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公司公告

大华股份:2021年第三季度报告(英文版)2021-11-02  

                                                                                        2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



Stock Code: 002236                      Stock Abbreviation: Dahua                    Notification No.: 2021-117

                             Zhejiang Dahua Technology Co., Ltd.
                                                2021 Q3 Report

     The Company and all members of the Board of Directors hereby guarantee that
the information disclosed herein is authentic, accurate and complete and free of any
false records, misleading statements, or material omissions.


Important Notice:
1. The Board of Directors, the Board of Supervisors, directors, supervisors and senior
management members of the Company hereby guarantee that the information presented in
this quarterly report is authentic, accurate, complete and free of any false records,
misleading statements or material omissions, and they will bear joint and several liability for
such information.
2. The Company's legal representative, chief accountant, and person in charge of
accounting institution (Accounting Officer) hereby declare and warrant that the financial
statements in the quarterly report are authentic, accurate, and complete.
3. Whether the Q3 report has been audited.
□ Yes √ No

I. Key Financial Data

(I) Key Accounting Data and Financial Indicators

Whether the Company needs retroactive adjustment or restatement of accounting data in prior years or not
□ Yes √ No
                                              Increase/Decrease of                          Increase/Decrease of the
                                              the Current Reporting From the Beginning of Period from the Beginning of
                            The Current              Period         the Year to the End of  the Year to the End of the
                          Reporting Period      Compared with the the Current Reporting     Current Reporting Period
                                               Same Period of the          Period           Compared with the Same
                                                  Previous Year                            Period of the Previous Year
Operating Revenue
                           7,980,099,801.37                26.11%      21,485,105,535.26                       32.90%
(RMB)
Net Profit Attributable
to Shareholders of the
                            755,871,328.43                -48.09%       2,399,047,215.98                      -15.08%
Listed Company
(RMB)
Net Profit Attributable
to Shareholders of the
Listed Company After
                            698,121,885.20                 56.50%       2,137,713,932.42                       23.12%
Deducting
Non-Recurring Gains
and Losses (RMB)




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                                                                       2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



Net Cash Flow
Generated by
                                  ——                   ——                 -1,213,296,065.50                       -195.69%
Operational Activities
(RMB)
Basic Earnings per
                                            0.26                -48.00%                     0.81                       -16.49%
Share (RMB/Share)
Diluted Earnings per
                                            0.26                -48.00%                     0.81                       -16.49%
Share (RMB/Share)
Weighted Average
                                         3.45%                   -4.75%                  11.36%                          -5.15%
ROE
                          At the End of the                                  Increase/Decrease at the End of the Current
                                                   At the End of the
                          Current Reporting                                 Reporting Period Compared with the End of the
                                                    Previous Year
                               Period                                                       Previous Year
Total Assets (RMB)         41,530,189,083.92       36,595,034,080.75                                                    13.49%
Owners' Equity
Attributable to
Shareholders of the        22,659,120,581.70       19,773,030,426.40                                                    14.60%
Listed Company (Unit:
RMB)


(II) Non-recurring Gains or Losses and Their Amounts

√ Applicable □ Not applicable
                                                                                                                     Unit: RMB
                                                                                                          The Amount from the
                                                                                    Amount in the
                                                                                                        Beginning of the Year to
                                     Item                                          Current Reporting
                                                                                                         the End of the Current
                                                                                        Period
                                                                                                            Reporting Period
Profits or losses from disposal of non-current assets (including the write-off
                                                                                       19,464,968.29             52,091,462.91
for the accrued impairment of assets)
The government subsidies included in the current profits and losses
(excluding the government subsidies closely related to regular businesses
                                                                                       56,971,239.95            128,060,831.11
of the Company, in line with national policies, and consecutively received
by a standard quota or quantity)
Gains or losses from investment or asset management entrusted to others                38,009,608.95            110,959,301.55
Profits and losses resulting from the changes in fair value for holding
trading financial assets and trading financial liabilities, and investment
income from disposal of trading financial assets, trading financial liabilities,        -6,466,471.78            71,959,225.75
and financial assets available for trading, excluding the effective hedging
businesses related to the regular business operation of the Company
Non-operating revenue and expenses other than the above                                 -4,145,081.84             -2,075,738.28
Other gains and losses items that fit the definition of non-recurring gains
                                                                                            5,848.54                175,494.33
and losses
Less: Impact of income tax                                                             21,734,984.55             64,705,465.34
    Impact of minority equity (after tax)                                              24,355,684.33             35,131,828.47
Total                                                                                  57,749,443.23            261,333,283.56
Other gains or losses that fit the definition of non-recurring gains or losses:
□ Applicable √ Not applicable
The Company has no other gains or losses that fit the definition of non-recurring gains or losses.




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                                                                2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.


Note for the definition of non-recurring gains and losses set out in the No. 1 Explanatory Announcement on Information
Disclosure for Companies Issuance Their Securities to the Public - Non-recurring gains and losses, as recurring gains and
losses.
□ Applicable √ Not applicable
The Company did not define any non-recurring gains and losses set out in the No. 1 Explanatory Announcement on
Information Disclosure for Companies Issuance Their Securities to the Public - Non-recurring gains and losses as
recurring gains and losses.


(III) The Changes in Key Accounting Data and Financial Indicators and the Reasons


√ Applicable □ Not applicable

(I) The changes of assets and liabilities and the reasons
1. Trading financial assets increased by 237.08% compared with the end of the previous year, mainly
due to changes in the fair value of derivative financial instruments in this period;
2. Prepayments increased by 47.69% compared with the end of the previous year, mainly due to the
Company's increased stocking;
3. Other receivables decreased by 37.58% compared with the end of the previous year, mainly due to
the collection of RMB360 million equity transfer receivables of the previous year in the period;
4. Inventory increased by 68.08% compared with the end of the previous year, mainly due to the rising
price of raw materials, the Company's increased stocking for expansion;
5. Other current assets increased by 112.20% compared with the end of the previous year, mainly due to
the reverse repurchase of RMB350 million treasury bonds in the current period compared with the end of
the previous year and the increase in input tax to be deducted;
6. Long-term equity investment increased by 138.97% compared with the end of the previous year,
mainly due to changes in owners' equity of the Company's associates in the current period, and the
recognition of corresponding shares by the Company accordingly according to the shareholding ratio;
7. Other non-current financial assets increased by 164.60% compared with the end of the previous year,
mainly due to investment of RMB500 million in new asset management plans in this period;
8. Fixed assets increased by 36.28% compared with the end of the previous year, mainly due to the
completion of the Dahua Intelligent (IoT) Industrial Park Construction Project Phase II and its transfer
into fixed assets;
9. The right-of-use assets increased by 100% compared with the end of the previous year, mainly due to
the implementation of the new lease standards and related statement adjustment in this period.
10. Intangible assets increased by 44.65% compared with the end of the previous year, mainly due to the
newly purchased land in this period.
11. Long-term deferred expenses increased by 44.09% compared with the end of the previous year,
mainly due to increase in fees for premise decoration in this period;
12. Short-term loans increased by 220.17% compared with the end of the previous year, mainly due to
the increase of short-term bank borrowings in this period;
13. Contract liabilities increased by 49.77% compared with the end of the previous year, mainly due to


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                                                           2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



the increase of contract advances received in this period;
14. The salary payable to employees decreased by 36.38% compared with end of the previous year,
mainly due to the issuance of year-end bonus in this period;
15. The taxes payable decreased by 46.48% compared with the end of the previous year, mainly due to
the decrease in VAT payable and corporate income tax payable;
16. Other payables decreased by 34.74% compared with the end of the previous year, mainly due to the
reduction of obligation to repurchase restricted stocks;
17. Non-current liabilities due within one year increased by 473.12% compared with the end of the
previous year, mainly due to the increase in long-term bank borrowings due within one year and lease
liabilities due within one year;
18. Long-term borrowings increased by 76.88% compared with the end of the previous year, mainly due
to the increase of long-term bank borrowings in this period;
19. Lease liabilities increased by 100% compared with the end of the previous year, mainly due to the
implementation of the new lease standards and related statement adjustments in this period;
20. Capital reserve increased by 48.14% compared with the end of the previous year, mainly due to the
confirmed increase of other rights and interests of shareholding companies in this period;
21. Treasury shares decreased by 52.37% compared with the end of the previous year, mainly due to
the reduction of repurchase obligation due to the unlocking of restricted stocks;
22. Other comprehensive incomes increased by 45.34% compared with the end of the previous year,
mainly due to the increase brought by foreign currency statement translation.
(II) The changes of items in the income statement and the reasons
1. Operating revenue increased by 32.90% compared with same period of the previous year, mainly due
to expansion of the company's sales scale;
2. Operating cost increased by 43.57% compared with same period of the previous year, mainly due to
cost increase arising from rising revenue;
3. Financial expenses decreased by 46.34% compared with same period of the previous year, mainly
due to the increase in interest income and the decrease in exchange losses compared with same period
of the previous year;
4. Investment income decreased by 113.26% compared with same period of the previous year, mainly
due to the decrease of equity transfer income and the increase in investment losses recognized for
shareholding companies compared with the same period of the previous year;
5. Income from changes in fair value increased by 768.60% compared with same period of the previous
year, mainly due to fair value changes of asset management plans in this period;
6. Credit impairment losses increased by 103.64% compared with same period of the previous year,
mainly due to the increase in provision for bad debts accrued in this period compared with the same
period of the previous year;
7. Asset impairment losses decreased by 66.11% compared with same period of the previous year,
mainly due to the decrease of accrued reserve for stock depreciation in this period compared with the



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                                                             2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



same period of the previous year;
8. Income from disposal of assets increased by 48262.64% compared with same period of the previous
year, mainly due to the increase in fixed assets disposal in this period compared with the same period of
the previous year.
(III) The changes of items in the cash flow statement and the reasons
1. The net cash flows from operating activities decreased by 195.69% compared with same period of the
previous year, mainly due to the Company's increased stocking in this period;
2. The net cash flows from investment activities decreased by 358.03% compared with same period of
the previous year, mainly due to the increase in expenses for acquisition and construction of fixed assets,
the increase of net cash outflows from entrusted wealth management and investments in financial
derivatives, and decrease in cash received from disposal of subsidiaries in this period compared with the
same period of the previous year.


II. Information on Shareholders

(I) The total number of common shareholders, the number of preferred shareholders with
restored voting rights and shareholding status of the top 10 shareholders

                                                                                                          Unit: share
                                                         Total Number of Preferred Shareholders (If
Total Number of Common Shareholders at
                                                 107,122 Any) Whose Voting Rights have been                       0
The End of The Reporting Period
                                                         Recovered at the End of the Reporting Period
                                   The shareholdings of the top 10 shareholders
                                                                      Number of      Pledged, Marked or Frozen
                                                          Number of                            Shares
                                Nature of Shareholding              Shares Held with
    Name of Shareholder                                    Shares
                               Shareholder Percentage                Limited Sales      State Of
                                                            Held                                      Number
                                                                      Conditions        Shares
                               Domestic
                                                          1,023,868,9
Fu Liquan                      Natural           34.18%                   767,901,735 Pledge            196,127,942
                                                                  80
                               Person
                               Domestic
                                                          160,577,49
Zhu Jiangming                  Natural            5.36%                   120,433,117 Pledge             20,300,000
                                                                   0
                               Person
Hong Kong Securities Clearing Overseas                    138,731,26
                                                  4.63%                             0
Co. Ltd.                      Legal Person                         7
                               Domestic
Chen Ailing                    Natural            2.38% 71,262,813         53,447,110 Pledge             21,100,000
                               Person
                               Domestic
Wu Jun                         Natural            2.31% 69,250,886         51,938,164
                               Person
China Galaxy Securities Co.,   State-owned
                                                  1.43% 42,799,551                  0
Ltd.                           Legal Person
Industrial and Commercial
Bank of China Limited - Zhong
Ou China Value Premier        Others              1.38% 41,483,700                  0
Selection Return Hybrid
Securities Investment Fund

China Securities Finance Co., Domestic
                              Non-state-ow        1.32% 39,611,241                  0
Ltd.
                              ned Legal



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                                                               2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



                                  Person
Agricultural Bank of China Co.,
Ltd.- China International Fund
Management Emerging Power Others                     0.96% 28,866,428                   0
Hybrid Securities Investment
Fund
Shanghai Greenwoods Assets
Management Co., Ltd. -     Others                    0.87% 26,096,493                   0
Greenwoods Global Fund
                       Shareholding List of Top Ten Shareholders Without Limited Sales Condition
                                                Number of Shares Held without Limited              Type of Shares
             Name of Shareholder
                                                          Sales Condition                   Type of Shares   Number
                                                                                        RMB common
Fu Liquan                                                                   255,967,245            255,967,245
                                                                                        stock
                                                                                            RMB common
Hong Kong Securities Clearing Co. Ltd.                                      138,731,267                138,731,267
                                                                                            stock
                                                                                            RMB common
China Galaxy Securities Co., Ltd.                                             42,799,551                     42,799,551
                                                                                            stock
Industrial and Commercial Bank of China
Limited - Zhong Ou China Value Premier                                                      RMB common
                                                                              41,483,700                     41,483,700
Selection Return Hybrid Securities                                                          stock
Investment Fund
                                                                                            RMB common
Zhu Jiangming                                                                 40,144,373                     40,144,373
                                                                                            stock
                                                                                            RMB common
China Securities Finance Co., Ltd.                                            39,611,241                     39,611,241
                                                                                            stock
Agricultural Bank of China Co., Ltd.- China
                                                                                            RMB common
International Fund Management Emerging                                        28,866,428                     28,866,428
                                                                                            stock
Power Hybrid Securities Investment Fund
Shanghai Greenwoods Assets Management                                                       RMB common
                                                                              26,096,493                     26,096,493
Co., Ltd. - Greenwoods Global Fund                                                          stock
                                                                                            RMB common
National Social Security Fund 111                                             24,137,331                     24,137,331
                                                                                            stock
China Merchants Bank Co., Ltd. - Yinhua
                                                                                            RMB common
Xinyi Flexible Allocation Hybrid Securities                                   22,112,659                     22,112,659
                                                                                            stock
Investment Fund
Description of the Association Relationship or Mr. Fu Liquan And Ms. Chen Ailing Are Husband and Wife. The Company
Concerted Action of Above-Mentioned            Is Unaware of Whether Other Shareholders Have Associated Relationship
Shareholders                                   or Are Persons Acting in Concert.
Explanation on Top Ten Shareholders’
Participation in Securities Margin Trading (If N/A
Any)


(II) The total number of preferred shareholders and the shareholdings of the top 10 preferred
shareholders

□ Applicable √ Not applicable


III. Other Significant Matters

√ Applicable □ Not applicable
     1. On March 26, 2021, the Proposal on the Company’s Plan for the Non-public Issuance of Shares
in 2021 and other related proposals were reviewed and approved at the Company's 12th session of the
7th board of directors and the 8th session of the 7th board of supervisors. The company planned to issue



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                                                           2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



312,151,600 non-public shares, and the total amount of funds raised did not exceed RMB 5.6 billion
(inclusive). The target company of this non-public issuance is China Mobile Capital Holdings Co., Ltd.,
which is the wholly-owned subsidiary of China Mobile Communications Group Co., Ltd.,. Matters related
to the non-public issuance have been reviewed and approved by the 2020 shareholders’ meeting.
    The Company disclosed, respectively on June 3, 2021 and June 17, 2021, the Announcement on
the Acceptance of the Non-public Issuance Application by the CSRC and the Announcement on
Receiving the First Feedback Given by the CSRC on the Review of Administrative Permits
(Announcement number: 2021-073, 2021-078).
    On July 5, 2021, the Proposal on Adjusting the Company’s Plan for the Non-public Issuance of
Shares in 2021 and other proposals related to the issuance were reviewed and approved at the
Company’s 19th session of the 7th board of directors and the 12th session of the 7th board of supervisors.
As adjusted, the company planned to issue no more than 288,624,700 non-public shares, and the total
amount of funds raised will not exceed RMB 5.1 billion (inclusive). The target company of this non-public
issuance is China Mobile Capital Holdings Co., Ltd., which is the wholly-owned subsidiary of China
Mobile Communications Group Co., Ltd. On the same day, the Company disclosed the Reply of Zhejiang
Dahua Technology Co., Ltd. to the Feedback on the Application for the Non-public Issuance of Shares.
    The non-public issuance plan can only be implemented after being approved by the CSRC. The
announcements above have been disclosed through the designated media Securities Times and Juchao
Information Network (http://www.cninfo.com.cn).
    2. On September 28, 2021, the Proposal on Preparing the Spin-off Listing of the Holding Subsidiary
was reviewed and approved at the 21st session of the 7th board of directors and the 14th session of the
7th board of supervisors. The Company's board of directors authorized the management to launch the
preliminary preparation for the spin-off listing of its holding subsidiary Zhejiang Huarui Technology Co.,
Ltd. on a domestic stock exchange, which includes but is not limited to verifying the feasibility plan,
preparing the listing plan, signing agreements involved in the preparation, and other matters related to
the listing, as well as submitting the listing plan and other matters related to the listing respectively to the
board of directors and shareholders' meeting for review after the spin-off listing plan is determined. For
more details, see the Indicative Announcement on Preparing the Spin-off Listing of the Holding
Subsidiary (Announcement No.2021-113) disclosed by the Company on September 29, 2021.




IV. Quarterly Financial Statements

(I) Financial Statements

1. Consolidated Balance Sheet

Prepared by: Zhejiang Dahua Technology Co., Ltd.
                                               September 30, 2021
                                                                                                      Unit: RMB
                          Item                               September 30, 2021          December 31, 2020



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                                                       2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



Current Assets:
     Cash and Bank Balances                                    5,900,823,999.97           7,471,652,634.66
     Deposit Reservation for Balance
     Loans to Banks and Other Financial Institutions
     Trading Financial Assets                                       8,345,068.23              2,475,680.45
     Derivative Financial Assets
     Notes Receivable                                            701,638,559.29             232,857,354.55
     Accounts Receivable                                      13,371,801,715.74          12,857,519,110.16
     Receivables Financing                                       598,769,005.58           1,207,879,654.58
     Prepayments                                                 239,634,123.12             162,250,648.05
     Premium Receivable
     Reinsurance Accounts Receivable
     Reinsurance Contract Reserves Receivable
     Other Receivables                                           605,771,161.97             970,427,893.48
       Including: Interest Receivable
                Dividends Receivable
     Buying Back the Sale of Financial Assets
     Inventory                                                 8,283,057,482.39           4,928,019,838.00
     Contract Assets                                              85,259,302.29              84,825,834.82
     Holding For-sale Assets
     Non-current Assets Due within 1 Year                        612,170,843.45             635,956,549.07
     Other Current Assets                                      1,185,003,174.64             558,434,219.93
Subtotal of Current Assets                                    31,592,274,436.67          29,112,299,417.75
Non-current Assets:
     Granting of Loans and Advances
     Investment in Creditor's Rights
     Investment in Other Creditor's Rights
     Long-term Receivables                                     2,001,039,216.28           2,250,315,769.50
     Long-term Equity Investment                               1,089,634,983.73             455,977,616.16
     Investment in Other Equity Instruments
     Other Non-current Financial Assets                          952,809,855.12             360,087,786.34
     Investment Property                                         321,183,939.71             336,008,869.13
     Fixed Assets                                              2,065,446,363.02           1,515,594,629.97
     Projects under Construction                               1,471,737,678.05           1,164,130,453.03
     Productive Biological Assets
     Oil and Gas Assets
     Right-of-use Assets                                         255,393,988.22
     Intangible Assets                                           588,418,323.99             406,777,323.39
     Development Expenditure
     Goodwill                                                     42,685,490.30              42,685,490.30
     Long-term Deferred Expenses                                  46,512,381.53              32,280,430.67
     Deferred Income Tax Assets                                 1,011,564,028.24            832,453,676.69
     Other Non-current Assets                                     91,488,399.06              86,422,617.82
Subtotal of Non-current Assets                                 9,937,914,647.25           7,482,734,663.00
Total Assets                                                  41,530,189,083.92          36,595,034,080.75
Current Liabilities:




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                                                              2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



     Short-term Loan                                                    800,996,316.75             250,177,083.34
     Borrowings from the Central Bank
     Borrowings from Banks and Other Financial Institutions
     Transactional Financial Liabilities
     Derivative Financial Liabilities
     Notes Payable                                                    4,057,933,186.57           3,258,552,758.17
     Accounts Payable                                                 6,612,618,680.99           6,444,787,705.28
     Received Prepayments
     Contract Liabilities                                             1,005,120,996.39             671,120,385.08
     Financial Assets Sold for Repurchase
     Deposit Taking and Interbank Deposit
     Receiving from Vicariously Traded Securities
     Receiving from Vicariously Sold Securities
     Payroll Payable                                                   1,148,623,235.11          1,805,464,535.31
     Tax Payable                                                        481,784,866.40             900,144,863.67
     Other Payables                                                     633,378,687.35             970,552,877.22
       Including: Interest Payable
               Dividends Payable                                         16,060,762.89              12,982,399.27
     Service Charge and Commission Payable
     Reinsurance Accounts Payable
     Holding For-sale Liabilities
     Non-current Liabilities Due within 1 Year                          870,522,409.77             151,891,709.34
     Other Current Liabilities                                          246,359,645.17             209,401,914.77
Subtotal of Current Liabilities                                      15,857,338,024.50          14,662,093,832.18
Non-current Liabilities:
     Insurance Contract Reserves
     Long-term Loan                                                   1,553,000,000.00             878,000,000.00
     Bonds Payable
       Including: Preferred Stocks
               Perpetual Bonds
     Lease Liabilities                                                  144,547,776.98
     Long-term Payables
     Long-term Payroll Payable
     Expected Liabilities                                               260,155,803.24             282,427,517.82
     Deferred Income                                                    105,117,255.53             110,469,806.29
     Deferred Income Tax Liabilities                                     75,145,796.36              67,272,768.46
     Other Non-current Liabilities                                      353,000,628.39             391,128,045.90
Subtotal of Non-current Liabilities                                   2,490,967,260.50           1,729,298,138.47
Total Liabilities                                                    18,348,305,285.00          16,391,391,970.65
Shareholders' Equity:
     Share Capital                                                    2,994,550,730.00           2,995,579,590.00
     Other Equity Instruments
       Including: Preferred Stocks
               Perpetual Bonds
     Capital Reserves                                                  2,947,512,711.28          1,989,655,334.05
     Less: Treasury Share                                               277,169,524.09             581,968,930.89




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                                                                          2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



     Other Comprehensive Incomes                                                         88,887,058.73                     61,157,523.13
     Special Reserves
     Surplus Reserves                                                                1,553,691,005.92                  1,553,691,005.92
     General Risk Reserves
     Undistributed Profits                                                         15,351,648,599.86                 13,754,915,904.19
Total Shareholders' Equity Attributable to the Parent
                                                                                   22,659,120,581.70                 19,773,030,426.40
Company
     Minority Shareholders' Equity                                                     522,763,217.22                    430,611,683.70
Total Shareholders' Equity                                                         23,181,883,798.92                  20,203,642,110.10
Total Liabilities and Shareholders' Equity                                         41,530,189,083.92                 36,595,034,080.75

Legal representative: Fu Liquan      Person in charge of accounting: Xu Qiaofen   Person in charge of the accounting institution: Zhu Zhuling


2. Consolidated Income Statement for the Period from the Beginning of the Year to the End of the
Reporting Period

                                                                                                                                 Unit: RMB
                                                                          Amount Occurred in the             Amount Occurred in the
                                  Item
                                                                             Current Period                    Previous Period
I. Total Operating Revenue                                                         21,485,105,535.26                  16,166,204,673.11
     Including: Operating Revenue                                                  21,485,105,535.26                  16,166,204,673.11
             Interest Income
             Earned Premiums
             Service Charge and Commission Income
II. Total Operating Cost                                                           19,336,098,032.94                 14,615,868,742.24
     Including: Operating Cost                                                     12,768,127,643.67                   8,893,029,099.00
             Interest Expenditures
             Service Charge and Commission Expenses
             Surrender Value
             Net Claims Paid
             The Net Amount Withdrawn for Insurance Liability
Reserves
             Policyholder Dividend Expense
             Reinsurance Cost
             Taxes and Surcharges                                                      129,966,366.70                    101,226,426.00
             Sales Expenses                                                          3,336,109,794.23                  2,801,268,128.70
             Administration expenses                                                   644,478,415.71                    560,596,447.94
             Research and development expense                                        2,364,208,725.24                  2,086,062,696.34
             Financial Expenses                                                          93,207,087.39                   173,685,944.26
                Including: interest expenses                                             69,224,790.43                     52,037,364.71
                        Interest Income                                                165,190,467.12                    118,510,356.09
     Add: Other Income                                                                 701,607,327.67                    694,649,909.73
           Investment Income (Mark "-" for Loss)                                      -142,801,874.09                  1,076,630,992.13
         Including: Investment Income from Affiliates and
                                                                                      -207,504,221.59                     -76,758,388.98
Joint Ventures
            Profits from recognition Termination of Financial
Assets at Amortized Cost
           Exchange Gains (Mark "-" for Losses)
           Profit of Net Exposure Hedging (Mark "-" for Loss)



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                                                                2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



            Incomes from Changes in Fair Value (losses marked
                                                                          138,013,394.47              15,889,143.16
with "-")
            Credit Impairment Losses (Mark "-" for Loss)                  -442,062,567.25           -217,078,819.11
            Asset Impairment Losses (Mark "-" for Loss)                    -35,822,007.91           -105,692,735.50
            Asset Disposal Income (Mark "-" for Loss)                      33,064,078.63                  68,366.98
III. Operating Profit (Mark "-" for Loss)                               2,401,005,853.84           3,014,802,788.26
     Add: Non-operating Revenues                                             9,559,210.80              8,100,433.16
     Less: Non-operating Expenses                                          12,094,457.42              13,141,979.08
IV. Total Profit (Mark "-" for Total Loss)                              2,398,470,607.22           3,009,761,242.34
     Less: Income Tax Expense                                              -12,527,132.44            191,074,833.54
V. Net Profit (Mark "-" for Net Loss)                                   2,410,997,739.66           2,818,686,408.80
  (I) Classified by Operation Continuity
     1. Net Profit as a Going Concern (Mark "-" for Net Loss)           2,410,997,739.66           2,818,686,408.80
    2. Net Profit of Discontinued Operation (Mark "-" for Net
Loss)
  (II) Classified by the Attribution of Ownership
     1. Net Profit Attributable to the Parent Company's Owner           2,399,047,215.98           2,825,124,363.85
     2. Minority Shareholders' Profit and Loss                              11,950,523.68             -6,437,955.05
VI. Net Amount of Other Comprehensive Incomes after Tax                    27,658,548.27              26,522,004.96
  Net Amount of Other Comprehensive Incomes after Tax
                                                                           27,729,535.60              26,521,962.03
Attributable to the Parent Company's Owner
    (1) Other Comprehensive Income that Cannot Be
Reclassified as P/L
           1. Re-Measure the Variation of The Defined
Benefit Plan
           2. Other Comprehensive Income that Cannot Be
Transferred To P/L Under the Equity Method
           3. Changes in the Fair Value of Investment in
Other Equity Instruments
          4. Changes in the Fair Value of the Credit Risk of
The Enterprise
              5. Others
    (II) Other Comprehensive Income that Will Be
                                                                           27,729,535.60              26,521,962.03
Reclassified As P/L
           1. Other Comprehensive Income that Can Be
Transferred To P/L Under the Equity Method
          2. Changes in The Fair Value of Investment in
Other Creditor's Rights
         3. Financial Assets Reclassified into Other
Comprehensive Income
          4. Provisions for The Credit Impairment of
Investment in Other Creditor's Rights
              5. Cash flow Hedge Reserves
              6. Currency Translation Difference                           34,171,086.70              26,521,962.03
              7. Others                                                     -6,441,551.10
  Net Amount of Other Comprehensive Incomes After Tax
                                                                               -70,987.33                     42.93
Attributable to Minority Shareholders
VII. Total Comprehensive Income                                         2,438,656,287.93           2,845,208,413.76
   Total Comprehensive Income Attributable to the Parent
                                                                        2,426,776,751.58           2,851,646,325.88
Company's Owner
     Total Comprehensive Income Attributable to Minority                    11,879,536.35             -6,437,912.12




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                                                                          2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



Shareholders
VIII. Earnings per Share:
     (I) Basic Earnings per Share                                                                    0.81                              0.97
     (II) Diluted Earnings per Share                                                                 0.81                              0.97

Legal representative: Fu Liquan      Person in charge of accounting: Xu Qiaofen   Person in charge of the accounting institution: Zhu Zhuling


3. Consolidated Cash Flow Statement for the Period from the Beginning of the Year to the End of
the Reporting Period

                                                                                                                                 Unit: RMB
                                                                          Amount Occurred in the             Amount Occurred in the
                                  Item
                                                                             Current Period                    Previous Period
I. Cash Flow Generated by Operational Activities:
    Cash from Sales of Merchandise and Provision of
                                                                                   23,072,421,222.54                 19,198,302,426.38
Services
   Net Increase in Customer's Bank Deposits and Interbank
Deposits
     Net Increase in Borrowings from the Central Bank
      Net Increase in Borrowings from Other Financial
Institutions
    Cash Arising from Receiving Premiums for the Original
Insurance Contract
     Net Amount Arising from Reinsurance Business
     Net Increase in Deposits and Investments from
Policyholders
   Cash Arising from Interests, Service Charges and
Commissions
    Net Increase in Borrowings from Banks and Other
Financial Institutions
     Net Increase in Repurchase Business Funds
    Net Amount of Cash Received from the Vicariously
Traded Securities
     Tax Refund                                                                      1,621,238,401.84                  1,572,217,203.40
     Other Received Cashes Related to Operational Activities                           395,183,997.84                    248,856,876.82
Subtotal of cash inflow from operational activities                                25,088,843,622.22                 21,019,376,506.60
     Cash Paid for Merchandise and Services                                        17,442,233,566.18                  12,357,110,067.90
     Net Increase in Loans and Advances to Customers
    Net Increase in Deposits with Central Bank and Other
Financial Institutions
     Cash Paid for Original Insurance Contract Claims
     Net increase of funds lent
   Cash Paid for Interests, Service Charges and
Commissions
     Cash Paid for Policy Dividends
     Cash Paid to and for Employees                                                  5,454,101,974.31                  4,412,528,770.59
     Cash Paid for Taxes and Surcharges                                              1,705,099,375.11                  1,602,848,395.17
     Other Paid Cashes Related to Operational Activities                             1,700,704,772.12                  1,378,932,526.92
Subtotal of Cash Outflow from Operational Activities                               26,302,139,687.72                 19,751,419,760.58
Net Cash Flow Generated by Operating Activities                                     -1,213,296,065.50                  1,267,956,746.02
II. Cash Flow from Investment Activities:



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                                                                2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



     Cash Arising from Disposal of Investments                             913,324,136.74          1,013,800,000.00
     Cash Arising from Investment Incomes                                   28,141,454.98             15,466,185.40
     Net Cash Arising from Disposal of Fixed Assets,
                                                                            48,160,497.82              1,174,856.98
Intangible Assets and Other Long-term Assets
    Net Cash Arising from Disposal of Subsidiaries and
                                                                           360,000,000.00            603,416,723.92
Other Business Units
     Other Received Cashes Related to Investment Activities                 40,401,379.14             87,990,213.91
Subtotal of cash inflow from investment activities                       1,390,027,468.68          1,721,847,980.21
    Cash Paid for Purchase and Construction of Fixed
                                                                           872,761,833.74            418,198,952.95
Assets, Intangible Assets and Other Long-term Assets
     Cash Paid for Investments                                           1,777,000,000.00          1,495,244,946.22
     Net Increase in Pledge Loans
    Net Cash Paid for Acquisition of Subsidiaries and Other
Business Units
     Other Paid Cashes Related to Investment Activities                      21,546,588.11            88,139,757.17
Subtotal of cash outflows from investment activities                     2,671,308,421.85          2,001,583,656.34
Net amount of cash flow generated by investment activities               -1,281,280,953.17          -279,735,676.13
III. Cash Flow from Financing Activities:
     Cash Arising from Absorbing Investments                                55,770,784.31             59,440,000.00
    Including: Cash Arising from Subsidiaries Absorbing
                                                                            55,770,784.31             59,440,000.00
Investments by Minority Shareholders
     Cash Arising from Borrowings                                        3,775,310,686.97          5,177,593,403.07
     Other Received Cashes Related to Financing Activities                                         3,210,646,359.16
Subtotal of cash inflow from financing activities                        3,831,081,471.28          8,447,679,762.23
     Cash Paid for Debts Repayment                                       1,927,003,259.88          3,852,221,214.55
   Cash Paid for Distribution of Dividends and Profits or
                                                                           854,086,449.21            435,782,912.96
Payment of Interests
    Including: Dividends and Profits Paid to Minority
Shareholders by Subsidiaries
     Other Paid Cashes Related to Financing Activities                      83,025,300.67          2,931,254,424.60
Subtotal of cash outflow from financing activities                       2,864,115,009.76          7,219,258,552.11
Net cash flow generated by financing activities                            966,966,461.52          1,228,421,210.12
IV. Impact of Fluctuation in Exchange Rate on Cash and
                                                                            -43,649,597.19           -85,940,173.22
Cash Equivalents
V. Net Increase in Cash and Cash Equivalents                             -1,571,260,154.34         2,130,702,106.79
     Add: Cash and Cash Equivalents at the Commencement
                                                                         7,358,452,769.53          2,734,185,976.41
of the Period
VI. Cash and Cash Equivalents at the End of the Period                   5,787,192,615.19          4,864,888,083.20


(II) Adjustments to the Financial Statements

1. Details of adjustments to the relevant items of the financial statements at the beginning of year
due to first implementation of the new lease standards from 2021

√ Applicable □ Not applicable
Whether the accounts of the balance sheet at the beginning of the year shall be adjusted
√ Yes □ No
Consolidated Balance Sheet
                                                                                                           Unit: RMB
                 Item                       December 31, 2020            January 1, 2021        Adjusted amount




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                                                     2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



Current Assets:
    Cash and Bank Balances             7,471,652,634.66          7,471,652,634.66
    Deposit Reservation for
Balance
    Loans to Banks and Other
Financial Institutions
    Trading Financial Assets               2,475,680.45              2,475,680.45
    Derivative Financial Assets
    Notes receivable                     232,857,354.55            232,857,354.55
    Accounts receivable                12,857,519,110.16        12,857,519,110.16
    Receivables Financing              1,207,879,654.58          1,207,879,654.58
    Prepayments                          162,250,648.05            152,994,874.90          -9,255,773.15
    Premium Receivable
   Reinsurance Accounts
Receivable
   Reinsurance Contract Reserves
Receivable
    Other Receivables                    970,427,893.48            968,975,721.11          -1,452,172.37
      Including: interest receivable
             Dividends Receivable
    Buying Back the Sale of
Financial Assets
    Inventory                          4,928,019,838.00          4,928,019,838.00
    Contract Assets                       84,825,834.82             84,825,834.82
    Holding For-sale Assets
    Non-current Assets Due within 1
                                         635,956,549.07            635,956,549.07
Year
    Other Current Assets                 558,434,219.93            558,536,267.47             102,047.54
Subtotal of Current Assets             29,112,299,417.75        29,101,693,519.77         -10,605,897.98
Non-current Assets:
    Granting of Loans and
Advances
    Investment in Creditor's Rights
    Investment in Other Creditor's
Rights
    Long-term Receivables              2,250,315,769.50          2,250,315,769.50
    Long-term Equity Investment          455,977,616.16            455,977,616.16
     Investment in Other Equity
Instruments
    Other Non-current Financial
                                         360,087,786.34            360,087,786.34
Assets
    Investment Property                  336,008,869.13            336,008,869.13
    Fixed Assets                       1,515,594,629.97          1,515,594,629.97
    Projects under Construction        1,164,130,453.03          1,164,130,453.03
    Productive Biological Assets
    Oil and gas assets
    Right-of-use Assets                                            155,673,708.67         155,673,708.67
    Intangible Assets                    406,777,323.39            406,777,323.39
    Development Expenditure




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                                                         2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



     Goodwill                                 42,685,490.30             42,685,490.30
     Long-term Deferred Expenses              32,280,430.67             32,280,430.67
     Deferred Income Tax Assets              832,453,676.69            832,453,676.69
     Other Non-current Assets                 86,422,617.82             86,422,617.82
Subtotal of Non-current Assets              7,482,734,663.00         7,638,408,371.67         155,673,708.67
Total Assets                               36,595,034,080.75        36,740,101,891.44         145,067,810.69
Current Liabilities:
     Short-term Loan                         250,177,083.34            250,177,083.34
   Borrowings from the Central
Bank
    Borrowings from Banks and
Other Financial Institutions
     Transactional financial liabilities
     Derivative Financial Liabilities
     Notes Payable                          3,258,552,758.17         3,258,552,758.17
     Accounts Payable                       6,444,787,705.28         6,444,787,705.28
     Received Prepayments
     Contract liabilities                    671,120,385.08            671,120,385.08
   Financial Assets Sold for
Repurchase
   Deposit Taking and Interbank
Deposit
    Receiving from Vicariously
Traded Securities
   Receiving from Vicariously Sold
Securities
     Payroll Payable                        1,805,464,535.31         1,805,464,535.31
     Tax Payable                             900,144,863.67            900,144,863.67
     Other Payables                          970,552,877.22            970,552,877.22
       Including: Interest Payable
                Dividends Payable             12,982,399.27             12,982,399.27
   Service Charge and
Commission Payable
     Reinsurance Accounts Payable
     Holding for-sale Liabilities
     Non-current Liabilities Due
                                             151,891,709.34            210,863,157.61          58,971,448.27
within 1 Year
     Other Current Liabilities               209,401,914.77            209,401,914.77
Subtotal of Current Liabilities            14,662,093,832.18        14,721,065,280.45          58,971,448.27
Non-current Liabilities:
     Insurance Contract Reserves
     Long-term Loan                          878,000,000.00            878,000,000.00
     Bonds Payable
       Including: Preferred Stocks
                Perpetual Bonds
     Lease Liabilities                                                  86,096,362.42          86,096,362.42
     Long-term Payables
     Long-term Payroll Payable
     Expected Liabilities                    282,427,517.82            282,427,517.82



                                                                                                           15
                                                         2021 Q3 Report of Zhejiang Dahua Technology Co., Ltd.



     Deferred Income                         110,469,806.29            110,469,806.29
     Deferred Income Tax Liabilities          67,272,768.46             67,272,768.46
     Other Non-current Liabilities           391,128,045.90            391,128,045.90
Subtotal of Non-current Liabilities        1,729,298,138.47          1,815,394,500.89          86,096,362.42
Total Liabilities                         16,391,391,970.65         16,536,459,781.34         145,067,810.69
Shareholders' Equity:
     Share Capital                         2,995,579,590.00          2,995,579,590.00
     Other Equity Instruments
       Including: Preferred Stocks
               Perpetual Bonds
     Capital Reserves                      1,989,655,334.05          1,989,655,334.05
     Less: Treasury Share                    581,968,930.89            581,968,930.89
     Other Comprehensive Incomes              61,157,523.13             61,157,523.13
     Special Reserves
     Surplus Reserves                      1,553,691,005.92          1,553,691,005.92
     General Risk Reserves
     Undistributed Profits                13,754,915,904.19         13,754,915,904.19
Total Shareholders' Equity
                                          19,773,030,426.40         19,773,030,426.40
Attributable to the Parent Company
     Minority Shareholders' Equity           430,611,683.70            430,611,683.70
Total Shareholders' Equity                 20,203,642,110.10        20,203,642,110.10
Total Liabilities and Shareholders'
                                          36,595,034,080.75         36,740,101,891.44         145,067,810.69
Equity


2. Explanation of retroactive adjustments to the comparative data of the previous period due to
first implementation of the new lease accounting standard from 2021

□ Applicable √ Not applicable

(III) Audit Report


Whether the Q3 report has been audited.
□ Yes √ No
The Q3 report of the Company has not been audited yet.




                                       Board of Directors of Zhejiang Dahua Technology Co., Ltd.
                                                                                        October 30, 2021




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