losses 7
withdrawn
individually
Accounts
receivable of
expected
credit losses
withdrawn by
portfolio
Of which:
Aging 2,221,448,326.94 59.89 321,719,768.25 14.48 1,899,728,558.69
portfolio
Subtotal of
2,221,448,326.94 59.89 321,719,768.25 14.48 1,899,728,558.69
portfolio
1,672,180,052.5
Total 3,708,914,888.74 100.00 45.09 2,036,734,836.22
2
1) Provision for bad debts of accounts receivable provided individually
Closing balance
Name Provision
Provision for Reasons for the
Book balance percentage
bad debts provision
(%)
Shanghai Huaxin Expected to be
International Group 299,136,676.70 293,153,943.17 98.00% difficult to
Co., Ltd. recover
Hongtu Sanbao
High-tech Reorganization by
200,000,000.00 160,000,000.00 80.00%
Technology Co., agreement
Ltd.
Shenzhen Yaode Expected to be
148,503,144.96 125,575,215.21 84.56%
Technology Co., difficult to
136
Konka Group Co., Ltd. Interim Report 2023
Closing balance
Name Provision
Provision for Reasons for the
Book balance percentage
bad debts provision
(%)
Ltd. recover
Guangan Ouqishi
Expected to be
Electronic
113,140,553.53 110,965,942.46 98.08% difficult to
Technology Co.,
Ltd.
recover
Guangxi BG New Expected to be
Materials Co., Ltd. 83,396,556.37 81,728,625.24 98.00% difficult to
recover
Zhongfu Tiangong Expected to be
Construction Group 71,539,096.65 53,654,322.49 75.00% difficult to
Co., Ltd. recover
No. 1 Engineering
Company Ltd. of Expected to be
CCCC First Harbor 65,221,300.00 65,221,300.00 100.00% difficult to
Engineering recover
Company Ltd.
Gome
Customization
(Tianjin) Home 59,569,295.02 35,741,577.01 60.00% Higher credit risk
Appliances Co.,
Ltd.
Xingda Hongye Expected to be
(Hk) Limited 51,902,301.95 51,902,301.95 100.00% difficult to
recover
China Energy Power Expected to be
Fuel Co., Ltd. 50,000,000.00 50,000,000.00 100.00% difficult to
recover
Expected to be
Others 307,010,871.53 297,847,469.62 97.02% difficult to
recover
Total 1,449,419,796.71 1,325,790,697.15 91.47%
2） Provision for bad debts for accounts receivable made as per portfolio
Closing balance
Aging Provision for bad Provision
Book balance
debts percentage (%)
Within one year 1,664,332,357.05 33,952,378.22 2.04
One to two years 210,579,371.75 21,100,053.08 10.02
Two to three years 111,910,276.13 25,392,441.65 22.69
Three to four years 165,114,817.76 107,126,493.77 64.88
Over four years 213,229,260.61 213,229,260.61 100.00
Total 2,365,166,083.30 400,800,627.33 16.95
This portfolio is recognised based on the aging characteristics of accounts receivable, and the
withdrawal proportion of provision for bad debts is recognised based on the historical loss rate and
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Konka Group Co., Ltd. Interim Report 2023
forward-looking factors.
（2） Accounts receivable listed by aging portfolio
Aging Closing balance
Within one year 1,685,919,645.47
One to two years 258,939,219.13
Two to three years 268,490,865.00
Over three years 1,601,236,150.41
Three to four years 679,278,480.01
Four to five years 716,006,713.85
Over five years 205,950,956.55
Subtotal 3,814,585,880.01
Less: Provisions for bad
1,726,591,324.48
debts
Total 2,087,994,555.53
（3） Information of provision for bad debts in the Reporting Period
Change in the Reporting Period
Category Opening balance Recovery or
Provision
reclassification
Provision for bad
debts of accounts 1,672,180,052.52 59,109,024.45 8,944,070.58
receivable
Total 1,672,180,052.52 59,109,024.45 8,944,070.58
(Continued)
Change in the Reporting Period
Category Decrease for other Closing balance
Charge-off or write-off
reasons
Provision for bad
debts of accounts 1,571,951.15 -5,818,269.24 1,726,591,324.48
receivable
Total 1,571,951.15 -5,818,269.24 1,726,591,324.48
Decreases for other reasons were RMB-5,818,269.24 due to exchange rate changes.
（4） Accounts receivable actually verified during the Reporting Period
Item Amount written off
Accounts receivable written off 1,571,951.15
（5） Top five accounts receivable in the closing balance categorised by debtors
The total amount of receivables with top five ending balance collected by arrears party for the
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Konka Group Co., Ltd. Interim Report 2023
Reporting Period was RMB1,424,661,269.74, accounting for 37.35% of the total ending balance of
accounts receivable. The total ending balance of provision for bad debts correspondingly
withdrawn was RMB594,613,927.63.
（6）Accounts receivable derecognised due to the transfer of financial assets
There were no accounts receivable derecognised for transfer of financial assets.
（7）Amount of assets and liabilities generated through the transfer of accounts receivable
and continuing involvement
There was no amount of assets and liabilities formed due to the transfer of accounts
receivable and continued involvement in Reporting Period.
5. Accounts receivable financing
Item Closing balance Opening balance
Notes receivable 344,155,903.39 237,187,228.44
Total 344,155,903.39 237,187,228.44
6. Prepayments
（1） Age of prepayments
Closing balance Opening balance
Item Amount Proportion Amount Proportion
(%) (%)
Within one
458,666,394.73 88.82 332,218,631.50 85.20
year
One to two
52,391,934.11 10.15 52,945,431.22 13.58
years
Two to three
1,556,755.37 0.30 4,191,405.92 1.07
years
Over three
3,771,408.88 0.73 592,183.75 0.15
years
Total 516,386,493.09 100.00 389,947,652.39 100.00
Note: The amount of prepayments aged over one year at the end of the period is
RMB57,720,098.36, accounting for 11.18% of the total balance of prepayments of the Company,
and consists mainly of payments for goods afloat or unsettled payments.
（2）Top five prepayments in the closing balance categorised by payees
The total amount of prepayments with top five ending balance collected by prepaid party was
RMB345,703,811.55, accounting for 66.95% of the total ending balance of prepayments.
7. Other accounts receivable
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Konka Group Co., Ltd. Interim Report 2023
Item Closing balance Opening balance
Interest receivable 5,279,505.89 3,878,580.64
Dividends receivable 272,999.43
Other accounts receivable 1,410,423,205.46 1,437,973,265.51
Total 1,415,702,711.35 1,442,124,845.58
7.1 Interest receivable
（1）Classification of interest receivable
Item Closing balance Opening balance
Interest on term deposits 5,279,505.89 3,878,580.64
Total 5,279,505.89 3,878,580.64
（2） Withdrawal of provision for bad debts for interest receivable
The Company did not have impaired interest receivable.
7.2 Dividends receivable
(1) Category of dividends receivable
Item (or investee) Closing balance Opening balance
Chongqing Qingjia Electronics 272,999.43
Co., Ltd.
Total 272,999.43
7.3 Other receivables
(1) Classified by account nature
Nature of fund Closing book balance Opening book balance
Deposit and margin 1,510,004,920.83 1,411,807,968.60
Intercourse funds among minority
shareholders in the business
177,858,075.72 176,571,471.89
consolidation not under the same
control and related parties
Energy-saving subsidies receivable 152,399,342.00 152,399,342.00
Others 1,496,581,720.41 1,523,970,760.63
Total 3,336,844,058.96 3,264,749,543.12
(2) Withdrawal of provision for bad debts for other receivables
Provision for Phase I Phase II Phase III Total
bad debts
140
Konka Group Co., Ltd. Interim Report 2023
Expected credit
Expected credit
loss during the
loss during the
Expected credit whole
whole outstanding
loss for the next outstanding
maturity (with
12 months maturity
credit
(without credit
impairment)
impairment)
Balance as of 1
6,475,374.50 382,824,494.22 1,437,476,408.89 1,826,776,277.61
January 2023
In the Reporting
Period, carrying
amount of other -5,096,229.69 5,096,229.69
receivables on 1
January 2023
-- Transferred to
-5,096,229.69 5,096,229.69
Phase II
-- Transferred to
Phase III
-- Reclassified
under Phase II
-- Reclassified
under Phase I
Provision in the
Reporting 3,427,101.55 91,765,719.66 1,286,766.29 96,479,587.50
Period
Reclassification
in the Reporting 5,000.00 5,000.00
Period
Charge-off in
the Reporting
Period
Write-off in the
Reporting
Period
Other changes 2,006,401.54 1,163,586.85 3,169,988.39
Balance as of 30
6,812,647.90 479,686,443.57 1,439,921,762.03 1,926,420,853.50
June 2023
Note: The first stage is that credit risk has not increased significantly since initial recognition.
For other receivables with an aging portfolio and a low-risk portfolio within one year, the loss
provision is measured according to the expected credit losses in the next 12 months.
The second stage is that credit risk has increased significantly since initial recognition but
credit impairment has not yet occurred. For other receivables with an aging portfolio and a low-
risk portfolio that exceed one year, the loss provision is measured based on the expected credit
losses for the entire duration.
The third stage is the credit impairment after initial confirmation. For other receivables of
credit impairment that have occurred, the loss provision is measured according to the credit losses
141
Konka Group Co., Ltd. Interim Report 2023
that have occurred throughout the duration.
(3) Withdrawing provision for bad debts for other receivables by portfolio
Closing balance
Book balance Provision for bad debts
Category
Withdrawal Carrying value
Proportion
Amount Amount proportion
(%)
(%)
Other
receivables of
expected 1,439,921,762.0
1,463,672,741.80 43.86 98.38 23,750,979.77
credit losses 3
withdrawn
individually
Other
receivables of
provision for
bad debts
withdrawn by
credit risk
characteristic
portfolio:
Aging
1,386,594,236.71 41.56 465,077,601.03 33.54 921,516,635.68
portfolio
Low-risk
486,577,080.45 14.58 21,421,490.44 4.40 465,155,590.01
portfolio
Subtotal of
1,873,171,317.16 56.14 486,499,091.47 25.97 1,386,672,225.69
portfolio
1,926,420,853.5
Total 3,336,844,058.96 100.00
0
57.73 1,410,423,205.46
(Continued)
Opening balance
Book balance Provision for bad debts
Category
Withdrawal Carrying value
Proportion
Amount Amount proportion
(%)
(%)
Other
receivables of
expected credit 1,461,191,467 1,437,476,408.
44.76 98.38 23,715,058.62
losses .51 89
withdrawn
individually
Other
receivables of
provision for
bad debts
withdrawn by
credit risk
characteristic
142
Konka Group Co., Ltd. Interim Report 2023
Opening balance
Book balance Provision for bad debts
Category
Withdrawal Carrying value
Proportion
Amount Amount proportion
(%)
(%)
portfolio:
Aging 1,342,397,234 372,315,645.7
41.12 27.74 970,081,588.53
portfolio .31 8
Low-risk 461,160,841.3
14.12 16,984,222.94 3.68 444,176,618.36
portfolio 0
Subtotal of 1,803,558,075 389,299,868.7
55.24 21.59 1,414,258,206.89
portfolio .61 2
3,264,749,543 1,826,776,277.
Total 100.00 55.95 1,437,973,265.51
.12 61
(4) Other receivables listed by aging
Aging Closing balance
Within one year 543,179,086.07
One to two years 277,182,000.17
Two to three years 913,187,173.58
Three to four years 1,158,266,707.88
Four to five years 250,085,099.34
Over five years 194,943,991.92
Subtotal 3,336,844,058.96
Less: Provisions for bad debts 1,926,420,853.50
Total 1,410,423,205.46
(5) Provision for bad debts for other receivables
The amount of provision for bad debts for Reporting Period was RMB96,479,587.50,
increasing RMB3,170,033.27 which was mainly due to exchange rate changes, decreasing
RMB44.88 which was mainly due to loss of control.
(6) Other receivables actually written off for the Reporting Period
There were no other receivables actually written off for the Reporting Period.
(7) Top five other accounts receivable in the closing balance categorised by debtors
The total amount of other receivables with top five ending balance collected by arrears party
in the Reporting Period was RMB1,475,353,794.88, accounting for 44.21% of the total ending
balance of other receivables. The total ending balance of provision for bad debts correspondingly
withdrawn was RMB600,453,158.74.
(8) Other accounts receivable derecognised due to the transfer of financial assets
143
Konka Group Co., Ltd. Interim Report 2023
There were no other receivables derecognised due to the transfer of financial assets for the
Reporting Period.
(9) Amount of assets and liabilities generated through the transfer of other accounts
receivable and continuing involvement
There were no assets or liabilities formed due to the transfer and the continued involvement of
other receivables during the Reporting Period.
8. Inventory
（1） Inventory classification
Closing balance
Provision for
Item inventory
Book balance impairment/for Carrying value
contract fulfilment
cost impairment
Raw materials 1,504,770,929.78 71,727,933.75 1,433,042,996.03
Semi-finished
130,868,472.14 37,830,224.42 93,038,247.72
products
Commodities in stock 2,961,430,584.10 244,868,061.46 2,716,562,522.64
Commissioned
2,535,888.55 2,535,888.55
products
Contract fulfilment
178,053.10 178,053.10
costs
Development costs 413,385,626.00 413,385,626.00
Total 5,013,169,553.67 354,426,219.63 4,658,743,334.04
(Continued)
Opening balance
Provision for
Item inventory
Book balance impairment/for Carrying value
contract fulfilment
cost impairment
Raw materials 1,168,223,234.28 64,695,751.94 1,103,527,482.34
Semi-finished
145,186,803.18 37,339,815.90 107,846,987.28
products
Commodities in stock 3,316,097,782.82 270,664,206.34 3,045,433,576.48
Commissioned
2,862,799.75 2,862,799.75
products
Contract fulfilment
254,159.33 254,159.33
costs
Development costs 149,842,751.04 149,842,751.04
Total 4,782,467,530.40 372,699,774.18 4,409,767,756.22
144
Konka Group Co., Ltd. Interim Report 2023
（2） Inventory falling price reserves and impairment provision of contract performance
costs
Increase in the Reporting Period
Item Opening balance
Withdrawal Others
Raw materials 64,695,751.94 7,004,127.25
Semi-finished 37,339,815.90
509,216.97
products
Commodities in stock 270,664,206.34 7,761,139.98
Commissioned
products
Contract fulfilment
costs
Development costs
Total 372,699,774.18 15,274,484.20
(Continued)
Decrease in the Reporting Period
Item Closing balance
Write-off Others
Raw materials 1,215,334.13 -1,243,388.69 71,727,933.75
Semi-finished
18,808.45 37,830,224.42
products
Commodities in stock 33,595,757.23 -38,472.37 244,868,061.46
Commissioned
products
Contract fulfilment
costs
Development costs
Total 34,829,899.81 -1,281,861.06 354,426,219.63
Specific basis for determining the realisable net value and reasons for inventory falling price
reserves and impairment provision for contract performance costs transferred back or written off
during the Reporting Period:
Reasons for write-off of
Specific basis for withdrawal of
Item inventory falling price reserves
inventory falling price reserves
in the Reporting Period
The realisable net value was lower They have been sold or collected
Raw materials
than the carrying value in the Reporting Period
Semi-finished The realisable net value was lower They have been sold or collected
products than the carrying value in the Reporting Period
The realisable net value was lower They have been sold in the
Commodities in stock
than the carrying value Reporting Period
145
Konka Group Co., Ltd. Interim Report 2023
9. Contract assets
(1) Contract assets
Closing balance
Item Provision for
Book balance Carrying value
impairment
Receivables among settled
items, which are not 441,792.02 9,012.56 432,779.46
unconditional payment
Total 441,792.02 9,012.56 432,779.46
Opening balance
Item Provision for
Book balance Carrying value
impairment
Receivables among settled
items, which are not
unconditional payment
Total
(2) Withdrawal of impairment provision for contractual assets
Charge-
Provision Reclassification
off/Write- Decrease
in the in the
Item off in the for other Reasons
Reporting Reporting
Reporting reasons
Period Period
Period
Receivables among settled
items, which are not 9,012.56
unconditional payment
Total 9,012.56
10. Non-current assets due within one year
Item Closing balance Opening balance Nature
Long-term receivables due
3,630,000.00 14,630,000.00 Cash deposit
within one year
Total 3,630,000.00 14,630,000.00
11. Other current assets
Item Closing balance Opening balance
Principal and interests of entrusted loans to
1,867,956,911.49 1,544,592,633.44
associated enterprises
Prepayments and deductible taxes, and
507,310,047.74 457,991,464.58
refund of tax for export receivable
Deferred expenses 22,893,812.47 17,278,894.58
Costs receivable for returning goods 15,705,912.79 14,214,651.96
146
Konka Group Co., Ltd. Interim Report 2023
Item Closing balance Opening balance
Others 4,325,476.35 4,763,581.27
Total 2,418,192,160.84 2,038,841,225.83
12. Long-term receivables
（1） Long-term accounts receivable
Closing balance
Item Provision
Book balance for bad Carrying value
debts
Finance lease payment
Including: Unrealised financing income
Cash deposits of long-term receivables 4,430,400.00 4,430,400.00
Less: Long-term receivable due within one
3,630,000.00 3,630,000.00
year (See Note VI. 10 for details)
Total 800,400.00 800,400.00
(Continued)
Opening balance
Item Provision
Book balance for bad Carrying value
debts
Finance lease payment
Including: Unrealised financing income
Cash deposits of long-term receivables 15,430,400.00 15,430,400.00
Less: Long-term receivable due within one
14,630,000.00 14,630,000.00
year (See Note VI. 10 for details)
Total 800,400.00 800,400.00
147
Konka Group Co., Ltd. Interim Report 2023
13. Long-term equity investment
Change in the Reporting Period
Profit or loss of
Investee Opening balance investment Changes in other
Increase in the Decrease in the Cost method to
recognised by comprehensive
investment investment equity method
the equity income
method
Konka Ventures
Development (Shenzhen)
Co., Ltd. (formerly known as
4,963,158.89
"Konka Ventures
Development (Shenzhen)
Co., Ltd.")
Nanjing Zhihuiguang
Information Technology 1,686,591.04
Research Institute Co., Ltd.
Feidi Technology (Shenzhen)
10,591,603.87
Co., Ltd.
Shenzhen Kangyue
32,232,415.88 -54,027.66
Enterprise Co., Ltd.
Foshan Zhujiang Media
Creative Park Culture 2,834,367.04
Development Co., Ltd.
Kangkai Technology Service
209,048.32
(Chengdu) Co., Ltd.
Puchuang Jiakang
3,658,484.71 -894,025.70
Technology Co, Ltd.
Chongqing Qingjia
5,831,185.33 5,831,185.33
Electronics Co., Ltd.
Shenzhen Jielunte
99,748,594.97 -4,159,623.03
Technology Co., Ltd.
148
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Profit or loss of
Investee Opening balance investment Changes in other
Increase in the Decrease in the Cost method to
recognised by comprehensive
investment investment equity method
the equity income
method
Panxu Intelligence Co., Ltd. 51,392,171.46 -274,477.86
Orient Excellent (Zhuhai)
7,482,864.06 1,101,394.33
Asset Management Co., Ltd.
Dongfang Jiakang No.1
(Zhuhai) Private Equity 483,905,786.35 16,750,995.01 12,807,706.86
Investment Fund (LP)
Tongxiang Wuzhen Kunyu
3,527,761.64
Equity Investment Co., Ltd.
Shenzhen RF-LINK
Technology Co., Ltd.
Anhui Kaikai Shijie E-
418,721,305.96
commerce Co., Ltd.
Kunshan Kangsheng
Investment Development 313,484,693.57 -10,055,178.43
Co., Ltd.
Chutian Dragon Co., Ltd. 523,726,463.18
Shaanxi Silk Road Cloud
13,333,698.78 -781,563.56
Intelligent Tech Co., Ltd.
Shenzhen Kanghongxing
Intelligent Technology Co.,
Ltd.
Shenzhen Yaode Technology
Co., Ltd.
Wuhan Tianyuan
352,295,640.91 -3,659,889.05
Environmental Protection
149
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Profit or loss of
Investee Opening balance investment Changes in other
Increase in the Decrease in the Cost method to
recognised by comprehensive
investment investment equity method
the equity income
method
Co., Ltd.
Chuzhou Konka Technology
Industry Development Co., 49,658,397.02 -2,909,934.84
Ltd.
Chuzhou Kangjin Health
Industrial Development Co., 275,858,698.37 -2,876,368.35
Ltd.
Nantong Kangjian
Technology Industrial Park
107,310,029.86
Operations and Management
Co., Ltd.
Chuzhou Kangxin Health
Industry Development Co., 183,310,823.25 -1,327,324.27
Ltd.
Dongguan Guankang
521,341,722.37
Yuhong Investment Co., Ltd.
Shandong Econ Technology
1,246,099,855.22
Co., Ltd.
Dongguan Kangjia New
Materials Technology Co., 6,951,651.72 186,757.47
Ltd..
Chongqing E2info
1,023,251,062.59 17,264,263.57
Technology Co., Ltd.
Yantai Kangyun Industrial
72,320,476.84 -2,714,568.47
Development Co., Ltd.
E3info (Hainan) Technology 30,708,255.04
150
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Profit or loss of
Investee Opening balance investment Changes in other
Increase in the Decrease in the Cost method to
recognised by comprehensive
investment investment equity method
the equity income
method
Co., Ltd.
Shenzhen Kangjia Jiapin
Intelligent Electrical
5,371,364.87 739,175.43
Apparatus Technology Co.,
Ltd.
Shenzhen KONKA E-display
82,221,081.72 690,558.45
Co., Ltd.
Chongqing Yuanlv Benpao
33,721,573.96
Real Estate Co., Ltd.
Shenzhen Kangpeng Digital
3,411,153.10 -1,124,071.28
Technology Co., Ltd.
Yantai Kangtang
Construction Development 232,597.64
Co., Ltd.
Dongguan Kangzhihui
23,998,624.46 25,519.24
Electronics Co., Ltd.
Sichuan Huayi Jiakang
121,403.90
Technology Co., Ltd.
Shenzhen Aimijiakang
Technology Co., Ltd.
(formerly: Sichuan 1,585,761.09 -327,859.93
Aimijiakang Technology
Co., Ltd.)
Beijing Konka Jingyuan
733,832.84
Technology Co., Ltd.
Chongqing Liangshan 121,802.33
151
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Profit or loss of
Investee Opening balance investment Changes in other
Increase in the Decrease in the Cost method to
recognised by comprehensive
investment investment equity method
the equity income
method
Enterprise Management Co.,
Ltd.
Shenzhen Kangene
Technology Innovation 967,323.92 58,982.15
Development Co., Ltd.
Shandong Kangfei Intelligent
Electrical Appliances Co., 1,373,981.26 -1,273,205.73
Ltd.
Henan Kangfei Intelligent
Electrical Appliances Co., 1,182,963.46 622,762.16
Ltd.
Guangdong Kangyuan
12,777,082.28 -1,809,061.91
Semiconductor Co., Ltd.
Chongqing Kangyiqing
1,010,683.91 -199,975.02
Technology Co., Ltd.
Shenzhen Kangying
Semiconductor Technology 13,254,520.44 -6,742,110.44
Co., Ltd.
Wiselite International (HK)
1,641,595.45
Limited
Chongqing Kangjian
Optoelectronics Technology 11,493,032.21 -800,000.00
Co., Ltd.
Anhui Kangta Supply Chain
18,060,000.00 -528,765.53
Management Co., Ltd.
Wuhan Kangtang 26,654,950.30 -958,720.49
152
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Profit or loss of
Investee Opening balance investment Changes in other
Increase in the Decrease in the Cost method to
recognised by comprehensive
investment investment equity method
the equity income
method
Information Technology Co.,
Ltd.
Sichuan Chengrui Real
41,423,514.93 -4,691,048.46
Estate Co., Ltd.
Konka Industrial
Development (Wuhan) Co., 43,290,693.00
Ltd.
Hefei KONSEMI Storage
180,146,610.27 -13,033,084.11
Technology Co., Ltd.
Sichuan Hongxinchen Real
54,880,000.00 -807,774.07
Estate Development Co., Ltd.
6,351,232,955.58 22,582,180.34 54,880,000.00 -28,505,538.53
(Continued)
Change in the Reporting Period
Withdrawal Closing balance
Cash dividends of
Investee Changes in other or profits Closing balance of the provision
impairment Others for impairment
equities declared to be provision
distributed
Reserve
Konka Ventures Development
(Shenzhen) Co., Ltd. (formerly
4,963,158.89
known as "Konka Ventures
Development (Shenzhen) Co.,
153
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Withdrawal Closing balance
Cash dividends of
Investee Changes in other or profits Closing balance of the provision
impairment Others for impairment
equities declared to be provision
distributed
Reserve
Ltd.")
Nanjing Zhihuiguang
Information Technology 1,686,591.04
Research Institute Co., Ltd.
Feidi Technology (Shenzhen)
10,591,603.87
Co., Ltd.
Shenzhen Kangyue Enterprise
32,178,388.22
Co., Ltd.
Foshan Zhujiang Media
Creative Park Culture 2,834,367.04
Development Co., Ltd.
Kangkai Technology Service
209,048.32
(Chengdu) Co., Ltd.
Puchuang Jiakang Technology
1,000,000.00 1,764,459.01
Co, Ltd.
Chongqing Qingjia Electronics
Co., Ltd.
Shenzhen Jielunte Technology
95,588,971.94
Co., Ltd.
Panxu Intelligence Co., Ltd. 51,117,693.60
Orient Excellent (Zhuhai)
8,584,258.39
Asset Management Co., Ltd.
Dongfang Jiakang No.1
(Zhuhai) Private Equity 479,962,498.20
Investment Fund (LP)
154
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Withdrawal Closing balance
Cash dividends of
Investee Changes in other or profits Closing balance of the provision
impairment Others for impairment
equities declared to be provision
distributed
Reserve
Tongxiang Wuzhen Kunyu
3,527,761.64
Equity Investment Co., Ltd.
Shenzhen RF-LINK
85,656,027.35
Technology Co., Ltd.
Anhui Kaikai Shijie E-
418,721,305.96
commerce Co., Ltd.
Kunshan Kangsheng
Investment Development Co., 29,400,000.00 274,029,515.14
Ltd.
Chutian Dragon Co., Ltd. -523,726,463.18
Shaanxi Silk Road Cloud
12,552,135.22
Intelligent Tech Co., Ltd.
Shenzhen Kanghongxing
Intelligent Technology Co., 12,660,222.73
Ltd.
Shenzhen Yaode Technology
214,559,469.35
Co., Ltd.
Wuhan Tianyuan
Environmental Protection Co., 90,301,655.75 3,078,000.00 435,859,407.61
Ltd.
Chuzhou Konka Technology
Industry Development Co., 46,748,462.18
Ltd.
Chuzhou Kangjin Health
Industrial Development Co., 272,982,330.02
Ltd.
155
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Withdrawal Closing balance
Cash dividends of
Investee Changes in other or profits Closing balance of the provision
impairment Others for impairment
equities declared to be provision
distributed
Reserve
Nantong Kangjian Technology
Industrial Park Operations and 107,310,029.86
Management Co., Ltd.
Chuzhou Kangxin Health
Industry Development Co., 181,983,498.98
Ltd.
Dongguan Guankang Yuhong
521,341,722.37
Investment Co., Ltd.
Shandong Econ Technology
1,246,099,855.22
Co., Ltd.
Dongguan Kangjia New
Materials Technology Co., 7,138,409.19
Ltd..
Chongqing E2info Technology
1,040,515,326.16
Co., Ltd.
Yantai Kangyun Industrial
69,605,908.37
Development Co., Ltd.
E3info (Hainan) Technology
30,708,255.04
Co., Ltd.
Shenzhen Kangjia Jiapin
Intelligent Electrical Apparatus 6,110,540.30
Technology Co., Ltd.
Shenzhen KONKA E-display
82,911,640.17
Co., Ltd.
Chongqing Yuanlv Benpao
33,721,573.96
Real Estate Co., Ltd.
156
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Withdrawal Closing balance
Cash dividends of
Investee Changes in other or profits Closing balance of the provision
impairment Others for impairment
equities declared to be provision
distributed
Reserve
Shenzhen Kangpeng Digital
2,287,081.82
Technology Co., Ltd.
Yantai Kangtang Construction
232,597.64
Development Co., Ltd.
Dongguan Kangzhihui
24,024,143.70
Electronics Co., Ltd.
Sichuan Huayi Jiakang
121,403.90
Technology Co., Ltd.
Shenzhen Aimijiakang
Technology Co., Ltd.
(formerly: Sichuan 1,257,901.16
Aimijiakang Technology Co.,
Ltd.)
Beijing Konka Jingyuan
733,832.84
Technology Co., Ltd.
Chongqing Liangshan
Enterprise Management Co., 121,802.33
Ltd.
Shenzhen Kangene Technology
Innovation Development Co., 1,026,306.07
Ltd.
Shandong Kangfei Intelligent
100,775.53
Electrical Appliances Co., Ltd.
Henan Kangfei Intelligent
1,805,725.62
Electrical Appliances Co., Ltd.
Guangdong Kangyuan 10,968,020.37
157
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Withdrawal Closing balance
Cash dividends of
Investee Changes in other or profits Closing balance of the provision
impairment Others for impairment
equities declared to be provision
distributed
Reserve
Semiconductor Co., Ltd.
Chongqing Kangyiqing
810,708.89
Technology Co., Ltd.
Shenzhen Kangying
Semiconductor Technology 6,512,410.00
Co., Ltd.
Wiselite International (HK)
1,641,595.45
Limited
Chongqing Kangjian
Optoelectronics Technology 10,693,032.21
Co., Ltd.
Anhui Kangta Supply Chain
17,531,234.47
Management Co., Ltd.
Wuhan Kangtang Information
25,696,229.81
Technology Co., Ltd.
Sichuan Chengrui Real Estate
36,732,466.47
Co., Ltd.
Konka Industrial Development
43,290,693.00
(Wuhan) Co., Ltd.
Hefei KONSEMI Storage
167,113,526.16
Technology Co., Ltd.
Sichuan Hongxinchen Real
54,072,225.93
Estate Development Co., Ltd.
Total 90,301,655.75 33,478,000.00 -523,726,463.18 5,888,122,429.28 312,875,719.43
158
Konka Group Co., Ltd. Interim Report 2023
14. Other equity instrument investments
（1） Other equity instrument investments
Item Closing balance Opening balance
Shenzhen Tianyilian Science & Technology Co., Ltd.
Shenzhen Adopt Network Co., Ltd.
Beijing Aowei Mutual Entertainment Technology Co., Ltd. 5,901,121.80 5,901,121.80
Feihong Electronics Co., Ltd.
ZAEFI
Shenzhen Chuangce Investment Development Co., Ltd.
Shanlian Information Technology Engineering Centre 1,860,809.20 1,860,809.20
Shenzhen CIU Science & Technology Co., Ltd. 953,000.00 953,000.00
Shenzhen Digital TV National Engineering Laboratory Co., Ltd. 7,726,405.16 7,726,405.16
Shanghai National Engineering Research Centre of Digital TV Co., Ltd. 2,400,000.00 2,400,000.00
BOHUA UHD 5,000,001.00 5,000,001.00
Total 23,841,337.16 23,841,337.16
（2） Investment in non-trading equity instruments in the Reporting Period
Reason for other
Amount of other Reason for assigning to
Dividend comprehensive
comprehensive measure in fair value of
income Accumulati Accumulative income
Item income which changes included
recognised ve gains losses transferred to
transferred to other comprehensive
this year retained
retained earnings income
earnings
Shenzhen Tianyilian Science &
4,800,000.00 Long-term holding based
Technology Co., Ltd.
159
Konka Group Co., Ltd. Interim Report 2023
Reason for other
Amount of other Reason for assigning to
Dividend comprehensive
comprehensive measure in fair value of
income Accumulati Accumulative income
Item income which changes included
recognised ve gains losses transferred to
transferred to other comprehensive
this year retained
retained earnings income
earnings
on strategic purpose
Long-term holding based
Shenzhen Adopt Network Co., Ltd. 5,750,000.00
on strategic purpose
Beijing Aowei Mutual Entertainment Long-term holding based
98,878.20
Technology Co., Ltd.
on strategic purpose
Long-term holding based
Feihong Electronics Co., Ltd. 1,300,000.00
on strategic purpose
Long-term holding based
ZAEFI 100,000.00
on strategic purpose
Shenzhen Chuangce Investment Long-term holding based
485,000.00
Development Co., Ltd. on strategic purpose
Shanlian Information Technology Long-term holding based
3,139,190.80
Engineering Centre on strategic purpose
Shenzhen CIU Science & Long-term holding based
200,000.00
Technology Co., Ltd. on strategic purpose
Shenzhen Digital TV National Long-term holding based
1,273,594.84
Engineering Laboratory Co., Ltd.
on strategic purpose
Shanghai National Engineering Long-term holding based
Research Centre of Digital TV Co., on strategic purpose
160
Konka Group Co., Ltd. Interim Report 2023
Reason for other
Amount of other Reason for assigning to
Dividend comprehensive
comprehensive measure in fair value of
income Accumulati Accumulative income
Item income which changes included
recognised ve gains losses transferred to
transferred to other comprehensive
this year retained
retained earnings income
earnings
Ltd.
Long-term holding based
BOHUA UHD
on strategic purpose
Total 17,146,663.84
161
Konka Group Co., Ltd. Interim Report 2023
15. Other non-current financial assets
Item Closing balance Opening balance
China Asset Management-Jiayi Overseas Designated
200,732,067.00 200,732,067.00
Plan
Tianjin Huacheng Property Development Co., Ltd. 1,000,000.00 1,000,000.00
Tianjin Property No. 8 Enterprise Management
28,540,777.26 28,540,777.26
Partnership (Limited Partnership)
CCB Trust-Cai Die No. 6 Property Rights Trust
66,080,293.70 66,080,293.70
Scheme
Daye Trust Co., Ltd. 100,000,000.00 100,000,000.00
Yibin OCT Sanjiang Properties Co., Ltd. 179,805,828.50 171,141,605.35
Yili Ecological Restoration Co., Ltd. 34,489,731.24 41,812,139.03
Kunshan Xinjia Emerging Industry Equity Investment
232,628,605.68 233,834,173.06
Fund Partnership (Limited Partnership)
Tongxiang Wuzhen Jiayu Digital Economy Industry
200,810,700.41 195,312,419.69
Equity Investment Partnership (Limited Partnership)
Yibin Kanghui Electronic Information Industry Equity
60,880,333.86 67,706,235.45
Investment Partnership (Limited Partnership)
Chuzhou Jiachen Information Technology Consulting
59,700,013.59 59,700,013.59
Service Partnership (Limited Partnership)
Yancheng Kangyan Information Industry Investment
167,287,646.77 167,230,693.52
Partnership (Limited Partnership)
Chongqing Kangxin Equity Investment Fund Limited
146,077,069.28 146,160,043.51
Partnership (Limited Partnership)
Shenzhen Kanghuijia Technology Co., Ltd. 10,137.30 10,137.30
Subtotal of equity investments 1,478,043,204.59 1,479,260,598.46
Chuzhou Huike Smart Household Appliances Industry
101,032,880.10 626,244,139.25
Investment Partnership (Limited Partnership)
Ningbo Yuanqing No. 9 Investment Partnership 148,855,198.11 148,855,198.11
Shenzhen Beihu Technology Partnership (Limited
58,000,000.00 58,000,000.00
Partnership)
Shanxi Kangmengrong Enterprise Management
9,163,411.30 9,163,411.30
Consulting Partnership (Limited Partnership)
Nanjing Kangfeng Dejia Asset Management
100,000,000.00 100,000,000.00
Partnership (Limited Partnership)
Shenzhen Gaohong Enterprise Consulting
103,690,684.93 100,000,000.00
Management Partnership (Limited Partnership)
Shenzhen Zitang No.1 Enterprise Consulting
99,000,000.00 100,386,000.00
Management Partnership (Limited Partnership)
Xi'an Bihuijia Enterprise Management Consulting
15,785,194.99 17,752,926.20
Partnership (Limited Partnership)
Subtotal of debt investments 635,527,369.43 1,160,401,674.86
162
Konka Group Co., Ltd. Interim Report 2023
Item Closing balance Opening balance
Total 2,113,570,574.02 2,639,662,273.32
16. Investment property
（1） Investment properties measured at cost
Item Land use right Properties and buildings Total
I. Original carrying
value
1. Opening balance 46,121,506.92 873,265,339.70 919,386,846.62
2. Increase in the
44,819,750.13 593,074,164.96 637,893,915.09
Reporting Period
(1) External purchase
(2) Fixed
assets\construction in
44,819,750.13 593,074,164.96 637,893,915.09
progress\transfer of
intangible assets
3. Decrease in the
15,171.30 15,171.30
Reporting Period
(1) Disposal 15,171.30 15,171.30
(2) Other transfer out
4. Closing balance 90,941,257.05 1,466,324,333.36 1,557,265,590.41
II. The accumulative
depreciation and
accumulative
amortisation
1. Opening balance 8,602,890.38 108,376,111.64 116,979,002.02
2. Increase in the
11,759,541.86 16,329,248.90 28,088,790.76
Reporting Period
(1) Provision or
11,759,541.86 16,329,248.90 28,088,790.76
amortisation
3. Decrease in the
3,897.13 3,897.13
Reporting Period
(1) Disposal 3,897.13 3,897.13
(2) Other transfer out
4. Closing balance 20,362,432.24 124,701,463.41 145,063,895.65
III. Provision for
impairment
1. Opening balance
163
Konka Group Co., Ltd. Interim Report 2023
Item Land use right Properties and buildings Total
2. Increase in the
Reporting Period
(1) Provision
3. Decrease in the
Reporting Period
(1) Disposal
(2) Other transfer out
4. Closing balance
IV. Carrying value
1. Closing carrying
70,578,824.81 1,341,622,869.95 1,412,201,694.76
value
2. Opening carrying
37,518,616.54 764,889,228.06 802,407,844.60
value
(2) Investment properties measured at fair value
There was no investment properties measured at fair value of the Company.
(3) Investment properties in the process of title certificate handling
Reason that the certificate
Item Carrying value
of title was not completed
Settlement of the project is
Konka Standard Electronic
underway, and the certificate
Product Plants Project in 262,318,214.53
can be handled only after the
Sunning
settlement
Total 262,318,214.53
(4) Investment properties with restricted ownership or use rights
Item Carrying value Reasons for the restriction
Tower 1 of Konka Guangming
101,798,700.19 As collateral for loan
Technology Center (Phase I)
Total 101,798,700.19
17. Fixed assets
Item Closing carrying value Opening carrying value
Fixed assets 4,021,128,223.39 4,114,029,693.38
Liquidation of fixed assets
Total 4,021,128,223.39 4,114,029,693.38
164
Konka Group Co., Ltd. Interim Report 2023
（1） Fixed assets
Properties and Machinery and Electronic Transport
Item Other equipment Total
buildings equipment equipment equipment
I. Original carrying
value
1. Opening balance 2,860,293,710.15 3,103,345,131.12 302,309,738.49 59,879,173.09 186,025,451.11 6,511,853,203.96
2. Increased amount of
17,093,650.47 78,602,521.68 13,399,791.51 696,486.57 2,345,289.89 112,137,740.12
the period
(1) Purchase 737,833.56 70,361,885.25 10,413,390.40 696,486.57 2,320,688.11 84,530,283.89
(2) Transfer-in of
16,355,816.91 8,229,911.50 2,895,079.35 24,601.78 27,505,409.54
construction in progress
(3) Increase through
consolidation
(4) Other transfer-in 10,724.93 91,321.76 102,046.69
3. Decreased amount of
12,174,081.35 23,220,251.48 13,061,482.92 1,695,052.22 1,293,362.43 51,444,230.40
the period
(1) Disposal or write-
78,890.76 22,971,062.12 13,061,482.92 1,378,087.77 1,029,221.71 38,518,745.28
off
(2) Decrease for loss of
controlling right
(3) Other decreases 12,095,190.59 249,189.36 316,964.45 264,140.72 12,925,485.12
4. Ending balance 2,865,213,279.27 3,158,727,401.32 302,648,047.08 58,880,607.44 187,077,378.57 6,572,546,713.68
II. Accumulated
depreciation
1. Opening balance 673,384,702.71 1,258,513,887.86 201,688,344.85 42,829,692.30 114,585,141.99 2,291,001,769.71
165
Konka Group Co., Ltd. Interim Report 2023
Properties and Machinery and Electronic Transport
Item Other equipment Total
buildings equipment equipment equipment
2. Increased amount of
41,189,192.38 125,682,629.90 12,632,971.50 2,271,500.06 7,437,906.27 189,214,200.11
the period
(1) Provision 41,189,192.38 125,682,629.90 12,605,623.17 2,271,060.28 7,437,906.27 189,186,412.00
(2) Increase through
consolidation
(3) Other increase 27,348.33 439.78 27,788.11
3. Decreased amount of
21,741.20 16,614,229.86 11,811,369.32 1,575,541.36 1,094,457.84 31,117,339.58
the period
(1) Disposal or write-
21,741.20 16,339,565.32 11,811,369.32 1,357,208.24 921,706.47 30,451,590.55
off
(2) Decrease for loss of
controlling right
(3) Other decreases 274,664.54 218,333.12 172,751.37 665,749.03
4. Ending balance 714,552,153.89 1,367,582,287.90 202,509,947.03 43,525,651.00 120,928,590.42 2,449,098,630.24
III. Provision for
impairment
1. Opening balance 23,987,527.51 75,533,448.92 1,351,990.45 827,482.72 5,121,291.27 106,821,740.87
2. Increased amount of
223.01 19,728.84 19,951.85
the period
(1) Provision 223.01 19,728.84 19,951.85
3. Decreased amount of
4,473,816.19 36,578.16 182.58 11,255.74 4,521,832.67
the period
(1) Disposal or write-
4,473,816.19 16,849.32 182.58 11,255.74 4,502,103.83
off
166
Konka Group Co., Ltd. Interim Report 2023
Properties and Machinery and Electronic Transport
Item Other equipment Total
buildings equipment equipment equipment
(2) Other decrease 19,728.84 19,728.84
4. Ending balance 23,987,527.51 71,059,855.74 1,315,412.29 827,300.14 5,129,764.37 102,319,860.05
IV. Carrying value
1. Ending carrying
2,126,673,597.87 1,720,085,257.68 98,822,687.76 14,527,656.30 61,019,023.78 4,021,128,223.39
value
2. Opening carrying
2,162,921,479.93 1,769,297,794.34 99,269,403.19 16,221,998.07 66,319,017.85 4,114,029,693.38
value
167
Konka Group Co., Ltd. Interim Report 2023
（2） List of temporarily idle fixed assets
Original Accumulated Provision for
Item Carrying value
carrying value depreciation impairment
Machinery and
824,823,845.49 372,859,046.34 58,181,788.74 393,783,010.41
equipment
Electronic
10,365,732.04 8,155,615.63 57,874.03 2,152,242.38
equipment
Transport
3,673,189.64 3,365,811.65 307,377.99
equipment
Properties and
266,352,257.20 135,135,305.00 7,899,900.07 123,317,052.13
buildings
Other equipment 1,799,875.89 901,797.73 46,523.56 851,554.60
Total 1,107,014,900.26 520,417,576.35 66,186,086.40 520,411,237.51
（3） Fixed assets leased out through operating leases
Item Closing carrying value
Electronic equipment 246,282.58
Machinery and equipment 25,553,563.94
Other equipment 442,665.13
Transport equipment 299.03
Total 26,242,810.68
（4） Details of fixed assets failed to accomplish certification of property
Reason that
the
Original carrying Accumulated Provision for Net book
Item certificate of
value depreciation impairment value
title was not
completed
Ankang's 576,367,3 Being
602,674,461.92 26,307,073.35
plants
88.57 handled
Bokang's
phase II
plants on the
31,097,02 Being
second and 33,616,122.84 2,519,102.25
0.59 handled
third floors
for printed
boards
Jingyuan
3,542,013 Being
Building 7,700,000.00 4,157,986.63
.37 handled
property
Yikang 76,610,752.33 41,214,156.47 35,396,59 Being
168
Konka Group Co., Ltd. Interim Report 2023
Reason that
the
Original carrying Accumulated Provision for Net book
Item certificate of
value depreciation impairment value
title was not
completed
Building
5.86 handled
property
Buildings
and
448,371,6 Being
constructions 453,857,134.27 5,485,450.94
83.33 handled
of Chongqing
Konka
1,094,774
Total 1,174,458,471.36 79,683,769.64
,701.72
(5) Fixed assets with restricted ownership or use right
Item Closing carrying value Reasons for the restriction
Housing and buildings of Anhui
142,712,112.61 Mortgage loan
Tongchuang
Machinery equipment of Jiangxi
13,378,706.66 Finance lease mortgage
Konka
Machinery equipment of
36,487,041.12 Finance lease mortgage
Xinfeng Microcrystalline
Housing and buildings of
83,749,203.78 Finance lease mortgage
Frestec Refrigeration
Buildings of Konka Group 73,963,459.56 Mortgage loan
Housing and buildings of Mortgage loan, finance lease
36,142,004.46
XingDa HongYe mortgage
Anhui Konka's buildings 607,509,925.08 Mortgage loan
Machinery equipment of
9,487,826.36 Finance lease mortgage
Xingda Hongye
Machinery equipment of Boluo
10,040,946.29 Finance lease mortgage
Konka Precision
Housing and buildings of As collateral for guarantee
2,733,931.24
Jiangxi Konka when as shareholder
Housing and buildings of
36,798,337.13 Mortgage loan
Jiangsu Konka Intelligent
Housing and buildings of
340,452,555.35 Mortgage loan
Chongqing Konka
Total 1,393,456,049.65
169
Konka Group Co., Ltd. Interim Report 2023
18. Construction in progress
（1） Construction in progress
Closing balance Opening balance
Item Provision for Provision for
Book balance Carrying value Book balance Carrying value
impairment impairment
Chongqing Konka
Semiconductor 646,716.96 646,716.96 197,885,487.81 197,885,487.81
Optoelectronics Park Project
Guangming Project 466,051,847.89 466,051,847.89
Jiangxi High-permeability
246,576,748.57 20,063,348.57 226,513,400.00 246,576,748.57 20,068,730.37 226,508,018.20
Crystalization Kiln
Dongguan Konka New
426,653,039.42 426,653,039.42 398,018,288.30 398,018,288.30
Industrial Park
Construction of Suining
Electronic Industrial Park 229,461,268.53 229,461,268.53 221,981,375.38 221,981,375.38
Workshops
Frestec Smart Home
187,025,745.30 187,025,745.30 113,146,458.03 113,146,458.03
Appliances Park
Other projects 468,950,870.45 43,191,700.46 425,759,169.99 410,734,273.00 43,964,371.54 366,769,901.46
Total 1,559,314,389.23 63,255,049.03 1,496,059,340.20 2,054,394,478.98 64,033,101.91 1,990,361,377.07
（2） Changes in major projects under construction in the Reporting Period
Name of item Opening balance Increase in the Decrease in the Reporting Period Closing balance
Reporting Period
170
Konka Group Co., Ltd. Interim Report 2023
Transferred to long-
term assets Other decreases
Chongqing Konka Semiconductor
197,885,487.81 1,298,004.56 198,536,775.41 646,716.96
Optoelectronics Park Project
Guangming Project 466,051,847.89 6,504,273.24 472,556,121.13
Jiangxi High-permeability
246,576,748.57 246,576,748.57
Crystalization Kiln
Dongguan Konka New Industrial Park 398,018,288.30 28,634,751.12 426,653,039.42
Construction of Suining Electronic
221,981,375.38 7,585,264.27 105,371.12 229,461,268.53
Industrial Park Workshops
Frestec Smart Home Appliances Park 113,146,458.03 73,879,287.27 187,025,745.30
Total 1,643,660,205.98 117,901,580.46 671,092,896.54 105,371.12 1,090,363,518.78
(Continued)
Including:
Proportion
Accumulated Amount of Capitalisation
estimated of the Engineering
Estimated number amount of interest rate of the
Name of item project Source of fund
(RMB100 million) Schedule (%) interest capitalisation in interests of the
accumulative
capitalisation the Reporting period (%)
input (%)
Period
Chongqing Konka
Semiconductor Self-owned fund
7.57 95.00 95.00 32,272.52 32,272.52
Optoelectronics Park and bank financing
Project
Self-owned fund
Guangming Project 5.2 100.00 100.00 24,439,935.19 2,111,837.68 1.43
and project loans
171
Konka Group Co., Ltd. Interim Report 2023
Including:
Proportion
Accumulated Amount of Capitalisation
estimated of the Engineering
Estimated number amount of interest rate of the
Name of item project Source of fund
(RMB100 million) Schedule (%) interest capitalisation in interests of the
accumulative
capitalisation the Reporting period (%)
input (%)
Period
Jiangxi High-
Self-owned fund
permeability 3.4 72.52 72.52 32,249,994.16
and bank financing
Crystalization Kiln
Dongguan Konka New Self-owned fund
5.97 71.47 71.47 22,693,029.73 7,426,357.70 4.23
Industrial Park and bank financing
Construction of
Suining Electronic
7.34 59.74 59.74 Self-owned fund
Industrial Park
Workshops
Frestec Smart Home Self-owned fund
4.88 38.32 38.32 308,750.00 226,250.00 4.50
Appliances Park and bank financing
Total 79,723,981.60 9,796,717.90
172
Konka Group Co., Ltd. Interim Report 2023
19. Right-of-use assets
Properties and Electronic Transport
Item Total
buildings equipment equipment
I. Original carrying
value
1. Opening balance 105,879,545.84 243,493.34 106,123,039.18
2. Increase in the
1,993,337.34 1,993,337.34
Reporting Period
(1) Rent 1,771,436.60 1,771,436.60
(2) Others 221,900.74 221,900.74
3. Decrease in the
16,937,812.60 16,937,812.60
Reporting Period
(1) Decrease for loss
of controlling right
(2) Others 16,937,812.60 16,937,812.60
4. Closing balance 90,935,070.58 243,493.34 91,178,563.92
II. Accumulated
depreciation
1. Opening balance 56,047,009.73 56,190.77 56,103,200.50
2. Increase in the
11,720,071.18 28,095.39 11,748,166.57
Reporting Period
(1) Provision 11,720,071.18 28,095.39 11,748,166.57
(2) Others
3. Decrease in the
10,160,601.40 10,160,601.40
Reporting Period
(1) Decrease for loss
of controlling right
(2) Others 10,160,601.40 10,160,601.40
4. Closing balance 57,606,479.51 84,286.16 57,690,765.67
III. Provision for
impairment
1. Opening balance
2. Increase in the
Reporting Period
(1) Provision
3. Decrease in the
Reporting Period
(1) Disposal
4. Closing balance
IV. Carrying value
173
Konka Group Co., Ltd. Interim Report 2023
Properties and Electronic Transport
Item Total
buildings equipment equipment
1. Closing carrying
33,328,591.07 159,207.18 33,487,798.25
value
2. Opening carrying
value
49,832,536.11 187,302.57 50,019,838.68
174
Konka Group Co., Ltd. Interim Report 2023
20. Intangible assets
（1） List of intangible assets
Intellectual property
Item Land use right Right to use Total
Trademark Patent and Franchise
software and Subtotal
right know-how rights
others
I. Original
carrying
value
1. Opening
920,331,792.11 72,197,456.33 116,715,865.54 168,553,796.14 166,134,944.42 523,602,062.43 1,443,933,854.54
balance
2. Increased
amount of the 12,707,974.60 3,923,438.71 16,631,413.31 16,631,413.31
period
(1) Purchase 3,923,438.71 3,923,438.71 3,923,438.71
(2) Transfer-
in of
12,707,974.60 12,707,974.60 12,707,974.60
construction
in progress
(3) Transfer
from R&D
(4) Increase
through
consolidation
(5) Other
reasons
3. Decreased 44,819,750.13 18,240.10 162,365.17 180,605.27 45,000,355.40
175
Konka Group Co., Ltd. Interim Report 2023
Intellectual property
Item Land use right Right to use Total
Trademark Patent and Franchise
software and Subtotal
right know-how rights
others
amount of the
period
(1) Disposal
(2) Decrease
for loss of
controlling
right
(3) Decrease
for other 44,819,750.13 18,240.10 162,365.17 180,605.27 45,000,355.40
reasons
4. Ending
875,512,041.98 72,197,456.33 116,697,625.44 181,261,770.74 169,896,017.96 540,052,870.47 1,415,564,912.45
balance
II.
Accumulated
amortisation
1. Opening
99,146,643.20 19,252,110.49 71,318,420.60 1,560,683.29 90,172,768.07 182,303,982.45 281,450,625.65
balance
2. Increased
amount of the 11,057,240.93 2,081,758.04 5,007,931.48 7,981,651.40 15,071,340.92 26,128,581.85
period
(1) Provision 11,057,240.93 2,081,758.04 5,007,931.48 7,981,651.40 15,071,340.92 26,128,581.85
(2) Other
increases
3. Decreased 10,826,630.74 18,240.10 30,949.24 49,189.34 10,875,820.08
176
Konka Group Co., Ltd. Interim Report 2023
Intellectual property
Item Land use right Right to use Total
Trademark Patent and Franchise
software and Subtotal
right know-how rights
others
amount of the
period
(1) Disposal
(2) Decrease
for loss of
controlling
right
(3) Decrease
for other 10,826,630.74 18,240.10 30,949.24 49,189.34 10,875,820.08
reasons
4. Ending
99,377,253.39 21,333,868.53 71,300,180.50 6,568,614.77 98,123,470.23 197,326,134.03 296,703,387.42
balance
III. Provision
for
impairment
1. Opening
564,705.88 44,943,521.62 235,294.12 45,743,521.62 45,743,521.62
balance
2. Increased
amount of the
period
(1) Provision
(2) Increase
in business
combinations
177
Konka Group Co., Ltd. Interim Report 2023
Intellectual property
Item Land use right Right to use Total
Trademark Patent and Franchise
software and Subtotal
right know-how rights
others
3. Decreased
amount of the
period
(1) Disposal
(2) Decrease
for loss of
controlling
right
4. Ending
564,705.88 44,943,521.62 235,294.12 45,743,521.62 45,743,521.62
balance
IV. Carrying
value
1. Ending
carrying 776,134,788.59 50,298,881.92 453,923.32 174,693,155.97 71,537,253.61 296,983,214.82 1,073,118,003.41
value
2. Opening
carrying 821,185,148.91 52,380,639.96 453,923.32 166,993,112.85 75,726,882.23 295,554,558.36 1,116,739,707.27
value
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Konka Group Co., Ltd. Interim Report 2023
（2） Land use right with certificate of title uncompleted
Reason that the certificate
Item Carrying value
of title was not completed
Land use right of the subsidiary
4,961,301.96 Being handled
Nano-Grystallization
（3） Significant intangible assets
Remaining amortisation
Item Closing carrying value
period (year)
Land usage right of Dongguan
187,867,124.67 46.17
Konka
Land usage right of Frestec Smart
91,233,386.84 47.25
Home Technology
Land usage right of Frestec
64,815,067.18 33.25
Refrigeration
Concessions of Yibin Konka 175,146,657.02 17.33
Land use right of Konka Huanjia 62,498,176.16 46.00
（4） Intangible assets with restricted ownership or using right
Item Closing carrying value Reasons for the restriction
Land use right of Dongguan Konka 187,867,124.67 Mortgage loan
Land use right of Anhui Konka 54,473,796.00 Mortgage loan
Land usage right of Frestec As collateral for finance lease
64,815,067.18
Refrigeration
Land usage right of Frestec Smart Mortgage loan
91,233,386.84
Home Technology
Land use right of Konka
17,700,070.99 Mortgage loan
Tongchuang
Land use right of Jiangsu Konka 13,982,363.30 Mortgage loan
Land usage right of XingDa Mortgage loan
13,346,838.13
HongYe
Land usage right of Jiangxi Konka Original shareholder guarantee
12,255,316.97
mortgage
Land use right of Konka Guangming 5,344,167.42 Mortgage loan
Land use right of Chongqing Konka 45,073,685.19 Mortgage loan
Total 506,091,816.68
21. Development expenses
There were no development expenses at the end of the Reporting Period.
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22. Goodwill
（1）Original carrying value of goodwill
Increase in the Decrease in the
Reporting Period Reporting Period
Opening Formed Closing
Investee
balance through balance
Others Disposal Others
business
combinations
Jiangxi 340,111,933 340,111,933.
Konka .01 01
XingDa 44,156,682. 44,156,682.2
HongYe 25 5
384,268,615 384,268,615.
Total
.26 26
（2）Provision for goodwill impairment
Increase in the Decrease in the
Opening Reporting Period Reporting Period Closing
Investee
balance balance
Provision Others Disposal Others
Jiangxi 340,111,933.01 340,111,933.01
Konka
XingDa 21,959,947.14 21,959,947.14
HongYe
Total 362,071,880.15 362,071,880.15
（3）Information on the asset group or the combination of asset groups of the goodwill
The asset group or combination of asset groups in which the goodwill is located is the
composition of all main business operating tangible assets and identifiable intangible assets
(excluding working capital and non-operating assets) reflected in the balance sheet of the
corresponding subsidiary and related to goodwill Asset group. As of 30 June 2023, there were no
specific signs of impairment during the reporting period, and no provision for impairment was
required.
23. Long-term prepaid expense
Increase in Amortisation
Other
Opening the in the Closing
Item decreased
balance Reporting Reporting balance
amount
Period Period
Decoration 134,516,167.2
263,367,218.24 33,594,230.18 174,102.43 364,115,052.87
expenses 4
Shoppe
18,787,080.49 11,228,271.92 10,138,894.42 89,761.11 19,786,696.88
expense
Others 105,155,204.34 29,976,322.80 19,215,146.82 106,194.70 115,810,185.62
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Konka Group Co., Ltd. Interim Report 2023
Increase in Amortisation
Other
Opening the in the Closing
Item decreased
balance Reporting Reporting balance
amount
Period Period
175,720,761.9
Total 387,309,503.07 6
62,948,271.42 370,058.24 499,711,935.37
24. Deferred income tax assets/deferred income tax liabilities
（1）Deferred tax assets that have not been offset
Closing balance Opening balance
Item Deductible Deferred tax Deductible Deferred tax
temporary temporary
differences Assets differences Assets
Deductible
4,098,631,230.28 848,280,716.81 3,446,211,696.71 710,037,893.08
losses
Provision for
asset 1,701,969,895.32 374,586,824.01 1,665,450,141.63 364,146,193.07
impairment
Deferred
117,990,955.16 29,205,238.79 90,355,036.00 22,296,259.01
revenue
Accrued
278,506,825.93 59,960,993.91 208,346,464.01 49,058,992.22
expenses
Unrealised
internal sales 37,964,452.00 9,491,113.00 62,006,060.41 15,501,515.10
profits
Others 150,433,381.08 35,004,869.54 192,042,399.09 40,620,988.75
Total 6,385,496,739.77 1,356,529,756.06 5,664,411,797.85 1,201,661,841.23
（2）Deferred tax liabilities that have not been offset
Closing balance Opening balance
Item Taxable Deferred tax Taxable Deferred tax
temporary temporary
differences liabilities differences liabilities
Estimated added
value of assets not
176,116,420.43 37,688,081.44 193,084,308.55 41,509,033.61
under the same
control
Prepaid interest 53,353,541.64 13,338,385.41 46,965,768.40 11,741,442.10
Accelerated
depreciation of 40,552,515.38 9,987,203.85 4,406,228.55 1,376,446.54
fixed assets
Financial assets at
fair value through 461,426,619.30 115,356,654.83 98,900,582.49 24,725,145.63
profit or loss
Others 136,243,885.68 33,578,141.66 92,458,572.57 19,678,578.52
Total 867,692,982.43 209,948,467.19 435,815,460.56 99,030,646.40
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（3）Breakdown of unrecognised deferred tax assets
Item Closing balance Opening balance
Deductible losses 2,098,966,791.56 2,114,844,242.75
Deductible temporary 2,967,427,358.07
2,554,384,865.59
differences
Total 4,653,351,657.15 5,082,271,600.82
（4）Deductible losses of unrecognised deferred tax assets matured/will mature in the
following year
Year Closing balance Opening balance Notes
2023 128,930,652.40 134,203,193.22
2024 27,800,217.79 92,292,924.99
2025 87,209,765.43 136,655,028.18
2026 174,626,635.88 263,654,830.43
2027 340,755,561.77 1,488,038,265.93
2028 and following
1,339,643,958.29
years
Total 2,098,966,791.56 2,114,844,242.75
25. Other non-current assets
Closing balance
Item Provision for
Book balance Carrying value
impairment
Prepayment for
1,031,630,446.98 1,031,630,446.98
land-purchase
Prepayment for
construction,
262,170,619.82 262,170,619.82
equipment and other
long-term assets
Total 1,293,801,066.80 1,293,801,066.80
(Continued)
Opening balance
Item Provision for
Book balance Carrying value
impairment
Prepayment for
1,459,111,732.63 1,459,111,732.63
land-purchase
Prepayment for
construction,
251,133,645.63 251,133,645.63
equipment and other
long-term assets
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Opening balance
Item Provision for
Book balance Carrying value
impairment
Total 1,710,245,378.26 1,710,245,378.26
26. Short-term loans
（1）Classification of short-term loans
Type of borrowings Closing balance Opening balance Notes
Unsecured loan 4,837,751,882.14 5,252,631,775.26
Guaranteed loan 1,617,632,258.71 1,953,423,601.39 ①②③④
Mortgage loan 324,461,605.28 373,503,928.32 ⑤⑥⑦⑧
Total 6,779,845,746.13 7,579,559,304.97
① The Company provides joint and several liability guarantee for the short-term borrowings totaling
RMB1,052,003,230.90 to its subsidiaries Anhui Konka, Dongguan Konka, Yibin Smart, Anhui
Tongchuang, Boluo Precision, Jiangxi Konka, Jiangxi High-permeability Substrate, Xinfeng
Microcrystalline, Liaoyang Kangshun and Konka Xinyun.
② The Company has obtained short-term borrowings amounting to RMB510,570,138.89 from
Shenzhen Chegongmiao Sub-branch of China Everbright Bank Co., Ltd., for which the Company's
subsidiary Electronics Technology provides joint and several liability guarantee at the maximum
amount.
③ The Company's subsidiary Konka Ventures has obtained short-term borrowings amounting to
RMB4,850,000.00 from Shenzhen Sub-branch of Bank of Hangzhou Co., Ltd., for which Shenzhen
Qianhai Datang Technology Co., Ltd. provides guarantee.
④ The Company's subsidiary Ningbo Khr Electric Appliance Co., Ltd. has obtained short-term
borrowings amounting to RMB50,208,888.92 from Cixi Guancheng Branch of Bank of China Limited,
for which the Company and Korea Electric Group Co., Ltd. provide joint and several liability
guarantee at a ratio of 3:2.
⑤ The Company's subsidiary Anhui Konka has obtained short-term borrowings amounting to
RMB120,854,386.40 from Chuzhou Branch of Bank of China Limited, for which it provides land use
rights of a carrying value of RMB36,265,753.33 and houses and buildings of a carrying value of
RMB419,389,308.53 as mortgage.
⑥ The Company's subsidiary Jiangsu Konka Smart has obtained short-term borrowings amounting to
RMB30,189,125.00 from Changzhou Branch of ZheShang Bank Co., Ltd., for which it provides
buildings of a carrying value of RMB36,798,337.13 and land use rights of RMB13,982,363.30 as
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Konka Group Co., Ltd. Interim Report 2023
mortgage.
⑦ The Company's subsidiary XingDa HongYe has obtained short-term borrowings amounting to
RMB94,106,816.10 from Zhongshan Fusha Sub-branch of Zhongshan Rural Commercial Bank, for
which it provides land use rights of a carrying value of RMB13,346,838.13 and buildings of a carrying
value of RMB32,508,579.22 as mortgage and certificates of time deposit of RMB19,800,000.00 as
pledge and Hu Zehong provides joint and several liability guarantee.
⑧ The Company's subsidiary Anhui Tongchuang has obtained short-term borrowings amounting to
RMB79,311,277.78 from Hefei Branch of ZheShang Bank Co., Ltd., for which it provides buildings
of a carrying value of RMB142,712,112.61 and land use rights of RMB17,700,070.99 as mortgage.
(2) Outstanding Short-term borrowings overdue
There were no outstanding short-term borrowings overdue at the end of the Reporting Period.
27. Notes payable
Type of note Closing balance Opening balance
Banker's acceptance 965,232,549.62 881,426,104.13
Commercial acceptance draft 191,314,370.08 173,147,717.91
Total 1,156,546,919.70 1,054,573,822.04
28. Accounts payable
Item Closing balance Opening balance
Within one year 2,576,717,410.79 2,330,698,958.02
One to two years 102,890,328.05 155,636,729.60
Two to three years 129,155,491.56 89,142,446.14
Over three years 118,222,655.92 84,468,429.17
Total 2,926,985,886.32 2,659,946,562.93
29. Accounts received in advance
Type of note Closing balance Opening balance
Rents 825.69
Total 825.69
30. Contract liabilities
Item Closing balance Opening balance
Sales advances received 698,842,722.45 601,044,358.35
Total 698,842,722.45 601,044,358.35
31. Employee remuneration payable
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（1）List of payroll payable
Item Opening Increase in the Decrease in the Closing balance
balance Reporting Period Reporting Period
Short-term
343,646,678.61 719,840,311.47 883,580,151.76 179,906,838.32
remuneration
Post-
employment
benefits-
4,600,603.98 53,677,921.52 56,607,348.20 1,671,177.30
defined
contribution
plans
Dismissal
360,921.46 6,681,292.01 6,576,287.67 465,925.80
benefits
Other benefits
due within one
year
Total 348,608,204.05 780,199,525.00 946,763,787.63 182,043,941.42
（2）Short-term remuneration
Item Opening balance Increase in the Decrease in the Closing balance
Reporting Period Reporting Period
Salaries,
bonuses,
334,684,052.90 627,794,483.80 793,883,970.52 168,594,566.18
allowances and
subsidies
Employee
3,936,505.74 26,927,394.98 23,011,331.06 7,852,569.66
benefits
Social
insurance 1,058,903.83 28,162,423.38 28,403,658.03 817,669.18
premiums
Including:
Medical
542,052.97 25,212,748.22 25,234,686.15 520,115.04
insurance
premiums
Work
injury
258,547.07 1,790,935.44 2,045,091.89 4,390.62
insurance
premiums
Maternity
258,303.79 1,158,739.72 1,123,879.99 293,163.52
insurance
premiums
Housing fund 302,288.94 30,708,276.31 30,929,187.43 81,377.82
Labour union
funds and
2,815,551.22 6,247,733.00 6,502,628.74 2,560,655.48
education
funds
Short-term
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Konka Group Co., Ltd. Interim Report 2023
Item Opening balance Increase in the Decrease in the Closing balance
Reporting Period Reporting Period
absence with
payment
Short-term
profit sharing
plan
Others 849,375.98 849,375.98
Total 343,646,678.61 719,840,311.47 883,580,151.76 179,906,838.32
（3）Defined contribution plans
Item Opening Increase in the Decrease in the Closing
balance Reporting Reporting balance
Period Period
Basic endowment
management 4,410,027.51 52,338,803.77 55,194,755.17 1,554,076.11
insurance
Unemployment
insurance 190,576.47 1,339,117.75 1,412,593.03 117,101.19
premiums
Annuity
contribution
Total 4,600,603.98 53,677,921.52 56,607,348.20 1,671,177.30
32. Tax and fees payables
Item Closing balance Opening balance
Corporate income tax 81,680,682.71 178,994,811.66
Value-added tax 58,801,002.32 60,178,835.36
Fund for disposing abandoned 14,716,729.00
15,232,892.00
appliances and electronic products
City construction and maintenance tax 3,354,684.29 3,710,919.05
Education fees and local education 2,735,721.75
2,445,441.96
Surcharge
Stamp duty 7,284,321.59 9,955,063.53
Land use tax 11,049,570.88 11,028,106.31
Personal income tax 2,031,906.97 2,477,590.24
Property tax 4,367,360.15 4,511,721.21
Tariff 1,572,800.19 1,624,434.41
Others 1,481,969.85 1,168,746.84
Total 189,302,632.91 291,102,679.36
33. Other Payables
186
Konka Group Co., Ltd. Interim Report 2023
Item Closing balance Opening balance
Interest payable 40,524.22 29,590,464.00
Other payables 1,728,597,316.54 1,866,120,909.34
Total 1,728,637,840.76 1,895,711,373.34
33.1. Interests payable
Item Closing balance Opening balance
Interest on long-term borrowings with
interest paid by instalment and 29,271,307.22
principal paid at maturity
Interest payable on short-term
40,524.22 319,156.78
borrowings
Total 40,524.22 29,590,464.00
33.2 Other Payables
（1） Listed by account nature
Nature of fund Closing balance Opening balance
Trading funds 587,476,707.68 677,014,483.12
Expenses payable 537,067,094.62 538,693,780.45
Related party borrowing 210,445,900.64 286,552,967.74
Cash deposit and front 293,368,012.84 286,952,679.25
Advance payment 6,254,533.38 5,482,995.92
Equity transfer payment 6,302,796.96 6,302,796.96
Others 87,682,270.42 65,121,205.90
Total 1,728,597,316.54 1,866,120,909.34
（2） Significant other accounts payable with an age of more than one year
Unit Reason for non-
Closing balance repayment or carry-
over
The Third Construction Engineering
Company Ltd. of China Construction 21,877,760.25 Not yet due for payment
Second Engineering Bureau
Total 21,877,760.25
34. Non-current liabilities due within one year
Item Closing balance Opening balance
Long-term borrowings due within one 249,391,640.39
3,707,359,363.54
year
Long-term payables due within one 139,213,550.70
79,815,088.04
year
Bonds payable due within one year 1,522,701,645.91
187
Konka Group Co., Ltd. Interim Report 2023
Item Closing balance Opening balance
Lease liabilities due within one year 10,403,563.49 20,614,839.60
Total 5,320,279,660.98 409,220,030.69
35. Other current liabilities
Item Closing balance Opening balance
Accounts payable with trade
21,548,290.82 26,744,560.49
acceptance notes
Tax to be charged off 27,268,196.78 21,806,789.93
Refunds payable 20,828,377.91 19,898,433.29
Total 69,644,865.51 68,449,783.71
36. Long-term borrowings
（1） Classification of long-term loans
Type of borrowings Closing balance Opening balance Notes
Guaranteed loan 4,103,161,904.83 3,116,984,312.66 ①②③④⑤⑥⑦
Mortgage loan 922,805,731.59 849,816,227.52 ⑧⑨⑩
Entrusted borrowings 2,554,463,826.38 2,595,372,200.43
Unsecured loan 3,213,210,743.03 2,536,925,213.87
Pledge loan 87,125,658.45 57,225,088.80
Less: Portion due
3,707,359,363.54 249,391,640.39
within one year
Total 7,173,408,500.74 8,906,931,402.89
①The Company has obtained long-term borrowings amounting to RMB1,000,777,777.73
from Shenzhen Branch of China Development Bank Co., Ltd., the term of which is from 24 June
2021 to 22 August 2025, and for which the Company's parent company OCT Group provides
joint and several liability guarantee at the maximum amount.
②The Company has obtained long-term borrowings amounting to RMB1,889,387,500.00
from Shenzhen Branch of China Guangfa Bank Co., Ltd., the term of which is from 24 June 2021
to 22 August 2025, and for which the Company's parent company OCT Group provides joint and
several liability guarantee at the maximum amount.
③The Company has obtained long-term borrowings amounting to RMB1,000,933,333.33
from the Export-Import Bank of China, the term of which is from 22 June 2022 to 21 June 2024,
and for which the Company's parent company OCT Group provides joint and several liability
guarantee at the maximum amount.
④The Company's subsidiary Sichuan Konka has obtained long-term borrowings amounting
to RMB30,052,333.33 from Yibin Rural Commercial Bank Co. Ltd., of which the term is from 23
May 2023 to 26 April 2026, and for which the Company provides joint and several liability
guarantee.
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Konka Group Co., Ltd. Interim Report 2023
⑤The Company's subsidiary Konka Xinyun Semiconductor Technology (Yancheng) Co.,
Ltd. has obtained long-term borrowings amounting to RMB60,839,080.00 from Yancheng
Branch of HuaXia Bank Co., Ltd., the term of which is from 15 September 2021 to 21 August
2026, and for which the Company and its subsidiary Kowin Memory Technology (Shenzhen) Co.,
Limited provide joint and several liability guarantee at the maximum amount.
⑥The Company's subsidiary Anhui Konka has obtained long-term borrowings amounting to
RMB120,131,666.66 from Chuzhou Plaza Sub-branch of China Construction Bank Co., Ltd., of
which the term is from 29 October 2021 to 26 October 2026, and for which the Company
provides joint and several liability guarantee.
⑦The Company's subsidiary Anhui Konka has obtained long-term borrowings amounting to
RMB1,040,213.78 from Chuzhou Branch of Agricultural Bank of China Co., Ltd., of which the
term is from 29 June 2023 to 24 June 2028, and for which the Company provides joint and
several liability guarantee.
⑧The Company has obtained long-term borrowings amounting to RMB378,796,757.10
from Guanlan Sub-branch of Shenzhen Rural Commercial Bank Co., Ltd., the term of which is
from 22 January 2021 to 22 January 2026, and for which it provides land use rights of a carrying
value of RMB5,344,167.42 and investment properties of a carrying value of RMB101,798,700.19
and housing buildings of a carrying value of RMB73,963,459.56 as mortgage.
⑨The Company's subsidiary Anhui Konka has obtained long-term borrowings amounting to
RMB91,725,600.69 from Chuzhou Branch of Industrial Bank Co., Ltd., of which the term is from
16 July 2021 to 15 July 2031, and for which it provides land use rights of a carrying value of
RMB18,208,042.67 and housing buildings of a carrying value of RMB188,120,616.55 as
mortgage and the Company provides joint and several liability guarantee.
⑩The Company's subsidiary Dongguan Konka has obtained long-term borrowings
amounting to RMB332,157,583.04 from Dongguan Fenggang Sub-branch of Agricultural Bank
of China Co., Ltd., the term of which is from 23 June 2021 to 21 October 2030, and for which it
provides land use rights of a carrying value of RMB187,867,124.67 as mortgage and the
Company provides joint and several liability guarantee.
The Company's subsidiary Frestec Smart Home has obtained long-term borrowings
amounting to RMB10,012,500.00 from Xinxiang Jiankang Road Sub-branch of China CITIC
Bank Corporation Limited, the term of which is from 27 October 2022 to 4 May 2030, and for
which it provides land use rights of a carrying value of RMB91,233,386.84 as mortgage and the
Company as well as Meng Honggang, the legal person of Chuzhou Hanshang Electric Appliance
Co.,Ltd., provide joint and several liability guarantee respectively at 51% and 49%.
The Company’s subsidiary Yantai Kangjin has obtained long-term borrowings amounting
to RMB10,100,000.00 from Yantai Rural Commercial Bank Co. Ltd. with the term from 16
January 2023 to 12 February 2026, and for which it provides construction in progress of a
carrying value of RMB31,357,965.10 as mortgage.
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Konka Group Co., Ltd. Interim Report 2023
The Company’s subsidiary Nantong Kanghai has obtained long-term borrowings
amounting to RMB22,004,742.67 from Haimen Sub-branch of Bank of Suzhou Co., Ltd. with the
term from 16 January 2023 to 25 July 2025, and for which it provides inventories of a carrying
value of RMB100,000,000.00 as mortgage.
The Company's subsidiary Chongqing Konka has obtained long-term borrowings
amounting to RMB78,008,548.09 from Chongqing Liangjiang Branch of Industrial and
Commercial Bank of China Co., Ltd., the term of which is from 30 December 2022 to 19
December 2037, and for which it provides housing buildings of a carrying value of
RMB340,452,555.35 and land use rights of a carrying value of RMB45,073,685.19 as mortgage
and the Company provides joint and several liability guarantee at the maximum amount.
The Company's parent company OCT Group has extended entrusted loans amounting to
RMB2,554,463,826.38 to the Company through China Merchants Bank Co., Ltd., the term of
which is from 10 January 2022 to 25 May 2025.
The Company's subsidiary Yibin Kangrun Medical has obtained long-term borrowings
amounting to RMB36,141,615.32 from Yibin Sub-Branch of Postal Savings Bank of China Co.,
Ltd. with the accounts receivable arising from the prospective earnings from a concession
agreement with an appraisal value of RMB595,900,000.00 as pledge, and the term thereof is from
30 June 2022 to 15 April 2040.
The Company's subsidiary Yibin Kangrun Medical has obtained long-term borrowings
amounting to RMB50,984,043.13 from Yibin Sub-Branch of Industrial and Commercial Bank of
China Co., Ltd. with the accounts receivable arising from the prospective earnings from a
concession agreement with an appraisal value of RMB595,900,000.00 as pledge, and the term
thereof is from 30 June 2022 to 15 April 2040.
37. Bonds payable
(1) List of bonds payable
Item Closing balance Opening balance
Corporate bonds 4,818,258,522.17 4,792,392,044.13
Less: Bonds payable due
1,522,701,645.91
within one year
Total 3,295,556,876.26 4,792,392,044.13
(2) Changes of bonds payable (excluding other financial instruments divided as financial
liabilities such as preferred shares and perpetual bonds)
Bond
Bond
Total par value Issue date maturit Issue amount Opening balance
name
y
21Konka0 8 January Three
1,000,000,000.00 996,500,000.00 1,042,632,148.95
1 (note a)) 2021 years
21Konka0 21 May Three
500,000,000.00 498,250,000.00 511,544,025.20
2 (note 2021 years
190
Konka Group Co., Ltd. Interim Report 2023
b))
21Konka0 Three
800,000,000.00 9 July 2021 797,200,000.00 813,864,800.79
3 (note c)) years
22Konka0
Three
1 (note 1,200,000,000.00 14 July 2022
years
1,195,800,000.00 1,216,078,113.18
d))
22Konka0 8 September Three
600,000,000.00 597,900,000.00 604,838,993.73
3 (note e)) 2022 years
22Konka0 18 October Three
600,000,000.00 597,900,000.00 603,433,962.28
5 (note f)) 2022 years
Total 4,700,000,000.00 4,683,550,000.00 4,792,392,044.13
(Continued)
Issue in the Accrue interest by Amortisation of
Bond name
Reporting Period par value premium/discount
21Konka01 (note a)) 22,300,000.02 550,314.48
21Konka02 (note b)) 10,000,000.02 275,157.24
21Konka03 (note c)) 15,799,999.98 440,251.56
22Konka01 (note d)) 19,380,000.00 660,377.34
22Konka03 (note e)) 9,900,000.00 330,188.70
22Konka05 (note f)) 10,500,000.00 330,188.70
Total 87,880,000.02 2,586,478.02
(Continued)
Repay during the Reporting
Bond name Closing balance
Period
21Konka01 (note a)) 44,600,000.00 1,020,882,463.45
21Konka02 (note b)) 20,000,000.00 501,819,182.46
21Konka03 (note c)) 830,105,052.33
22Konka01 (note d)) 1,236,118,490.52
22Konka03 (note e)) 615,069,182.43
22Konka05 (note f)) 614,264,150.98
Total 64,600,000.00 4,818,258,522.17
Note 1:
a. On 8 January 2021, the Company issued RMB1 billion of private placement corporate
bonds with the duration of three years, the annual interest rate of 4.46% and the due date of 8
January 2024.
b) On 21 May 2021, the Company issued RMB500 million of private placement corporate
bonds with the duration of three years, the annual interest rate of 4.00% and the due date of 21
May 2024.
c) On 9 July 2021, the Company issued RMB800 million of private placement corporate
191
Konka Group Co., Ltd. Interim Report 2023
bonds with the duration of three years, the annual interest rate of 3.95% and the due date of 9 July
2024.
d) On 14 July 2022, the Company issued RMB1.2 billion of public placement corporate
bonds with the duration of three years, the annual interest rate of 3.23% and the due date of 14
July 2025.
e) On 8 September 2022, the Company issued RMB600 million of private placement
corporate bonds with the duration of three years, the annual interest rate of 3.30% and the due
date of 8 September 2025.
f) On 18 October 2022, the Company issued RMB600 million of private placement
corporate bonds with the duration of three years, the annual interest rate of 3.50% and the due
date of 18 October 2025.
Note 2: OCT Group provided full-amount, unconditional and irrevocable joint and several
liabilities guarantee for the due payment of the public and private offering of corporate bonds.
Note 3: The current year's repayments are interest.
38. Lease liabilities
Item Closing balance Opening balance
Lease liabilities 41,588,054.08 57,201,478.76
Less: Lease liabilities due
10,403,563.49 20,614,839.60
within one year (see Note VI-34)
Total 31,184,490.59 36,586,639.16
39. Long-term payables
Nature of fund Closing balance Opening balance
Accrued financing lease outlay 88,406,103.20 152,547,691.61
Less: Unrecognised financing
1,717,892.65 5,370,013.73
expenses
Less: Amount due within one
79,815,088.04 139,213,550.70
year (see Note VI-34)
Total 6,873,122.51 7,964,127.18
40. Long-term employee benefits payable
Item Closing balance Opening balance
Termination benefits-net liabilities of
4,794,271.77 4,894,209.73
defined contribution plans
Total 4,794,271.77 4,894,209.73
41. Projected liabilities
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Konka Group Co., Ltd. Interim Report 2023
Item Closing balance Opening balance Cause(s)
Product quality After-sales of
118,873,974.69 74,590,486.63
assurance household appliances
Performance
82,723,436.52 82,723,436.52
compensation
Pending litigation 206,591.51 206,591.51
Discard expenses 1,921,004.01 1,875,064.89
Total 203,725,006.73 159,395,579.55
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42. Deferred revenue
Increase in the Decrease in the
Item Opening balance Closing balance Cause(s)
Reporting Period Reporting Period
Government grants 334,844,966.31 74,815,467.22 47,296,452.95 362,363,980.58 Related to assets/income
Total 334,844,966.31 74,815,467.22 47,296,452.95 362,363,980.58
（1） Category of deferred income
Amount
recognised as Amount recognised
Subsidies
non-operating as other income in Related to
Government subsidy items Opening balance increased in the Other changes Closing balance
income in the the Reporting assets/ income
Reporting Period
Reporting Period
Period
Plant construction subsidy for Yibin Related to
105,864,968.77 1,159,766.16 104,705,202.61
Konka Industrial Park assets
Medical waste centralised treatment
Related to
project in Gaoxian County, Yibin 28,405,837.81 5,739,564.92 1,009,001.83 33,136,400.90
assets
City
Related to
Subsidy for industrial R&D 20,000,000.00 20,000,000.00
assets
Returned payments for land by Related to
18,327,272.79 196,363.62 18,130,909.17
Chongqing Konka assets
Related-to-
Relocation subsidy 13,085,700.00 10,000,000.00 3,085,700.00
income
Plant decoration subsidy for Yibin Related to
11,513,723.80 719,607.72 10,794,116.08
Konka Technology Park assets
194
Konka Group Co., Ltd. Interim Report 2023
Amount
recognised as Amount recognised
Subsidies
non-operating as other income in Related to
Government subsidy items Opening balance increased in the Other changes Closing balance
income in the the Reporting assets/ income
Reporting Period
Reporting Period
Period
Special funds for supporting the
development of advanced Related to
11,440,000.00 11,440,000.00
manufacturing and modern service assets
industries
Subsidy for high-tech innovation and Related to
10,596,031.61 449,675.04 10,146,356.57
operation in Yancheng assets
Subsidy for the Micro LED R&D
Related to
project of Chongqing Optoelectronic 25,000,000.00 25,000,000.00
assets
Technology Research Institute
Subsidy for the project of Frestec Related to
21,250,000.00 21,250,000.00
Refrigeration assets
Other government subsidies related to Related to
115,611,431.53 22,825,902.30 8,497,260.28 24,914,778.30 350,000.00 104,675,295.25
assets/income assets/income
Total 334,844,966.31 74,815,467.22 8,497,260.28 38,449,192.67 350,000.00 362,363,980.58
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Konka Group Co., Ltd. Interim Report 2023
43. Other non-current liabilities
Item Closing balance Opening balance
Contract liabilities over one
381,807,253.24 314,233,260.08
year
Total 381,807,253.24 314,233,260.08
44. Share Capital
Increase/decrease (+/-)
Opening Bonus
Item New Closing balance
balance Bonus issue Other Subtota
shares
issue from s l
issued
profit
Total
2,407,945,408.00 2,407,945,408.00
shares
45. Capital surplus
Decrease in the
Increase in the
Item Opening balance Reporting Closing balance
Reporting Period
Period
Other capital
365,247,361.05 90,301,655.75 17,433,984.73 438,115,032.07
surplus
Total 365,247,361.05 90,301,655.75 17,433,984.73 438,115,032.07
Note: Capital surplus for the Reporting Period--other capital surplus increase and decrease
due to the main reasons:
1 The associated enterprise Wuhan Tianyuan Environmental Protection Co., Ltd. increased
capital and shares, resulting in an increase in other capital surplus of RMB90,301,655.75;
2 Other capital surplus decreased by RMB3,656,102.53 due to the disposal of the
associated enterprise Guangdong Chutian Dragon Co., Ltd.
3 The change in the accounting method for Chutian Dragon Co., Ltd. decreased other
capital surplus by RMB13,777,882.20.
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46. Other comprehensive income
Amount incurred in the Reporting Period
Less:
Less: Amount
Amount recognised
recognised as other
as other comprehens
Less:
Amount comprehensi ive income
Opening Inco Attributable to Attributable to Closing balance
Item incurred before ve income in in the
Balance me the parent minority Balance
income tax in the previous previous
tax company after shareholders
the Reporting period and period and
expe tax after tax
Period transferred transferred
nse
to profit or to retained
loss in the earnings in
Reporting the
Period Reporting
Period
I. Other
comprehensive income
that cannot be -6,398,878.20 -6,398,878.20
reclassified as profits
or losses
Changes in the fair
value of other equity
-6,398,878.20 -6,398,878.20
instrument
investments
Others
II. Other
comprehensive income -7,866,303.43 4,837.39 4,837.39 -7,861,466.04
reclassified as profits
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Amount incurred in the Reporting Period
Less:
Less: Amount
Amount recognised
recognised as other
as other comprehens
Less:
Amount comprehensi ive income
Opening Inco Attributable to Attributable to Closing balance
Item incurred before ve income in in the
Balance me the parent minority Balance
income tax in the previous previous
tax company after shareholders
the Reporting period and period and
expe tax after tax
Period transferred transferred
nse
to profit or to retained
loss in the earnings in
Reporting the
Period Reporting
Period
and losses
Including: Other
comprehensive income
that can be transferred
-4,029,937.27 -4,029,937.27
to profits or losses
under the equity
method
Exchange difference
on translating foreign -3,836,366.16 4,837.39 4,837.39 -3,831,528.77
operations
Total of other
comprehensive -14,265,181.63 4,837.39 4,837.39 -14,260,344.24
income
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47. Surplus reserves
Decrease in
Increase in the
the
Item Opening balance Reporting Closing balance
Reporting
Period
Period
Statutory surplus
1,005,961,774.19 1,005,961,774.19
reserves
Discretionary
238,218,590.05 238,218,590.05
surplus reserves
Total 1,244,180,364.24 1,244,180,364.24
48. Retained earnings
Same period of the
Item This Period
previous year
Closing balance of previous period 3,638,868,004.50 5,229,563,700.95
Add: Total beginning balance of retained
earnings before adjustments
Including: Changes in accounting policies
Other adjustment factors
Beginning balance of the Reporting
3,638,868,004.50 5,229,563,700.95
Period
Plus: Net profit attributable to owners of
-193,240,232.33 -1,470,298,426.05
the parent company in the Reporting Period
Other comprehensive income
560,005.44
transferred to retained earnings
Less: Appropriation of statutory surplus
reserves
Appropriation of discretionary surplus
reserves
Ordinary share dividends payable 120,397,270.40
Ending balance of this period 3,446,187,777.61 3,638,868,004.50
49. Operating revenue and cost of sales
(1) Operating income and operating costs
Amount incurred in the Reporting Period Amount incurred in the previous period
Item
Income Cost Income Cost
Principal 9,989,383,650.13 9,658,914,170.75
16,243,380,757.24 16,013,632,913.79
business
Other 482,677,521.81 420,429,613.36
652,089,519.57 468,807,708.05
business
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Item Amount incurred in the Reporting Period Amount incurred in the previous period
Total 10,472,061,171.94 10,079,343,784.11 16,895,470,276.81 16,482,440,621.84
(2) List of deductions from operating income
Amount incurred in
Amount incurred in
the Reporting
Item Details the previous period Details
Period
(RMB)
(RMB)
Amount of operating
10,472,061,171.94 16,895,470,276.81
income
Total amount of items
deducted from 336,328,394.84 467,356,118.26
operating income
Proportion of the total
amount of items
deducted from 3.21 2.77
operation income in
operating income (%)
I. Business income irrelevant to principal business
1. Other business
income outside normal
business. E.g., income
from the lease of fixed
assets, intangible
assets, packaging Income from
Income from sales
materials, sales of waste products,
sales of waste
materials, non- products, utility
utility bills, rental
monetary asset bills, rental
income, income
income, income
exchange with 336,328,394.84 from material 467,356,118.26
from material
materials and sales and other
sales and other
operation of entrusted income not related
income not
to the main
management business, business
related to the
and income that is main business
included in the income
from primary business
but is outside the
normal business of the
listed company.
2. Income from non-
qualified pseudo-
banking businesses;
such as interest
income from borrowed
funds; income from
new pseudo-banking
businesses in the
reporting and previous
fiscal years, such as
income from
guarantee, commercial
factoring, small loans,
finance lease and
pawn, except finance
200
Konka Group Co., Ltd. Interim Report 2023
Amount incurred in
Amount incurred in
the Reporting
Item Details the previous period Details
Period
(RMB)
(RMB)
lease business
conducted for the sale
of primary products.
3. Income from new
trading businesses in
the reporting and
previous fiscal years.
4. Income from related
transactions irrelevant
to the existing normal
operation businesses
of the listed company.
5. Income of
subsidiaries acquired
in business
combination under the
same control from the
period-beginning to
the combination date.
6. Income from
businesses that have
not yet had or are
difficult to have a
stable business model.
Subtotal of business
income irrelevant to 336,328,394.84 467,356,118.26
principal business
II. Income without commercial substance
1. Income from
transactions or events
that do not
significantly alter the
risk, timing or amount
of future cash flows of
the company.
2. Income from
transactions without
true business. E.g.,
false income realised
in the way of self-
transaction and false
income from
transactions by means
of Internet technology
or other means.
3. Income from
businesses at unfair
trade prices.
4. Income from
subsidiaries or
201
Konka Group Co., Ltd. Interim Report 2023
Amount incurred in
Amount incurred in
the Reporting
Item Details the previous period Details
Period
(RMB)
(RMB)
businesses acquired in
business combination
at unfair
considerations or by
non-trading means in
the reporting fiscal
year.
5. Income involved in
non-standard audit
opinions in audit
opinions.
6. Other income from
transactions or events
without commercial
rationality.
Subtotal of income
without commercial
substance
III. Other income
irrelevant to principal
business or without
commercial substance
Amount of operating
10,135,732,777.10 16,428,114,158.55
income after deduction
(3) Details of income from contracts
Amount incurred in this Total
Category of contracts
year
Product categories
Of which: Industry trade business 4,350,074,427.45 4,350,074,427.45
Colour TV business 1,919,054,194.60 1,919,054,194.60
Consumer appliances 2,285,781,923.95 2,285,781,923.95
business
Material technology business 793,973,411.72 793,973,411.72
PCB business 245,209,214.94 245,209,214.94
Semi-conductor business 5,850,208.69 5,850,208.69
Other business 872,117,790.59 872,117,790.59
Total 10,472,061,171.94 10,472,061,171.94
Classified by operating region
Of which: Domestic 6,571,071,083.57 6,571,071,083.57
Overseas 3,900,990,088.37 3,900,990,088.37
Total 10,472,061,171.94 10,472,061,171.94
(4) Main operations (classified by product)
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Konka Group Co., Ltd. Interim Report 2023
Amount incurred in this year Amount incurred last year
Item
Income Cost Income Cost
Supply chain
trading 4,350,074,427.45 4,306,025,179.35 10,171,407,159.62 10,120,679,704.92
business
Colour TV
1,919,054,194.60 1,950,631,109.94 2,389,828,778.20 2,418,706,246.97
business
Consumer
appliances 2,285,781,923.95 2,020,436,028.43 1,900,207,771.57 1,711,652,138.98
business
Material
technology 793,973,411.72 778,483,727.14 774,458,509.72 749,206,296.93
business
PCB business 245,209,214.94 209,373,794.15 291,397,810.91 280,056,849.29
Semi-
conductor 5,850,208.69 15,242,064.76 50,916,083.90 52,958,914.59
business
Others 389,440,268.78 378,722,266.98 665,164,643.32 680,372,762.11
Total 9,989,383,650.13 9,658,914,170.75 16,243,380,757.24 16,013,632,913.79
(5) Information in relation to the trade price apportioned to the residual contract
performance obligation:
The amount of revenue corresponding to performance obligations that have been signed
but have not yet been fulfilled or completed at the end of the year is RMB1,637,959,026.62,
of which RMB1,589,889,591.47 is expected to be recognized as revenue in 2023, and the
remaining RMB52,657,167.35 is expected to be recognized as revenue in 2024 and
following years.
50. Taxes and surcharges
Item Amount incurred in the Amount incurred in the
Reporting Period previous period
Stamp duty 17,006,122.55 15,956,693.35
Land use tax 8,628,212.80 13,241,507.04
City maintenance &
3,916,672.25 8,149,278.82
construction tax
Property tax 9,429,982.31 9,150,456.54
Educational surcharge 1,795,764.31 3,669,080.87
Local educational surcharge 1,197,136.14 2,445,857.60
Water resources fund 474,599.45 228,825.54
Others 270,476.72 443,271.42
Total 42,718,966.53 53,284,971.18
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Konka Group Co., Ltd. Interim Report 2023
51. Sales costs
Item Amount incurred in the Amount incurred in the
Reporting Period previous period
Employee benefits 171,827,349.50 159,102,544.06
Advertising expense 114,639,309.81 141,115,130.40
Promotional activities 95,664,759.55 72,748,154.60
Warranty fee 80,388,332.75 79,063,725.82
Logistic Fee 41,136,310.25 30,314,056.31
Taxes and fund 549,965.00 26,642,413.92
Lease expense 9,554,537.27 12,385,615.94
Travel expenses 5,281,279.82 7,448,071.22
Entertainment fees 6,056,077.13 5,435,508.51
Exhibition expenses 5,525,688.44 1,713,164.44
Others 27,913,056.01 24,257,299.06
Total 558,536,665.53 560,225,684.28
52. Management costs
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Employee benefits 201,752,601.81 213,795,836.28
Depreciation charges 103,962,882.38 71,715,060.26
Intermediary fees 20,680,100.93 17,693,182.52
Travel expenses 6,391,903.53 3,765,905.28
Water and electricity expenses 580,512.03 5,296,977.22
Loss on scraping of inventories 5,169,402.73 2,086,492.21
Others 51,707,164.36 39,955,230.74
Total 390,244,567.77 354,308,684.51
53. R&D expense
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Salary 125,331,251.82 118,779,499.31
Depreciation and amortisation
52,673,986.51 49,464,665.22
charge
New product trial production
12,377,094.01 24,519,154.67
expense
Material expense 17,796,228.66 11,347,523.74
Commission service fee 2,048,184.94 7,150,370.69
Testing expense 3,249,155.22 3,120,118.84
204
Konka Group Co., Ltd. Interim Report 2023
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Information use fee 360,938.22 1,438,063.33
Others 23,197,053.73 21,529,130.76
Total 237,033,893.11 237,348,526.56
54. Financial expenses
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Interest expense 432,772,700.64 465,576,348.06
Less: Interest income 123,908,981.38 109,353,054.39
Add: Exchange loss -133,558,528.06 -114,830,078.08
Other expenses 23,770,433.30 25,722,111.99
Total 199,075,624.50 267,115,327.58
55. Other income
Amount incurred in the Amount incurred in the
Resources
Reporting Period previous period
Support funds 70,000,000.00 227,351,711.98
Rewards and subsidies 23,457,361.87 90,960,177.86
Transfer of deferred income 38,449,192.67 13,538,617.74
Software tax refund 3,434,829.42 7,949,955.87
Post subsidies 541,457.45 2,253,703.66
Land tax rebates 1,433,605.93
Subsidies for L/C exports 2,034,374.00 249,549.87
Total 137,917,215.41 343,737,322.91
56. Investment Returns
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Returns on long-term equity
investments calculated by the -30,242,661.05 59,402,481.72
equity method
Return on investment arising
from the disposal of long-term 188,118,447.66 406,299,201.96
equity investments
Income from remeasurement of
residual stock rights at fair 51,474,909.15 239,092,140.86
value after losing control power
Interest income from debt 36,609,075.35 32,966,971.77
investments during the holding
205
Konka Group Co., Ltd. Interim Report 2023
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
period
Investment income from
disposal of financial assets at -3,794,910.98 42,739.74
fair value through profit or loss
Financial assets transferred
from equity investments 574,780,174.75
calculated by the equity method
Investment income from
holding of trading financial 9,383,976.00
assets
Others 500,000.00
Total 826,829,010.88 737,803,536.05
57. Income from changes in fair value
Sources of income from Amount incurred in the Amount incurred in the
changes in the fair value Reporting Period previous period
Financial assets at fair value
-132,580,077.43 -638,799.36
through profit or loss
Total -132,580,077.43 -638,799.36
58. Credit impairment loss
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Bad debt loss of notes receivable 6,446,862.01 7,050,461.27
Bad debt loss of accounts
-50,164,953.87 -42,299,060.06
receivable
Bad debt loss of other accounts
-96,474,587.50 -43,359,714.77
receivable
Total -140,192,679.36 -78,608,313.56
59. Impairment Losses on Assets
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Inventory depreciation loss and
contract performance cost -15,274,484.20 -13,309,988.75
impairment loss
Contractual asset impairment loss -9,012.56
Total -15,283,496.76 -13,309,988.75
60. Asset disposal income ("-" for loss)
206
Konka Group Co., Ltd. Interim Report 2023
Amount
Amount
Amount recorded into the
incurred in the
Item incurred in the current non-
Reporting
previous period recurring profit
Period
or loss
Incomes from disposal of non-current
64,713.62 12,782,328.52 64,713.62
assets
Including: incomes from disposal of
non-current assets not classified as the 64,713.62 12,782,328.52 64,713.62
held-for-sale assets
Of which: Fixed assets disposal
-195,494.55 -75,972.28 -195,494.55
income
Right-of-use assets disposal
241,619.81 14,904.57 241,619.81
income
Intangible assets disposal income 18,588.36 12,843,396.23 18,588.36
Total 64,713.62 12,782,328.52 64,713.62
61. Non-operating income
(1) List of non-operating income
Amount
Amount
Amount recorded into the
incurred in the
Item incurred in the current non-
Reporting
previous period recurring profit
Period
or loss
Compensation and penalty income 2,522,169.54 14,518,135.77 2,522,169.54
Government subsidies unrelated to the
8,708,660.28 200,900.00 8,708,660.28
normal operation of the Company
Non-current assets damage and
450.00 364,917.85 450.00
retirement gains
Debt restructuring gains 33,184.00
Others 6,094,337.36 15,375,604.03 6,094,337.36
Total 17,325,617.18 30,492,741.65 17,325,617.18
(2) Government subsidies recorded in profit or loss of the current year
Item Issuing body Reason Type
Subsidy received
Chuzhou for participation in
Chuzhou Huike smart home
Development Zone Chuzhou Huike
appliance industry Subsidy
Management Intelligent Home
investment project subsidy
Committee Appliance Industry
Investment
Zhongshan Human Subsidies received
New apprenticeship training
Resources and Social for training Subsidy
subsidies
Security Bureau, schoolchildren
207
Konka Group Co., Ltd. Interim Report 2023
Fusha Branch Office
Other employment
Others Subsidy
subsidies
(Continued)
Affect the
profit and Amount Amount
Special
loss for the incurred in incurred in Related to
Item subsidy
Reporting the Reporting the previous assets/income
or not
Period or Period period
not
Chuzhou Huike
smart home
Related to
appliance industry Not Not 8,497,260.28
income
investment project
subsidy
New apprenticeship Related to
Not Not 184,400.00
training subsidies income
Related to
Others Not Not 27,000.00
income
Total 8,708,660.28
62. Non-operating expenses
Amount recorded into
Amount incurred Amount incurred
the current non-
Item in the Reporting in the previous
recurring profit or
Period period
loss
Losses on damage and
1,419,908.80 829,936.20 1,419,908.80
scraping of non-current assets
Compensation expense 54,800.00 955,320.82 54,800.00
Others 2,851,899.22 2,075,688.78 2,851,899.22
Total 4,326,608.02 3,860,945.80 4,326,608.02
63. Income tax expenses
（1） Income tax expense
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Income tax expense of the
27,239,426.46 38,695,464.05
Reporting Period
Deferred income tax expense -43,950,094.04 -128,041,906.16
Total -16,710,667.58 -89,346,442.11
（2） Adjustment process of accounting profits and income tax expenses
208
Konka Group Co., Ltd. Interim Report 2023
Amount incurred in
Item
the Reporting Period
Profit before taxation -345,138,634.09
Income tax expense calculated at legal/applicable tax rate -86,284,658.52
Impact of different tax rates applied by subsidiaries 22,641,079.77
Impact of income tax in the periods before adjustment 12,568,007.52
Impact of non-taxable income 3,418,384.35
Impacts of non-deductible costs, expenses, and losses 6,267,791.52
Impact of using deductible losses on the deferred tax assets not recognised
-2,630,356.53
previously
Impact of deductible temporary differences or deductible losses of deferred
44,087,259.86
tax assets not recognised in the Reporting Period
Others -16,778,175.54
Income tax expense -16,710,667.58
64. Other comprehensive income
For details, refer to "Note VI-46 Other comprehensive income".
65. Cash flow statement
（1） Cash generated from/used in other operating/investing/financing activities
1） Other cash received related to operating activities
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Income from government
subsidies 196,790,552.27 398,867,359.07
Front money and guarantee
deposit 107,899,740.15 194,816,415.68
Interest income from bank
deposits 49,564,086.35 38,460,424.38
Trading funds 45,235,678.79 71,915,009.80
Compensation and penalty
income 8,691,566.66 4,270,552.74
Others 26,051,273.52 45,629,873.92
Total 434,232,897.74 753,959,635.59
2） Other cash paid related to operating activities
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Cash payment fee 535,602,399.78 608,403,775.17
Deposit and margin 146,237,387.07 141,618,948.53
Payment made on behalf 5,640,757.14 9,670,660.47
209
Konka Group Co., Ltd. Interim Report 2023
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Expense for bank handling
2,878,961.21
charges 2,735,395.17
Others 65,077,290.21 120,570,024.96
Total 755,293,229.37 883,142,370.34
3） Other cash received related to investment activities
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Recovery of loan at call 382,971,149.03 2,345,834,176.94
Others 46,988,449.65 39,792,247.45
Total 429,959,598.68 2,385,626,424.39
4） Other cash paid related to investment activities
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Payment of loan at call 310,116,949.03 271,583,749.03
Others 161,037,718.80 25,736,148.70
Total 471,154,667.83 297,319,897.73
5） Other proceeds received related to financing activities
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Receiving loan at call 50,370,200.00 29,957,440.00
Recovery of margin deposit pledged 219,929,641.72 68,792,633.93
Others 23,432.92
Total 270,299,841.72 98,773,506.85
6） Other cash paid related to financing activities
Amount incurred in the Amount incurred in the
Item
Reporting Period previous period
Payment of lease-related accounts 62,969,375.44 155,109,520.16
Deposit as margin for pledge 401,172,422.54 117,654,180.32
Retuning loan at call 1,870,614.17 117,768,871.27
Financing cost 20,729,450.01 21,190,465.55
Others 1,765,552.03
Total 486,741,862.16 413,488,589.33
（2） Supplemental information for consolidated cash flow statement
210
Konka Group Co., Ltd. Interim Report 2023
Item Amount of the Amount of the previous
Reporting Period period
1. Reconciliation of net profit to cash flows
from operating activities:
Net profit -328,427,966.51 58,490,784.63
Plus: Provision for asset impairment 15,283,496.76 13,309,988.75
Credit impairment loss 140,192,679.36 78,608,313.56
Depreciation of fixed assets, depletion of
oil and gas assets, and depreciation of 217,019,718.21 210,447,096.53
productive biological assets
Depreciation of right-of-use assets 11,748,166.57 28,657,676.02
Amortisation of intangible assets 26,128,581.85 22,954,726.69
Amortisation of long-term prepaid expense 62,948,271.42 40,889,139.75
Losses on disposal of fixed assets,
intangible assets and other long-lived assets -64,713.62 -12,782,328.52
(gains: negative)
Losses on scrap of fixed assets (gains:
1,419,458.80 465,018.35
negative)
Losses on changes in fair value (gains:
132,580,077.43 638,799.36
negative)
Finance costs (gains: negative) 383,689,359.03 439,621,848.38
Investment loss (gains: negative) -826,829,010.88 -737,803,536.05
Decrease in deferred income tax assets
-154,867,914.83 -127,089,601.40
(gains: negative)
Increase in deferred income tax liabilities
110,917,820.79 -932,734.69
(decrease: negative)
Decrease in inventories (gains: negative) -265,531,923.08 25,150,562.26
Decrease in accounts receivable generated
13,821,648.87 803,133,784.03
from operating activities (gains: negative)
Increase in accounts payable used in
296,871,337.26 -1,251,480,426.64
operating activities (decrease: negative)
Others -38,449,192.67 -13,538,617.74
Net cash flows from operating activities -201,550,105.24 -421,259,506.73
2. Significant investment and financing
activities not involving cash
Conversion of liabilities into capital
Convertible corporate bonds due within one
year
Fixed assets acquired under finance leases
3. Net changes in cash and cash equivalents:
211
Konka Group Co., Ltd. Interim Report 2023
Item Amount of the Amount of the previous
Reporting Period period
Closing balance of cash 6,030,068,656.57 5,903,519,802.47
Less: Opening balance of cash 5,461,912,010.90 5,968,347,219.03
Plus: Closing balance of cash equivalents
Less: Opening balance of cash equivalents
Net increase in cash and cash equivalents 568,156,645.67 -64,827,416.56
（3） Net cash paid for the acquisition of subsidiaries in the Reporting Period
No such cases in the Reporting Period.
（4） Net cash received for the disposal of subsidiaries in the Reporting Period
Amount of the
Item
Reporting Period
Cash or cash equivalents received in the Reporting Period from the
20,855,540.00
disposal of subsidiaries in the Reporting Period
Of which: Sichuan Hongxinchen Real Estate Development Co., Ltd. 20,855,540.00
Less: Cash and cash equivalents held by subsidiaries on the day when
2,036,650.33
control is lost
Of which: Sichuan Hongxinchen Real Estate Development Co., Ltd. 2,036,650.33
Add: Cash or cash equivalents received in the Reporting Period from
disposal of subsidiaries in the prior period
Net cash received from the disposal of subsidiaries 18,818,889.67
（5） Cash and cash equivalents
Item Closing balance Opening balance
Cash 6,030,068,656.57 5,461,912,010.90
Including: Cash on hand 14.78
Bank deposits available for
6,030,068,656.57 5,461,911,996.12
payment at any time
Ending balance of cash and cash
6,030,068,656.57 5,461,912,010.90
equivalents
66. Items in the statement of changes in shareholders' equity
There was no "other" amount to adjust the amount at the end of the previous year in this period.
67. Assets with restricted ownership or use rights
Closing carrying Reasons for the restriction
Item
value
Among them, RMB440,390,112.54 is the
Monetary funds 878,270,149.59
margin deposit, which is pledged for borrowing
212
Konka Group Co., Ltd. Interim Report 2023
Closing carrying Reasons for the restriction
Item
value
money or issuing bank acceptance
bills; RMB307,603.35 for financial supervision
account funds; RMB226,700,000.00 is time
deposit that cannot be withdrawn in
advance; RMB210,872,433.70 is restricted due
to other reasons.
Notes receivable 217,674,323.25 Pledge for making out an invoice
Affected by the case of the minority shareholder
of the subsidiary, the inventory was wrongly
Inventory 149,679,547.48
seized, and the company did not give up the
claim, mortgage loan
Investment property 101,798,700.19 Mortgage loan
Mortgage loan, financing lease mortgage,
Fixed assets 1,393,456,049.65
original shareholder guarantee mortgage
Mortgage loan, financing lease mortgage,
Intangible assets 506,091,816.68
original shareholder guarantee mortgage
Construction in
262,754,573.95 Mortgage loan, financing lease mortgage
progress
Total 3,509,725,160.79
68. Foreign currency monetary items
（1） Foreign currency monetary items
Item Balances
Foreign currency
denominated in RMB
balance at the end of Exchange rate
at the end of the
the Reporting Period
period
Monetary funds
Including: USD 195,999,137.08 7.2258 1,416,250,564.71
EUR 27,013.32 7.8771 212,786.62
EGP 48,519,595.32 0.2338 11,346,048.28
GBP 1.32 9.1432 12.07
HKD 10,959,014.64 0.9220 10,103,992.32
CAD 6.96 5.4721 38.09
PLN 1,969,461.89 1.7711 3,488,054.87
Accounts receivable
Including: USD 84,267,618.26 7.2258 608,900,956.02
EUR 47,944.52 7.8771 377,663.78
EGP 11,463,548.94 0.2338 2,680,689.71
HKD 24,063,672.25 0.9220 22,186,224.54
AUD 49,764.00 4.7992 238,827.39
213
Konka Group Co., Ltd. Interim Report 2023
Item Balances
Foreign currency
denominated in RMB
balance at the end of Exchange rate
at the end of the
the Reporting Period
period
Other accounts
receivable
Including: USD 110,937,713.61 7.2258 801,613,731.00
EGP 108,000.00 0.2338 25,255.22
HKD 1,627,550.19 0.9220 1,500,568.72
JPY 21,400,000.00 0.0501 1,072,011.60
Short-term loans
Including: USD
Accounts payable
Including: USD 29,303,729.18 7.2258 211,742,886.31
EUR 133,714.16 7.8771 1,053,279.81
EGP 42,216,229.19 0.2338 9,872,039.77
HKD 454,560.50 0.9220 419,095.69
Other payables
Including: USD 4,767,018.12 7.2258 34,445,519.53
EUR 59,956.16 7.8771 472,280.67
EGP 47,686.00 0.2338 11,151.12
HKD 5,995,982.70 0.9220 5,528,176.13
（2） Overseas entities
The significant overseas entities include Hongdin Trading, Hong Kong Konka, Chain Kingdom
Memory Technologies, Kangjietong, Jiali International, Kowin Memory (Hong Kong) and Konka
Mobility. The main overseas operating place is Hong Kong. The Company's recording currency is
HKD since the main currency in circulation in Hong Kong is HKD.
69. Government grants
(1) Overview of government subsidies
Amount recognised
Category Amount Presented item as profit and loss of
the Reporting Period
Industrial support funds to
40,000,000.00 Other income 40,000,000.00
Anlu Konka
Industrial support funds to
30,000,000.00 Other income 30,000,000.00
Xi'an
Subsidy for the Micro LED
R&D project of Chongqing 25,000,000.00 Deferred revenue
Optoelectronic Technology
214
Konka Group Co., Ltd. Interim Report 2023
Amount recognised
Category Amount Presented item as profit and loss of
the Reporting Period
Research Institute
Subsidy for Frestec
21,250,000.00 Deferred revenue
Refrigeration
Other income/deferred
Others 61,350,881.11 44,854,241.75
income, etc.
Total 177,600,881.11 114,854,241.75
(2) Return of Government Subsidy
No such cases in the Reporting Period.
215
Konka Group Co., Ltd. Interim Report 2023
VII. Changes of Consolidation Scope
1. Disposal of subsidiaries
The differences of
enjoyed net assets
share of the
The equity Equity subsidiary in
Equity
disposal disposal Control right Recognition basis of control right corresponding
Subsidiary disposal
price(RMB'0,000 proportio losing time point losing time point consolidated
method
) n (%) statements of the
disposal price and the
disposal investment
(RMB'0,000)
Sichuan
Hongxinchen The rights and obligations related
Real Estate 3,472.00 31 Transfer 2023-2-27 to the underlying equity have been 3,256.58
Development transferred
Co., Ltd.
(Continued)
Residual Recognition method Amount of other
Carrying value
equity Fair value of and major comprehensive
of residual Gains or losses from
proportion residual equity on assumptions of fair income related to
equity on the re-measurement of
Subsidiary on the date the date of losing value of remaining former subsidiaries
date of losing residual equity at fair
of losing control power equity on the day transferred into
control power value (RMB'0,000)
control (RMB'0,000) when the control investment profit or
(RMB'0,000)
power (%) right is lost loss (RMB'0,000)
Sichuan
Hongxinchen
Real Estate 49 340.51 5,488.00 5,147.49 Evaluated price
Development
Co., Ltd.
216
Konka Group Co., Ltd. Interim Report 2023
2. Changes in the scope of consolidation due to other reasons
（1） No subsidiaries were established by the Company from January to June 2023
（2） The Company's subsidiaries cancelled and with distribution of remaining assets
from January to June 2023
Registered capital Shareholding Liquidation
Subsidiary
(RMB'0,000) percentage (%) completion time
Anhui Zhilian 5,000 100 1 June 2023
217
Konka Group Co., Ltd. Interim Report 2023
八、 Interests in other entities
1. Interests in subsidiaries
(1) Composition of the business group
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Enterprise management consulting,
Guangdong, Guangdong, Establishment
1 Konka Ventures incubation management, housing 51
Shenzhen Shenzhen or investment
leasing, etc.
Shandong, Shandong, Other professional consultation and Establishment
2 Yantai Konka 51
Yantai Yantai investigation or investment
Sichuan, Sichuan, Establishment
3 Chengdu, Anren Enterprise incubation management 51
Chengdu Chengdu or investment
Konka Enterprise Guizhou, Guizhou, Establishment
4 Enterprise management consulting 51
Service Guiyang Guiyang or investment
Establishment
5 Yibin Konka Incubator Sichuan, Yibin Sichuan, Yibin Commercial services 51
or investment
Establishment
6 Anhui Konka Anhui, Chuzhou Anhui, Chuzhou Manufacturing 78
or investment
Establishment
7 Kangzhi Trade Anhui, Chuzhou Anhui, Chuzhou Wholesale 78
or investment
Guangdong, Guangdong, Insurance agents (non-bank Establishment
8 Konka Factoring 100
Shenzhen Shenzhen finance) or investment
Guangdong, Guangdong, Establishment
9 Konka Unifortune Trade and services 51
Shenzhen Shenzhen or investment
China, Hong China, Hong Establishment
10 Jiali International Trade and services 51
Kong Kong or investment
Guangdong, Guangdong, Establishment
11 Wankaida Software development 100
Shenzhen Shenzhen or investment
12 Dongguan Konka Guangdong, Guangdong, Manufacturing 75 25 Establishment
218
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Dongguan Dongguan or investment
Establishment
13 Suining Konka Smart Sichuan, Suining Sichuan, Suining Wholesale 100
or investment
Germany, Germany, Establishment
14 Konka Europe International trade 100
Frankfurt Frankfurt or investment
Telecommunication Guangdong, Guangdong, Establishment
15 Manufacturing 75 25
Technology Shenzhen Shenzhen or investment
China, Hong China, Hong Establishment
16 Konka Mobility Commerce 100
Kong Kong or investment
Guangdong, Guangdong, Establishment
17 Mobile Interconnection Commerce 100
Shenzhen Shenzhen or investment
Establishment
18 Sichuan Konka Sichuan, Yibin Sichuan, Yibin Manufacturing 100
or investment
Establishment
19 Yibin Smart Sichuan, Yibin Sichuan, Yibin Manufacturing 100
or investment
Establishment
20 Anhui Tongchuang Anhui, Chuzhou Anhui, Chuzhou Manufacturing 100
or investment
Anhui Electrical Establishment
21 Anhui, Chuzhou Anhui, Chuzhou Manufacturing 51
Appliance or investment
Establishment
22 Frestec Refrigeration Henan, Xinxiang Henan, Xinxiang Manufacturing 51
or investment
Establishment
23 Frestec Smart Home Henan, Xinxiang Henan, Xinxiang Manufacturing 51
or investment
Frestec Electrical Establishment
24 Henan, Xinxiang Henan, Xinxiang Manufacturing 51
Appliances or investment
Frestec Household Establishment
25 Henan, Xinxiang Henan, Xinxiang Manufacturing 51
Appliances or investment
Jiangsu, Jiangsu, Establishment
26 Jiangsu Konka Smart Manufacturing 51
Changzhou Changzhou or investment
219
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Establishment
27 Kangjiatong Sichuan, Yibin Sichuan, Yibin Trade and services 100
or investment
Guangdong, Guangdong, Establishment
28 Pengrun Technology Trade and services 51
Shenzhen Shenzhen or investment
China, Hong China, Hong Establishment
29 Jiaxin Technology Trade and services 51
Kong Kong or investment
Beijing Konka Establishment
30 Beijing Beijing Sale of home appliance 100
Electronic or investment
Tianjin Pilot Free Tianjin Pilot Free Establishment
31 Tianjin Konka Service Industry 100
Trade Zone Trade Zone or investment
Guangdong, Guangdong, Establishment
32 Konka Circuit Manufacturing 100
Shenzhen Shenzhen or investment
Guangdong, Guangdong, Establishment
33 Boluo Precision Manufacturing 100
Boluo Boluo or investment
Guangdong, Guangdong, Establishment
34 Boluo Konka Manufacturing 100
Boluo Boluo or investment
China, Hong China, Hong Establishment
35 Hong Kong Konka International trade 100
Kong Kong or investment
China, Hong China, Hong Establishment
36 Hongdin Invest Investment holding 100
Kong Kong or investment
Chain Kingdom Memory China, Hong China, Hong Establishment
37 International trade 51
Technologies Kong Kong or investment
Chain Kingdom Memory
Guangdong, Guangdong, Establishment
38 Technologies Trade and services 51
Shenzhen Shenzhen or investment
(Shenzhen)
China, Hong China, Hong Establishment
39 Hongjet Trade and services 51
Kong Kong or investment
China, Hong China, Hong Establishment
40 Hongdin Trading International trade 100
Kong Kong or investment
220
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Establishment
41 Kanghao Technology Egypt, Cairo Egypt, Cairo International trade 67
or investment
America, America, Establishment
42 Konka North America International trade 100
California California or investment
Guangdong, Guangdong, Establishment
43 Konka Investment Capital market services 100
Shenzhen Shenzhen or investment
Yibin Konka Industrial park development and Establishment
44 Sichuan, Yibin Sichuan, Yibin 100
Technology Park operation management or investment
Guangdong, Guangdong, Establishment
45 Konka Capital Capital market services 100
Shenzhen Shenzhen or investment
Guangdong, Guangdong, Establishment
46 Konka Suiyong Commercial services 51
Shenzhen Shenzhen or investment
Guangdong, Guangdong, Establishment
47 Shengxing Industrial Commercial services 51
Shenzhen Shenzhen or investment
Guangdong, Guangdong, Software and information Establishment
48 Zhitong Technology 51
Shenzhen Shenzhen technology services or investment
Guangdong, Guangdong, Establishment
49 Electronics Technology Manufacturing 100
Shenzhen Shenzhen or investment
Guangdong, Guangdong, Software and information Establishment
50 Shenzhen Kangcheng 100
Shenzhen Shenzhen technology services or investment
Guangdong, Guangdong, Establishment
51 Xiaojia Technology Retail trade 100
Shenzhen Shenzhen or investment
Establishment
52 Haimen Konka Jiangsu, Nantong Jiangsu, Nantong Trade and services 100
or investment
Sichuan, Sichuan, Establishment
53 Chengdu Konka Smart Trade and services 100
Chengdu Chengdu or investment
Chengdu Konka Sichuan, Sichuan, Establishment
54 Manufacturing 100
Electronic Chengdu Chengdu or investment
Guangdong, Guangdong, Establishment
55 XingDa HongYe Manufacturing 51
Zhongshan Zhongshan or investment
221
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Liaoyang Kangshun Liaoning, Liaoning, Establishment
56 Wholesale 100
Smart Liaoyang, Liaoyang or investment
Liaoyang Kangshun Liaoning, Liaoning, Comprehensive utilisation of Establishment
57 100
Renewable Liaoyang, Liaoyang renewable resources or investment
Establishment
58 Nanjing Konka Jiangsu, Nanjing Jiangsu, Nanjing Wholesale 100
or investment
Renewable resources processing Establishment
59 Konka Huanjia Liaoning, Dalian Liaoning, Dalian 51
trade or investment
Renewable resources processing Establishment
60 Konka Huanjia (Henan) Henan, Lankao Henan, Lankao 51
trade or investment
Establishment
61 Shanghai Konka Shanghai Shanghai Real estate 100
or investment
Shandong, Shandong, Establishment
62 Yantai Kangjin Real estate 62.8
Yantai Yantai or investment
Establishment
63 Jiangxi Konka Jiangxi, Jiujiang Jiangxi, Jiujiang Manufacturing and processing 51
or investment
Xinfeng Jiangxi, Jiangxi, Establishment
64 Manufacturing and processing 51
Microcrystalline Nanchang Nanchang or investment
Jiangsu Konka Special Jiangsu, Jiangsu, Establishment
65 Wholesale 51
Material Yancheng Yancheng or investment
Guangdong, Guangdong, Establishment
66 Shenzhen Nianhua Commercial services 100
Shenzhen Shenzhen or investment
Guangdong, Guangdong, Establishment
67 Shenzhen KONSEMI Semiconductors 100
Shenzhen Shenzhen or investment
Software and information Establishment
68 Chongqing Konka Chongqing Chongqing 100
technology services or investment
Konka Eco- Guangdong, Guangdong, Establishment
69 Commercial services 51
Development Shenzhen Shenzhen or investment
Suining Konka Industrial Industrial park development and Establishment
70 Sichuan, Suining Sichuan, Suining 100
Park operation management or investment
222
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Establishment
71 Konka Ronghe Zhejiang, Jiaxing Zhejiang, Jiaxing Wholesale and retail trade 51
or investment
Suining Electronic
Establishment
72 Technological Sichuan, Suining Sichuan, Suining Commercial services 100
or investment
Innovation
Shenzhen Chuangzhi Guangdong, Guangdong, Establishment
73 Wholesale 100
Electrical Appliances Shenzhen Shenzhen or investment
Kanghong (Yantai)
Shandong, Shandong, Comprehensive utilisation of Establishment
74 Environmental 51
Yantai Yantai abandoned resources or investment
Protection
Recycling, processing and sales of Establishment
75 Chongqing Kangxingrui Chongqing Chongqing 51
renewable resources or investment
Chongqing Kangxingrui Recycling, processing and sales of Establishment
76 Chongqing Chongqing 51
Automobile Recycling waste resources or investment
Chongqing
Research & experiment Establishment
77 Optoelectronic Chongqing Chongqing 70 5
development or investment
Technology
Computer, telecommunications and
Kowin Memory Guangdong, Guangdong, Establishment
78 other electronic equipment 100
(Shenzhen) Shenzhen Shenzhen or investment
manufacturing
Computer, telecommunications and
Konka Xinyun Jiangsu, Jiangsu, Establishment
79 other electronic equipment 100
Semiconductor Yancheng Yancheng or investment
manufacturing
Jiangkang (Shanghai) Research & experiment Establishment
80 Shanghai Shanghai 51
Technology development or investment
Ningbo Kanghr Electrical machinery and Establishment
81 Zhejiang, Ningbo Zhejiang, Ningbo 60
Electrical Appliance equipment manufacturing or investment
223
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Konka Intelligent Guangdong, Guangdong, Research & experiment Establishment
82 51
Manufacturing Shenzhen Shenzhen development or investment
Establishment
83 Suining Jiarun Property Sichuan, Suining Sichuan, Suining Real estate 100
or investment
Ecological protection and Establishment
84 Yibin Kangrun Sichuan, Yibin Sichuan, Yibin 67
environmental governance services or investment
Establishment
85 Konka Material Hainan, Haikou Hainan, Haikou Commercial services 100
or investment
Jiangxi High Establishment
86 Jiangxi, Jiujiang Jiangxi, Jiujiang Manufacturing and processing 51
Transparent Substrate or investment
Computer, telecommunications and
Establishment
87 Nantong Hongdin Jiangsu, Nantong Jiangsu, Nantong other electronic equipment 100
or investment
manufacturing
Establishment
88 Chuzhou Konka Anhui, Chuzhou Anhui, Chuzhou Manufacturing 94.9
or investment
Establishment
89 Konka Soft Electronic Sichuan, Suining Sichuan, Suining Manufacturing 97.5
or investment
Konka Hongye Establishment
90 Sichuan, Suining Sichuan, Suining Manufacturing 95.05
Electronics or investment
Kowin Memory (Hong China, Hong China, Hong Wholesale of computers, software Establishment
91 100
Kong) Kong Kong and auxiliary equipment or investment
Industrial and Trade Guangdong, Guangdong, Establishment
92 Wholesale 100
Technology Shenzhen Shenzhen or investment
Hunan, Hunan, Establishment
93 Konka Huazhong Commercial services 100
Changsha Changsha or investment
Ecological protection and Establishment
94 Yibin Kangrun Medical Sichuan, Yibin Sichuan, Yibin 63.65
environmental governance services or investment
224
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Yibin Kangrun
Ecological protection and Establishment
95 Environmental Sichuan, Yibin Sichuan, Yibin 40.87
environmental governance services or investment
Protection
Shaanxi Konka Manufacture of household cleaning Establishment
96 Shaanxi, Xi'an Shaanxi, Xi'an 51
Intelligent and sanitary electrical appliances or investment
Chongqing Xinyuan Science and technology promotion Establishment
97 Chongqing Chongqing 75
Semiconductor and application services or investment
Guangdong, Guangdong, Software and information Establishment
98 Anlu Konka 100
Shenzhen Shenzhen technology services or investment
Guangdong, Guangdong, Establishment
99 Kanghong Dongsheng Commercial services 95.09
Shenzhen Shenzhen or investment
Guizhou, Guizhou,
Qiannan Buyi Qiannan Buyi
Guizhou Konka New Establishment
100 and Miao and Miao Manufacturing and processing 51
Material Technology or investment
Autonomous Autonomous
Prefecture Prefecture
Guizhou, Guizhou,
Qiannan Buyi Qiannan Buyi
Guizhou Kanggui Establishment
101 and Miao and Miao Wholesale and retail trade 100
Energy or investment
Autonomous Autonomous
Prefecture Prefecture
Guangdong, Guangdong, Establishment
102 Guangdong Xinwei Semiconductors 100
Lvfeng Lvfeng or investment
Kangxinrun Renewable Recycling, processing and sales of Establishment
103 Chongqing Chongqing 51
Resources renewable resources or investment
Guizhou, Guizhou,
Qiannan Buyi Qiannan Buyi
Guizhou Kanggui Establishment
104 and Miao and Miao Manufacturing and processing 70
Material Technology or investment
Autonomous Autonomous
Prefecture Prefecture
225
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Establishment
105 Nantong Kanghai Jiangsu, Nantong Jiangsu, Nantong Real estate 51
or investment
Establishment
106 Chongqing Kangyiyun Chongqing Chongqing Real estate 80
or investment
Jiangxi Konka High-tech Jiangxi, Jiangxi, Establishment
107 Commercial services 100
Park Shangrao Shangrao or investment
Shangrao Konka
Jiangxi, Jiangxi, Research & experiment Establishment
108 Electronic Technology 100
Shangrao Shangrao development or investment
Innovation
Guizhou Konka New Manufacture of non-metallic Establishment
109 Guizhou, Kaili Guizhou, Kaili 98
Energy mineral products or investment
Zhejiang Konka Zhejiang, Zhejiang, Research & experiment Establishment
110 100
Electronic Shaoxing Shaoxing development or investment
Zhejiang Konka Zhejiang, Zhejiang, Establishment
111 Commercial services 51 49
Technology Industry Shaoxing Shaoxing or investment
Establishment
112 Xi'an Konka Intelligent Shaanxi, Xi'an Shaanxi, Xi'an Wholesale 51
or investment
Computer, telecommunications and
Establishment
113 Xi'an Konka Network Shaanxi, Xi'an Shaanxi, Xi'an other electronic equipment 100
or investment
manufacturing
Xi'an Kanghong Establishment
114 Shaanxi, Xi'an Shaanxi, Xi'an Commercial services 40 60
Technology Industry or investment
Xi'an Konka Intelligent Establishment
115 Shaanxi, Xi'an Shaanxi, Xi'an Retail trade 100
Technology or investment
Chongqing Konka Low Establishment
116 Chongqing Chongqing Wholesale 55
Carbon or investment
Guangdong, Guangdong, Establishment
117 Kanghong Xintong Commercial services 95.09
Shenzhen Shenzhen or investment
Songyang Industry Software and information Establishment
118 Zhejiang, Lishui Zhejiang, Lishui 51
Operation technology services or investment
226
Konka Group Co., Ltd. Interim Report 2023
Shareholding
Main place of Place of percentage (%) Acquisition
No. Subsidiary Business nature
business registration method
Direct Indirect
Computer, telecommunications and
Guangdong, Guangdong, Establishment
119 Kangyan Technology other electronic equipment 100
Shenzhen Shenzhen or investment
manufacturing
Konka Photovoltaic Zhejiang, Zhejiang, Science and technology promotion Establishment
120 60
Technology Hangzhou Hangzhou and application services or investment
Songyang Konka Establishment
121 Zhejiang, Lishui Zhejiang, Lishui Wholesale 100
Intelligent or investment
Electrical machinery and Establishment
122 Konka North China Tianjin Tianjin 100
equipment manufacturing or investment
Computer, telecommunications and
Guangdong, Guangdong, Establishment
123 Zhongshan Kanghong other electronic equipment 51
Zhongshan Zhongshan or investment
manufacturing
Guangdong, Guangdong, Software and information Establishment
124 Digital Technology 100
Shenzhen Shenzhen technology services or investment
（1） Major non-wholly-owned subsidiaries
Profit or loss Dividends declared to
attributable to be distributed to Closing balance of
Shareholding of
Subsidiary minority minority shareholders minority shareholders'
minority shareholders
shareholders in the in the Reporting equities
Reporting Period Period
Anhui Konka Electronic Co., Ltd. 22.00% -2,653,734.78 122,251,966.99
（2） Key financial data on major non-wholly-owned subsidiaries
Closing balance
Subsidiary
Current assets Non-current Total assets Current liabilities Non-current Total liabilities
assets liabilities
227
Konka Group Co., Ltd. Interim Report 2023
Anhui Konka
2,936,026,320.29 868,495,196.06 3,804,521,516.35 3,061,042,160.51 187,788,596.78 3,248,830,757.29
Electronic Co., Ltd.
(Continued)
Opening balance
Subsidiary Non-current Non-current
Current assets Total assets Current liabilities Total liabilities
assets liabilities
Anhui Konka
1,128,527,494.45 876,466,424.50 2,004,993,918.95 1,231,359,349.01 205,826,622.59 1,437,185,971.60
Electronic Co., Ltd.
(Continued)
Amount incurred in the Reporting Period
Subsidiary Total comprehensive Cash flows from
Operating income Net profit
income operating activities
Anhui Konka Electronic Co., Ltd. 972,416,661.43 -12,062,430.83 -12,062,430.83 6,806,364.98
(Continued)
Amount incurred in the previous period
Subsidiary Total comprehensive Cash flows from
Operating income Net profit
income operating activities
Anhui Konka Electronic Co., Ltd. 2,943,030,518.60 -1,594,092.50 -1,594,092.50 6,078,558.09
228
Konka Group Co., Ltd. Interim Report 2023
2. Interests in joint ventures or associated enterprises
（1）Major joint ventures or associated enterprises
Shareholding Accounting
percentage (%) processing
Name of the
method for
joint Main
Place of Business investment in
venture or place of
registration nature joint
associated business Direct Indirect ventures or
enterprise
associated
enterprises
Dongfang
Jiakang No.1
(Zhuhai)
Investment Equity
Private Zhuhai Zhuhai 49.95
management method
Equity
Investment
Fund (LP)
Shenzhen
Professional
Jielunte Equity
Shenzhen Shenzhen machinery 42.79
Technology method
manufacturing
Co., Ltd.
(2) Main financial information of significant associated enterprise
Closing balance/amount incurred in the Reporting
Period
Item Dongfang Jiakang No.1
Shenzhen Jielunte
(Zhuhai) Private Equity
Technology Co., Ltd.
Investment Fund (LP)
Current assets 974,113,527.00 267,654,771.54
Non-current assets 316,561,987.27
Total assets 974,113,527.00 584,216,758.81
Current liabilities 10,001,480.00 249,764,867.78
Non-current liabilities 114,249,555.56
Total liabilities 10,001,480.00 364,014,423.34
Equities of minority shareholders 10,838,453.25
Equities attributable to shareholders of
the parent company 964,112,047.00 209,363,882.22
Share of net assets calculated based on
the shareholding 479,962,498.20 95,588,971.94
Adjustments
- Goodwill
- Internal unrealised profit
- Others
Carrying value of equity investments 479,962,498.20 95,588,971.94
229
Konka Group Co., Ltd. Interim Report 2023
Closing balance/amount incurred in the Reporting
Period
Item Dongfang Jiakang No.1
Shenzhen Jielunte
(Zhuhai) Private Equity
Technology Co., Ltd.
Investment Fund (LP)
in associated enterprises
Fair values of equity investments of
joint ventures with quoted prices
Operating income 168,815,683.51
Finance costs -284,133.17 1,539,262.28
Income tax expense 2,245,248.55
Net profit 25,641,054.77 -13,237,135.87
Net profit from discontinued
operations
Other comprehensive income
Total comprehensive income 25,641,054.77 -13,237,135.87
Dividends received from the joint
venture in the Reporting Period
(Continued)
Opening balance/amount incurred in the previous
period
Item Dongfang Jiakang No.1
Shenzhen Jielunte
(Zhuhai) Private Equity
Technology Co., Ltd.
Investment Fund (LP)
Current assets 971,913,521.98 253,227,910.38
Non-current assets 288,320,463.89
Total assets 971,913,521.98 541,548,374.27
Current liabilities 3,340.00 233,990,644.75
Non-current liabilities 74,263,430.52
Total liabilities 3,340.00 308,254,075.27
Equities of minority shareholders 12,856,913.14
Equities attributable to shareholders of
the parent company 971,910,181.98 220,437,385.86
Share of net assets calculated based on
the shareholding 483,905,786.35 99,748,594.97
Adjustments
- Goodwill
- Internal unrealised profit
- Others
Carrying value of equity investments 483,905,786.35 99,748,594.97
230
Konka Group Co., Ltd. Interim Report 2023
in associated enterprises
Fair values of equity investments of
joint ventures with quoted prices
Operating income 182,061,953.26
Finance costs -229,796.85 -1,371,564.48
Income tax expense -1,984,423.47
Net profit -2,383,969.26 248,699.00
Net profit from discontinued
operations
Other comprehensive income
Total comprehensive income -2,383,969.26 248,699.00
Dividends received from the joint
venture in the Reporting Period
(3) Combined financial data on insignificant joint ventures and associated enterprises
Closing balance/amount Opening balance/amount
Item incurred in the incurred in the previous
Reporting Period period
Associated enterprises
Total carrying value of investment 5,312,570,959.14 5,767,578,574.26
The total of following items according
to the shareholding proportions
Net profit -37,153,622.36 60,936,191.32
Other comprehensive income -38,929.34
Total comprehensive income -37,153,622.36 60,897,261.98
IX. The Risk Related to Financial Instruments
The Company's main financial instruments include borrowings, accounts receivable,
accounts payable, trading financial assets and liabilities, etc. Please refer to Note VI for detailed
descriptions of various financial instruments. The risks related to these financial instruments and
the risk management policies adopted by the Company to mitigate these risks are described below.
The Management of the Company manages and monitors these risk exposures to ensure that these
risks are controlled within a limited scope.
1. Various risk management objectives and policies
The goals of the Company engaged in the risk management are to achieve the proper balance
between the risks and benefits, reduce the negative impact to the Company operating performance
risk to a minimum, and maximise the profits of shareholders and other equity investors. Based on
the risk management goal, the basic strategy of the Company's risk management is determining
and analysing the various risks faced by the Company, setting up the bottom line of risk and
231
Konka Group Co., Ltd. Interim Report 2023
conducting appropriate risk management, and timely supervising various risks in a reliable way
and controlling the risk within the range of limit.
(1) Market risk
1) Foreign exchange risk
Foreign exchange risk refers to the risks that may lead to losses due to fluctuation in
exchange rate. The foreign exchange risk borne by the Company is related to USD. Except the
procurement and sales in USD of the Company's subsidiaries Hong Kong Konka, Hongdin
Trading, Chain Kingdom Memory Technologies, Hongjet and Jiali, the Company's other primary
business activities are settled in RMB. The currency risk arising from the assets and liabilities of
such balance in USD may affect the Group's operating results. As of 30 June 2023, the
Company's assets and liabilities were mainly the balance in RMB except for the assets or
liabilities of a balance in USD as listed below.
Balance at the end of the Balance at the
Item
period beginning of the period
Monetary funds 195,999,137.08 106,315,046.38
Accounts receivable 84,267,618.26 86,909,542.13
Other accounts receivable 110,937,713.61 111,545,094.65
Short-term loans 15,090,462.34
Accounts payable 29,303,729.18 24,084,328.20
Other payables 4,767,018.12 205,546.18
Interest payable 10,875.01
The Company pays close attention to the impact of exchange rate changes on the Company's
foreign exchange risk, and requires major companies in the Group that purchase and sell in
foreign currency to pay attention to the changes in foreign currency assets and liabilities, manage
the Group's foreign currency net asset exposure in a unified way, implement single currency
settlement, and reduce the scale of foreign currency assets and liabilities, so as to reduce foreign
exchange risk exposure.
2) Interest rate risk
The Company bears interest rate risk due to interest rate changes of interest-bearing financial
assets and liabilities. The Company's interest bearing financial assets are mainly bank deposits, of
which the variable interest rate is mostly short-term, while the interest bearing financial liabilities
are mainly bank loans and corporate bonds. The Company's long-term borrowings from banks
and corporation bonds are at fixed interest rates. The risk of cash flow changes of financial
instruments caused by interest rate changes is mainly related to short-term borrowings from banks
with floating interest rates. The Company's policy is to maintain the floating interest rates of such
borrowings to eliminate the fair value risk of interest rate changes. As of 30 June 2023, the
232
Konka Group Co., Ltd. Interim Report 2023
balance of such short-term borrowings was RMB6,779,845,746.13.
(2) Credit risk
As of 30 June 2023, the maximum credit risk exposure that may cause financial losses to the
Company mainly came from losses generated from the Company's financial assets due to failure
of the other party in a contract to perform its obligations and the financial guarantee undertaken
by the Company, including:
The carrying amount of financial assets recognised in the consolidated balance sheet; for
financial instruments measured at fair value, the book value reflects their risk exposure, but not
the maximum risk exposure, and the maximum risk exposure will change with the change of
future fair value.
In order to reduce credit risk, the Company has set up a group to determine the credit limit,
conduct credit approval, and implement other monitoring procedures to ensure that necessary
measures are taken to recover overdue claims. In addition, the Company reviews the recovery of
each single receivable on each balance sheet date to ensure that sufficient provision for bad debts
is made for the unrecoverable amount. Therefore, the Company's management believes that the
Company's credit risk has been greatly reduced.
The Company's working capital is deposited in banks with a high credit rating, so the credit
risk of working capital is low.
The Company has adopted necessary policies to ensure that all customers have good credit
records. Except for the top five customers in terms of the amount of accounts receivable, the
Company has no other major credit concentration risk. For the financial assets of the Company
that have been individually impaired, please refer to 4. Accounts Receivable and 7. Other
Receivables in Note VI.
(3) Liquidity risk
Liquidity risk refers to the risk that the Company is unable to fulfil its financial obligations
on the due date. The Company manages liquidity risk in the method of ensuring that there is
sufficient liquidity to fulfil debt obligations without causing unacceptable loss or damage to the
Company's reputation. In order to mitigate the liquidity risk, the Management of the Company
has carried out a detailed inspection on the liquidity of the company, including the maturity of
accounts payable and other payables, bank credit line and bond financing. The conclusion is that
the Company has sufficient funds to meet the needs of the Group's short-term debts and capital
expenditure.
The analysis of the financial assets and financial liabilities held by the Company based on
the maturity period of the undiscounted remaining contractual obligations is as follows:
233
Konka Group Co., Ltd. Interim Report 2023
Amount as of 30 June 2023:
Item Within one year One to two years Two to five years Over five years Total
Financial assets
Monetary funds 6,908,338,806.16 6,908,338,806.16
Held-for-trading financial
assets 743,307,489.50 743,307,489.50
Notes receivable 593,966,294.88 593,966,294.88
Accounts receivable 1,637,812,189.62 207,340,829.26 242,781,248.64 60,288.01 2,087,994,555.53
Other accounts receivable 538,800,413.35 245,611,216.94 631,274,801.06 16,280.00 1,415,702,711.35
Current portion of non-
current assets 3,630,000.00 3,630,000.00
Long-term receivables 800,400.00 800,400.00
Other current assets 2,418,192,160.84 2,418,192,160.84
Financial liabilities
Short-term loans 6,779,845,746.13 6,779,845,746.13
Notes payable 1,156,546,919.70 1,156,546,919.70
Accounts payable 2,576,717,410.79 102,890,328.05 243,352,180.52 4,025,966.96 2,926,985,886.32
Other payables 1,244,725,162.97 171,062,266.84 273,145,282.32 39,705,128.63 1,728,637,840.76
Payroll payable 182,043,941.42 182,043,941.42
Non-current liabilities due
within one year 5,320,279,660.98 5,320,279,660.98
Long-term loans 3,619,780,819.43 2,967,359,468.60 586,268,212.71 7,173,408,500.74
Bonds payable 830,105,052.33 2,465,451,823.93 3,295,556,876.26
Long-term payables 1,562,290.65 5,310,831.86 6,873,122.51
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Konka Group Co., Ltd. Interim Report 2023
2. Sensitivity analysis
The Company adopts sensitivity analysis technology to analyse the possible impact of
reasonable and possible changes of risk variables on current profits/losses or shareholders' equity.
As any risk variable rarely changes in isolation, and the correlation between variables will have a
significant effect on the final impact amount of the change of a risk variable, the following
content is based on the assumption that the change of each variable is independent.
(1) Sensitivity analysis of foreign exchange risk
Assumption for the sensitivity of foreign exchange risk: All net investment hedging and cash
flow hedging of overseas operations are highly effective.
On the basis of the above assumption, under the condition that other variables remain
unchanged, the impact of reasonable changes in the exchange rate on current profits/losses and
equity after tax is as follows:
Closing balance
Exchange rate
Item Impact on shareholders'
fluctuations Impact on net profit
equity
Appreciation of 1%
USD 22,249,707.57 17,750,467.03
against RMB
Depreciation of 1%
USD -22,249,707.57 -17,750,467.03
against RMB
(2) Sensitivity analysis of interest rate risk
Sensitivity analysis of interest rate risk is based on the following assumptions:
Changes in market interest rates affect the interest income or expense of financial
instruments with variable interest rates;
For financial instruments with fixed interest rates measured at fair value, market interest rate
changes affect only their interest income or expense;
Changes in the fair values of derivative financial instruments and other financial assets and
liabilities are calculated at the market interest rate on the balance sheet date by discounted cash
flow.
On the basis of the above assumptions and under the condition that other variables remain
unchanged, the impact of reasonable changes in the interest rate on current profits/losses and
equity after tax is as follows:
Closing balance
Interest rate
Item Impact on shareholders'
fluctuations Impact on net profit
equity
Borrowings at Up 0.5% -25,773,357.94 -24,732,737.56
floating interest
235
Konka Group Co., Ltd. Interim Report 2023
rates
Borrowings at
floating interest Down 0.5% 25,773,357.94 24,732,737.56
rates
236
Konka Group Co., Ltd. Interim Report 2023
X. The Disclosure of Fair Value
1. Closing fair value of assets and liabilities measured at fair value
Closing fair value
Item Level-1 fair value Level-2 fair value Level-3 fair value
Total
measurement measurement measurement
I. Continuous fair value measurement
(I) Held-for-trading financial assets
1. Financial assets measured at fair value through profit
and loss for the Reporting Period
(II) Accounts receivable financing 344,155,903.39 344,155,903.39
(III) Other equity investments
(IV) Other equity instrument investment 23,841,337.16 23,841,337.16
(V) Investment properties
(VI) Biological assets
(VII) Other non-current financial assets 2,113,570,574.02 2,113,570,574.02
Total assets continuously measured at fair value 344,155,903.39 2,137,411,911.18 2,481,567,814.57
Total liabilities continuously measured at fair value
II. Non-continuous fair value measurement
Total assets not continuously measured at fair value
Total liabilities not continuously measured at fair
value
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Konka Group Co., Ltd. Interim Report 2023
2. Basis for determining the market price of continuous and non-continuous level-1 fair
value measurement projects
The first level of the input is an unadjusted quoted price in an active market for the same
assets and liabilities available on the measurement date.
3. Qualitative and quantitative data on valuation techniques and important parameters
adopted for continuous and non-continuous level-2 fair value measurement projects
The Level 2 fair value measurement of input value at Level 2 is the input value observable
directly or indirectly of relevant assets or liabilities exclusive of input value at Level 1.
4. Qualitative and quantitative data on valuation techniques and important parameters
adopted for continuous and non-continuous level-3 fair value measurement projects
The third level of the input is the unobservable input of related assets and liabilities.
XI. Related Party and Related-party Transaction
（一）Related party relationship
1. Controlling shareholder and the ultimate controller
（1）Controlling shareholder and the ultimate controller
Sharehold Voting
Place
ing ratio right ratio
of Registere
Name Business nature to the to the
registr d capital
Company Company
ation
(%) (%)
OCT Group Shenzh Tourism, real estate, RMB12
29.999997 29.999997
Co. Ltd. en electronics industry billion
Note: The ultimate controller of the Company is State-owned Assets Supervisor Commission of
the State Council.
（2） Registered capital of the controlling shareholder and its changes
Opening balance Increase Decrease Closing balance
Controlling in the in the
shareholders Reporting Reporting
Period Period
OCT Group Co. Ltd. 12,000,000,000.00 12,000,000,000.00
（3） Controlling shareholders' shares or equity and their changes
Shareholding amount Shareholding percentage
Controlling (%)
shareholders Closing balance Opening balance Ending Opening
percentage percentage
OCT Group Co. Ltd. 722,383,542.00 722,383,542.00 29.999997 29.999997
238
Konka Group Co., Ltd. Interim Report 2023
2. Subsidiary
Refer to note VIII-1. (1) Subsidiaries for the information of subsidiaries.
3. Associated enterprises and joint ventures
Refer to Note VIII-2. (1) Significant Associated Enterprises for details of significant
associated enterprises of the Company. Information on other joint ventures or associated
enterprises occurring connected transactions with the Company in Reporting Period, or forming
balance due to connected transactions made in previous period:
Name Relationship with the Company
Anhui Kaikai Shijie E-commerce Co., Ltd. Associate
Anhui Kangta Supply Chain Management Co.,
Associate
Ltd.
Chuzhou Kangxin Health Industry
Associate
Development Co., Ltd.
Orient Excellent (Zhuhai) Asset Management
Associate
Co., Ltd.
Dongguan Kangzhihui Electronics Co., Ltd. Associate
Dongguan Guankang Hongyu Investment Co.,
Associate
Ltd.
Feidi Technology (Shenzhen) Co., Ltd. Associate
Guangdong Kangyuan Semiconductor Co. , Ltd. Associate
Hefei KONSEMI Storage Technology Co., Ltd. Associate
Henan Kangfei Intelligent Electrical Appliances
Associate
Co., Ltd.
Kangkong Venture Capital (Shenzhen) Co., Ltd. Associate
Puchuang Jiakang Technology Co, Ltd. Associate
Shandong Kangfei Intelligent Electrical
Associate
Appliances Co., Ltd.
Shenzhen Aimijiakang Technology Co., Ltd. Associate
Shenzhen Jielunte Technology Co., Ltd. Associate
Shenzhen Kanghongxing Smart Technology Co.,
Associate
Ltd.
Shenzhen Kopen Digital Technology Co., Ltd. Associate
Shenzhen Konda E-display Co., Ltd. Associate
Shenzhen Kangying Semiconductor Technology
Associate
Co., Ltd.
Shenzhen Morsemi Semiconductor Technology
Associate
Co., Ltd.
Shenzhen Konka Jiapin Intelligent Electrical
Associate
Apparatus Co., Ltd.
239
Konka Group Co., Ltd. Interim Report 2023
Name Relationship with the Company
Shenzhen Kangxi Technology Innovation
Associate
Development Co., Ltd.
Shenzhen RF-Llink Technology Co., Ltd. Associate
Shenzhen Yaode Technology Co., Ltd. Associate
Sichuan Chengrui Real Estate Co., Ltd. Associate
Sichuan Hongxinchen Real Estate
Associate
Development Co., Ltd.
Sichuan Huayi Jiakang Technology Co., Ltd. Associate
Wuhan Kangtang Information Technology Co.,
Associate
Ltd.
Yantai Kangyun Industrial Development Co.,
Associate
Ltd.
Yancheng Kangyan Information Industry
Associate
Investment Partnership (Limited Partnership)
E3info (Hainan) Technology Co., Ltd. Associate
Chongqing Kangjian Photoelectric Technology
Associate
Co., Ltd.
Chongqing Qingjia Electronics Co., Ltd. Associate
Anhui Kangfu New Energy Co., Ltd. Associate
Chutian Dragon Co., Ltd. Associate
Shenzhen Zhongkang Beidou Technology Co.,
Ltd. (formerly named: Shenzhen Zhongbing Associate
Konka Technology Co., Ltd.)
KK Smartech Limited Associate
Shandong Econ Technology Co., Ltd. Associate
Dongguan Kangjia New Materials Technology
Associate
Co., Ltd.
Nantong Kangjian Technology Industrial Park
Associate
Operations and Management Co., Ltd.
4. Other related parties
Names of other related parties Relationship with the Company
HOHOELECTRICAL&FURNITURECO.,LIM
ITED Minority shareholder of subsidiary
AUJET INDUSTRY LIMITED Minority shareholder of subsidiary
Beijing Xuri Shengxing Technology Co., Ltd. Minority shareholder of subsidiary
Chuzhou Hanshang Electric Appliance Co.,
Minority shareholder of subsidiary
Ltd.
Korea Electric Group Co., Ltd. Minority shareholder of subsidiary
Hu Zehong Minority shareholder of subsidiary
Shanghai SUS Environment Co.,Ltd. Minority shareholder of subsidiary
Shenzhen New Journey Energy Conservation Minority shareholder of subsidiary
240
Konka Group Co., Ltd. Interim Report 2023
Names of other related parties Relationship with the Company
and Environmental Protection Service Co., Ltd.
Central Enterprises in poverty-stricken
areas(Jiangxi)Industrial Investment Funds Minority shareholder of subsidiary
Partnership(L.P.)
Chongqing Liangshan Industrial Investment
Minority shareholder of subsidiary
Co., Ltd.
The company controlled by the ultimate
Jiangxi Meiji Enterprise Co., Ltd. controller of the minority shareholders of the
subsidiary
Dai Rongxing Close family members of minority shareholders
AMobile Intelligent Corp. Ltd. Subsidiary of associated enterprise
Huanjia Group Co., Ltd. Minority shareholder of subsidiary
Yantai Kangyue Investment Co., Ltd. Subsidiary of associated enterprise
Chongqing Lanlv Moma Real Estate
Subsidiary of associated enterprise
Development Co., Ltd.
（二）Related-party transactions
1. Related party transactions involving the purchase and sale of goods and the supply and
acceptance of services
（1） Purchasing goods/receiving services
Amount incurred Amount incurred
Related party
Related party in the Reporting in the previous
transaction
Period period
Chuzhou Hanshang Electric Appliance Purchase of
186,735,395.72 181,578,952.60
Co., Ltd. goods
Purchase of
Puchuang Jiakang Technology Co, Ltd. 82,483,825.77 150,151,893.73
goods
Purchase of
OCT Group Co., Ltd. and its
goods and 19,556,218.59 25,346,178.36
subsidiaries and associates
services
Shenzhen Jielunte Technology Co., Purchase of
Ltd. and its subsidiaries as well as its goods and 17,989,178.13 13,992,143.62
associated enterprises services
Anhui Kaikai Shijie E-commerce Co., Purchase of
14,519,171.29 21,234.50
Ltd. and its subsidiaries goods
Korea Electric Group Co., Ltd. and its Purchase of
13,962,407.67 18,805,740.79
subsidiaries goods
Shenzhen Konda E-display Co., Ltd. Purchase of
10,289,325.37 8,959,207.84
and its subsidiaries goods
Dongguan Kangjia New Material Purchase of
7,656,559.11 6,976,616.01
Technology Co., Ltd. goods
Purchase of
KK Smartech Limited 7,026,770.10
goods
241
Konka Group Co., Ltd. Interim Report 2023
Amount incurred Amount incurred
Related party
Related party in the Reporting in the previous
transaction
Period period
Purchase of
Dongguan Konka Smart Electronic
goods and 5,303,236.99 13,821,902.86
Technology Co., Ltd.
services
HOHOELECTRICAL&FURNITURE Purchase of
5,279,694.58 9,072,974.63
CO.,LIMITED goods
Purchase of
Chongqing Ruiyin Renewable
goods and 541,543,811.51
Resources Co., Ltd. and its subsidiaries
services
Shenzhen Kangying Semiconductor
Purchase of
Technology Co., Ltd. and its 4,317,763.40 8,145,702.87
goods
subsidiaries
Purchase of
Subtotal of other related parties goods and 6,384,913.67 2,468,604.98
services
（2） Information of sales of goods and provision of labour service
Related Amount incurred Amount
Related party party in the Reporting incurred in the
transaction Period previous period
Sales of
Chuzhou Hanshang Electric Appliance Co., goods and
87,808,617.20 35,546,108.63
Ltd. provision of
labor service
Sales of
Korea Electric Group Co., Ltd. and its goods and
61,575,942.67 117,013,253.39
subsidiaries provision of
labor service
Sales of
Anhui Kaikai Shijie E-commerce Co., Ltd. goods and
43,083,217.15 86,686,831.47
and its subsidiaries provision of
labor service
Sales of
OCT Group Co., Ltd. and its subsidiaries goods and
31,848,071.22 133,512,390.92
and associates provision of
labor service
Sales of
Shenzhen Jielunte Technology Co., Ltd.
goods and
and its subsidiaries as well as its associated 31,298,689.17 13,440,177.22
provision of
enterprises
labor service
Shandong Kangfei Intelligent Electrical
销售商品 20,835,714.08 21,685,823.71
Appliances Co., Ltd.
Sales of
Shenzhen Konda E-display Co., Ltd. and goods and
9,771,563.23 14,036,782.18
its subsidiaries provision of
labor service
Sales of
E3info (Hainan) Technology Co., Ltd. and goods and
9,168,670.42 563,757.57
its subsidiaries provision of
labor service
242
Konka Group Co., Ltd. Interim Report 2023
Related Amount incurred Amount
Related party party in the Reporting incurred in the
transaction Period previous period
Sales of
Hefei KONSEMI Storage Technology Co., goods and
8,004,252.90 42,085,293.63
Ltd. provision of
labor service
Sales of
Shenzhen Kangying Semiconductor goods and
5,789,685.32 8,803,735.07
Technology Co., Ltd. and its subsidiaries provision of
labor service
Sales of
Dongguan Konka Smart Electronic goods and
5,049,897.52 12,592,625.44
Technology Co., Ltd. provision of
labor service
Shenzhen Aimijiakang Technology Co., Sales of
1,453,563.03 25,833,743.92
Ltd. goods
HOHOELECTRICAL&FURNITURECO., Sales of
15,922,314.20
LIMITED goods
Nantong Kangjian Technology Industrial Provision of
14,150,943.39
Park Operations and Management Co., Ltd. labor service
Henan Kangfei Intelligent Electrical Sales of
12,773,438.03
Appliances Co., Ltd. goods
Sales of
goods and
Subtotal of other related parties 8,788,964.79 6,726,787.89
provision of
labor service
2. Related party leases
（1）Lease situation
The lease fee
The lease fee
Type of recognized in the
recognised in
Lessor Lessee leased same period of
the Reporting
assets the previous
Period
year
Dongguan
Guankang Yuhong Dongguan Konka
Factory 22,799,157.95
Investment Co., Electronic Co., Ltd.
Ltd.
Konka Ventures Commercial
OCT Group Co.
Development residences
Ltd. and its 14,099,760.00 11,610,366.36
(Shenzhen) Co., and office
subsidiaries
Ltd. buildings
Commercial
OCT Group Co.
Konka Group Co., residences
Ltd. and its 351,831.90 755,425.60
Ltd. and office
subsidiaries
buildings
3. Related party guarantees
（1）The Company was guarantor
243
Konka Group Co., Ltd. Interim Report 2023
Contracte
Actual Whether
d
guarantee Cu Start date Expiry the
guarantee
Secured party amount rre of date of guarantee
amount
(RMB'0,0 ncy guarantee guarantee is
(RMB'0,0
00) completed
00)
CN 19 August 19 August
Boluo Precision 2,480.11 191.67 No
Y 2020 2023
CN 25 August 24 August
Boluo Precision 3,000.00 3,000.00 No
Y 2022 2023
CN 19 January 18 January
Boluo Precision 4,000.00 1,800.00 No
Y 2023 2024
CN 2 March 2 March
Boluo Precision 3,000.00 1,795.79 No
Y 2023 2026
30
CN 24 May
Konka Circuit 20,000.00 5,999.28 November No
Y 2021
2024
14 13
CN
Konka Circuit 5,000.00 3,676.77 September September No
Y
2022 2023
Anhui CN
3,000.00 3,000.00 2 June 2022 1 June 2023 No
Tongchuang Y
Anhui CN
5,000.00 5 July 2022 4 July 2023 No
Tongchuang Y
Anhui CN 19 October 19 October
10,000.00 9,800.00 No
Tongchuang Y 2022 2023
Anhui CN 6 February 5 February
10,000.00 8,000.00 No
Tongchuang Y 2023 2024
Liaoyang CN 6 January 5 January
5,000.00 3,000.00 No
Kangshun Smart Y 2023 2024
Konka Xinyun CN 26 May 25 May
6,000.00 1,000.00 No
Semiconductor Y 2022 2024
Konka Xinyun CN 12 July 11 July
20,000.00 6,083.91 No
Semiconductor Y 2021 2022
24
Electronics CN 10 January
8,500.00 8,385.38 November No
Technology Y 2024
2022
Electronics CN 10 October 21 July
50,000.00 50,000.00 No
Technology Y 2022 2023
CN 24 March 23 March
Dongguan Konka 5,000.00 5,000.00 No
Y 2023 2024
CN 23 June
Dongguan Konka 80,000.00 33,215.76 7 May 2031 No
Y 2021
Telecommunicatio CN 20 May 20 May
7,500.00 3,494.93 No
n Technology Y 2022 2023
CN 23 May 26 April
Sichuan Konka 4,000.00 3,000.00 No
Y 2023 2026
Mobile CN 11 August 11 August
7,000.00 4,000.00 No
Interconnection Y 2022 2023
CN 23 May 26 April
Yibin Smart 980.00 980.00 No
Y 2023 2024
CN 13 13
Chongqing Konka 38,000.00 7,793.11 No
Y December December
244
Konka Group Co., Ltd. Interim Report 2023
Contracte
Actual Whether
d
guarantee Cu Start date Expiry the
guarantee
Secured party amount rre of date of guarantee
amount
(RMB'0,0 ncy guarantee guarantee is
(RMB'0,0
00) completed
00)
2022 2037
Xi'an Kanghong 31
CN 26 May
Technology 30,000.00 December No
Y 2023
Industry 2032
25 25
CN
XingDa HongYe 2,000.00 353.89 December December No
Y
2020 2023
CN 31 May 31 August
XingDa HongYe 750.00 87.55 No
Y 2021 2023
19 19
Konka Soft CN
975.00 48.37 December December No
Electronic Y
2022 2023
Ningbo Khr CN 12 August 27 July
6,000.00 3,735.71 No
Electric Appliance Y 2021 2023
Ningbo Khr CN 12 July 11 July
6,000.00 3,000.00 No
Electric Appliance Y 2022 2023
Frestec Smart CN
10,200.00 510.00 6 July 2022 4 May 2030 No
Home Y
CN 6 November 1 December
Jiangxi Konka 10,000.00 3,000.00 No
Y 2020 2023
CN 26 June 25 June
Jiangxi Konka 6,000.00 5,000.00 No
Y 2022 2023
CN 10 March 9 March
Jiangxi Konka 990.00 990.00 No
Y 2022 2024
29 29
CN
Jiangxi Konka 10,000.00 1,760.11 September September No
Y
2020 2023
30 30
CN
Jiangxi Konka 1,000.00 174.77 December December No
Y
2020 2023
Xinfeng CN 8 December 8 December
2,100.00 369.60 No
Microcrystalline Y 2020 2023
29 28
Xinfeng CN
7,200.00 6,000.00 December December No
Microcrystalline Y
2022 2023
Xinfeng CN 30 June 29 June
7,200.00 6,000.00 No
Microcrystalline Y 2023 2024
Jiangxi High
CN 10 March 9 March
Transparent 990.00 990.00 No
Y 2022 2024
Substrate
13 31
CN
Yibin Kangrun 10,000.00 10,000.00 November December No
Y
2020 2024
13 13
CN
Anhui Konka 10,000.00 September September No
Y
2022 2023
Anhui Konka 5,500.00 1,135.96 CN 18 August 18 August No
245
Konka Group Co., Ltd. Interim Report 2023
Contracte
Actual Whether
d
guarantee Cu Start date Expiry the
guarantee
Secured party amount rre of date of guarantee
amount
(RMB'0,0 ncy guarantee guarantee is
(RMB'0,0
00) completed
00)
Y 2022 2023
CN 22 August 22 August
Anhui Konka 18,000.00 6,000.00 No
Y 2022 2023
CN 10 August 15 July
Anhui Konka 28,000.00 9,161.03 No
Y 2021 2031
CN 29 October 26 October
Anhui Konka 7,000.00 6,000.00 No
Y 2021 2026
CN 24 October 26 October
Anhui Konka 7,000.00 6,000.00 No
Y 2022 2026
19 18
CN
Anhui Konka 7,000.00 7,000.00 September September No
Y
2022 2023
CN 25 June 24 June
Anhui Konka 5,000.00 104.00 No
Y 2023 2028
CN
Econ Technology 2,498.29 1,667.36 8 July 2022 7 July 2023 No
Y
CN 27 July 26 July
Econ Technology 749.49 499.66 No
Y 2022 2023
CN 16 August 15 August
Econ Technology 24.98 24.98 No
Y 2022 2023
6 5
CN
Econ Technology 199.86 199.86 September September No
Y
2022 2023
30 29
CN
Econ Technology 3,747.44 3,801.79 September September No
Y
2022 2024
23
CN 23 May
Econ Technology 2,748.12 2,027.81 November No
Y 2024
2022
CN 22 May 21 May
Econ Technology 1,498.97 1,498.97 No
Y 2023 2024
CN 10 May 11 August
Econ Technology 3,747.44 2,959.47 No
Y 2023 2023
Anhui Electrical CN
13,500.00 5,000.00 3 July 2020 1 July 2023 No
Appliance Y
Foshan Zhujiang
Media Creative
CN 17 May 21 March
Park Cultural 980.00 941.66 No
Y 2022 2023
Development Co.,
Ltd.
8 8
CN
OCT Group 60,000.00 60,000.00 September September No
Y
2022 2025
CN 18 October 18 October
OCT Group 60,000.00 60,000.00 No
Y 2022 2025
(2) The Company was secured party
246
Konka Group Co., Ltd. Interim Report 2023
Whether
Guarantee Cur Start date Expiry date
the
Guarantor amount renc of of
guarantee is
(RMB'0,000) y guarantee guarantee
completed
15 14
CN
Electronics Technology 51,000.00 September September No
Y
2022 2023
CN 8 January 8 January
OCT Group 100,000.00 No
Y 2021 2024
CN 21 May 21 May
OCT Group 50,000.00 No
Y 2021 2024
CN
OCT Group 80,000.00 9 July 2021 9 July 2024 No
Y
CN 8 September 8 September
OCT Group 60,000.00 No
Y 2022 2025
CN 18 October 18 October
OCT Group 60,000.00 No
Y 2022 2025
CN 14 July
OCT Group 120,000.00 14 July 2022 No
Y 2025
CN 22 June 21 June
OCT Group 100,000.00 No
Y 2022 2024
CN 24 June 23 June
OCT Group 149,000.00 No
Y 2021 2024
CN 23 August 22 August
OCT Group 39,750.00 No
Y 2022 2025
22 22
CN
OCT Group 30,000.00 December December No
Y
2022 2025
CN 18 January 18 January
OCT Group 70,000.00 No
Y 2023 2026
25 25
Hu Zehong, Liang Ruiling, CN
173.41 December December No
Dai Yaojin Y
2020 2023
Hu Zehong, Liang Ruiling, CN 31 May 31 August
42.90 No
Dai Yaojin Y 2021 2023
CN 6 November 1 December
Zhu Xinming 1,470.00 No
Y 2020 2023
Jiangxi Xinzixin Real CN 26 June 25 June
2,450.00 No
Estate Co., Ltd. Y 2022 2023
Jiangxi Xinzixin Real CN 10 March 9 March
485.10 No
Estate Co., Ltd. Y 2022 2024
29 29
Jiangxi Xinzixin Real CN
862.45 September September No
Estate Co., Ltd. Y
2020 2023
30 30
CN
Zhu Xinming 85.63 December December No
Y
2020 2023
CN 8 December 8 December
Zhu Xinming 181.10 No
Y 2020 2023
29 28
CN
Zhu Xinming 2,940.00 December December No
Y
2022 2023
Jiangxi Xinzixin Real 2,940.00 CN 30 June 29 June No
247
Konka Group Co., Ltd. Interim Report 2023
Whether
Guarantee Cur Start date Expiry date
the
Guarantor amount renc of of
guarantee is
(RMB'0,000) y guarantee guarantee
completed
Estate Co., Ltd. Y 2023 2024
Jiangxi Xinzixin Real CN 10 March 9 March
485.10 No
Estate Co., Ltd. Y 2022 2024
13 31
CN
Econ Technology 3,300.00 November December No
Y
2020 2024
Chuzhou State-owned
CN 18 August 18 August
Assets Management Co., 249.91 No
Y 2022 2023
Ltd.
Chuzhou State-owned
CN 22 August 22 August
Assets Management Co., 1,320.00 No
Y 2022 2023
Ltd.
Chuzhou State-owned
CN 10 August 15 July
Assets Management Co., 2,015.43 No
Y 2021 2031
Ltd.
Chuzhou State-owned
CN 29 October 26 October
Assets Management Co., 1,320.00 No
Y 2021 2026
Ltd.
Chuzhou State-owned
CN 24 October 26 October
Assets Management Co., 1,320.00 No
Y 2022 2026
Ltd.
Chuzhou State-owned 19 18
CN
Assets Management Co., 1,540.00 September September No
Y
Ltd. 2022 2023
Chuzhou State-owned
CN 25 June 24 June
Assets Management Co., 22.88 No
Y 2023 2028
Ltd.
CN 15 October 14 October
Zhu Xinming 11,123.00 No
Y 2022 2023
CN 15 October 14 October
Zhu Xinming 1,323.00 No
Y 2022 2023
31
CN 1 January
Zhu Xinming 3,399.49 December No
Y 2023
2023
CN 19 February 18 February
Zhu Xinming 13,249.19 No
Y 2023 2024
CN 1 March 28 February
Zhu Xinming 6,860.00 No
Y 2023 2024
CN 9 March 8 March
Zhu Xinming 2,330.54 No
Y 2023 2024
30
CN
Zhu Xinming 2,156.00 1 April 2023 September No
Y
2023
31
CN 13 January
Zhu Xinming 443.45 December No
Y 2023
2023
31
CN 30 March
Zhu Xinming 44.05 December No
Y 2023
2023
248
Konka Group Co., Ltd. Interim Report 2023
Whether
Guarantee Cur Start date Expiry date
the
Guarantor amount renc of of
guarantee is
(RMB'0,000) y guarantee guarantee
completed
31
CN 14 April
Zhu Xinming 443.45 December No
Y 2023
2023
31
CN 30 June
Zhu Xinming 44.05 December No
Y 2023
2023
CN 28 February 27 February
Zhu Xinming 490.00 No
Y 2023 2024
31
CN 1 January
Zhu Xinming 5,109.05 December No
Y 2023
2023
31
CN 13 January
Zhu Xinming 252.63 December No
Y 2023
2023
31
CN 13 January
Zhu Xinming 101.77 December No
Y 2023
2023
31
CN 14 April
Zhu Xinming 203.63 December No
Y 2023
2023
31
CN 1 January
Zhu Xinming 1,862.90 December No
Y 2023
2023
31
CN 17 February
Zhu Xinming 223.85 December No
Y 2023
2023
31
CN 8 March
Zhu Xinming 93.12 December No
Y 2023
2023
31
CN 19 May
Zhu Xinming 101.35 December No
Y 2023
2023
31
CN
Zhu Xinming 93.12 8 June 2023 December No
Y
2023
CN 27 June 31 October
Zhu Xinming 1,470.00 No
Y 2023 2023
Yuan Shengxiang, Yudong
CN 19 August 31 October
Environmental Protection 3,430.00 No
Y 2020 2025
Technology Co., Ltd.
Yuan Shengxiang, Yudong
CN 19 August 31 October
Environmental Protection 2,450.00 No
Y 2020 2025
Technology Co., Ltd.
31
Hu Zehong, Liang Ruiling, CN
2,450.00 1 July 2018 December No
Dai Yaojin Y
2025
31
Hu Zehong, Liang Ruiling, CN
4,899.02 1 July 2018 December No
Dai Yaojin Y
2025
249
Konka Group Co., Ltd. Interim Report 2023
Whether
Guarantee Cur Start date Expiry date
the
Guarantor amount renc of of
guarantee is
(RMB'0,000) y guarantee guarantee
completed
Suiyong Rongxin Asset CN 1 January 30 June
980.00 No
Management Co., Ltd. Y 2018 2023
Suiyong Rongxin Asset CN 1 January 30 June
2,450.00 No
Management Co., Ltd. Y 2018 2023
Suiyong Rongxin Asset CN 1 January 30 June
1,862.00 No
Management Co., Ltd. Y 2018 2023
Shenzhen Henglongtong
Technology Co., Ltd.,
Guizhou Huajinrun
Technology Co. Ltd.,
Huaying Gaokede 31
CN 1 January
Electronics Technology 735.00 December No
Y 2022
Co., Ltd., Huaying 2025
Gaokelong Electronics
Technology Co., Ltd.,
Shenzhen Baili Yongxing
Technology Co., Ltd.
Shenzhen Henglongtong
Technology Co., Ltd.,
Guizhou Huajinrun
Technology Co. Ltd.,
Huaying Gaokede 31
CN 1 January
Electronics Technology 488.37 December No
Y 2022
Co., Ltd., Huaying 2025
Gaokelong Electronics
Technology Co., Ltd.,
Shenzhen Baili Yongxing
Technology Co., Ltd.
Shenzhen Henglongtong
Technology Co., Ltd.,
Guizhou Huajinrun
Technology Co. Ltd.,
Huaying Gaokede 31
CN 1 January
Electronics Technology 552.72 December No
Y 2022
Co., Ltd., Huaying 2025
Gaokelong Electronics
Technology Co., Ltd.,
Shenzhen Baili Yongxing
Technology Co., Ltd.
Chuzhou Hanshang Electric CN 20 May 19 May
2,450.00 No
Appliance Co., Ltd. Y 2021 2024
Chuzhou Hanshang Electric CN 20 May 19 May
2,083.96 No
Appliance Co., Ltd. Y 2021 2024
17 16
Shenzhen Qianhai Datang CN
588.00 November November No
Technology Co., Ltd. Y
2022 2025
Konka Ventures 15
CN 5 November
Development (Shenzhen) 1,322.54 December No
Y 2022
Co., Ltd. 2021
Wu Guoren 875.00 US 31 31 No
250
Konka Group Co., Ltd. Interim Report 2023
Whether
Guarantee Cur Start date Expiry date
the
Guarantor amount renc of of
guarantee is
(RMB'0,000) y guarantee guarantee
completed
D December December
2019 2024
31 31
US
Wu Guoren 2,450.00 December December No
D
2019 2024
31 31
US
Wu Guoren 212.50 December December No
D
2019 2024
31 31
US
Xiao Yongsong 840.00 December December No
D
2019 2024
31 31
US
Xiao Yongsong 2,352.00 December December No
D
2019 2024
31 31
US
Xiao Yongsong 204.00 December December No
D
2019 2024
Shenzhen Unifortune 31
US 21 June
Supply Chain Management 1,477.84 December No
D 2021
Co., Ltd. 2022
Shenzhen Unifortune 31
US 21 June
Supply Chain Management 867.30 December No
D 2021
Co., Ltd. 2022
31
Guizhou Huajinrun US 1 January
381.15 December No
Technology Co. Ltd. D 2022
2025
31
Guizhou Huajinrun US 1 January
157.50 December No
Technology Co. Ltd. D 2022
2025
31
Shenzhen Henglongtong US 1 January
241.40 December No
Technology Co., Ltd. D 2022
2025
31
Shenzhen Henglongtong US 1 January
99.75 December No
Technology Co., Ltd. D 2022
2025
10 31
AUJET INDUSTRY US
3,227.63 November December No
LIMITED D
2021 2023
10 31
AUJET INDUSTRY US
89.18 November December No
LIMITED D
2021 2023
31
AUJET INDUSTRY US
1,029.00 20 July 2020 December No
LIMITED D
2023
4. Loans from/to related parties
Cur
Amount(RMB'0,00
Related party ren Start date Maturity
0)
cy
251
Konka Group Co., Ltd. Interim Report 2023
Cur
Amount(RMB'0,00
Related party ren Start date Maturity
0)
cy
Borrowing:
CN 10 January 9 January
OCT Group 131,091.00
Y 2022 2025
CN 19 May 18 May
OCT Group 50,000.00
Y 2022 2025
CN 26 May 25 May
OCT Group 70,000.00
Y 2022 2025
31
Chuzhou Hanshang Electric CN 1 February
10,535.00 December
Appliance Co., Ltd. Y 2022
2023
31
Chuzhou Hanshang Electric CN 30 May
490.00 December
Appliance Co., Ltd. Y 2023
2023
10 31
Chuzhou Hanshang Electric CN
1,837.50 November December
Appliance Co., Ltd. Y
2022 2023
Chuzhou Hanshang Electric CN 14 February 13 February
980.00
Appliance Co., Ltd. Y 2023 2024
CN 31 March 19 March
Econ Technology 33.00
Y 2022 2024
CN 19 March
Econ Technology 31.35 2 June 2021
Y 2024
CN 19 March
Econ Technology 20.13 4 June 2021
Y 2024
CN 13 August 19 March
Econ Technology 1,536.15
Y 2021 2024
CN 13 October 19 March
Econ Technology 285.85
Y 2021 2024
17
CN 19 March
Econ Technology 40.26 December
Y 2024
2021
CN 16 February 19 March
Econ Technology 99.26
Y 2022 2024
CN 12 May 28 February
Econ Technology 95.96
Y 2022 2024
CN 16 June 28 February
Econ Technology 39.60
Y 2022 2024
CN 23 June 28 February
Econ Technology 1,070.92
Y 2022 2024
19
CN 28 February
Econ Technology 49.50 September
Y 2024
2022
19
CN 28 February
Econ Technology 33.00 December
Y 2024
2022
CN 24 February 28 February
Econ Technology 97.02
Y 2023 2024
Chongqing Kangjian Photoelectric CN 26 October 24 August
666.67
Technology Co., Ltd. Y 2022 2023
Kangkong Venture Capital 245.00 CN 21 July 19 July
252
Konka Group Co., Ltd. Interim Report 2023
Cur
Amount(RMB'0,00
Related party ren Start date Maturity
0)
cy
(Shenzhen) Co., Ltd. Y 2022 2023
30
Beijing Xuri Shengxing Technology CN 5 December
228.67 November
Co., Ltd. Y 2022
2023
7
CN
Shanghai SUS Environment Co.,Ltd. 1,000.00 9 June 2023 September
Y
2023
7
CN 20 June
Shanghai SUS Environment Co.,Ltd. 1,000.00 September
Y 2023
2023
Total 271,505.84
Lending:
25
Dongguan Guankangyuhong CN 6 August
19,600.00 September
Investment Co., Ltd. Y 2022
2023
18
Chuzhou Kangxin Health Industry CN 23 October
15,288.00 December
Development Co., Ltd. Y 2023
2022
Chuzhou Kangxin Health Industry CN 5 January 23 October
735.00
Development Co., Ltd. Y 2023 2023
Chuzhou Kangxin Health Industry CN 5 January 23 October
59.45
Development Co., Ltd. Y 2023 2023
18
Chuzhou Kangxin Health Industry CN 23 October
1,240.03 December
Development Co., Ltd. Y 2023
2022
Chuzhou Kangxin Health Industry CN 22 March 23 October
16,758.00
Development Co., Ltd. Y 2023 2023
Chuzhou Kangxin Health Industry CN 21 March 23 October
1,359.26
Development Co., Ltd. Y 2023 2023
Chuzhou Kangxin Health Industry CN 21 March 23 October
109.95
Development Co., Ltd. Y 2023 2023
Chuzhou Kangxin Health Industry CN 22 March 23 October
1,344.36
Development Co., Ltd. Y 2023 2023
CN 21 January 4 March
Sichuan Chengrui 14,724.50
Y 2022 2025
16 25
Yantai Kangyue Investment Co., CN
12,852.70 December November
Ltd. Y
2020 2022
23
Yantai Kangyun Industrial CN 26 February
10,020.00 November
Development Co., Ltd. Y 2024
2021
Yantai Kangyun Industrial CN 25 August 26 February
3,230.00
Development Co., Ltd. Y 2022 2024
Yantai Kangyun Industrial CN 17 March 26 February
1,020.00
Development Co., Ltd. Y 2022 2024
Yantai Kangyun Industrial CN 23 May 26 February
3,400.00
Development Co., Ltd. Y 2022 2024
Yantai Kangyun Industrial CN 26 February
2,500.00 1 June 2022
Development Co., Ltd. Y 2024
253
Konka Group Co., Ltd. Interim Report 2023
Cur
Amount(RMB'0,00
Related party ren Start date Maturity
0)
cy
15
Yantai Kangyun Industrial CN 26 February
2,430.00 November
Development Co., Ltd. Y 2024
2022
25 22
Chongqing Lanlv Moma Real Estate CN
18,843.00 November September
Development Co., Ltd. Y
2020 2023
15 23
Sichuan Hongxinchen Real Estate CN
21,963.39 September December
Development Co., Ltd. Y
2022 2023
31
CN 17 March
Econ Technology 18,315.11 December
Y 2023
2023
20
CN 6 April
Econ Technology 4,996.58 December
Y 2023
2023
24 23
Chongqing Liangshan Industrial CN
7,524.80 December December
Investment Co., Ltd. Y
2022 2023
Total 178,314.13
5. Asset transfer and debt restructuring of related parties
Amount incurred Amount
Related party
Related party in the Reporting incurred in the
transaction
Period previous period
OCT Group Co., Ltd. and its Transfer of patents,
subsidiaries and associate software copyrights 12,843,396.23
enterprises and trademarks
Total 12,843,396.23
6. Remuneration for key management personnel
Reporting Period Same period of the previous
Project
(RMB'0,000) year (RMB'0,000)
Total remuneration 549.95 737.41
（三）Balances with related parties
1. Receivables
Ending balance Opening balance
Related party Bad debt Bad debt
Carrying balance Carrying balance
provision provision
Accounts
receivable:
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Konka Group Co., Ltd. Interim Report 2023
Ending balance Opening balance
Related party Bad debt Bad debt
Carrying balance Carrying balance
provision provision
OCT Group
Co., Ltd. and
153,191,974.88 11,823,388.29 156,687,630.71 8,433,199.71
its subsidiaries
and associates
Shenzhen
Yaode
Technology 148,503,144.96 125,575,215.21 143,135,135.62 121,664,865.28
Co., Ltd. and
its subsidiaries
HOHOELECT
RICAL&FUR
126,891,283.20 18,139,114.89 123,273,472.66 18,429,711.73
NITURECO.,
LIMITED
Chuzhou
Hanshang
Electric 62,593,179.59 1,276,900.87 52,156,655.05 1,063,995.77
Appliance Co.,
Ltd.
Anhui Kaikai
Shijie E-
commerce Co., 41,113,303.07 2,318,660.87 47,638,172.10 2,368,282.48
Ltd. and its
subsidiaries
Shenzhen
Kanghongxing
Smart 39,239,778.12 34,665,687.97 39,215,316.77 32,913,147.45
Technology
Co., Ltd.
Korea Electric
Group Co.,
23,695,513.68 483,388.48 4,960,132.20 101,186.70
Ltd. and its
subsidiaries
Shenzhen
Jielunte
Technology
Co., Ltd. and
9,813,160.70 200,188.48 13,523,856.80 410,843.28
its subsidiaries
as well as its
associated
enterprises
Shenzhen
Konda E-
display Co., 2,042,851.77 41,674.16 10,824,609.83 220,822.05
Ltd. and its
subsidiaries
Subtotal of
other related 17,442,982.92 940,045.58 17,711,091.20 574,271.36
parties
Total 624,527,172.88 195,464,264.80 609,126,072.94 186,180,325.81
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Konka Group Co., Ltd. Interim Report 2023
Ending balance Opening balance
Related party Bad debt Bad debt
Carrying balance Carrying balance
provision provision
Financing
accounts
receivable/No
tes receivable:
Korea Electric
Group Co.,
126,000,000.00 103,340,000.00
Ltd. and its
subsidiaries
Anhui Kaikai
Shijie E-
commerce Co., 4,000,000.00 63,064.76
Ltd. and its
subsidiaries
Chuzhou
Hanshang
Electric 5,028,746.39
Appliance Co.,
Ltd.
Total 130,000,000.00 108,431,811.15
Dividends
receivable
Chongqing
Qingjia
272,999.43
Electronics
Co., Ltd.
Total 272,999.43
Other
receivables:
Jiangxi Meiji
Enterprise Co., 93,512,640.31 86,901,651.51 93,512,640.31 86,901,651.51
Ltd.
Dai Rongxing 84,345,435.41 84,345,435.41 83,058,831.58 83,058,831.58
Chongqing
Liangshan
Industrial 77,196,153.61 1,574,801.53 75,330,416.70 1,536,740.51
Investment Co.,
Ltd.
Shenzhen
Kanghongxing
Smart 39,888,921.64 36,131,458.50 39,888,921.64 36,024,193.48
Technology
Co., Ltd.
OCT Group
Co., Ltd. and
36,778,366.11 20,417,601.13 35,760,987.33 20,304,912.84
its subsidiaries
and associates
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Konka Group Co., Ltd. Interim Report 2023
Ending balance Opening balance
Related party Bad debt Bad debt
Carrying balance Carrying balance
provision provision
Huanjia Group
25,083,675.53 24,582,002.02 25,083,675.53 24,582,002.02
Co., Ltd.
Dongguan
Guankang
Yuhong 22,000,000.00 220,000.00 22,000,000.00 220,000.00
Investment Co.,
Ltd.
HOHOELECT
RICAL&FUR
2,535,424.83 575,287.89 2,443,773.67 554,492.25
NITURECO.,
LIMITED
Hu Zehong 1,587,271.29 153,103.04 2,058,174.06 41,986.75
Subtotal of
other related 468,092.37 7,709.48 159,634.37 3,230.02
parties
Total 383,395,981.10 254,909,050.52 379,297,055.19 253,228,040.96
Prepayments:
Puchuang
Jiakang
4,120,342.24 3,176,682.44
Technology
Co, Ltd.
Chuzhou
Hanshang
Electric 2,632,500.00
Appliance Co.,
Ltd.
Shenzhen
Kangying
Semiconductor
2,021,396.41 5,720,375.37
Technology
Co., Ltd. and
its subsidiaries
Henan Kangfei
Intelligent
Electric 1,971,261.84
Appliance Co.,
Ltd.
OCT Group
Co., Ltd. and
208,530.00 1,094,665.28
its subsidiaries
and associates
Subtotal of
other related 390,830.43 1,184,075.41
parties
Total 11,344,860.92 11,175,798.50
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Konka Group Co., Ltd. Interim Report 2023
Ending balance Opening balance
Related party Bad debt Bad debt
Carrying balance Carrying balance
provision provision
Contract
assets:
OCT Group
Co., Ltd. and
441,792.02 9,012.56
its subsidiaries
and associates
Total 441,792.02 9,012.56
Other current
assets:
Yantai
Kangyun
Industrial
247,211,577.82 238,121,355.60
Development
Co., Ltd. and
its subsidiaries
Sichuan
Hongxinchen
Real Estate 233,954,106.29
Development
Co., Ltd.
Shandong
Econ
Technology 233,116,949.03 183,151,149.03
Co., Ltd. and
its subsidiaries
Chongqing
Lanlv Moma
Real Estate 228,125,919.93 220,546,846.61
Development
Co., Ltd.
Dongguan
Guankang
Yuhong 216,823,806.77 217,760,251.21
Investment
Co., Ltd.
Yantai
Kangyue
165,457,091.34 160,287,449.78
Investment
Co., Ltd.
Sichuan
162,456,304.41 158,533,783.32
Chengrui
Total 1,867,956,911.49 1,544,592,633.47
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Konka Group Co., Ltd. Interim Report 2023
2. Payables
Ending carrying Opening carrying
Related party
balance balance
Accounts payable:
Chuzhou Hanshang Electric Appliance Co., Ltd. 61,751,089.15 22,429,429.76
Puchuang Jiakang Technology Co, Ltd. 40,191,613.80 43,840.00
OCT Group Co., Ltd. and its subsidiaries and
24,899,469.89 13,114,183.37
associates
Shenzhen Jielunte Technology Co., Ltd. and its
16,376,915.47 13,942,717.31
subsidiaries
Shenzhen Konda E-display Co., Ltd. and its
13,727,043.65 12,879,895.22
subsidiaries
Korea Electric Group Co., Ltd. and its subsidiaries 11,303,306.87 2,609,330.74
HOHOELECTRICAL&FURNITURECO.,LIMITED 9,872,039.77 6,083,652.55
Dongguan Kangjia New Materials Technology Co.,
4,793,873.81 1,811,519.42
Ltd.
Anhui Kaikai Shijie E-commerce Co., Ltd. and its
4,615,128.91 4,615,128.91
subsidiaries
Panxu Intelligence Co., Ltd. and its subsidiaries 3,737,203.15 5,894,192.83
Subtotal of other related parties 9,504,535.20 6,042,680.04
Total 200,772,219.67 89,466,570.15
Notes payable:
Korea Electric Group Co., Ltd. and its subsidiaries 7,801,909.48 9,889,686.67
Dongguan Kangjia New Materials Technology Co.,
2,265,450.56 5,664,319.21
Ltd.
Chuzhou Hanshang Electric Appliance Co., Ltd. 13,000,000.00
Shenzhen Jielunte Technology Co., Ltd. and its
880,920.54 4,868,677.92
subsidiaries
Panxu Intelligence Co., Ltd. and its subsidiaries 4,425,575.22
Total 10,948,280.58 37,848,259.02
Contractual liabilities/other current liabilities:
OCT Group Co., Ltd. and its subsidiaries and
42,311,463.60 42,395,460.49
associates
Shenzhen Konda E-display Co., Ltd. and its
9,351,106.86 2,873,318.85
subsidiaries
Henan Kangfei Intelligent Electric Appliance Co.,
3,871,147.85 830,737.57
Ltd.
Shenzhen Aimijiakang Technology Co., Ltd. 1,030,654.81 2,541,156.83
Shandong Kangfei Intelligent Electrical Appliances
467,417.09 1,328,665.36
Co., Ltd.
Subtotal of other related parties 211,926.08 794,914.19
Total 57,243,716.29 50,764,253.29
Other payables:
Chuzhou Hanshang Electric Appliance Co., Ltd. 177,963,968.88 185,043,644.73
259
Konka Group Co., Ltd. Interim Report 2023
Ending carrying Opening carrying
Related party
balance balance
Shandong Econ Technology Co., Ltd. and its
37,625,604.01 42,331,626.74
subsidiaries
Shanghai SUS Environment Co.,Ltd. 20,458,916.66
OCT Group Co., Ltd. and its subsidiaries and
12,966,717.20 5,897,248.07
associates
Central Enterprises in poverty-stricken
areas(Jiangxi)Industrial Investment Funds 7,200,000.00 2,400,000.00
Partnership(L.P.)
Chongqing Kangjian Photoelectric Technology Co.,
7,151,258.03 8,029,369.86
Ltd.
Kangkong Venture Capital (Shenzhen) Co., Ltd. 2,486,447.97 2,483,024.67
Beijing Xuri Shengxing Technology Co., Ltd. 2,465,923.83 2,396,943.13
Korea Electric Group Co., Ltd. and its subsidiaries 2,092,105.43 1,908,700.39
Guangdong Wanrundaoheng Culture Tourism
83,480,206.21
Development Co., Ltd.
Subtotal of other related parties 8,309,603.52 8,674,635.51
Total 278,720,545.53 342,645,399.31
XII. Contingency
(1) Before the Company acquired Jiangxi Konka , Jiangxi Konka and its subsidiaries Xinfeng
Microcrystalline and Jiangxi High Transparent Substrate (formerly known as Nano-Grystallized
Glass) provided joint and several liability guarantee for the loans from Nanchang Rural
Commercial Bank Co., Ltd. to Jiangxi Xinxin Jian'an Engineering, Jiangxi Zhongyi Decorative
Material and Jiangxi Shanshi Science and Technology, related parties of former controlling
shareholders of Jiangxi Konka , and Nanchang Rural Commercial Bank Co., Ltd. then transferred
the claims to China Great Wall AMC Jiangxi Branch. For the failure of Jiangxi Xinxin Jian'an
Engineering, Jiangxi Zhongyi Decorative Material and Jiangxi Shanshi Science and Technology
to repay the borrowings on time, China Great Wall AMC Jiangxi Branch filed a lawsuit
requesting Jiangxi Xinxin Jian'an Engineering, Jiangxi Zhongyi Decorative Material and Jiangxi
Shanshi Science and Technology to repay the loan principal amounting to RMB300 million and
the liquidated damage and interest arising from it and guarantors Jiangxi Konka, Jiangxi High
Transparent Substrate and Xinfeng Microcrystalline to bear joint and several liability for such
debts.
On 31 October 2019, the Higher People's Court of Jiangxi Province ruled in the first instance
that Jiangxi Xinxin Jian'an Engineering, Jiangxi Zhongyi Decorative Material, Jiangxi Shanshi
Technology should repay to China Great Wall AMC Jiangxi Branch the loan principal of
RMB300 million and the interest and liquidated damage arising from it within 10 days from the
effective date of the judgment, and Jiangxi Konka New Material, Zhu Xinming, Leng Sumin,
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Konka Group Co., Ltd. Interim Report 2023
Nano-Grystallized Glass, Xinfeng Microcrystalline should bear joint and several liability for all
debts recognised in this judgment. The defendants appealed against the verdict of the first
instance and the Supreme People's Court accepted the appeal. On 24 March 2021, the Supreme
People's Court made the following ruling: I. Civil Judgment (2018) G.M.CH. No. 110 made by
the Higher People's Court of Jiangxi Province is abrogated; II. This case is remanded to the
Higher People's Court of Jiangxi Province for retrial. As of the date of issuance of this report, the
first instance of the retrial was decided, and a file was been filed.
The actual controller of Jiangxi Konka New Materials, Zhu Xinming, and his spouse, Leng
Sumin, Jiangxi Xinzixin Real Estate Co., Ltd., Zhu Zilong, Zhu Qingming and Zeng Xiaohong, as
guarantors, provided a total of approximately RMB143 million of real estate mortgage guarantee
to Great Wall AMC for the above loans. Zhu Xinming and Leng Sumin also provided joint
liability guarantees. In order to avoid the adverse impact of this case on the Company, the
Company has agreed in the acquisition agreement of Jiangxi Konka, Xinfeng Microcrystalline
and nanometre microcrystalline that all contingent debts incurred by Jiangxi Konka by the
original shareholders of Konka new material in the form of joint and several liability. Jiangxi
Xinzixin Real Estate Co., Ltd. has held a total of approximately RMB243 million of real estate
assets as the case of the anti-guarantee mortgage to Konka group and went through the mortgage
registration procedures. As of the date of this report, the case is still on trial and the above
commercial acceptance bill has not been honoured.
(2) As for the dispute of the Company with Luo Zaotong, Luo Jingxia, Luo Zongyin, Luo
Zongwu and Shenzhen Yaode Technology Co., Ltd. on share repurchase, since the other party did
not actively perform the repurchase obligation, the Company filed a lawsuit with the People's
Court of Nanshan District, Shenzhen. The amount of the subject matter involved in the lawsuit is
RMB249 million. On 22 November 2021, the Company applied to the People's Court of Nanshan
District, Shenzhen, for property preservation. On 11 January 2023, the People's Court of Nanshan
District, Shenzhen, rendered a verdict of the first instance, ruling that Luo Zaotong, Luo Jingxia,
Luo Zongyin and Luo Zongwu pay the repurchase amount of RMB172 million plus the sum of
interest calculated at 12% per annum from 6 April 2017 to the date of payment of the equity
repurchase by the defendant Luo Zaotong, Luo Jingxia, Luo Zongyin and Luo Zongwu. As of the
date of issuance of this report, the case was executed in progress.
(3) As the acceptor failed to pay the commercial acceptance bills held by the Company upon
maturity, the Company, as the plaintiff, requested debtors Hongtu Sanpower Technology Co.,
Ltd., Jiangsu Hongtu High Technology Co., Ltd., Sanpower Group Co., Ltd., Nanjing Jiongjiong
Electronic Technology Co., Ltd. and Shenzhen Qianhai Benniu Agricultural Technology Co., Ltd.
to bear joint and several liability for the bills and the overdue interest. In July 2019, the company
filed a lawsuit with the court, and the court has preserved the defendant's corresponding property.
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Konka Group Co., Ltd. Interim Report 2023
As of the date of issuance of this report, the case was in trial.
(4) The amount of the subject matter involved in the dispute between the Company and
Wuhan Jialian Agricultural Technology Development Co., Ltd., Peng Chaojun, He Jiaguo, He
Jiayi, Liang Xiangzhou, Xu Yizheng, He Fan, Pang Huasheng, Song Liangming, and Liang
Xiangmei over the right of recourse for bills is RMB200 million and the corresponding interest.
In September 2020, the Company filed a lawsuit with the Wuhan Intermediate People's Court,
and the court order the defendant to pay Konka Group the bills and interest. The defendant
applied for retrial during the execution of the case. As of the date of issuance of this report, the
case was in retrial.
(5) The amount of the subject matter involved in the dispute between the Company's
subsidiary Konka Unifortune and Shenzhen Yaode Technology Co., Ltd., Dongsheng Xinluo
Technology (Shenzhen) Co., Ltd., Shenzhen Hongyao Dingsheng Investment Management Co.,
Ltd., Shenzhen Xiangrui Yingtong Investment Management Co., Ltd., Luo Jingxia, Luo Zongwu,
Luo Zongyin, Luo Zaotong and Luo Saiyin over contracts is RMB155 million. On 8 September
2022, the court issued a judgment in favour of the Company's subsidiary. As of the date of
issuance of this report, the case was executed in progress.
(6) As the acceptor failed to pay the commercial bills held by the Company upon maturity,
the Company, as the plaintiff, filed a lawsuit with the court on the matured bills amounting to
RMB300 million, requesting the bill acceptor Shanghai Huaxin and prior parties involved to bear
joint and several liability for the bills and liquidated damage and interest. As of the date of
issuance of this report, the case involving RMB150 million is in compulsory execution and
shareholders have been added as persons to be executed in this case. For the remaining RMB150
million, the defendants have been ordered to pay Konka Group the bills and interest, which is
now in compulsory execution. As of the date of issuance of this report, the case was executed in
progress.
(7) The amount of the subject matter involved in the dispute between the Company's
subsidiaries Frestec Refrigeration, Anhui Konka, Konka Material and Anhui Tongchuang
(plaintiff) and Shantou Meisen Technology Co., Ltd., Shenzhen Meisenyuan Plastic Electronics
Co., Ltd., Lin Yuanqin, Huang Ruirong, Jiangsu Huadong Hardware Zone Co., Ltd., Chuangfu
Commerce & Trade Plaza Real Estate Development (Huizhou) Co., Ltd. and Puning Junlong
Trade Co., Ltd. (defendants) over contracts is RMB380 million. As of the date of issuance of this
report, the portion of the case, related to Anhui Tongchuang and Frestec Refrigeration, were
executed in progress, while the rest was in trial.
(8) The amount of the subject matter involved in the dispute between the Company's
subsidiary Konka Investment (plaintiff) and Elion Resources Group Co., Ltd. and Elion
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Konka Group Co., Ltd. Interim Report 2023
Ecological Co., Ltd. (defendants) over capital increase is RMB98 million. The court of arbitration
issued an award on 27 January 2022. On 16 February 2022, the compulsory enforcement was
filed. On 9 September 2022, the Company and Elion entered into an execution settlement
agreement, which provides for monthly repayment from 15 September 2022 to 25 August 2023 to
pay off the outstanding amount of this case. As of the issuance of this report, an accumulated
amount of RMB125 million has been returned, and the case was executed in progress.
(9) A case has been filed on the dispute over the sales and purchase contracts between the
Company's subsidiary Konka Huanjia (plaintiff) and 38 companies (defendant) including Huanjia
Group Co., Ltd. and Dalian Jinshunda Material Recycling Co., Ltd., etc. The amount of the
subject matter involved in it is RMB890 million. Konka Huanjia has applied for the court to seal
up and freeze the defendant's corresponding property. In the case involving RMB322 million of
litigation, the court delivered a ruling of the first instance to Kangjia in March 2023, rejecting the
suit of Kangjia Huanjia. The remaining cases, involving RMB568 million, were decided by the
court for the first instance in December 2022, and Kangjia Huanjiadun has appealed to the
Liaoning Provincial High People's Court. As of the date of issuance of this report, the case
involving RMB322 million of litigation was closed, while the cases, involving RMB568 million,
were remanded for retrial.
(10) The amount of the subject matter involved in the dispute between the Company's
subsidiary Dongguan Konka (plaintiff) and Dongguan Gaoneng Polymer Materials Co., Ltd.,
Wang Dong, Shenzhen Xinlian Xingyao Trading Co., Ltd., Shenzhen Jinchuan Qianchao
Network Technology Co., Ltd., Puning Junlong Trading Co., Ltd. and Huang Zhihao (defendants)
over sales and purchase contracts is RMB90 million. In December 2020, the Company filed a
lawsuit with the court. The latter issued a judgment in favour of the Company. As of the date of
issuance of this report, the case was executed in progress.
(11) As the acceptor failed to pay the commercial bills held by the Company upon maturity,
the Company, as the plaintiff, filed a lawsuit with the court on the matured bills amounting to
RMB78 million, requesting the court to order Hefei Huajun Trading Co., Ltd. and Wuhan Jialian
Agricultural Technology Development Co., Ltd. to pay the Company the bills and the interest for
default, and applied for property preservation. The case executed a return of RMB2 million, and
the Company is applying with the court for adding shareholders as persons to be executed. As of
the date of issuance of this report, the case was executed in progress.
(12) The amount of the subject matter involved in the dispute between the Company's
subsidiary Konka Factoring (the plaintiff) and Tahoe Group Co., Ltd., Fuzhou Taijia Enterprise
Co., Ltd. and Xiamen Lianchuang Micro-electronics Co., Ltd. (the defendants) over the right of
recourse for bills is RMB50 million and the corresponding interest. On 1 September 1 2021, the
Intermediate People's Court of Xiamen Municipality, Fujian Province, ordered the defendants to
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Konka Group Co., Ltd. Interim Report 2023
pay the plaintiff e-commercial acceptance bills of RMB50 million and the corresponding interest.
On 4 January 2022, the compulsory enforcement was filed. The case executed a return of RMB43
million. As of the date of issuance of this report, the case was executed in progress.
(13) The amount of the subject matter involved in the dispute between the Company
(plaintiff) and China Energy Electric Fuel Co., Ltd., China Energy (Shanghai) Enterprise Co.,
Ltd., Shanghai Nengping Enterprise Co., Ltd. and Shenzhen Qianhai Baoying Commercial
Factoring Co., Ltd. (defendants) over the right of recourse for bills is RMB50 million and the
corresponding interest. In September 2018, the company filed a lawsuit with the Shenzhen
Intermediate People's Court, and the court has preserved the defendant's corresponding property.
The judgment of this case has come into effect. The court ordered China Energy Electric Fuel Co.,
Ltd. and other defendants to pay the Company the bills of RMB50 million and the interest. As of
the date of issuance of this report, the case was executed in progress, and the Company applied
with the court for adding shareholders as persons to be executed.
(14) The amount of the subject matter involved in the dispute between the Company's
subsidiary Anhui Konka (plaintiff) and Makena Electronic (Hong Kong) (defendant) over the
sales and purchase contract is RMB5,440,200. On 7 December 2021, Anhui Konka filed
arbitration with the Shenzhen Court of International Arbitration. On 14 October 2022, the
compulsory enforcement was filed. As of the date of issuance of this report, the case was
executed in progress.
(15) The amount of the subject matter involved in the dispute between the Company's
subsidiary Anhui Konka (plaintiff) and Shanghai Likai Logistics Co., Ltd. Shenzhen Branch and
Shanghai Likai Logistics Co., Ltd. (defendants) over freight forwarding contracts in maritime and
open sea waters is RMB38 million. On 26 April 2021, Konka applied to Shanghai Maritime Court
for compulsory execution. On 7 June 2021, the court accepted the case. As of the date of issuance
of this report, the case was executed in progress.
(16) The amount of the subject matter involved in the dispute between the Company's
subsidiary Pengrun Technology (plaintiff) and Guangan Ou Qi Shi Electronic Technology Co.,
Ltd., Guan Hongshao, Huaying Gaokede Electronic Technology Co., Ltd., Huaying Gaokelong
Electronic Technology Co., Ltd., Guizhou Jiaguida Technology Co., Ltd., Sichuan Hongrongyuan
Real Estate Co., Ltd., Du Xinyu, Linbolong and Wang Shisheng (defendants) over trust contract
is RMB167 million. The case has been applied for property preservation measures. As of the date
of issuance of this report, the case was under trial.
(17) The amount of the subject matter involved in the dispute between the Company
(plaintiff) and Yantai Kangyue Investment Co., Ltd. (defendant) over borrowing contract is
RMB160 million. The Company has applied to the Shenzhen Intermediate People's Court for
264
Konka Group Co., Ltd. Interim Report 2023
property preservation. As of the date of issuance of this report, the cases are under trial.
(18) The amount of the subject matter involved in the dispute between the Company's
subsidiary Konka Huanjia (plaintiff) and Bank Of Fuxin Co., Ltd., Huanjia Group, Dalian Jinjia
Materials Recycling Co., Ltd., Dalian Jin Kaixuan Renewable Resources Acquisition Chain Co.,
Ltd., Dalian Yingtai Paper Co., Ltd., Dalian Zhanhong Renewable Resources Recycling Co., Ltd.
and Wang Jinping (defendants) over the execution objection by an outsider is RMB240 million.
As of the date of issuance of this report, the case was under trial.
(19) The amount of the subject matter involved in the dispute between the Company's
subsidiary Jiaxin Technology Co., Limited (plaintiff) and Tripod Electronics Technology
(HongKong) Limited, Chen Wenhuan and Chen Baohong (defendants) over a sales and purchase
contract of international goods is RMB51 million. As of the date of issuance of this report, the
case was under trial.
(20) The amount of the subject matter involved in the dispute between the Company's
subsidiary Kangzhi Trade (plaintiff) and B&L Technology Co., Limited (defendant) over a sales
and purchase contract of international goods is RMB25 million. As of the date of issuance of this
report, the case was executed in progress.
(21) The amount of the subject matter involved in the dispute between the Company's
subsidiary Anhui Konka (plaintiff) and MAKENA Electronic (Shenzhen) Co., Ltd. (defendant)
over a guarantee contract is RMB21 million. On 27 December 2022, the court made verdict of
first instance, which supported most of Anhui Konka's claims, and both parties appealed against
the verdict of first instance. As of the date of issuance of this report, the case was under trial.
(22) The amount of the subject matter involved in the dispute between Shenzhen Oriental
Venture Capital Investment Co., Ltd. (plaintiff) and the Company (defendant) over a contract is
RMB750 million. As of the date of issuance of this report, the case was under trial.
(23) The amount of the subject matter involved in the dispute between the Company and the
Company's subsidiary Electronics Technology (defendants) and Wu Rong (plaintiff) over a sales
and purchase contract is RMB22 million. As of the date of issuance of this report, the case was
under trial.
XIII. Commitments
1. Capital commitments
Item Closing balance Opening balance
Contract signed but hasn't been
recognised in financial statements
265
Konka Group Co., Ltd. Interim Report 2023
-Commitment on construction and
purchase of long-lived assets
-Large amount contract 675,769,622.91 523,553,381.89
-Foreign investment commitments
Total 675,769,622.91 523,553,381.89
2. Other commitments
As of 30 June 2023, there were no other significant commitments for the Company to
disclose.
XIV. Events after Balance Sheet Date
1. 1. No significant non-adjusted events
2. Sales return
No such cases in the Reporting Period.
3. 3. There were no other significant events after balance sheet date for the Company.
XV. Other Significant Events
The Company has no other significant events.
XVI. Notes of Main Items in the Financial Statements of the Company as the Parent
1. Accounts receivable
（1）Accounts receivable listed by withdrawal methods for bad debts
Closing balance
Book balance Provision for bad debts
Category Provision Carrying
Proportion value
Amount Amount percentage
(%)
(%)
Accounts
receivable of
716,102,2
expected credit 11.79 652,174,491.35 91.07 63,927,795.70
87.05
losses withdrawn
individually
Accounts
receivable of
expected credit
losses withdrawn
by portfolio
Of which: Aging 350,995,2 158,461,756.1
5.78 192,533,466.31 54.85
portfolio 22.41 0
Grouping 5,004,296 5,004,296,403
82.43
of related parties ,403.24 .24
266
Konka Group Co., Ltd. Interim Report 2023
Closing balance
Book balance Provision for bad debts
Category Provision Carrying
Proportion value
Amount Amount percentage
(%)
(%)
Subtotal of 5,355,291 5,162,758,159
88.21 192,533,466.31 3.60
portfolio ,625.65 .34
Total 6,071,393 5,226,685,955
100 844,707,957.66 13.91
,912.70 .04
(Continued)
Opening balance
Book balance Provision for bad debts
Category Provision Carrying
Proportion value
Amount Amount percentage
(%)
(%)
Accounts
receivable of
723,559,6
expected credit 13.60 652,094,110.07 90.12 71,465,499.56
09.63
losses withdrawn
individually
Accounts
receivable of
expected credit
losses withdrawn
by portfolio
Of which: Aging 410,174,7 216,284,942.5
7.71 193,889,834.11 47.27
portfolio 76.68 7
Grouping 4,186,128 4,186,128,552
78.69
of related parties ,552.37 .37
Subtotal of 4,596,303 4,402,413,494
86.40 193,889,834.11 4.22
portfolio ,329.05 .94
Total 5,319,862 4,473,878,994
100.00 845,983,944.18 15.90
,938.68 .50
（2）Provision for bad debts of accounts receivable provided individually
Closing balance
Name Provision
Provision for Reasons for the
Book balance percentage
bad debts provision
(%)
Shanghai Huaxin
Expected to be
International 299,136,676.70 293,153,943.17 98
difficult to recover
Group Co., Ltd.
Hongtu Sanbao
High-tech Agreement
200,000,000.00 160,000,000.00 80
Technology Co., reorganisation
Ltd.
267
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Closing balance
Name Provision
Provision for Reasons for the
Book balance percentage
bad debts provision
(%)
Zhongfu Tiangong
Expected to be
Construction 71,539,096.65 53,654,322.49 75
difficult to recover
Group Co., Ltd.
CCCC First
Harbor Expected to be
55,438,105.00 55,438,105.00 100
Engineering difficult to recover
Company Ltd.
China Energy
Expected to be
Electric Fuel Co., 50,000,000.00 50,000,000.00 100
difficult to recover
Ltd.
Henan Radio and
Expected to be
Television 26,847,370.00 26,847,370.00 100
difficult to recover
Network Co., Ltd.
Others Expected to be
13,141,038.70 13,080,750.69 99.54
difficult to recover
Total 716,102,287.05 652,174,491.35 91.07
1） Provision for bad debts for accounts receivable made as per portfolio
1 Among the portfolio, withdrawal of expected credit loss by aging
Closing balance
Aging Provision for bad Provision
Book balance
debts percentage (%)
Within one year 98,861,669.89 2,016,778.04 2.04
One to two years 64,853,679.82 6,498,338.72 10.02
Two to three years 3,042,884.82 690,430.57 22.69
Over three years 184,236,987.88 183,327,918.98 99.51
Three to four years 2,588,464.99 1,679,396.09 64.88
Four to five years 19,473,262.48 19,473,262.48 100.00
Over five years 162,175,260.41 162,175,260.41 100.00
Total 350,995,222.41 192,533,466.31 54.85
2 Among the portfolio, withdrawal of expected credit loss by adopting other method
Closing balance
Aging Provision for Provision
Book balance
bad debts percentage (%)
Grouping of related parties 5,004,296,403.24
Total 5,004,296,403.24
（3） Accounts receivable listed by aging portfolio
Aging Closing balance
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Konka Group Co., Ltd. Interim Report 2023
Within one year 4,541,756,449.61
One to two years 516,433,226.62
Two to three years 99,003,192.95
Over three years 914,201,043.52
Three to four years 72,635,057.88
Four to five years 668,764,128.97
Over five years 172,801,856.67
Subtotal 6,071,393,912.70
Less: Provisions for bad debts 844,707,957.66
Total 5,226,685,955.04
（4） Information of provision for bad debts in the Reporting Period
Change in the Reporting Period
Category Opening balance Recovery or
Provision
reclassification
Provision for bad
debts of accounts
receivable 845,983,944.18 320,444.05 1,596,430.57
Total 845,983,944.18 320,444.05 1,596,430.57
(Continued)
Change in the Reporting Period
Category Charge-off or write- Closing balance
Others
off
Provision for bad
debts of accounts
receivable 844,707,957.66
Total 844,707,957.66
（5） No actual verified accounts receivable in the Reporting Period.
（6） Top five accounts receivable in the closing balance categorised by debtors
The total amount of receivables with top five ending balance collected by arrears party for the
Reporting Period was RMB4,781,615,179.61, accounting for 78.76% of the total ending balance of
accounts receivable. The total ending balance of provision for bad debts correspondingly
withdrawn was RMB0.
（7） There was no account receivable terminated the recognition owning to the transfer of
the financial assets
（8） There was no asset and liability formed due to the transfer of accounts receivable and
continued involvement in the Reporting Period
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2. Other accounts receivable
Item Closing balance Opening balance
Interest receivable 5,279,505.89 3,878,580.64
Dividends receivable 397,213,312.02 393,563,347.61
Other accounts receivable 9,200,889,225.20 9,944,884,426.80
Total 9,603,382,043.11 10,342,326,355.05
2.1 Interest receivable
Item Closing balance Opening balance
Interest on term deposits 5,279,505.89 3,878,580.64
Total 5,279,505.89 3,878,580.64
2.2 Dividends receivable
Investee Closing balance Opening balance
Hong Kong Konka Limited 117,213,312.02 113,563,347.61
Suining Konka Industrial Park
280,000,000.00 280,000,000.00
Development Co., Ltd.
Total 397,213,312.02 393,563,347.61
2.3 Other receivables
（1） Classified by account nature
Nature of fund Closing book balance Opening book balance
Intercourse funds among
10,878,544,849.73 11,299,542,985.57
subsidiaries
Energy-saving subsidies receivable 141,549,150.00 141,549,150.00
Intercourse funds with other related
67,922,245.03 50,667,315.53
parties
Deposit and margin 13,000,446.16 17,354,107.03
Others 63,695,802.50 375,797,998.76
Total 11,164,712,493.42 11,884,911,556.89
（2） Withdrawal of provision for bad debts for other receivables
Phase I Phase II Phase III
Expected credit
Provision loss during the Expected credit loss
Expected
for bad whole during the whole Total
credit loss for
debts outstanding outstanding
the next 12
maturity maturity (with
months
(without credit credit impairment)
impairment)
Balance as
of 1 January 357,726.75 57,275,497.55 1,882,393,905.79 1,940,027,130.09
2023
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Phase I Phase II Phase III
Expected credit
Provision loss during the Expected credit loss
Expected
for bad whole during the whole Total
credit loss for
debts outstanding outstanding
the next 12
maturity maturity (with
months
(without credit credit impairment)
impairment)
In the
Reporting
Period,
carrying
amount of -66,300.39 66,300.39
other
receivables
on 1 January
2023
--
Transferred -66,300.39 66,300.39
to Phase II
--
Transferred
to Phase III
--
Reclassified
under Phase
II
--
Reclassified
under Phase
I
Provision in
the
333,341.39 14,165,418.49 9,297,378.25 23,796,138.13
Reporting
Period
Reclassificat
ion in the
Reporting
Period
Charge-off
in the
Reporting
Period
Write-off in
the
Reporting
Period
Other
changes
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Phase I Phase II Phase III
Expected credit
Provision loss during the Expected credit loss
Expected
for bad whole during the whole Total
credit loss for
debts outstanding outstanding
the next 12
maturity maturity (with
months
(without credit credit impairment)
impairment)
Balance as
of 30 June 624,767.75 71,507,216.43 1,891,691,284.04 1,963,823,268.22
2023
（3） Withdrawing provision for bad debts for other receivables by portfolio
Closing balance
Book balance Provision for bad debts
Category Carrying
Withdrawal
Proportion value
Amount Amount proportion
(%)
(%)
Other
receivables
of expected 1,906,715,323.4 1,891,691,284 15,024,039.3
17.08 99.21
credit losses 0 .04 6
withdrawn
individually
Other
receivables
of provision
for bad debts
withdrawn
by credit risk
characteristi
c portfolio:
Aging 41,914,655.7
110,462,355.71 0.99 68,547,699.96 62.06
portfolio 5
Low-risk 12,424,901.2
16,009,185.47 0.14 3,584,284.22 22.39
portfolio 5
Grouping of
9,131,525,628.8 9,131,525,62
related 81.79
4 8.84
parties
Subtotal of 9,257,997,170.0 9,185,865,18
82.92 72,131,984.18 0.78
portfolio 2 5.84
11,164,712,493. 1,963,823,268 9,200,889,22
Total 100 17.59
42 .22 5.20
Opening balance
Category
Book balance Provision for bad debts Carrying
value
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Withdrawal
Proportion
Amount Amount proportion
(%)
(%)
Other
receivables
of expected
1,901,377,741.07 16.00 1,882,393,905.79 99.00 18,983,835.28
credit losses
withdrawn
individually
Other
receivables
of provision
for bad debts
withdrawn
by credit risk
characteristi
c portfolio:
Aging
94,419,620.35 0.79 54,385,072.09 57.60 40,034,548.26
portfolio
Low-risk
16,755,275.76 0.14 3,248,152.21 19.39 13,507,123.55
portfolio
Grouping
9,872,358,919
of related 9,872,358,919.71 83.07
.71
parties
Subtotal of 9,925,900,591
9,983,533,815.82 84.00 57,633,224.30 0.58
portfolio .52
11,884,911,556.8 9,944,884,426
Total 9
100.00 1,940,027,130.09 16.32
.80
（4） Other receivables listed by aging
Aging Closing balance
Within one year 4,613,334,198.38
One to two years 3,517,576,136.05
Two to three years 1,001,637,203.66
Three to four years 325,281,105.82
Four to five years 1,358,342,044.40
Over five years 348,541,805.11
Subtotal 11,164,712,493.42
Less: Provisions for bad debts 1,963,823,268.22
Total 9,200,889,225.20
（5） Provision for bad debts for other receivables
The amount of provision for bad debts for the Reporting Period was RMB23,796,138.13,
and other receivables actually written off in this period were RMB0.00.
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（6） Other receivables actually written off for the Reporting Period
There were no other receivables actually written off for the Reporting Period.
（7） Top five other accounts receivable in the closing balance categorised by debtors
The total amount of other receivables with top five ending balance collected by arrears party
this year was RMB7,530,437,339.57, accounting for 67.45% of the total ending balance of other
receivables. The total ending balance of provision for bad debts correspondingly withdrawn was
RMB1,732,011,461.53.
（8） There were no other receivables derecognised due to the transfer of financial assets for
the Reporting Period.
（9） There were no assets or liabilities formed due to the transfer and the continued
involvement of other receivables for the Reporting Period.
274
Konka Group Co., Ltd. Interim Report 2023
3. Long-term equity investment
（1）Category of long-term equity investment
Closing balance Opening balance
Item Provision for Provision for
Book balance Carrying value Book balance Carrying value
impairment impairment
Investment
in 7,334,954,047.75 781,480,000.00 6,553,474,047.75 7,277,554,047.75 781,480,000.00 6,496,074,047.75
subsidiaries
Investment
in associated
enterprises 2,347,018,914.97 219,718,378.41 2,127,300,536.56 2,824,333,468.08 219,718,378.41 2,604,615,089.67
and joint
ventures
Total 9,681,972,962.72 1,001,198,378.41 8,680,774,584.31 10,101,887,515.83 1,001,198,378.41 9,100,689,137.42
（2）Investment in subsidiaries
Impairment
Increase in the provision set Closing balance
Decrease in the
Investee Opening balance Reporting Closing balance aside in the of the provision
Reporting Period
Period Reporting for impairment
Period
Konka Ventures 2,550,000.00 2,550,000.00
Anhui Konka 122,780,937.98 122,780,937.98
Konka Factoring 300,000,000.00 300,000,000.00
Konka Unifortune 15,300,000.00 15,300,000.00
Wankaida 10,000,000.00 10,000,000.00
Dongguan Konka 274,783,988.91 274,783,988.91
275
Konka Group Co., Ltd. Interim Report 2023
Impairment
Increase in the provision set Closing balance
Decrease in the
Investee Opening balance Reporting Closing balance aside in the of the provision
Reporting Period
Period Reporting for impairment
Period
Konka Europe 3,637,470.00 3,637,470.00
Telecommunication
360,000,000.00 360,000,000.00
Technology
Mobile
100,000,000.00 100,000,000.00
Interconnection
Anhui Tongchuang 779,702,612.22 779,702,612.22
Kangjiatong 30,749,800.00 30,749,800.00
Pengrun
25,500,000.00 25,500,000.00
Technology
Beijing Konka
200,000,000.00 200,000,000.00
Electronic
Konka Circuit 297,650,000.00 77,400,000.00 375,050,000.00
Hong Kong Konka 781,828.61 781,828.61
Konka Investment 500,000,000.00 500,000,000.00
Electronics
1,000,000,000.00 1,000,000,000.00
Technology
Konka Huanjia - 91,800,000.00
Shanghai Konka 40,000,000.00 40,000,000.00 -
Jiangxi Konka - 689,680,000.00
Shenzhen Nianhua 30,000,000.00 30,000,000.00
Shenzhen
100,000,000.00 100,000,000.00
KONSEMI
Konka Eco-
50,000.00 50,000.00
Development
276
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Impairment
Increase in the provision set Closing balance
Decrease in the
Investee Opening balance Reporting Closing balance aside in the of the provision
Reporting Period
Period Reporting for impairment
Period
Suining Konka
200,000,000.00 200,000,000.00
Industrial Park
Konka Ronghe 5,100,000.00 5,100,000.00
Suining Electronic
Technological 200,000,000.00 200,000,000.00
Innovation
Shenzhen
Chuangzhi
10,000,000.00 10,000,000.00
Electrical
Appliances
Kanghong (Yantai)
Environmental 1,025,100.00 1,025,100.00
Protection
Chongqing
25,500,000.00 25,500,000.00
Kangxingrui
Chongqing
Optoelectronic
933,333,333.33 933,333,333.33
Technology
Research Institute
Kowin Memory
192,520,000.00 192,520,000.00
(Shenzhen)
Ningbo Kanghr
90,000,000.00 90,000,000.00
Electrical Appliance
Konka Intelligent
510.00 510.00
Manufacturing
Suining Jiarun
10,000,000.00 10,000,000.00
Property
Yibin Kangrun 67,000,000.00 67,000,000.00
277
Konka Group Co., Ltd. Interim Report 2023
Impairment
Increase in the provision set Closing balance
Decrease in the
Investee Opening balance Reporting Closing balance aside in the of the provision
Reporting Period
Period Reporting for impairment
Period
Konka Material 9,205,452.93 9,205,452.93
Industrial and Trade
50,000,000.00 50,000,000.00
Technology
Konka Huazhong 30,000,000.00 30,000,000.00
Guizhou Kanggui
Material 70,000,000.00 70,000,000.00
Technology
Nantong Kanghai 15,300,000.00 15,300,000.00
Jiangxi Konka
50,000,000.00 50,000,000.00
High-tech Park
Shangrao Konka
Electronic
30,000,000.00 30,000,000.00
Technology
Innovation
Sichuan
Hongxinchen Real
20,000,000.00 20,000,000.00 -
Estate Development
Co., Ltd.
Xi'an Kanghong
Technology 12,000,000.00 12,000,000.00
Industry
Xi'an Konka
Intelligent 50,000,000.00 50,000,000.00
Technology
Tianjin Konka 171,603,013.77 171,603,013.77
Songyang Konka
30,000,000.00 30,000,000.00
Intelligent
278
Konka Group Co., Ltd. Interim Report 2023
Impairment
Increase in the provision set Closing balance
Decrease in the
Investee Opening balance Reporting Closing balance aside in the of the provision
Reporting Period
Period Reporting for impairment
Period
Konka North China 30,000,000.00 30,000,000.00
Total 6,496,074,047.75 77,400,000.00 20,000,000.00 6,553,474,047.75 781,480,000.00
（3）Investment in associated enterprises and joint ventures
Change in the Reporting Period
Closing balance of Profit or loss of Changes in other
Investee Increase in the Decrease in the
previous period investment recognised by comprehensive
investment investment
the equity method income
Anhui Kaikai Shijie E-commerce Co., Ltd. 17,400,738.44
Kunshan Kangsheng Investment Development
219,065,984.22 -10,055,178.43
Co., Ltd.
Chutian Dragon Co., Ltd. 523,726,463.18
Shaanxi Silk Road Cloud Intelligent Tech Co.,
13,333,698.78 -781,563.56
Ltd.
Shenzhen Kanghongxing Intelligent
Technology Co., Ltd.
Shenzhen Zhongkang Beidou Technology Co.,
Ltd.
Shenzhen Kangjia Jiapin Intelligent Electrical
5,371,364.87 739,175.43
Apparatus Technology Co., Ltd.
Shenzhen Yaode Technology Co., Ltd.
Wuhan Tianyuan Environmental Protection
352,295,640.91 -3,659,889.05
Co., Ltd.
Shenzhen KONKA E-display Co., Ltd. 12,567,702.52 690,558.45
Chuzhou Konka Technology Industry
5,899,324.39 -2,909,934.84
Development Co., Ltd.
279
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period
Closing balance of Profit or loss of Changes in other
Investee Increase in the Decrease in the
previous period investment recognised by comprehensive
investment investment
the equity method income
Chuzhou Kangjin Health Industrial
172,987,384.01 -2,876,368.35
Development Co., Ltd.
Nantong Kangjian Technology Industrial Park
5,625,680.96
Operations and Management Co., Ltd.
Shenzhen Kangyue Enterprise Co., Ltd. 2,999,091.61 -54,027.66
Dongguan Guankang Yuhong Investment Co.,
Ltd.
Chongqing Yuanlv Benpao Real Estate Co.,
Ltd.
Chuzhou Kangxin Health Industry
10,835,065.75 -1,327,324.27
Development Co., Ltd.
E3info (Hainan) Technology Co., Ltd. 8,574,609.73
Shenzhen Kangpeng Digital Technology Co.,
3,411,153.10 -1,124,071.28
Ltd.
Yantai Kangyun Industrial Development Co.,
4,135,456.96 -2,714,568.47
Ltd.
Shandong Econ Technology Co., Ltd. 1,044,184,489.99
Dongguan Kangjia New Materials Technology
3,950,928.27 186,757.47
Co., Ltd..
Chongqing E2info Technology Co., Ltd. 163,744,169.42 15,527,141.05
Sichuan Chengrui Real Estate Co., Ltd. 7,851,192.26 -4,691,048.46
Wuhan Kangtang Information Technology Co.,
26,654,950.30 -958,720.49
Ltd.
Sichuan Hongxinchen Real Estate
6,161,929.55 -3,564,612.77
Development Co., Ltd.
Total 2,604,615,089.67 6,161,929.55 -17,573,675.23
(Continued)
280
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period Closing balance
Cash dividends Ending balance of
Investee Provision set depreciation
Changes in other or profits
aside for Others (Carrying value) reserve
equities declared to be
impairment
distributed
Anhui Kaikai Shijie E-commerce Co., Ltd. 17,400,738.44
Kunshan Kangsheng Investment
29,400,000.00 179,610,805.79
Development Co., Ltd.
-
Chutian Dragon Co., Ltd. 523,726,4
63.18
Shaanxi Silk Road Cloud Intelligent Tech
12,552,135.22
Co., Ltd.
Shenzhen Kanghongxing Intelligent
5,158,909.06
Technology Co., Ltd.
Shenzhen Zhongkang Beidou Technology
-
Co., Ltd.
Shenzhen Kangjia Jiapin Intelligent
6,110,540.30
Electrical Apparatus Technology Co., Ltd.
Shenzhen Yaode Technology Co., Ltd. 214,559,469.35
Wuhan Tianyuan Environmental Protection
3,078,000.00 435,859,407.61
Co., Ltd. 90,301,655.75
Shenzhen KONKA E-display Co., Ltd. 13,258,260.97
Chuzhou Konka Technology Industry
2,989,389.55
Development Co., Ltd.
Chuzhou Kangjin Health Industrial
170,111,015.66
Development Co., Ltd.
Nantong Kangjian Technology Industrial
5,625,680.96
Park Operations and Management Co., Ltd.
Shenzhen Kangyue Enterprise Co., Ltd. 2,945,063.95
Dongguan Guankang Yuhong Investment
281
Konka Group Co., Ltd. Interim Report 2023
Change in the Reporting Period Closing balance
Cash dividends Ending balance of
Investee Provision set depreciation
Changes in other or profits
aside for Others (Carrying value) reserve
equities declared to be
impairment
distributed
Co., Ltd.
Chongqing Yuanlv Benpao Real Estate Co.,
Ltd.
Chuzhou Kangxin Health Industry
9,507,741.48
Development Co., Ltd.
E3info (Hainan) Technology Co., Ltd. 8,574,609.73
Shenzhen Kangpeng Digital Technology
2,287,081.82
Co., Ltd.
Yantai Kangyun Industrial Development
1,420,888.49
Co., Ltd.
Shandong Econ Technology Co., Ltd. 1,044,184,489.99
Dongguan Kangjia New Materials
4,137,685.74
Technology Co., Ltd..
Chongqing E2info Technology Co., Ltd. 179,271,310.47
Sichuan Chengrui Real Estate Co., Ltd. 3,160,143.80
Wuhan Kangtang Information Technology
25,696,229.81
Co., Ltd.
Sichuan Hongxinchen Real Estate
2,597,316.78
Development Co., Ltd.
-
Total 90,301,655.75 32,478,000.00 523,726,4 2,127,300,536.56 219,718,378.41
63.18
282
Konka Group Co., Ltd. Interim Report 2023
4. Operating revenue and cost of sales
（1） Operating income and operating costs
Amount incurred in the Reporting Amount incurred in the previous period
Item Period
Income Cost Income Cost
Principal 588,736,212.10 651,086,329.20
795,988,114.95 904,792,276.47
business
Other 82,606,260.87 31,456,950.98
141,186,691.51 50,784,505.04
business
Total 671,342,472.97 682,543,280.18 937,174,806.46 955,576,781.51
(2) Information in relation to the trade price apportioned to the residual contract performance
obligation:
The amount of income corresponding to the performance obligations of contracts signed but
not yet performed or fully performed was RMB5,105429.95 at the year-end, among which
RMB5,105,429.95 is expected to be recognized in 2023.
5. Investment income
Amount incurred
Amount incurred in the
Item in the previous
Reporting Period
period
Returns on long-term equity investments
-17,573,675.23 76,488,083.68
calculated by the equity method
Return on investment arising from the disposal
182,495,426.59 152,614,987.18
of long-term equity investments
Investment income from disposal of financial
-3,794,910.98
assets at fair value through profit or loss
Interest income from debt investments during
3,622,191.78 2,010,000.00
the holding period
Equity investment calculated by the equity
574,780,174.75
method and converted to financial assets
Return on investment in the financial assets
9,383,976.00
held for trading during the holding period
Others 500,000.00
Total 749,413,182.91 231,113,070.86
XVII. Approval of Financial Statements
The financial statement was approved on 25 August 2023 by the Board of Directors.
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Konka Group Co., Ltd. Interim Report 2023
XVIII. Supplementary Materials
1.Items and amounts of non-recurring profit or loss
Amount of the Notes
Item
Reporting Period
Gains and losses on disposal of non-current assets 234,443,700.65
Tax rebates, reductions or exemptions due to approval beyond
authority or the lack of official approval documents
Government grants recognised in the Reporting Period, except
for those acquired in the ordinary course of business or granted
143,191,046.27
at certain quotas or amounts according to the government's
unified standards
Dispossession surcharge to non-financial institutions included in
the current profit and loss
Profits arising from business combination when the combined
cost is less than the recognised fair value of net assets of the
merged company
Gain/Loss on non-monetary asset swap
Gain/Loss on entrusting others with investments or asset
management
Asset impairment provisions due to acts of God such as natural
disasters
Gains and losses on debt restructuring
Expenses on business reorganisation, such as expenses on staff
arrangements, integration, etc.
Gain/Loss on the part over the fair value due to transactions with
distinctly unfair prices
Current net profit or loss of subsidiaries acquired in business
combination under the same control from period-beginning to
combination date
Gains and losses arising from contingencies unrelated to the
normal operation of the company's business
Gain/loss from change of fair value of trading financial assets
and liabilities, and derivative financial assets and liabilities, and
investment gains from disposal of trading financial assets and
-95,971,002.08
liabilities, and derivative financial assets and liabilities, and
investment in other obligatory rights, other than valid hedging
related to the Company's common businesses
Reclassification of impairment loss allowances of receivables
and contract assets separately tested for impairment
284
Konka Group Co., Ltd. Interim Report 2023
Amount of the Notes
Item
Reporting Period
Gain/loss on entrustment loans 62,144,007.08
Gain/loss on change in fair value of investment property of
which the follow-up measurement is carried out adopting fair
value method
Effect on current profit or loss when a one-off adjustment is
made to current profit or loss according to requirements of
taxation, accounting and other relevant laws and regulations
Custodian fees earned from entrusted operation
Non-operating income and expenses other than those listed
5,709,807.68
above
Other profit and loss items in line with the definition of non-
584,664,150.75
recurring gains and losses
Subtotal 934,181,710.35
Less: Income tax effect 226,223,116.92
Effect of minority shareholders' equities (after tax) 9,604,455.35
Total 698,354,138.08
（1）Particulars about other gains and losses that meet the definition of exceptional gain/loss:
Item Amount Reasons
As the Company reduced part of its shareholding in Chutian Dragon
Shareholding Co., Ltd., the measurement of its investment in Chutian Dragon Co.,
in Chutian
584,164,150.75 Ltd. was adjusted in the current period from a long-term equity
Dragon Co.,
Ltd. investment (under the equity method) to a held-for-trading financial
asset, which incurred an exceptional gain.
（2）The explanation of the Company to "Project confirmed with the definition of non-recurring gains
and losses" and define non-recurring gains and losses as recurring gains and losses according to the nature
and features of normal business operations of it.
Item Amount Reasons
Government subsidies which are closely related to the
Software tax normal business of the company and which are in
3,434,829.42
refund accordance with national policies and certain standard
quota or quantitative amount
Total 3,434,829.42
2. Return on net assets and earnings per share
285
Konka Group Co., Ltd. Interim Report 2023
EPS (RMB/share)
Weighted average
Profit for the Reporting Period return on net Basic Diluted
assets (%) earnings per earnings per
share share
Net profit attributable to ordinary
shareholders of the Company as the -2.55 -0.0803 -0.0803
Parent
Net profit attributable to ordinary
shareholders of the Company as the
-11.76 -0.3703 -0.3703
Parent before exceptional gains and
losses
3. Accounting Data Differences under China’s Accounting Standards for Business Enterprises (CAS)
and International Financial Reporting Standards (IFRS) and Foreign Accounting Standards
（1）Net Profit and Equity under CAS and IFRS
□ Applicable √ Not applicable
（2）Net Profit and Equity Differences under CAS and Foreign Accounting Standards
□ Applicable √ Not applicable
The Board of Directors
Konka Group Co., Ltd.
25 August 2023
286
