Luxshare Precision Industry Co., Ltd. Annual Report 2023
Luxshare Precision Industry Co., Ltd.
Annual Report 2023
2024-024
April 2024
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Annual Report 2023
Section I Important Note, Table of Contents and Definitions
The Board of Directors, the Board of Supervisors, directors, supervisors and
executives of the Company hereby warrant that the information contained in this
Annual Report is true, accurate and complete and this Annual Report is free from
any misrepresentation, misleading statement or material omission, and agree to
assume joint and several liability for this Annual Report.
WANG Laichun, Principal of the Company, CFO WU Tiansong and Chief
Accountant CHEN Huiyong hereby represent that the financial statements
contained in this Annual Report are true, accurate and complete.
All directors of the Company attended the meeting of the Board of Directors
reviewing this Report.
The relevant risks facing the Company are set out in “Section III
Management’s Discussion and Analysis - XI. Prospects for future development of
the Company”.
According to the profit distribution proposal approved by the Board of
Directors, the Company will distribute a cash dividend of RMB 3 (inclusive of tax)
per 10 shares to all shareholders on the basis of 7,178,011,313 shares, and will not
distribute any bonus shares or transfer any capital reserve to the share capital for
the reporting period.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
Table of Contents
Section I Important Note, Table of Contents and Definitions ............................................................................................................2
Section II Company Profile and Key Financial Indicators ................................................................................................................7
Section III Management’s Discussion and Analysis .......................................................................................................................... 11
Section IV Corporate Governance .....................................................................................................................................................64
Section V Environment and Social Responsibilities ..........................................................................................................................95
Section VI Significant Matters ............................................................................................................................................................139
Section VII Changes in shares and shareholders .................................................................................................................................160
Section VIII Preference Shares ............................................................................................................................................................169
Section IX Bonds.................................................................................................................................................................................170
Section X Financial Report..................................................................................................................................................................185
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
List of References
1. Financial statements signed and chopped by the principal, CFO and Chief Accountant of the Company;
2. Original of the auditor’s report stamped with the seal of the accounting firm and signed and chopped by the
certified public accountants;
3. Originals of all documents of the Company publicly disclosed on the website for information disclosure
designated by the China Securities Regulatory Commission during the reporting period and related announcements;
and
4. Other references.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
Definitions
Terms means Definition
We/us, the Company or Luxshare-ICT means Luxshare Precision Industry Co., Ltd.
Luxshare Limited, founder and
Luxshare Limited means
controlling shareholder of Luxshare-ICT.
ICT-Lanto means ICT-Lanto Limited.
LUXSHARE PRECISION means Luxshare Precision Limited.
Luxshare Precision Industry (Jiangsu)
Luxshare Jiangsu means
Co., Ltd.
Luxshare Precision Industry (Shanxi)
Luxshare Shanxi means
Co., Ltd.
Dongguan Luxshare Precision Industry
Luxshare Dongguan means
Co., Ltd.
Luxshare Precision Industry (Suzhou)
Luxshare Suzhou means
Co., Ltd.
Luxshare Precision Industry (Chuzhou),
Luxshare Chuzhou means
Ltd.
Kunshan Luxshare Precision Industry
Luxshare Kunshan means
Co., Ltd.
Luxshare Precision Industry (Baoding)
Luxshare Baoding means
Co., Ltd.
Xuancheng Luxshare Precision Industry
Luxshare Xuancheng means
Co., Ltd.
Yancheng Luxshare Precision Industry
Luxshare Yancheng means
Co., Ltd.
Luxshare Precision Industry (Enshi) Co.,
Luxshare Enshi means
Ltd.
Luxshare Vietnam means Luxshare-ICT (Vietnam) Limited
Luxshare-ICT (Van Trung) Company
Luxshare Van Trung means
Limited
Luxshare Nghe An means Luxshare-ICT (Nghe An) Limited
Shenzhen Luxshare Acoustics
Luxshare Electroacoustic means
Technology Ltd.
Luxshare Smart Manufacturing means Luxshare iTech (Zhejiang) Co., LTD.
Guangdong Luxshare & Merry
Luxshare-Merry means
Electronics Co., Ltd.
ASAP Jiangxi means ASAP Technology (Jiangxi) Co., Ltd.
Xiexun Jiangxi means Xiexun Electronic (Ji’an) Co., Ltd.
Jiangxi Luxshare Intelligent Manufacture
Smart Manufacturing Jiangxi means
Co., Ltd.
Lanto Bozhou means Bozhou Lanto Electronic Limited
Xuntao Bozhou means Bozhou Xuntao Electronic Limited
Meite Suzhou means Merry Electronics (Suzhou) Co., Ltd.
Huzhou Jiuding means Huzhou Jiuding Electronic Co., Ltd.
Lanto Kunshan means Lanto Electronic Limited
Kunshan RF means Kunshan-Luxshare RF Technology Co.,
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
Ltd.
Liding Electronic Technology
Liding Dongguan means
(Dongguan) Co., Ltd.
Luxcase Precision Technology
Luxcase ICT Yancheng means
(Yancheng) Co., Ltd.
Xiexun Wan’an means Wan’an Xiexun Electronic Co., Ltd.
Luxshare Intelligent Manufacture
Smart Manufacturing Changshu means
Technology (Changshu) Co., Ltd.
Fujian JK means Fujian JK Wiring Systems Co., Ltd..
Xingning Electronics means Xingning Luxshare Electronic Co., Ltd.
Luxsan Kunshan means Luxsan Technology (Kunshan) Co., Ltd.
Bisaisi Automotive Technology (Suzhou)
BCS Suzhou means
Co., Ltd.
SpeedTech means SpeedTech Corp.
Luxshare Automation Jiangsu means Luxshare Automation (Jiangsu) Ltd.
Dongguan Luxshare Technology Co.,
Dongguan Luxshare Technology means
Ltd.
Luxshare Electronic Technology
Luxshare Electronic Kunshan means
(Kunshan) Co., Ltd.
Luxshare Electronic Technology (Enshi)
Luxshare Electronic Enshi means
Co., Ltd.
TIME Interconnect Technology means TIME Interconnect Technology Limited
Huarong Technology means Shenzhen Huarong Technology Co., Ltd.
BCS Automotive Interface Solutions
BCS Germany means
GmbH(Germany)
BCS Automotive Interface Solutions US,
BCS USA means
LLC (USA)
BCS Automotive Interface Solutions
BCS Romania means
Romania s.r.l.(Romania)
Luxsan Hong Kong means LUXSAN TECHNOLOGY LIMITED
Luxsan Investment means Luxsan Investment (Jiangsu) Co., Ltd.
Luxsan Intelligent Equipment (Kunshan)
Luxsan Equipment means
Co., Ltd.
Wuhu Chery Auto Purchasing Parts Co.,
Chery Parts means
Ltd.
Chery Commercial Vehicle (Anhui) Co.,
Chery Commercial Vehicle means
Ltd.
Henan Chery means Henan Chery Auto Co., Ltd.
Articles of Association of Luxshare
AOA means
Precision Industry Co., Ltd.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
Section II Company Profile and Key Financial Indicators
I. Company profile
Stock short name Luxshare-ICT Stock code 002475
Stock exchange Shenzhen Stock Exchange
Chinese name 立讯精密工业股份有限公司
Chinese short name 立讯精密
English name (if any) Luxshare Precision Industry Co., Ltd.
English short name (if any) Luxshare-ICT
Legal representative WANG Laichun
2/F, Block A, Sanyang New Industrial Zone, West Haoyi, Shajing Street, Baoan District,
Registered address
Shenzhen
Postal code of registered address 518104
History of changes in registered
N/A
address
Office address No. 313 Beihuan Road, Qingxi Town, Dongguan, Guangdong
Postal code of office address 523642
Company website https://www.luxshare-ict.com/
E-mail Public@luxshare-ict.com
II. Contact person and contact information
Board Secretary Securities Affairs Representative
Name HUANG Dawei LI Ruihao
No. 313 Beihuan Road, Qingxi Town, No. 313 Beihuan Road, Qingxi Town,
Address
Dongguan, Guangdong Dongguan, Guangdong
Telephone 0769-87892475 0769-87892475
Fax 0769-87732475 0769-87732475
E-mail David.Huang@luxshare-ict.com Ray.Li@luxshare-ict.com
III. Media for information disclosure and place for keeping annual report
Website of the stock exchange disclosing the
Shenzhen Stock Exchange (www.szse.cn)
Company’s annual report
Media and website disclosing the Company’s
The Securities Times, the Shanghai Securities News and http://www.cninfo.com.cn
annual report
Place for keeping annual report Securities Affairs Office of the Company
IV. Changes in registration particulars
Unified social credit code 91440300760482233Q
Changes in main business since the listing of the Company (if No
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
any)
Changes in controlling shareholder (if any) No
V. Other related information
Accounting firm engaged by the Company
Name of accounting firm BDO China Shu Lun Pan Certified Public Accountants LLP
Rooms 1, 2 & 3, 4/F, No. 61 East Nanjing Road, Huangpu
Office address of accounting firm
District, Shanghai
Name of accountants signing this report LI Jing and DAN Jie
Sponsor engaged by the Company that performs the duties of ongoing supervision over the Company during the reporting period:
□Applicable N/A
Financial advisor engaged by the Company that performs the duties of ongoing supervision over the Company during the reporting
period
□Applicable N/A
VI. Key accounting data and financial indicators
Did the Company need to retrospectively adjust or re-state any accounting data of prior accounting years?
□Yes No
2023 2022 Y/Y % Change 2021
Operating income
231,905,459,829.83 214,028,394,291.44 8.35% 153,946,097,790.40
(RMB)
Net profit attributable
to shareholders of the 10,952,656,702.16 9,163,104,849.54 19.53% 7,070,520,386.57
listed company (RMB)
Net profit attributable
to shareholders of the
listed company after
10,185,553,553.99 8,442,052,945.85 20.65% 6,015,597,220.13
deduction of non-
recurring gain or loss
(RMB)
Net cash flow from
operating activities 27,605,060,411.16 12,727,610,319.34 116.89% 7,284,766,917.00
(RMB)
Basic earnings per
1.54 1.29 19.38% 1.01
share (RMB/share)
Diluted earnings per
1.53 1.28 19.53% 0.99
(RMB/share)
Weighted average Decrease by 1.39
21.61% 23.00% 22.35%
return on equity percentage points
December 31, 2023 December 31, 2022 Y/Y % Change December 31, 2021
Total assets (RMB) 161,992,099,595.65 148,384,319,074.71 9.17% 120,572,098,167.88
Net assets attributable
to shareholders of the 56,310,184,510.60 45,342,897,318.53 24.19% 35,288,554,748.72
listed company (RMB)
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
Whether the lower of the net profit before and after deduction of non-recurring gain or loss in the past three accounting years has been
negative and the most recent annual auditor’s report indicates that the Company’s ability to continue as a going concern is uncertain?
□Yes No
Whether the lower of the net profit before and after deduction of non-recurring gain or loss is negative?
□Yes No
VII. Differences in accounting data arising from adoption of Chinese and foreign accounting
standards concurrently
1. Differences in net profit and net assets disclosed in the financial statements prepared according to the
international accounting standards and the Chinese accounting standards
□Applicable N/A
There was no difference in net profit and net assets disclosed in the financial statements for the reporting period prepared according to
the international accounting standards and the Chinese accounting standards.
2. Differences in net profit and net assets disclosed in the financial statements prepared according to the
foreign accounting standards and the Chinese accounting standards
□Applicable N/A
There was no difference in net profit and net assets disclosed in the financial statements for the reporting period prepared according to
the foreign accounting standards and the Chinese accounting standards.
VIII. Main quarterly financial indicators
In RMB
First quarter Second quarter Third quarter Fourth quarter
Operating income 49,942,325,179.17 48,028,855,731.10 57,903,635,250.06 76,030,643,669.50
Net profit attributable
to shareholders of the 2,017,931,635.56 2,337,794,295.99 3,018,448,573.21 3,578,482,197.40
listed company
Net profit attributable
to shareholders of the
listed company after 1,771,547,570.19 2,382,825,838.93 2,878,274,332.09 3,152,905,812.78
deduction of non-
recurring profit or loss
Net cash flow from
3,612,281,990.23 5,201,747,161.89 -1,591,995,327.88 20,383,026,586.92
operating activities
Whether there’s any significant difference between the financial indicators set forth above or aggregate amounts thereof and the
corresponding financial indicators contained in any quarterly or semi-annual report already disclosed?
□Yes No
IX. Items and amounts of non-recurring gains or losses
Applicable □ N/A
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
In RMB
Item 2023 2022 2021 Remark
Gain or loss on disposal of non-current assets
(including allowance for impairment of assets 106,350,953.11 40,397,780.40 -57,241,855.39
that has been written off)
Government grants recognized in profit or loss
(excluding government grants that are closely
related to the business of the Company, in
accordance with national policy requirements, 791,098,788.52 602,294,263.90 853,542,165.37
enjoyed according to specific criteria, and
having a continuous impact on the Company’s
profit or loss)
Fair value changes in financial assets and
financial liabilities held by non-financial
enterprises and gains or losses from the disposal
488,375,997.34 543,762,585.57 602,993,325.33
of financial assets and financial liabilities,
except for effective hedging transactions related
to the Company's ordinary operating activities
Gain or loss on assets under entrusted
189,969,851.82 50,525,057.66 95,298,693.93
investment or management
Interest in the fair value of the acquirees’
identifiable net assets at the date of acquisition
16,559,223.33
in excess of the investment cost of the relevant
subsidiaries, associates and joint ventures
Gain or loss on assets under entrusted
41,640,366.02 11,040,674.64 -12,600,634.71
investment or management
Other non-operating income and expenses -601,026,495.49 -377,143,056.77 -170,939,666.46
Less: Effect of income tax 158,749,222.86 100,226,804.81 211,043,425.20
Effect of minority interest (after tax) 90,557,090.29 49,598,596.90 61,644,659.76
Total 767,103,148.17 721,051,903.69 1,054,923,166.44 --
Other items of gain or loss within the meaning of non-recurring gains or losses:
Applicable □N/A
Mainly for investment income recognized for advance termination of financial assets.
If the Company classifies any item of non-recurring gain or loss defined by or listed in the Explanatory Announcement No. 1 on
Information Disclosure for Companies Publicly Offering Securities - Non-recurring Gain or Loss as recurring gain or loss, please
explain the reason.
□Applicable N/A
We have not classified any item of non-recurring gain or loss defined by or listed in the Explanatory Announcement No. 1 on
Information Disclosure for Companies Publicly Offering Securities - Non-recurring Gain or Loss as recurring gain or loss in the
reporting period.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
Section III Management’s Discussion and Analysis
I. Situations of our industry during the reporting period
During the reporting period, we are engaged in the research and development (R&D), manufacturing and sale
of products in the fields of consumer electronics, communication and data center, automotive electronics and
healthcare, among others. Our products and businesses are diversified and vertically integrated, and cover
components, modules and system assembly.
(I) Consumer electronics
Since 2023, despite the impact of factors such as the global economic downturn and geopolitics, the consumer
electronics industry has been relatively sluggish overall. However, with the release of a series of new products by
major terminal brands in the second half of the year and the accelerated application of new technologies, terminal
demand has shown signs of recovery, and the industry chain has transitioned from actively destocking to passively
destocking. According to the "China Wearable Device Market Quarterly Tracking Report" released by the globally
renowned data research firm IDC, the shipment volume of wearable devices in China in the third quarter of 2023
was 34.7 million units, a year-on-year increase of 7.5%. Among them, the shipment volume of smartwatches was
11.4 million units, a year-on-year increase of 5.5%, and the shipment volume of TWS earphones was 15.1 million
units, a year-on-year increase of 10.6%. A research report from Canalys, a market research institution, pointed out
that in the fourth quarter of 2023, global smartphone shipments increased by 8% year-on-year, reaching 319 million
units, ending nine consecutive quarters of sluggishness. This indicates that the overall market is entering a stable
recovery phase. Meanwhile, technological innovation and application are important factors driving the continued
growth of the consumer electronics industry. With the continuous emergence of emerging technologies such as AI
(Artificial Intelligence) and XR (Extended Reality), new development momentum has been brought to the consumer
electronics industry, especially the popularization and application of AI technology in smartphones, personal
computers, wearable electronic products, and other fields in the future, expanding the industry's growth space.
(II) Communication and data center
In 2023, the telecommunications industry welcomed new development opportunities in the wave of global
digitization transformation. Significant growth trends were observed in areas such as copper connections, optical
connections, heat dissipation modules, servers, and communication radio frequency (RF), all of which became
important drivers for industry development.
Copper connection products have consistently played a crucial role in high-speed interconnection products in
data centers, particularly in short-distance transmission scenarios within servers, where copper connections offer
significant advantages in heat dissipation efficiency, signal transmission, and cost-effectiveness. Thus, copper
interconnection remains the most cost-effective solution in many current and future applications. According to a
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
report on high-speed cables, LPO, and CPO published by the market research firm LightCounting, the market size
of high-speed cables is expected to grow exponentially in the next five years. With breakthrough optical
technologies being introduced and developed, optical connection products enable networks to achieve higher
bandwidth and longer transmission distances, with the market size expanding as data centers transition to higher
computational power in the future. LightCounting predicts that the global optical module market will experience a
compound annual growth rate of 11% over the next five years (2024-2028).
As computational power technologies advance rapidly, the demand and requirements for heat dissipation
technology at terminals also increase accordingly. Liquid cooling technology is gradually becoming a new solution
for data center cooling, especially cold plate and immersion liquid cooling technologies, which significantly
improve heat dissipation efficiency by efficiently exchanging heat with servers through liquid. In the future, as the
demand for efficient and environmentally friendly cooling solutions in data centers increases, the application of
liquid cooling technology will further expand.
Servers, as the core carriers of computational power, are experiencing a sharp growth trend in market demand
as AI technologies are increasingly applied. According to data from TrendForce, AI server shipments reached 1.2
million units in 2023, accounting for nearly 9% of total server shipments, with a year-on-year growth rate of 38.4%.
In the future, the development of AI applications such as large language models will further drive the overall demand
for servers.
In terms of communication radio frequency, major economies around the world are increasing investment in
network infrastructure construction, with many countries accelerating the layout of computational power
infrastructure. According to the "World Internet Development Report 2023" blue book, the United States and China
still lead in internet development, while countries such as Singapore, the Netherlands, South Korea, Finland, and
Sweden rank relatively high. European countries generally have strong internet development capabilities, while
Central Asia and Africa still have considerable room for improvement in internet development. Therefore, the base
station RF industry is expected to show strong growth momentum in the coming years.
(III) Automotive electronics
In 2023, the Chinese new energy vehicle (NEV) market continued its strong growth momentum, both
production and sales volumes, as well as market penetration rate, have achieved significant improvements.
According to statistics from the China Association of Automobile Manufacturers, China's total automobile sales
reached 30.09 million units in 2023, a year-on-year increase of 12%, marking a growth rate surpassing 10% for the
first time in six years. Among them, the production and sales volumes of NEVs in China reached 9.587 million units
and 9.495 million units respectively, with year-on-year increases of 35.8% and 37.9%, demonstrating the strong
momentum of NEVs in the Chinese market. Additionally, thanks to continuous efforts by Chinese automakers in
product quality, technological innovation, brand building, and strong support from national policies, China's total
automobile exports reached 4.91 million units in 2023, a year-on-year increase of 57.9%. Among them, NEV exports
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
reached 1.203 million units, a year-on-year increase of 77.6%.
NEVs represent an important direction for the transformation and upgrading of China's automobile industry.
With the continuous improvement of electrification technology and the gradual reduction of manufacturing costs
for vehicles, NEVs have received strong support from national policies and high recognition from the market in
recent years, significantly enhancing their market competitiveness.
In terms of smart cabins, with the emergence of more user-friendly and intelligent designs, including features
such as high-definition touch screens, voice interaction systems, and personalized settings, the driving and riding
experience has been greatly enhanced. Through artificial intelligence technology, smart cabins can automatically
adjust seat positions, air conditioning temperatures, and even detect the driver's fatigue status through facial
recognition technology, issuing timely reminders. Furthermore, with the popularization of 5G technology, the
connection between vehicles and external information has become closer. Smart cabins can receive and process
various information from the cloud in real-time, providing drivers with richer and more convenient services.
In terms of autonomous driving, many current models are equipped with Level 2 or even higher-level
autonomous driving systems, capable of achieving partial autonomous driving functions on highways, urban roads,
and other environments, such as automatic following, lane changing, and parking. These systems collect
surrounding environmental information quickly through advanced millimeter-wave radar, cameras, LiDAR, and
other high-precision sensors, combined with advanced algorithms and big data analysis, to achieve precise control
of vehicle driving status. To ensure safety, autonomous driving systems are also equipped with multiple safety
monitoring mechanisms to deal with possible emergencies.
In this context, the global automotive market has reached a new breakthrough.
(IV) Our position in the industry
During the reporting period, the Company was honored with titles such as "Fortune Global 500", "Top 500
Chinese Private Enterprises", "Top 500 Chinese Manufacturing Private Enterprises", "Top 100 Private Enterprises
in Guangdong Province", "Top 100 Manufacturing Private Enterprises in Guangdong Province", and ranked first
among the backbone enterprises in the Chinese electronic components industry in 2023.
II. Our main business during the reporting period
As a leading enterprise in the precision manufacturing field, the company is always dedicated to focusing on
industries such as consumer electronics, automotive, and telecommunications. With keen insights into industry
trends and a profound understanding of customer needs, the company has continuously driven product innovation,
technological breakthroughs and process optimization, and continuously created values for customers acting as a
"middleman", earning high praise and long-term trust from top global clients, and laying a solid foundation for the
company's high-quality growth.
The company's products mainly cover areas such as consumer electronics, automotive, telecommunications,
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
industrial, and medical industries. It is committed to providing customers with one-stop multi-category core
components, modules, and system-level products, including:
(1) Consumer Electronics Business
消费电子 Consumer electronics 室内应用场景 Indoor application scenarios
办公室应用场景案例 Office application scenarios
智能显示器 Smart display TV 盒子 TV box 会议系统 Conference system
MR 智能音箱 Smart speaker 转换坞 Conversion dock
控制器 Controller 平板电脑 Tablet 智能手写笔 Smart stylus
智能手机 Smartphone 笔记本电脑 Laptop 蓝牙鼠标 Bluetooth mouse
摄像头 Camera 无线充电 Wireless charging 蓝牙键盘 Bluetooth keyboard
家庭应用场景案例 Home application scenarios
吸尘器 Vacuum cleaner 扫地机器人 Robotic vacuum cleaner 游戏手柄 Game controller
智能转接头 Smart adapter 充电宝 Power bank 电子烟 E-cigarette
智能插座 Smart socket 移动电源 Portable charger 路由器 Router
智能锁 Smart lock 智能音箱 Smart speaker 电子书 E-reader
美容仪 Beauty device 追踪器 Tracker VR
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
消费电子 Consumer electronics 户外应用场景 Outdoor application scenarios
1、户外电源 Outdoor power source 7、AR 眼镜 AR glasses
2、平衡车 Balance car 8、骨传导耳机 Bone conduction headphone
3、电动车 Electric scooter 9、蓝牙耳机 Bluetooth headphone
4、智能车锁 Smart lock 10、智能指环 Smart ring
5、电动车充电器 Electric vehicle charger 11、智能手环 Smart wristband
6、智能头盔 Smart helmet 12、智能手表 Smart watch
(2) Communication and Data Center Business
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
通讯 Communication 无线基站应用场景 Wireless base station application scenarios
无线基站室外部分（天线、塔放、射频拉远单元等）Outdoor components of base station (antennas, tower amplifiers, remote
radio units, etc.)
1、基站天线 Base station antenna 2、塔放/合路器 Tower amplifier/combiner
3、射频拉远单元 Remote ratio unit 4、直放站 Repeater
5、AAU 6、RRU
无线基站室内部分（（室分天线、室内线端、电源系统） Indoor components of wireless base station (Distributed antenna, indoor
cabling, power supply system)
7、室分天线 Distributed antenna 8CPE 9、电源系统 power supply system
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
企业 Enterprise 数据中心应用场景 Date center application scenarios
电连接（（连接器及连接器模组，线缆及线缆模组） Electrical connectivity (connectors and connector modules, cables and cable
modules)
1、ACC/DAC 2、SSIO 8、挂耳 Earhook
3、HSIO 7、线缆模组 Cable module
光连接（AOC、光模块、光跳线）Optical connectivity (AOC, optical modules, optical patch cords)
4、AOC 5、Transceiver 6、光跳线 Optical patch cords
热管理（（散热器、风扇、液冷板及温控） Thermal management (heat sinks, fans, liquid cooling plates, and temperature control)
11、散热器 Heat sink 10、风扇 Fans
9、水冷板 Liquid cooling plates 12、温控解决方案 Temperature control solution
电源模块与电源系统（服务器电源模块、电源柜）Power module and power system (server power module, power cabinet)
13、服务器电源模块 Server power module 14、电源系统 Power supply system
(3) Automotive Business
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
汽车 Vehicle 应用场景 Application scenarios
1、电气化-低压/高压线束 Electrification - Low-voltage/High-voltage wiring harness
车内线束 Vehicle interior wiring harness 特种线束 Specialized wiring harness 充电枪 Charging gun
2、连接器-高压/低压/高速连接器 Connectors - High-voltage/Low-voltage/High-speed connectors
高/低压连接器 High/Low voltage BMS Busbar 高速连接器 High-speed connectors
connectors
3、智能座舱 Smart cockpit
驾 驶 员 / 乘 客 监 控 系 统 信息娱乐系统 Infotainment system AR-HUD
Driver/Passenger monitoring system
4、车身控制/智能进入 Body control/Smart entry
ZCU ECU ETC 传感器 Sensor
UWB/NFC/BLE key 触摸开关 Touch switch
5、电源管理 Power management
CCS PDU BDU 逆变器 Inverter WPC 整车无线充电
Vehicle wireless
charging
6、磁性器件模组-电厂&滤波器 Magnetic device module - inductors & filters
Choke 电感 Inductor EMI 滤波器 EMI filter
(4) Medical Business
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
医疗 Medical 应用场景 Application scenarios
1、监护类 Monitoring
血氧线 Oxygen saturation Cable 心电线 ECG lead 温度线 Temperature probe cable
2、手术类 Surgery
吻合器线 Cable used for anastomosis 电刀线 Cable for electric knife 吻合器连接器 Anastomosis connector
3、除颤类 Defibrillation
体外除颤线 External defibrillation 体 腔 除 颤 线 Body-controlled 除颤器零件 Defibrillator components
defibrillation Cable
Cable
4、设备内部类 Internal equipment 5、影像类（超声） Imaging (ultrasound) 6、影像类（MR） Imaging (MR)
各类医疗设备机内线 Various types of 超 声 换 能 器 线 Ultrasound transducer 磁共振成像线圈线缆 MRI imaging coil
medical device internal wiring cable cable
III. Analysis of core competencies
(I) Smart Manufacturing: Deep Integration of Digitalization and Automation
Given the continuous deep integration of the next generation of information technology and manufacturing, we
have always insisted on intelligent manufacturing as the underlying logic, and devoted great energy to promoting
automated processes and digital applications to empower the process development, personnel organization and
production modes.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
For the digital applications, we have introduced systems such as SAP, PLM, MES and WMS to further optimize
the management processes and production processes throughout the entire lifecycle from design, R&D, production
to marketing, procurement, warehousing and after sales, conduct precise, scientific and intelligent customer-oriented
management, and constantly strive to improve our production efficiency and product yield.
In terms of automated processes, we actively leverage the significant advantages of machine vision in precision,
speed, repeatability, reliability, and information aggregation to achieve precise positioning and error detection of
precision electronic components in process, active coordination and positioning of parts and fixtures in assembly,
and machine AI-assisted inspection of component product appearance. By relying on real-time feedback of
measurement data from machine vision, we enhance the deep self-learning ability of automated equipment and
create a closed-loop control for automated processes.
(II) Strategic Layout: Forward-looking Planning to Create a Second Growth Curve
Under the guidance of our “three five-year” strategy, we always grasp the market dynamics, respond to industry
growth trend, take coordinated development as our fundamental purpose, make forward-looking layouts around the
main business, and are dedicated to providing the market with a perfect and integrated solution of industrial chains.
On the one hand, capitalizing on our comprehensive capabilities deeply accumulated and continuously optimized
in the consumer electronics field, we have built “process + underlying technology” structure to continuously explore
the mass market of new and old products for core customers and other consumer electronics customers. In addition,
we conduct horizontal expansion to empower automotive and communication sectors, which highlights our
differentiated advantages in relevant sectors, and effectively supports the implementation of commercial plans,
thereby achieving our diversified product layout. On the other hand, with many years of efforts in market segments,
we have proprietary key process capabilities, including design and processing of molds/jigs, bare copper wire
drawing, plastic particle molding, stamping/press forging, precision implant molding, surface treatment, SMT, SiP
and system-level assembly testing. We make continuous efforts to explore product value by way of vertically
integrating components, modules, and system-level assembly in a forward or reverse direction.
In the era of the internationalization of industrial chains, our globalization layout is developing in depth. In
addition to Guangdong, Jiangxi, Jiangsu, Zhejiang, Anhui and other provinces in China, we have established mature
production capacity bases and R&D centers in such countries and regions as Vietnam, India, Mexico and German.
While serving customers nearby and enhancing product cost advantages, these bases and centers have gathered
overseas sophisticated talents and offered strong support for the team to explore high-end markets and provide high-
quality services to customers.
(III) Research and Development Innovation: Driving Technological Innovation and Product Iteration
Since inception, our company has consistently regarded research and development (R&D) innovation as a
crucial engine for enterprise development. We has increased R&D investment, continuously promoted the
innovation of traditional manufacturing processes, enhanced the level of automation in production, and modularized
20
Luxshare Precision Industry Co., Ltd. Annual Report 2023
various precision manufacturing processes. The company attaches great importance to the research and development
of underlying materials and process technology. Our in-house R&D team collaborates closely with top global clients
to establish multiple R&D laboratories, enabling the rapid grasp of cutting-edge technological trends. Leveraging
its deep understanding of precision manufacturing practices and comprehensive digitization and intelligence, the
company achieves joint innovation in new materials, processes, and techniques, accelerating the commercialization
of its technological innovations.
In terms of R&D investment, the company adopts a targeted strategy, dividing R&D resources into two main
areas: investment in cutting-edge technology and investment in product iteration. Approximately 30% of the overall
R&D expenditure is allocated to investment in cutting-edge technology, focusing on innovative research and
development in areas such as underlying materials, processes, and techniques. This investment aims to support the
company's medium- to long-term product and business planning, ensuring that its products maintain a leading
position in the global industry over the next 20 years. Investment in product iteration focuses on the development
of process innovation for product iteration and upgrade, from the conceptualization of new products to new product
introduction (NPI), verification, and mass production. This approach enables the company to not only maintain the
competitiveness of existing products but also seize opportunities in emerging technologies and markets, laying a
solid foundation for the company's long-term development and the cultivation of new quality productivity.
Over the years, the company's R&D investment and achievements have shown a steady upward trend. In terms
of R&D investment, the company has cumulatively invested RMB 23.278 billion in R&D in the past three years,
including RMB 8.189 billion during the reporting period. In terms of R&D achievements, the company added 1,527
new patents in 2023, bringing its total to 6,202 patents.
(IV) Green Development: Achieving Sustainable Development and Environmental Protection
The company is committed to integrating the concept of sustainable development into its core business strategy,
seizing the transformative trends of sustainable development in the new era. We focus on addressing the challenges
and opportunities of climate change, safeguarding employee rights, implementing responsible supply chain
management, and upholding business ethics. Internally, we continuously monitor the latest trends in sustainable
development, learn from advanced experiences within the industry, and strive to enhance our level of sustainable
development management. Through ongoing internal training and process optimization, we ensure that the concept
of sustainable development is understood and supported internally and efficiently implemented in daily operations.
Externally, we have established regular communication mechanisms to maintain close interaction with various
stakeholders, promptly understand and respond to their needs and expectations. Through open and transparent
communication, we enhance mutual understanding and trust with investors, customers, and suppliers, jointly
promoting the company's continuous development towards a sustainable future.
Based on the decarbonization goals of the SBTi 1.5°C pathway, the company steadily promotes carbon
footprinting, emission reduction, and carbon neutrality action plans according to the climate action planning
21
Luxshare Precision Industry Co., Ltd. Annual Report 2023
roadmap. We regularly review and adjust climate change strategies based on actual business operations. Through
measures such as rooftop photovoltaics, direct purchases of green electricity, investments in green energy funds,
and procurement of green certificates, we increase the proportion of clean energy use and reduce CO2 emissions
from electricity consumption.
During the reporting period, the company's proportion of clean energy use increased to 63%, exceeding the
target of achieving a clean energy use proportion of 50% by 2025. Furthermore, through energy-saving
transformations, we significantly reduced energy consumption and greenhouse gas emissions, resulting in a total
reduction of 1,100,057.45 tCO2e in greenhouse gas emissions. As of the end of the reporting period, a total of 54
factories have obtained ISO 14001 environmental management system certification, 10 factories have obtained ISO
50001 energy management system certification, and 14 factories have been recognized as national or provincial-
level green factories. Additionally, 14 subsidiaries have achieved UL 2799 waste landfill-free certification at the
platinum level.
(V) Talent Strategy: Building an Innovative and Development-Oriented Talent Team
Talent is the foundation of innovation and the driving force behind nurturing new quality productivity.
Innovation is essentially driven by talent. Especially, "highly skilled" original research and development talents in
craft, materials, and technology, as well as management talents with rich practical experience and industry insight,
are crucial elements in propelling Luxshare towards the high end of the industry and value chain. Since its
establishment, Luxshare has always adhered to the solid foundation of talent resources, relying on talent for
development and growth. Currently, Luxshare boasts a research and development team of nearly 20,000 people.
This passionate and creative team brings together elites from different fields, countries, and regions, serving as the
backbone of Luxshare's various technological breakthroughs and innovative achievements. Regarding talent
selection, cultivation, and retention, the company adheres to the principle of "achieving success for everyone in
their careers". The rapid development of the company has provided many growth platforms for employees and
cadres. New products, new businesses, and new opportunities drive employees to demand higher levels and
standards from themselves, fully inspiring team potential, sense of mission, and sense of honor. Furthermore, the
company incentivizes everyone financially by providing competitive compensation and benefits, as well as equity
incentive plans, significantly enhancing the sense of achievement for employees and cadres and effectively
improving their quality of life. A sound and effective talent incentive mechanism strongly promotes the company's
talent "attraction, development, and retention", laying the foundation for the exploration and sustainable
development of new fields and new businesses while ensuring an abundant talent pool for traditional advantageous
areas. Lastly, Luxshare aims to emotionally connect with each individual by strengthening employee care, actively
listening to the voices of employees and cadres at all levels, and genuinely caring about their personal needs and
family happiness. Through this emotional interaction, the company builds and enhances employees' sense of
belonging and identification with the company.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
IV. Analysis of main business
1. Overview
(1) Consumer electronics business
In 2023, the company remained steadfast in its customer-oriented approach, leveraging its advantages in vertical
integration and cost control. As a result, its operational performance saw steady improvement during the reporting
period. With the release of a series of new products by major terminal brands and the accelerated application of new
technologies in the latter half of the year, the consumer electronics market showed clear signs of recovery,
particularly in major categories such as smartphones, smart wearable devices, and personal computers, which
gradually reversed their sluggish state. In areas such as smart mobile terminals, health wearables, acoustic wearables,
smart offices, and smart homes, the company achieved breakthroughs in both quantity and quality during the
reporting period. This success was attributed to its solid product development capabilities, leading automation
process development, efficient lean manufacturing capabilities, and the sincere cooperation of its team members.
Products were delivered with high quality as scheduled, earning high praise and recognition from core customers.
Furthermore, during the reporting period, the company achieved substantial breakthroughs in enhancing its core
capabilities and expanding its business scale through vertical integration and horizontal mergers and acquisitions.
Leveraging its deep experience and technological reserves in areas such as Surface Mount Technology (SMT) and
System in Package (SiP), the company acquired all assets of Qorvo, a leading RF front-end chip manufacturer in
the United States, located in Beijing and Dezhou, Shandong Province. This acquisition further nurtured the
company's precision manufacturing capabilities in RF front-end modules, strengthened its vertical integration
service advantages, and propelled the company to achieve a leapfrog development from system packaging to module
packaging. Moreover, through joint ventures and high-quality mergers and acquisitions, the company expanded its
existing business scale, achieving better resource allocation, higher production efficiency, and stronger market
competitiveness. Leveraging efficient collaborative advantages with its joint venture partners upstream and
downstream in the industry chain, the company created more room for incremental development in core components
and precision module businesses in the consumer electronics sector. This strategy also facilitated the expansion of
"old customers with new products", creating more possibilities for growth.
(2) Communication and Data Center Business
Since entering the telecommunications and data center industries, the company has continuously deepened its
expertise in electrical connections, optical connections, air-cooled/liquid-cooled cooling, power management, RF,
and other products. With "application generation, development generation, pre-research generation" as the core
product strategy, and technological innovation as a crucial driving force, the company has built its unique
capabilities sandbox in various technical fields. Through extensive patent layouts and deep involvement in industry
standard formulation, the company has gradually established strong technological barriers and market
23
Luxshare Precision Industry Co., Ltd. Annual Report 2023
competitiveness. Especially in the field of high-speed interconnection in data centers, the company has cooperated
proactively with leading chip manufacturers to jointly develop next-generation high-speed connection standards
such as 800G and 1.6T for global mainstream data centers and cloud service providers. Some products in specific
segments, such as external high-speed copper cables, cables and connector components, backplane connectors and
backplane cables, HSIO, SSIO, etc., have won recognition from customers with leading technology, cost advantages,
and excellent product performance. Based on this foundation, the company has comprehensively promoted further
cooperation with leading customers in optical connections, cooling, power modules, and other products. During the
reporting period, the company has made breakthrough progress under this strategic guidance.
(3) Auto Business
In 2023, leveraging our robust smart manufacturing platform and drawing on our years of experience in rapid
iteration, cost control, global supply chain advantages, and research and development innovation in the consumer
electronics and telecommunications sectors, we rapidly empowered ourselves to enter the automotive industry with
a range of products. With a deep understanding of automotive-grade product safety and reliability, we quickly
enabled our offerings to meet the requirements of the automotive industry. Building on deep strategic partnerships
with leading domestic and international OEMs and automotive brands, we successfully opened up vast market space
for our automotive-related products, including high/low-voltage wiring harnesses, high-speed wiring harnesses,
charging guns, automotive connectors, intelligent cockpit domain controllers, LCD instrument panels, three-in-one
motor systems, AR HUD, DMS, and more. During the reporting period, each product line experienced strong market
demand, resulting in high-speed growth in performance.
2. Revenue and cost
(1) Components of operating revenue
In RMB
2023 2022
Y/Y %
% of operating % of operating change
Amount Amount
revenue revenue
Total operating revenue 231,905,459,829.83 100% 214,028,394,291.44 100% 8.35%
By segment
Computer interconnect products
7,492,410,071.11 3.23% 11,279,925,261.07 5.27% -33.58%
and precision components
Automotive interconnect products
9,252,368,552.09 3.99% 6,149,359,869.13 2.87% 50.46%
and precision components
Communication interconnect
products and precision 14,538,256,002.45 6.27% 12,834,368,214.51 6.00% 13.28%
components
Consumer electronics 197,183,318,387.02 85.03% 179,666,857,997.07 83.95% 9.75%
Other connectors and other
3,439,106,817.16 1.48% 4,097,882,949.66 1.91% -16.08%
business
24
Luxshare Precision Industry Co., Ltd. Annual Report 2023
By product
-
Computer interconnect products
7,492,410,071.11 3.23% 11,279,925,261.07 5.27% 33.58
and precision components
%
Automotive interconnect products
9,252,368,552.09 3.99% 6,149,359,869.13 2.87% 50.46%
and precision components
Communication interconnect
products and precision 14,538,256,002.45 6.27% 12,834,368,214.51 6.00% 13.28%
components
Consumer electronics 197,183,318,387.02 85.03% 179,666,857,997.07 83.95% 9.75%
Other connectors and other
3,439,106,817.16 1.48% 4,097,882,949.66 1.91% -16.08%
business
By region
Domestic market 25,149,439,369.07 10.84% 20,224,747,347.20 9.45% 24.35%
Overseas market 206,756,020,460.76 89.16% 193,803,646,944.24 90.55% 6.68%
By sales mode
Direct sales 231,905,459,829.83 100.00% 214,028,394,291.44 100.00% 8.35%
(2) Segments, products, regions or sales models representing more than 10% of operating revenue or profit
Applicable □N/A
In RMB
Y/Y % Y/Y % Y/Y %
Gross Change in Change in Change in
Operating income Operating cost
margin operating operating gross
revenue cost margin
By segment
Consumer
197,183,318,387.02 176,289,664,722.15 10.60% 9.75% 10.83% -0.87%
electronics
By product
Consumer
197,183,318,387.02 176,289,664,722.15 10.60% 9.75% 10.83% -0.87%
electronics
By region
Domestic sales 25,149,439,369.07 20,949,932,693.12 16.70% 24.35% 23.49% 0.58%
Export sales 206,756,020,460.76 184,091,367,765.47 10.96% 6.68% 7.68% -0.82%
By sales mode
Direct sales 231,905,459,829.83 205,041,300,458.59 11.58% 8.35% 9.11% -0.61%
In case of any adjustment to the statistic scale for main business data, the main business data of the most recent reporting period as
adjusted according to the statistic scale applied at the end of the current reporting period
□Applicable N/A
(3) Whether the Company’s revenue from sale of tangible goods is higher than the revenue from labor service?
Yes □No
Segment Item Unit 2023 2022 Y/Y % change
25
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Computer Sales volume KPCS 339,436 651,927 -47.93%
interconnect Output KPCS 381,866 691,581 -44.78%
products and
precision Inventories KPCS 42,430 39,654 7.00%
components
Automotive Sales volume 1,000 sets 289,181 323,444 -10.59%
interconnect Output 1,000 sets 315,470 352,333 -10.46%
products and
precision Inventories 1,000 sets 26,289 28,889 -9.00%
components
Communication Sales volume KPCS 273,342 484,370 -43.57%
interconnect Output KPCS 287,729 522,561 -44.94%
products and
precision Inventories KPCS 14,386 38,191 -62.33%
components
Sales volume KPCS 3,985,052 3,727,774 6.90%
Consumer Output KPCS 4,336,890 4,233,740 2.44%
electronics Inventories KPCS 351,838 505,965 -30.46%
Sales volume KPCS 358,699 385,129 -6.86%
Other connectors Output KPCS 386,291 416,004 -7.14%
and other business Inventories KPCS 27,592 30,874 -10.63%
Analysis of changes in the relevant data over 30% year on year
Applicable □N/A
1. The decrease in computer interconnect quantity is due to both the decline in shipment volume itself and
higher unit prices resulting from internal vertical integration;
2. Revenue from communication interconnects increased, but production and shipment volumes decreased,
primarily due to changes in product structure and higher integration levels in shipments;
3. The decrease in end-of-period inventory for consumer electronics is attributed to the realization of sales from
strategic stocking at the end of 2022, which was carried out for sales in 2023;
(4) Performance of material sales contracts and material purchase contracts by the Company as of the end of the reporting
period
□Applicable N/A
(5) Components of operating cost
Segment
Segment
In RMB
Segment Item 2023 2022 Y/Y %
26
Luxshare Precision Industry Co., Ltd. Annual Report 2023
% of % of change
Amount operating Amount operating
cost cost
Computer interconnect
Cost of
products and precision 5,936,846,692.39 2.90% 8,991,105,125.09 4.78% -33.97%
sales
components
Automotive interconnect
Cost of
products and precision 7,781,748,026.29 3.80% 5,159,940,778.89 2.75% 50.81%
sales
components
Communication
Cost of
interconnect products and 12,241,553,918.40 5.97% 11,405,956,391.67 6.07% 7.33%
sales
precision components
Cost of
Consumer electronics 176,289,664,722.15 85.98% 159,057,762,186.53 84.64% 10.83%
sales
Other connectors and other Cost of
2,791,487,099.36 1.36% 3,314,115,803.20 1.76% -15.77%
business sales
Remark
None.
(6) Change in the scope of consolidation during the reporting period
Yes □No
In 2023, the establishment of new subsidiary companies by the company led to changes in the scope of consolidation as follows:
Company Name Establishment Date
Luxshare Precision Industry (Huzhou), Ltd. 2023/1/1
TIME Interconnect Technology Limited 2023/1/10
Kunshan TIME Interconnect Technology Limited 2023/1/19
Luxshare Technologies International, Inc. 2023/3/24
Linkz Cables Mexico S.DE R.L. DE C.W. 2023/4/14
ICT Legend S. DE R.L. DE C.V. 2023/5/8
Luxshare Precision Industry (Shantou), Co., Ltd. 2023/6/19
Luxshare Precision Industry (Anhui), Co., Ltd. 2023/7/21
Luxshare Technologies Mexico S. de. R.L.de c.v. 2023/8/14
Luxshare Technologies (Vietnam)Co., ltd 2023/8/29
Dongguan Luxshare Holdings Co., Ltd. 2023/9/5
Luxcase Precision Technology (Vietnam)Co., Ltd. 2023/11/10
27
Luxshare Precision Industry Co., Ltd. Annual Report 2023
In 2023, the deregistration of subsidiary companies by the company resulted in changes in the scope of
consolidation as follows:
Company Name Establishment Date
Kunshan Luxshare Precision Mould Co., Ltd. 2023/2/6
Henan Leader Precision Industry Co., Ltd. 2023/6/21
Other changes in the scope of consolidation include the absorption merger of Taiwan Qiao Investment Co., Ltd.
by SpeedTech Co., Ltd. SpeedTech Co., Ltd. assumed its debts and liabilities, while Taiqiao Investment Co., Ltd.
was deregistered.
(7) Material changes or adjustments in respect of business, products or services of the Company during the reporting period
□Applicable N/A
(8) Major customers and suppliers
Major customers of the Company:
Aggregate sales revenue from top 5 customers (RMB) 191,203,704,609.15
Proportion of aggregate sales revenue from top 5 customers to
82.44%
annual sales revenue
Proportion of aggregate sales revenue from related parties
0.00%
among top 5 customers to annual sales revenue
Particulars of top 5 customers:
No. Name of customer Sales revenue (RMB) % of annual sales revenue
1 Customer 1 174,489,981,736.18 75.24%
2 Customer 2 6,031,671,165.64 2.60%
3 Customer 3 4,877,559,242.24 2.10%
4 Customer 4 3,219,651,965.78 1.39%
5 Customer 5 2,584,840,499.31 1.11%
Total -- 191,203,704,609.15 82.44%
Other information of major customers:
□Applicable N/A
Major suppliers of the Company:
Aggregate purchase amount from top 5 suppliers (RMB) 115,275,781,375.25
Proportion of aggregate purchase amount from top 5 suppliers to
65.16%
annual purchase cost
Proportion of aggregate purchase amount from related parties
0.00%
among top 5 suppliers to annual purchase cost
Particulars of top 5 suppliers:
No. Name of supplier Purchase amount (RMB) % of annual purchase cost
1 Supplier 1 109,487,264,912.33 61.89%
2 Supplier 2 1,506,823,978.96 0.85%
3 Supplier 3 1,463,571,008.07 0.83%
28
Luxshare Precision Industry Co., Ltd. Annual Report 2023
4 Supplier 4 1,438,333,951.40 0.81%
5 Supplier 5 1,379,787,524.49 0.78%
Total -- 115,275,781,375.25 65.16%
Other information of major suppliers:
□Applicable N/A
3. Expenses
In RMB
Y/Y %
2023 2022 Reason of material change
change
The growth in personnel compensation
Sales expenses 889,024,421.63 831,398,139.60 6.93%
and benefits
Continuing to adhere to the principle of
conservatism, some of the research and
development expenses not directly
attributable are transferred to general
General expenses 5,542,856,994.26 5,075,668,085.35 9.20% and administrative expenses. This is
mainly due to increases in personnel
compensation and benefits, as well as
increases in depreciation expenses and
material consumption costs.
The increase in interest income and
Financial
482,869,327.02 882,721,138.77 -45.30% expenses, as well as the impact of
expenses
exchange rate fluctuations.
Continuing to adhere to the principle of
conservatism, some of the research and
development expenses not directly
attributable are transferred to general
R&D expenses 8,188,767,532.85 8,447,038,946.21 -3.06% and administrative expenses. This is
mainly due to increases in personnel
compensation and benefits, as well as
increases in depreciation expenses and
material consumption costs.
The accelerated depreciation of fixed
assets and provisions for asset
Income tax
641,829,343.18 667,318,205.34 -3.82% impairment, along with changes in tax
expenses
loss carryforwards, have led to changes
in deferred income taxes.
4. R&D investments
Applicable □N/A
Expected effect on the
Description of major
Purpose Progress Objectives future development of
R&D project
Company
29
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Ensure stable power
Achieve effective
supply and signal
connection of battery
XC2C New Energy transmission inside the
modules and accurate Enhanced
Battery Pack Harness Mass production battery pack through
transmission of signals technological
Assembly delivered the improvement of
to support the innovation capabilities,
Development Project R&D process
development and expanded market share
technology for new
popularization of new
energy battery pack
energy vehicles
wiring harnesses
Broadened smart
driving product
Development of ADAS Achieve product
Achieve production categories, enriched
and Autonomous development based on
Prototype in trial manufacturing of data new energy product
Driving Domain high-computing power
production fusion intelligent lines, to accumulate
Controllers based on autonomous driving
driving products technology for
TDA4VM Chip chips
achieving L3 assisted
driving
In response to the
current development
Insulation
trend, develop core
performance: 500VDC
products for the new
voltage, insulation
energy vehicle industry,
resistance ≥ 100MΩ;
increase the market
Reduce temperature at withstand voltage
share of domestically
cable and connector performance: 2000VAC
produced charging
Research and junctions to enhance voltage, leakage current
guns, promote
development of liquid operational safety; ≤ 5mA; charging gun
technological
cooling system for new adding overheat self- Pilot testing phase protection level: IP55
advancement in the
energy vehicle charging power-off function to Operating environment
industry, with an annual
gun improve charging temperature T: -20℃≤ T
demand of
efficiency and mitigate ≤ 60℃; leakage, short
approximately 20
charging risks circuit, and protection
million sets and an
ground loss, control
annual output value of
box protection time t: t
approximately 300
< 100 ms; charging
million yuan, achieving
current: up to 500A
a profit and tax of over
50 million yuan
Obtain CCCor gaming
console video data
Broaden the
Research and through in-car
Achieve full product classification of smart
development of NBOX infotainment system, Sample debugging in
functionality driving products and
based on Rockchip enhancing with 2D/3D progress
development expand the business
RK3588 chip rendering, and
scope
outputting video data to
VR/AR glasses
800G optical module, a 1. Master independent 1. The company
crucial component in intellectual property collaborates closely
the communication rights, structural with core customers,
Research and
industry, has long been design, PCB paddle enabling early
development of low-
dominated by major Completion of card design, understanding of
power hot-swappable
companies from Europe optimized sample optomechanical design; customer needs,
optical module based
and America such as production 2. The product supports cooperating with
on eight-channel OSFP
Coherent, Intel, a signal rate of 53Gbd customers for rapid
form factor
Broadcom, etc., in PAM4 simultaneously, research and
terms of interface downward compatible development, and
formulation and with 25.78125Gbps launching products to
30
Luxshare Precision Industry Co., Ltd. Annual Report 2023
protocol development. NRZ meet the demand for
After years of signal/26.5625GBd rapid updates of
development, various PAM4 signal; 3. The electronic products.
interfaces such as SFP, product supports The company's ability
QSFP, DSFP, QSFP- Independent PLL to solve problems in
DD, OSFP, SFP-DD, function, with PAM4 connector applications
etc., have been and NRZ data is a comprehensive
established to meet transmission functions, manifestation of the
different application which can be used for company's research and
scenarios. By bridging and FEC development
developing this hot- truncation of advantages. 2. The
swappable optical PAM4/NRZ systems; 4. layout of complete
module based on the CDB function can optical transmission
eight-channel OSFP update product products allows the
form factor, we can firmware on the device, company to provide
grasp key technologies, and optimize customers with one-
major technical parameters remotely in stop procurement,
pointers, develop unattended equipment simplifying the
independent rooms; 5. Compatible customer procurement
intellectual property with existing optical process and supplier
rights, design, and modules, easy to switch management. 3. Enter
monitor market trends the AI market supply
chain
Through this project,
1. Support the company has
IEEE802.3DJ developed the latest
Research and develop specification; 2. generation of self-
Research and the next-generation Comply with OSFP developed interfaces in
development of OSFP high-speed Optimized sample MSA association servers, switches, high-
224G interconnect interconnect solution production completed standards; 3. Support performance
solution for data centers to single-channel 224G computing, etc.,
enhance signal PAM4 rate level; 4. enhancing the
transmission rates ESD meets contact company's position in
discharge 8KV, air the industry and
discharge 15KV meeting widespread
customer demands
PCIe 6.0 is the future
Research and
Develop customized trend for connectors,
development of PCIe Development Product SI testing
products according to and this project will
6.0 CEM connector completed requirements meet
specific customer become one of the
cable assembly PCIe 6.0
requirements important products to
unlock future markets
The development of the
first domestic 224G
Collaborate with Preliminary SI test data
Research and Explore the SI high-speed connector
customers to develop for samples completed,
development of OSFP performance limits of enhances confidence
prototypes for next- currently optimizing
224G connector 224G connectors with among customers and
generation high-speed details
customers competitive advantage
I/O connectors
against top companies
in the industry.
Research and 1. As a representative
Compliant with SFF-
development of Connector products product of the current
Address the market TA-1016 standard, SI
connectors for liquid- have been sampled and PCIe 6.0 standard, this
demand for MCIO PCIe testing standards meet
cooled environments are undergoing project not only
6.0 connectors PCIe 6.0 specification
based on PCIe 6.0 reliability testing improves performance
requirements
transmission rates but also meets the
31
Luxshare Precision Industry Co., Ltd. Annual Report 2023
requirements of liquid
cooling technology,
gaining a market
advantage and
accumulating technical
expertise. 2. The
project's products have
undergone
comprehensive and
rigorous testing by
customers and have
been successfully
trialed on new products,
laying a solid technical
and market foundation
for future market
promotion
The developed 140kW
hydrogen fuel cell stack Enter a new field and
Develop hydrogen fuel
Development of can be used in expand into new
cell stacks suitable for
140kW high-power fuel Sample stage transportation product forms, this
use in 18-ton heavy
cell stack (commercial vehicles) project serves as a pre-
trucks
and energy storage research project
fields
Due to its low power
consumption
advantages, it holds
great appeal at the
client end. Currently, it
Develop LPO series Achieve the research primarily awaits market
products targeting Validation has been and development goal demand to increase. As
Ultra-low-power 800G
customer's ultra-low conducted on of halving power the first team to develop
LPO optical transceiver
power application equipment from several consumption compared LPO products, we have
module based on the
needs, aiming to major customers, and to DSP BASED an early advantage in
eight-channel OSFP
replace DSP BASED preliminary test data products while meeting the subsequent market
form factor
products for short- shows good results product transmission increment stage.
range applications performance. Additionally,
leveraging LPO
products can serve as a
new product
introduction point at
target customers
Through the design of a From January 2023 to 1. High efficiency and
single-phase immersion June 2023: This project energy-saving: Liquid
liquid cooling cabinet, has developed a new directly contacting with These aspects are
technical product, "metal server components crucial for the
Research and transformation of the product" water-cooling enables fast heat company's strategic
development of existing liquid cooling plate, model: transfer, saving over layout and
efficient and cabinet inlet and outlet 277176.417T=17AL60 95% energy. 2. Simple competitiveness in the
environmentally arrangement and flow 63-T5, and the core equipment: Supports a liquid cooling field,
friendly single-phase channel design is technical solution of maximum server expected to provide
immersion liquid conducted to solve the this project has been operating power of significant support for
cooling technology problem of uneven applied for and 8000W. 3. No the company's revenue
temperature authorized patent by ultrasound: Minimal and benefits in the
distribution inside the Luxshare Thermal fan noise during coming years
existing liquid cooling Technology (Huizhou) operation. 4. Space-
cabinet, resulting in Co., Ltd. Patent name: saving: Enables high-
32
Luxshare Precision Industry Co., Ltd. Annual Report 2023
high local temperatures Liquid Cooling Device, density integration of
of some electronic Patent number: ZL servers, saving over
components, which 2023 2 0381854.3 80% space. 5. No loss
affects their normal of coolant and water:
operation and service Coolant and cooling
life water circulate within
the system.
1. The structure is
simple, facilitating self-
assembly and reducing
costs. The device
comprises a
temperature-sensing
chip module and a
202302-202307: This
water flow module. The This technology
project resulted in a
water flow module belongs to the critical
new product, the
includes slots for chip technology in the field
Design a fluid-passing "Metallic Product"
placement, used to fix of temperature
and temperature- water-cooling plate,
the chip in position, detection and control
sensing pipeline device model:
ensuring a tight fit for liquid cooling. It
to address the 217.4*192*13.7mm.
between the holds significant
unreliable fixation of The core technical
Research and temperature-sensing importance for the
temperature-sensitive solution of this project
development of chip and the slot of the company's strategic
chips commonly used, has been applied for
temperature-sensitive water flow module.2. layout and
which can lead to and authorized as a
pipeline technology for The temperature enhancement of
loosening or patent by Luxshare
liquid cooling systems measurement effect is competitiveness in
detachment, resulting Heat Transmission
good, with high liquid cooling products.
in poor contact and Technology (Huizhou)
efficiency and rapid It is anticipated to
inaccurate temperature Co., Ltd. Patent title: A
response. After provide important
monitoring, as well as fluid-passing and
fixation, colloids are support for the
high costs temperature-sensing
used to isolate the chip company's revenue and
pipeline device, Patent
from the air, allowing profitability in the
number: CN
the temperature- coming years
219453680 U
sensing chip to only
conduct temperature
changes received from
the water flow module,
without being affected
by surrounding
materials or air.
202302-2023010: This 1. Excellent heat This technology
project has led to the dissipation belongs to the critical
development of a new performance: Based on technology in the field
Design a two-phase
product, the "Metallic the size specifications of liquid cooling,
immersion cooling
Product" water-cooling of the chassis, the heat particularly in the realm
device for mining
plate, with model generation of the of immersion phase-
machines to address the
Research and number equipment, and the change heat dissipation.
poor air-cooling effect
development of heat 182*18.5*313mm. selection of fans, this It holds significant
of the air-cooling
exchangers with Additionally, the core design maximizes the importance for the
module in existing two-
excellent heat transfer technical solution of arrangement of 5 fans company's strategic
phase immersion
efficiency this project has been to provide sufficient layout and
cooling devices, which
applied for and airflow, effectively enhancement of
fails to effectively
authorized as a patent removing heat in a competitiveness in
dissipate heat from
by Luxshare Heat timely manner, and liquid cooling products.
phase-change media
Transmission meeting the heat It is anticipated to
Technology (Huizhou) dissipation provide important
Co., Ltd. Patent title: requirements of the support for the
33
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Heat dissipation device equipment.2. Minimal company's revenue and
and mining machine, loss of air pressure and profitability in the
Patent number: CN airflow: Specially coming years
219592965 U designed forced-flow
guiding ducts with
smooth transitions at
bends are implemented.
The design of the ducts
forms a closed channel
with the heat sink,
reducing losses in air
pressure and airflow.
202302-2023012: This
project has resulted in
the development of a
new product, the This technology
Design a centrifugal "Computer Peripheral belongs to the field of
1. The centrifugal
drum fan to address Product" heat fan technology and
blower distributes the
issues with existing dissipation fan, with holds significant
velocity field more
centrifugal drum fans, model number 2B importance for
uniformly at the outlet.
including the speed 12038-6000rpm. improving the
Research and 2. The centrifugal
field biased towards the Additionally, the core performance and
development of blower provides higher
upper side of the air technical solution of competitiveness of the
centrifugal drum fan airflow and air
outlet, hindering heat this project has been company's fan
cooling technology pressure, leading to
dissipation and exhaust applied for and products. It is expected
superior gas flow
along the path, as well authorized as a patent to provide important
performance and
as uneven speed fields, by Luxshare Heat support for the
effectively enhancing
low air volume, and low Transmission company's revenue and
its overall performance.
air pressure Technology (Huizhou) profitability in the
Co., Ltd. Patent title: coming years
Centrifugal blower,
Patent number:
202322468561.1
1. Excellent heat
dissipation
202303-202309: This
performance: The This technology
project has led to the
liquid cooling plate is belongs to the critical
development of a new
positioned on the area of liquid cooling,
product, the "Power
surface of multiple particularly in the key
Electronic Component"
Design a heat optical modules technology of cooling
optical module, with
dissipation-enhanced arranged in parallel, plate heat dissipation. It
model number 0707-
electrical connector allowing the cooling holds significant
EP01-5C025.
component and liquid liquid circulating importance for the
Application in the Additionally, the core
cooling plate to address through the internal company's strategic
research and technical solution of
the weak heat channels of the cooling layout and
development of heat this project has been
dissipation capability of plate to dissipate heat enhancement of
sinks for electrical applied for and
conventional air-cooled from the optical competitiveness in the
connectors. authorized as a patent
electrical connectors, modules. field of liquid-cooled
by Luxshare Heat
thereby meeting the 2. Low flow resistance: optical module
Transmission
high-power heat By employing parallel products. It is
Technology (Huizhou)
dissipation demands. and series channels, anticipated to provide
Co., Ltd. Patent title:
where the first and important support for
Electrical connector
second main channels the company's revenue
component, Patent
act as parallel channels, and profitability in the
number:
and each main channel coming years
202310693538.4
is predominantly
arranged in a serpentine
34
Luxshare Precision Industry Co., Ltd. Annual Report 2023
series, internal
bidirectional flow
channels are utilized to
significantly reduce
fluid flow resistance.
1. High efficiency and
energy saving: Direct
contact between the
liquid and server
202303-202312: This components facilitates
project has resulted in rapid heat transfer,
the development of a achieving energy
This technology
new product, the savings of over 95%. 2.
belongs to the critical
"Metallic Product" Excellent heat
domain of immersion
Design a liquid liquid separator, with dissipation uniformity:
liquid cooling, holding
separator and liquid model number Utilizing multiple inlet
Research and significant importance
cooling device to 86.5*47.3*30mm. pipes connected to the
development of for the company's
address issues in Additionally, the core liquid cooling chamber
immersion-cooled strategic positioning
current immersion- technical solution of enhances the coolant
server cabinets and competitiveness in
cooled liquid cooling this project has been inflow rate by
designed for easy the server liquid
systems, including applied for and approximately 50%,
disassembly, cooling product sector.
limited inlet pipe authorized as a patent thereby improving
maintenance, and It is anticipated to
numbers, low coolant by Luxshare Heat cooling efficiency. 3.
reassembly. provide important
flow rates, and uneven Transmission Extremely low on-site
support for the
heat dissipation. Technology (Huizhou) failure rate and
company's revenue and
Co., Ltd. Patent title: A simplified
profitability in the
liquid separator and maintenance:
coming years
liquid cooling device, Maintenance tasks are
Patent number: significantly reduced,
2023232842370 leading to a substantial
decrease in on-site
maintenance costs
compared to air
cooling.
1. Enhanced load-
Provide a liquid cooling
202305-202312: This bearing capacity: The
plate and liquid cooling
project has resulted in water-cooling plate
cabinet, to enhance the
the development of a consists of plate This technology
structural stability and
new product, the components and belongs to the critical
load-bearing capacity
"Metallic Product" partition plates, all domain of liquid
of the liquid cooling
water-cooling plate, made of extruded cooling for energy
plate. This addresses
with model number aluminum. The load- storage batteries,
the challenge of
253.97*192*23.4mm. bearing capacity is holding significant
increased pressure on
Research and Additionally, the core increased by 30%. 2. importance for the
the liquid cooling plate
development of liquid technical solution of Space-saving: Suitable company's strategic
due to the higher energy
cooling heat dissipation this project has been for high-density positioning and
density and increased
technology for energy applied for and integration of battery competitiveness in
number of battery cells
storage batteries. authorized as a patent energy and cell liquid cooling products.
in energy storage
by Luxshare Heat quantity, saving over It is anticipated to
batteries. Such pressure
Transmission 50% of space. 3. No provide important
often leads to
Technology (Huizhou) coolant or water loss: support for the
deformation, rupture of
Co., Ltd. Patent title: A Both the coolant and company's revenue and
the liquid cooling
liquid cooling plate and cooling water circulate profitability in the
plate's casing, coolant
liquid cooling cabinet, within the system, coming years.
leakage, and potential
Patent number: eliminating loss. 4.
failures in the cooling
202322594625.2 Cabinet-coupled fire
circulation system
hydrants: Low failure
35
Luxshare Precision Industry Co., Ltd. Annual Report 2023
rate and easy
maintenance.
Reduce thermal
resistance and enhance
heat conduction
202306-202312: This efficiency, the internal This technology
project has led to the cavity of the isothermal belongs to the critical
development of a new plate is interconnected domain of 3D
product, the "Metallic with the internal cavity isothermal plates,
Product" VC thermal of the pipe body, holding significant
Design a 3D isothermal plate, with model forming a unified importance for the
plate capable of number XQGP- structure. The metal company's
handling higher power 301016730. powder or metal technological
Research and dissipation and Additionally, the core braided mesh capillary development,
development of 3D achieving lower technical solution of structures on the inner optimization, market
isothermal plate heat thermal resistance this project has been surface of the pipe body expansion, and
dissipation technology. values to address the applied for and are connected to the enhancement of
increasing heat flux authorized as a patent metal powder or metal competitiveness in 3D
density of electronic by Luxshare Heat braided mesh capillary isothermal plate
components Transmission structures on the products. It is
Technology (Huizhou) condensation surface anticipated to provide
Co., Ltd. Patent title: panel of the isothermal important support for
3D isothermal plate, plate. This facilitates the company's revenue
Patent number: the reflux of the and profitability in the
202322553002.0 working fluid (pure coming years.
water or other
substances) within the
cavity
Develop diffractive
waveguide + Increase product
Providing customers
MicroLED ultra- competitiveness by
Research and with competitive AR
lightweight and thin reducing material and
development of ultra- Trial production/mass glasses products to
smart AR glasses to labor costs, thereby
lightweight and thin production enhance the company's
meet the current market bringing greater
smart AR glasses core competitiveness in
demand for profitability to the
the AR industry.
monochrome AR enterprise.
glasses.
Develop the world's
Based on Micro OLED
lightest and thinnest
+ Pancake optical
PC.
scheme, the binocular
VR standalone unit, Enhance product
Research and resolution can reach
utilizing advanced competitiveness by
development of 5120x2560, supporting
graphics processing Trial production/mass reducing material and
interactive, ultra- two refresh rate modes
technology, capable of production labor costs to bring
lightweight smart VR of 75Hz and 90Hz;
providing users with greater profitability to
headset supports 6DoF and
high-definition, low- the enterprise
SteamVR tracking,
latency virtual reality
providing a horizontal
experience, with a 5K-
field of view of 102°.
level headset
Improve the quality and
Research and
Enhance product Enhance product market value of the
development of
functionality and functionality and company's products to
wearable GPS-based Completed
improve product improve product increase
safety metronome for
performance performance competitiveness and
night running
market share
36
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Improve the quality and
Research and
Enhance product Enhance product market value of the
development of UWB
functionality and functionality and company's products to
technology application Completed
improve product improve product increase
in car digital keys for
performance performance competitiveness and
wearable devices
market share
Research and Improve the quality and
development of Enhance product Enhance product market value of the
combined wearable functionality and functionality and company's products to
Completed
device for gaze tracking improve product improve product increase
and eye movement performance performance competitiveness and
analysis market share
Research and Improve the quality and
development of Enhance product Enhance product market value of the
acoustic sensor-based functionality and functionality and company's products to
Completed
wearable device for improve product improve product increase
wrist-based heart rate performance performance competitiveness and
monitoring market share
Improve the quality and
Research and
Enhance product Enhance product market value of the
development of
functionality and functionality and company's products to
wearable device Completed
improve product improve product increase
application for safe
performance performance competitiveness and
driving monitoring
market share
Research and Improve the quality and
development of Enhance product Enhance product market value of the
wearable device using functionality and functionality and company's products to
Completed
sensors and machine improve product improve product increase
learning for epilepsy performance performance competitiveness and
detection market share
Improve the quality and
Research and
Enhance product Enhance product market value of the
development of
functionality and functionality and company's products to
wearable sensor device Completed
improve product improve product increase
combined with gait
performance performance competitiveness and
analysis system
market share
Research and Improve the quality and
development of Enhance product Enhance product market value of the
wearable device functionality and functionality and company's products to
Completed
application for people improve product improve product increase
with hearing performance performance competitiveness and
impairments market share
Improve the quality and
Research and
Enhance product Enhance product market value of the
development of non-
functionality and functionality and company's products to
contact blood glucose Completed
improve product improve product increase
detection applied to
performance performance competitiveness and
wearable devices
market share
Improve the quality and
Research and
Enhance product Enhance product market value of the
development of camera
functionality and functionality and company's products to
application for 3D Completed
improve product improve product increase
modeling in wearable
performance performance competitiveness and
devices
market share
37
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Research and
Improve the quality and
development of
Enhance product Enhance product market value of the
wearable physiological
functionality and functionality and company's products to
signal measurement Completed
improve product improve product increase
system for detecting
performance performance competitiveness and
emotional responses in
market share
the elderly
Research and Improve the quality and
development of low- Enhance product Enhance product market value of the
power multi-node functionality and functionality and company's products to
Incomplete
wearable motion improve product improve product increase
monitoring system with performance performance competitiveness and
virtual reality market share
After adding an RF
antenna, the wireless
charging case can now
establish a Bluetooth
connection with
devices such as
smartphones, enabling
the display of
information such as the
battery levels of the With successful product
After the headphones
charging case and development and
are removed from the
Research and headphones on the obtaining a patent, the
charging case, users can Delivery has been
development of phone. Technical company can enhance
activate the automatic completed, and the
wireless charging case specifications: UWB its competitiveness in
wake-up function to patent application is in
with automatic wake- communication has the Bluetooth earphone
obtain information such progress
up functionality been implemented, market, aiming to
as the charging case's
bringing along the secure more orders and
battery level
feature of locating the drive company profits
charging case. The
UWB positioning
accuracy is less than 0.1
meters, with a data
transmission rate of 1
Gbit/s. The pulse
duration is short,
between 0.2 and 1.5
nanoseconds
1. Solar Charging
Reminder: In some
situations where there's
insufficient light for
solar-powered The product has been
Research and Meet the demand for
earphones to charge, a successfully put into
development of more convenient and
Delivery has been low battery alert is production, enhancing
wireless Bluetooth intelligent charging
completed, and the automatically triggered the company's
earphones based on solutions for Bluetooth
patent application is in to prevent damage or competitiveness in the
photovoltaic charging earphones, thus
progress malfunction due to Bluetooth earphone
and display of battery enhancing user
prolonged low battery market and bringing
level experience
operation. 2. Solar substantial profits.
Charging Doesn't
Require Power Supply:
Solar charging devices
operate solely on solar
38
Luxshare Precision Industry Co., Ltd. Annual Report 2023
energy, eliminating the
need for electrical
power supply and
conserving a significant
amount of energy. 3.
Efficient and
Convenient Charging:
Solar charging provides
an efficient and
convenient charging
method, with stable
charging possible for
extended periods in
ample sunlight, thus
extending battery life.
Utilizing AI
technology, the product
offers features such as
call recording, on-site
recording, voice-to-text
transcription, multi-
language translation,
With the successful
and VIAIMAI
development of the
generative conference
The factory has product, it has elevated
assistant. These
deployed three competitiveness in the
functionalities greatly
production lines, Bluetooth earphone
assist in recording
aiming for an annual market, achieving a
important content,
output of 2 million significant leap in both
Research and swiftly organizing
Meet the needs of office units. During the sound quality and
development of meeting minutes, and
professionals, the office production validation practicality. This
Bluetooth earphones overcoming
headphones offer and testing phases, no advancement aims to
capable of recording, communication barriers
features tailored for oversights or errors secure more orders for
writing, translating, posed by various
business use were encountered. The the company, thereby
listening, and speaking languages and dialects
product meets usage boosting profits.
during frequent
requirements, boasting Moreover, it lays a solid
business trips, thereby
international advanced foundation of
significantly improving
levels and reliable technology and market
work efficiency.
performance presence for subsequent
Moreover, while
market promotion
emphasizing its
efforts
conference office
attributes, the product
also seamlessly
integrates all features of
traditional TWS
wireless Bluetooth
earphones
Particulars of R&D personnel
2023 2022 Y/Y % change
Number of R&D personnel
19,063 18,421 3.49%
(person)
Proportion of R&D personnel
8.20% 7.77% 0.43%
to total number of employees
39
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Education background of R&D personnel
Undergraduate 8,947 8,327 7.45%
Master 381 332 14.76%
Other 9,735 9,762 -0.28%
Age of R&D personnel
Below 30 9,005 9,417 -4.38%
30-40 7,533 7,706 -2.25%
Particulars of R&D expenses:
2023 2022 Y/Y % change
Amount of R&D expenses
8,188,767,532.85 8,447,038,946.21 -3.06%
(RMB)
Proportion of R&D expenses
3.53% 3.95% -0.42%
to operating revenue
Amount of R&D expenses
0.00 0.00
capitalized (RMB)
Proportion of capitalized R&D
expenses to total R&D 0.00% 0.00%
expenses
Analysis of the cause and effect of significant change in the composition of R&D personnel:
□Applicable N/A
Analysis of significant change in the proportion of R&D expenses to operating revenue compared with 2022:
□Applicable N/A
Analysis and reasonableness of significant change in the proportion of R&D expenses capitalized:
□Applicable N/A
5. Cash flows
In RMB
Item 2023 2022 Y/Y % change
Sub-total of cash inflows from
246,049,309,173.22 243,587,978,384.02 1.01%
operating activities
Sub-total of cash outflows from
218,444,248,762.06 230,860,368,064.68 -5.38%
operating activities
Net cash flow from operating
27,605,060,411.16 12,727,610,319.34 116.89%
activities
Sub-total of cash inflows from
17,874,274,670.25 10,037,921,670.41 78.07%
investing activities
Sub-total of cash outflows from
37,434,186,876.09 23,364,287,513.52 60.22%
investing activities
Net cash flows from investing
-19,559,912,205.84 -13,326,365,843.11 46.78%
activities
Sub-total of cash inflows from
93,759,639,627.24 76,864,295,489.69 21.98%
financing activities
Sub-total of cash outflows from
89,689,373,974.63 68,708,047,308.24 30.54%
financing activities
40
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Net cash flows from financing
4,070,265,652.61 8,156,248,181.45 -50.10%
activities
Net increase in cash and cash
12,371,733,891.14 8,390,881,701.43 47.44%
equivalents
Analysis of main causes of material changes in the related data
Applicable □N/A
1. The increase in net cash flows generated from operating activities is attributed to accelerated customer
payments and sales realization with receipts due to the initial strategic stocking in this period;
2. The increase in both inflows and outflows of cash flows from investing activities is due to financial operations
involving purchases and redemptions;
Analysis of significant difference between net cash flows from operating activities during the reporting period and net profit in current
year
Applicable □N/A
The difference between the cash flow from operating activities and the profit for the current period
mainly arises from accelerated customer payments, sales realization of inventory stocked as part of
the initial strategy at the beginning of the period, and a higher amount of long-term asset
amortization absorbed within the net profit;
V. Analysis of non-main business
Applicable □N/A
In RMB
Whether
% of total or not
Amount Reason
profit sustainabl
e
Investment income from the purchase of financial
assets, income from wealth management products,
Investment income 1,771,282,791.44 13.75% No
and equity method investment income recognized
from associated enterprises.
Gain or loss on changes Investment income on financial assets at fair value
210,346,832.18 1.63% No
in fair value through profit or loss
Impairment loss on
-1,318,867,316.40 -10.24% Inventory and fixed asset impairment No
assets
Mainly acquisition of default or compensation
Non-operating income 93,459,027.40 0.73% No
income
Non-operating Mainly payment of default or compensation, asset
68,334,885.79 0.53% No
expenses scrapping losses, external donations
Gain on disposal of
122,867,177.52 0.95% Disposal of production equipment No
assets
Other gains 825,189,115.07 6.40% Government grants related to income No
Loss on credit 23,273,879.47 0.18% Mainly payment of default or compensation, asset No
41
Luxshare Precision Industry Co., Ltd. Annual Report 2023
impairment scrapping losses, external donations
VI. Analysis of assets and liabilities
1. Material changes in components of assets
In RMB
December 31, 2023 January 1, 2023
% of % of Y/Y %
Reason of material change
Amount total Amount total Change
assets assets
Increase in cash reserves for
Cash and bank safety days and funding
33,619,539,457.51 20.75% 19,367,209,441.41 13.05% 7.70%
balances requirements to support
operations and investments
Accounts Optimization of customer
23,504,481,889.07 14.51% 26,043,354,859.19 17.55% -3.04%
receivable payments
Contract assets 0.00% 0.00% 0.00%
Expansion of business scale,
realization of sales from initial
Inventories 29,757,930,319.35 18.37% 37,363,329,476.66 25.18% -6.81%
stocking of inventory at the
beginning of the period
Investment Recovery of house rental for
23,353,936.24 0.01% 92,782,410.06 0.06% -0.05%
properties self-use
Recognition of investment
Long-term equity income from associated
4,232,941,741.05 2.61% 2,000,007,642.66 1.35% 1.26%
investments enterprises under the equity
method
Fixed assets 44,560,506,279.62 27.51% 44,026,022,703.69 29.67% -2.16% Expansion of business scale
Construction in Unaccepted equipment and
2,226,217,016.31 1.37% 2,695,377,794.32 1.82% -0.45%
progress building structures
Right-of-use Mainly leased building
648,963,968.09 0.40% 941,749,814.66 0.63% -0.23%
assets structures
Supplementing working
Bank borrowings 20,514,182,240.47 12.66% 14,911,899,668.93 10.05% 2.61%
capital due to scale increase
Contract liabilities 243,566,923.42 0.15% 501,765,453.24 0.34% -0.19% Advance payments for goods
Long-term Supplementing funds required
12,038,771,289.92 7.43% 9,205,313,060.94 6.20% 1.23%
borrowings for expansion in scale
Deducting unreceived
Lease liabilities 552,488,888.66 0.34% 800,739,041.51 0.54% -0.20% financing expenses from lease
payments for factories
Investments in foreign
Trade payables 1,720,764,175.32 1.06% 1,353,266,499.91 0.91% 0.15% exchange and wealth
management, etc.
Advance payments for
Cash and bank
486,702,941.36 0.30% 586,577,865.23 0.40% -0.10% materials, water and electricity
balances
fees, and customs deposits.
42
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Proceeds from equity transfer,
Accounts export tax rebates, and
322,407,052.71 0.20% 431,123,451.91 0.29% -0.09%
receivable deposits and insurance
compensation
Deferred input tax credits,
prepaid income taxes to be
Contract assets 2,920,078,401.07 1.80% 2,197,204,594.09 1.48% 0.32% refunded, and high-value
certificates of deposit with a
term not exceeding 1 year
Factory and workshop
Inventories 590,266,003.15 0.36% 810,913,529.72 0.55% -0.19%
renovation expenses
Mainly arising from equity
payments, unrealized profits
from internal asset
Investment
872,943,835.40 0.54% 1,208,582,281.01 0.81% -0.27% transactions, government
properties
subsidies, and tax-deductible
losses, etc., temporal
differences
Advance payments for
equipment, project payments,
Long-term equity
9,931,644,112.92 6.13% 1,676,259,912.33 1.13% 5.00% land payments, and
investments
certificates of deposit with a
term exceeding 1 year
Company note payment
Fixed assets 492,585,900.03 0.30% 515,054,217.52 0.35% -0.05%
transactions
Construction in Impact of initial inventory
45,908,515,295.43 28.34% 49,786,483,552.54 33.55% -5.21%
progress stocking strategy
Right-of-use Accrued expenses and
406,677,940.53 0.25% 472,880,196.48 0.32% -0.07%
assets deposits
Short-term payable bonds and
Bank borrowings 932,701,803.30 0.58% 3,957,037,125.24 2.67% -2.09% inter-company fund
transactions
Government subsidies related
Contract liabilities 595,323,601.05 0.37% 665,910,095.66 0.45% -0.08%
to assets
Mainly temporary differences
resulting from accelerated
Long-term depreciation of fixed assets
883,924,973.73 0.55% 1,606,645,177.00 1.08% -0.53%
borrowings and evaluation of appreciation
from non-controlling interests
in business combinations
Analysis of high proportion of overseas assets:
□Applicable N/A
2. Assets and liabilities at fair value
Applicable □N/A
In RMB
Gain or Aggregate Impairment Amount Amount
Opening Other Closing
Item loss on changes in loss acquired in sold in the
balance changes balance
changes in fair value recognized the reporting
43
Luxshare Precision Industry Co., Ltd. Annual Report 2023
fair value recorded in in the reporting period
in the equity current period
reporting period
period
Financial assets
1. Financial
assets held
for trading
1,326,226,8 218,566,87 16,228,842, 16,145,356, 1,628,279,0
(excluding
50.46 7.30 058.88 751.33 35.31
derivative
financial
assets)
2.
Derivative 27,039,649. 65,445,490. 92,485,140.
financial 45 56 01
assets
4. Other
-
investment 440,106,99 134,424,51 25,000,000. 41,184,747. 249,122,25
174,799,99
s in equity 2.66 3.54 00 36 1.32
3.98
instruments
5. Other
non-current 35,700,000. 35,700,000.
financial 00 00
assets
Subtotal of
1,829,073,4 109,212,37 134,424,51 16,253,842, 16,186,541, 2,005,586,4
financial 0.00 0.00
92.57 3.88 3.54 058.88 498.69 26.64
assets
Investment
587,585,00 587,585,00
in equity
9.82 9.82
instruments
1,829,073,4 109,212,37 134,424,51 16,253,842, 16,186,541, 587,585,00 2,593,171,4
Total
92.57 3.88 3.54 058.88 498.69 9.82 36.46
-
Financial 44,318,321. 117,942,42
73,665,535. -41,436.00
liabilities 50 1.18
68
Other changes
Accounts receivable financing represents the balance of 6+9 bank acceptance drafts not yet discounted and discontinued for recognition.
According to the standards, these balances are reclassified from the accounts receivable bills category to the accounts receivable
financing category.
Whether there’s any material change in the measurement properties of main assets of the Company during the reporting period?
□Yes No
3. Encumbrances on assets as of the end of the reporting period
In RMB
44
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Item Ending period
Book balance Book value Restricted Restriction
(CNY) (CNY) type status
Restricted due
Cash and cash
3,935,387,136.86 3,935,387,136.86 Margin to issuance of bills,
equivalents
letters of credit
Notes Pledged
receivable/Accounts 164,567,477.58 164,567,477.58 Pledge financing for notes
receivable financing receivable
Accounts
receivable
Equity
investments
Mortgaged
Fixed assets 635,803,443.15 635,803,443.15 Mortgage financing for fixed
assets
Financing
Intangible assets 401,674,060.39 401,674,060.39 Pledge through the pledge
of land use rights
Trading
financial assets
Restricted due
Other non-
2,874,097,749.98 2,874,097,749.98 Pledge to issuance of bills,
current assets
letters of credit
Total 8,011,529,867.96 8,011,529,867.96
VII. Analysis of investments
1. Overall situation
Applicable □N/A
Amount of investment in 2023 (RMB) Amount of investment in 2022 (RMB) Y/Y % Change
793,376,506.36 1,166,241,440.00 -31.97%
45
Luxshare Precision Industry Co., Ltd. Annual Report 2023
2. Major equity investments acquired in the reporting period
□Applicable N/A
3. Major non-equity investment that have not yet been completed in the reporting period
□Applicable N/A
4. Investment in financial assets
(1) Securities investment
Applicable □N/A
In RMB
Gain or
loss on Aggregate
Amount
Method Opening changes changes Amount Gain or Closing
Initial acquired Source
Type of Security Short of balance of in fair in fair sold in the loss in the balance of Accounting
investm in the of
security code name measur carrying value in value reporting reporting carrying item
ent cost reporting funds
ement amount the recorded period period amount
period
reporting in equity
period
Stock
listed
on Investment
Tony 22,50 - - Self-
domesti Fair 342,379, 133,216, 41,212,9 172,691, in other
603595 Elect 0,000. 169,687, 0.00 133,906, owned
c or value 257.92 878.48 95.00 671.36 equity
ronic 00 586.56 489.63 funds
oversea instruments
s
market
Stock
listed
on Investment
50,00 - - - Self-
domesti SDM Fair 72,480,0 28,138,1 in other
430755 0,000. 44,341,8 18,582,5 0.00 0.00 44,341,8 owned
c or C value 00.00 81.82 equity
00 18.18 45.45 18.18 funds
oversea instruments
s
market
72,50 - -
414,859, 114,634, 41,212,9 200,829,
Total 0,000. -- 214,029, 0.00 178,248, -- --
257.92 333.03 95.00 853.18
00 404.74 307.81
(2) Investment in derivatives
Applicable □N/A
1) Investment in derivatives for the purpose of hedging during the reporting period
Applicable □N/A
46
Luxshare Precision Industry Co., Ltd. Annual Report 2023
In RMB 10,000
Gain or loss
Aggregate Amount
on changes in Amount End-Term
Initial changes in sold in
Type of Opening fair value acquired in Closing Investment
investment fair value the
derivative balance during the the reporting amount / Net Assets
cost recorded in reporting
reporting period Ratio
equity period
period
1,018,470
Forward 55,577.51 55,577.51 16,825.61 8,068.71 1,178,915.16 216,022.35 3.84%
.32
2,098,021
Option 21,590.26 21,590.26 32,143.23 12,965.98 2,420,158.59 343,727.31 6.10%
.54
3,116,491
Total 77,167.77 77,167.77 48,968.84 21,034.68 3,599,073.75 559,749.66 9.94%
.85
Whether there’s any material change in the
accounting policies and accounting
principles for hedge business in the No material change
reporting period as compared with the
preceding reporting period
Explanation of the actual profit and loss situation for the reporting period: During the
reporting period (January 1st to December 31st), the company engaged in foreign exchange
Actual gain or loss in the reporting period
derivative transactions, with an amount of approximately CNY489.6884 million included in
the current period's profit and loss.
Explanation of the hedging effect: The company conducts foreign exchange derivative
transactions in accordance with the principles of legality, prudence, safety, and effectiveness,
without engaging in speculative or arbitrage transactions. All transactions are based on
Description of hedging effects normal production and operation, aiming to lock in target exchange rates and prevent adverse
effects from significant fluctuations in exchange rates. The company strictly conducts
hedging transactions based on its foreign currency holdings, with overall risk being
controllable.
Source of funds Self-owned funds
1. We conduct foreign exchange derivative transactions for the purpose of fixing costs, and
avoiding and preventing foreign exchange and interest rate risks, and prohibit any
speculation.
2. We have established strict business management policy regarding financial derivative
transactions, which contain explicit provisions on the principle of operation, approving
power, internal operating process, information segregation measures, internal risk controls,
information disclosure and other issues relating to financial derivative transactions, to control
the risks associated with such transactions.
Analysis of risks associated with the
3. We carefully examine the terms of contracts entered into with the relevant banks, and
derivatives held in the reporting period
strictly implement the risk management policy to prevent legal risks.
(including without limitation market risk,
4. We continuously follow up on the changes in the market price or fair value of the relevant
liquidity risk, credit risk, operational risk
foreign exchange derivatives, promptly assesses the changes in risk exposures of such foreign
and legal risk) and related risk control
exchange derivatives, reports to the management on a regular basis, promptly reports the
measures
abnormal situations discovered, calls attention to the relevant risks, and takes the appropriate
emergency measures.
5. In order to prevent any delay in the delivery of forward exchange contracts, we attach great
importance to the management of accounts receivable, and have established safety
management measures to prevent any delay in the payment of accounts receivable.
6. Our Internal Audit Department is responsible for supervising and auditing the decision-
making, management, execution and other issues in respect of foreign exchange derivative
transactions.
Changes in the market price or fair value of Change in the fair value of a foreign exchange derivative is the difference between its fair
the derivatives held in the reporting period market price in the month in which the delivery date determined by the Company falls and
47
Luxshare Precision Industry Co., Ltd. Annual Report 2023
(in the analysis of the fair value of its contract price.
derivatives, the specific approaches,
assumptions and parameters used shall be
disclosed)
Whether or not involved in any litigation N/A
Disclosure date of the announcement of the
Board of Directors approving the February 22, 2023
investment in derivatives (if any)
The Company conducts foreign exchange derivative transactions for the purpose of avoiding
foreign exchange risk arising from fluctuations in the foreign exchange rates of RMB, and
effectively controlling the uncertainties of costs caused by foreign exchange risk. The
Special opinion issued by the independent Company has established the Business Management Policy Regarding Financial Derivative
directors regarding the Company’s Transactions, to enhance risk management and control over foreign exchange derivative
investment in derivatives and related risk transactions. In addition, the Company only provides self-owned funds, rather than any
control measures offering proceeds, as deposit for derivative transactions. The review, voting and other
procedures relating to such transactions have complied with the Company Law, the AOA and
other applicable regulations. We all agree to the company engaging in the aforementioned
business.
2) Investment in derivatives for the purpose of speculation during the reporting period
□Applicable N/A
No investment in derivatives for the purpose of speculation existed during the reporting period.
5. Use of offering proceeds
□Applicable N/A
None of proceeds has been used during the reporting period
VIII. Sale of material assets and equities
1. Sale of material assets
□Applicable N/A
No material asset has been sold during the reporting period.
2. Sale of material equities
□Applicable N/A
IX. Analysis of major controlled and investee companies
Applicable □N/A
Major subsidiaries and investee companies representing more than 10% of the net profit of the Company
In RMB
Company Type Main Registered Total assets Net assets Operating Operating Net profits
48
Luxshare Precision Industry Co., Ltd. Annual Report 2023
business capital income profit
Purchase
and sale of
electronic
products,
data lines,
connection
Luxshare
lines, USD 5 84,503,050, 11,550,791, 190,587,78 3,408,472,7 3,263,710,9
Precision Subsidiary
connectors, million 646.45 180.98 9,169.69 00.36 94.65
Limited
computer
and
peripherals,
plastic and
hardware
products.
Sales and
services in
respect of
internal and
external
connection
USD
lines for IT,
ICT-Lanto 153,290,32 58,617,385, 6,249,529,6 58,155,505, 1,240,180,2 1,114,706,5
Subsidiary communica
Limited 3 650.65 61.19 976.54 41.06 21.54
tion and
consumer
electronic
application
s, and
precision
connectors.
Computer
peripherals,
connection
lines and
connectors;
new-type
electronic
component
s
(electronic
devices),
instruments CNY
Lanto and 2,320,000,0 22,231,655, 7,578,255,5 22,931,796, 524,484,91 569,846,21
Electronic Subsidiary accessories 00 308.24 07.27 475.81 4.22 3.47
Limited for
communica
tion and IT
purpose,
plastic,
rubber and
hardware
products;
research,
developme
nt,
production
and sale of
49
Luxshare Precision Industry Co., Ltd. Annual Report 2023
special
electronic
equipment,
testing
instruments
, tools,
molds,
remote
control
dynamic
models and
related
supplies
and
component
s;
production
and sale of
power
supply
units and
wireless
transmissio
n products;
developme
nt of
software;
import and
export of
goods and
technology.
Licensed
items:
production
of Class II
medical
devices;
Class II
value-
added
telecommu
nications
services.
General
items:
manufactur
ing of
automotive
component
s and
accessories
; research
and
developme
nt of
automotive
component
s;
50
Luxshare Precision Industry Co., Ltd. Annual Report 2023
wholesale
of
automotive
component
s and
accessories
; sale of
automotive
component
s and
accessories
; sale of
mechanical
component
s and spare
parts;
manufactur
ing of opto-
electronic
component
s; sale of
opto-
electronic
component
s; research
and
developme
nt of
special
electronic
materials;
research
and
developme
nt of
household
appliances;
research
and
developme
nt of
motorcycle
component
s;
manufactur
ing of
lighting
equipment;
manufactur
ing of
transformer
s, rectifiers
and
inductors;
manufactur
ing of
computer
software,
51
Luxshare Precision Industry Co., Ltd. Annual Report 2023
hardware
and
peripheral
devices;
manufactur
ing of
power
transmissio
n,
distribution
and control
equipment.
Technology
developme
nt,
technical
consulting
and
technical
services in
respect of
computer
accessories
; design,
R&D and
production
of precision
stamping
molds
(precision ≥
0.02mm),
precision
Luxcase cavity
Precision molds CNY
35,394,696, 14,807,257, 79,079,113, 2,117,124,1 2,005,177,5
Technology Subsidiary (precision ≥ 6,264,312,9
727.13 564.66 772.15 52.49 24.24
(Yancheng) 0.05mm), 60
Co., Ltd. metal
product
molds, non-
metal
product
molds and
standard
parts for
molds;
production
of high-
temperatur
e resistant
molded
insulating
materials,
stamped
hardware
parts,
rivets,
shafts,
52
Luxshare Precision Industry Co., Ltd. Annual Report 2023
mechanical
component
s and other
component
s for 3C
electronics
products;
industrial
design,
product
design
(exterior
design,
structural
design,
circuit
design,
graphic
design,
etc.); lease
of own idle
equipment;
wholesale,
commissio
n agency
(except
auction),
import,
export and
supporting
services in
respect of
the
aforesaid
products
and related
component
s. General
items:
Manufactur
ing of
mobile
terminal
devices;
manufactur
ing of
communica
tion
equipment;
manufactur
ing of
electronic
component
s;
manufactur
ing of
forgings
and powder
53
Luxshare Precision Industry Co., Ltd. Annual Report 2023
metallurgy
products;
manufactur
ing of
computer
software,
hardware,
and
peripheral
devices;
retail of
computer
software,
hardware,
and
auxiliary
equipment.
Subsidiaries acquired and disposed of during the reporting period
Applicable □N/A
Effect on the production, operation
Company name Method of acquisition or disposal and results of the Company taken as
a whole
No significant effect on the
Luxshare Precision Industry (Huzhou), Ltd. Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Kunshan-Luxshare RF Technology Co., Ltd.
Canceled production, operation and results of
Wuzhong Branch
the Company taken as a whole
No significant effect on the
TIME Interconnect Technology Limited Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Dongguan Leader Precision Industry Co., Ltd.
Newly established production, operation and results of
Dongkeng Branch
the Company taken as a whole
No significant effect on the
Kunshan TIME Interconnect Technology Limited Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Kunshan Luxshare Precision Mould Co., Ltd. Canceled production, operation and results of
the Company taken as a whole
No significant effect on the
Luxshare Technologies International,Inc. Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Linkz Cables Mexico S.de R.L.de C.V. Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
ICT Legend S.DE R.L.DE C.V. Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Luxshare Precision Technology (Shantou) Co., Ltd. Newly established
production, operation and results of
54
Luxshare Precision Industry Co., Ltd. Annual Report 2023
the Company taken as a whole
No significant effect on the
Taiqiao Investment Co., Ltd. Merged production, operation and results of
the Company taken as a whole
No significant effect on the
Henan Leader Precision Industry Co., Ltd. Canceled production, operation and results of
the Company taken as a whole
No significant effect on the
Luxshare Precision Industry (Anhui) Co., Ltd. Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Dongguan Luxshare Holdings Co., Ltd. Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Luxshare Technologies (Vietnam) Co., LTD Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Luxshare Technologies Mexico S. de.R.L.de C.V. Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Luxcase Precision Technology (Vietnam) Co., Ltd. Newly established production, operation and results of
the Company taken as a whole
No significant effect on the
Dongguan Luxshare Technologies Co., Ltd. Dalian
Newly established production, operation and results of
Branch
the Company taken as a whole
No significant effect on the
Xuancheng Luxshare Precision Industry Co., Ltd.
Newly established production, operation and results of
Kunshan Branch
the Company taken as a whole
Particulars of significant controlled and investee companies
N/A
X. Structured entities controlled by the Company
□Applicable N/A
XI. Prospects for future development of the Company
1. Situations of the industry
Refer to I. Situations of our industry in the reporting period under Section III Management’s Discussion and
Analysis.
2. Future growth strategy
Currently, the company has established a diversified, integrated, and synergistic strategic framework in the
fields of consumer electronics, automotive, telecommunications, and others. The three core business segments are
advancing together, laying a solid foundation for the company's long-term sustainable development. In the future,
55
Luxshare Precision Industry Co., Ltd. Annual Report 2023
facing new environments, markets, and customers, the company will continue to implement the "three five-year"
development plan. While consolidating the foundation of the consumer electronics business, it will respond to the
rapid development trends in the telecommunications market and the new energy vehicle market. It will dynamically
allocate internal and external resources to fully support the high-quality growth of telecommunications/data center
and automotive businesses. In terms of research and development innovation, the company will continue to build a
top-notch R&D talent team and deeply focus on the composite development of underlying technologies, emerging
materials, and process technologies. Combining accurate understanding of the evolution trends of cutting-edge
technologies with in-depth analysis of customer product pain points, the company will proactively invest more R&D
resources with the starting point of "thinking beyond customers' imagination." This aims to conduct sufficient pre-
research and technical reserves for customers' next-generation products, broaden the company's capability
boundaries, and thereby create the company's differentiating competitive advantages. In smart manufacturing, the
company will fully leverage digital applications and AI artificial intelligence to empower the production
manufacturing end, innovating comprehensively in product design, research and development, mass production,
and testing. This will help customers achieve more efficient, high-quality, and cost-effective product implementation.
3. Business plan for the next year
Looking ahead to 2024, the complex and ever-changing external environment will continue to present certain
challenges for the industry in which the company operates. However, in the face of new trends and patterns in
economic and social development, these challenges often conceal enormous development opportunities. Based on
this understanding, the company will persistently adhere to its core business, pinpoint its role in the industry chain,
leverage its unique strengths, and act as a "ferryman" to create more value for both customers and the industry's
development.
Viewed from the perspective of industry development cycles, each boom cycle in the consumer electronics
sector is primarily driven by new demand sparked by technological advancements. Whether it's smartphones, smart
wearables, smart homes, or virtual reality, the company will continue to deepen its vertical integration capabilities
from core components and modules to complete system assembly. It will optimize the company's development
capabilities in underlying technologies and processes. Leveraging years of manufacturing experience and market
influence accumulated in the consumer electronics industry, coupled with the extension into various niche fields
through the integration of "AI+", the company aims to continuously empower and differentiate its products, creating
richer ecosystem combinations for specific scenarios.
In the telecommunications field, the company will continue to drive technological innovations in products such
as optical/electrical connections, liquid cooling, power supplies, and RF communications. Guided by industry
technological advancements, through comprehensive preliminary research and scenario simulations, it will deeply
grasp the core value of the industry chain and build core competitiveness with moat advantages. In terms of
expanding business opportunities, the rapid iteration of AI technology is driving rapid growth in computing power
56
Luxshare Precision Industry Co., Ltd. Annual Report 2023
demand while also imposing higher requirements on hardware performance such as transmission and cooling.
Facing new markets and opportunities, the company will accurately position top cloud service customers
domestically and abroad, swiftly forming differentiated competitive advantages, focusing on forging the ability to
provide high-value-added products and services for leading global customers, thus creating more growth momentum
for the company's second growth curve.
In the automotive product field, with more and more traditional OEMs and consumer electronics terminal brand
manufacturers swiftly entering the new energy vehicle ranks, the previously relatively closed supply chain pattern
is undergoing significant changes. Against this backdrop, manufacturers with experience in both consumer
electronics and automotive industry R&D and manufacturing will be better positioned to adapt to the future
automotive industry's efficient, responsive development models and rhythms. Currently, the company's team has
accumulated over a decade of experience in the automotive field, forming four major segmented business sectors:
automotive wiring harnesses/connectors, intelligent cabins, vehicle electronics, and power management. Based on
this, it has created a complete product matrix and vertically integrated service system. In the future, the company
will continue to consolidate its existing capabilities, continuously improve the coverage of its superior products
among diverse customers at home and abroad, and leverage platform advantages and the outbound resources of
deep strategic cooperation. This will enable the company's Tier 1 products to continuously refine and enhance their
competitiveness through real-world practice, laying a solid foundation for achieving the medium- to long-term goal
of becoming a global automotive Tier 1 leader in the next fifteen years.
Looking back on the past year, the achievements we have made embody the wisdom and sweat of all colleagues,
as well as our unremitting pursuit of high quality and sustainable development, and our firm determination and
belief in building a "century-old shop". Looking ahead, we will adhere to our original aspiration, maintain strategic
stability, continuously enhance our ability to seize opportunities, respond to challenges, turn crises into opportunities,
and foster opportunities. Through continuous improvement of internal operational management capabilities and
tapping into internal potential, we will strive for perfection in various platform operation mechanisms, operational
efficiency, and operational quality with a "craftsman spirit", ensuring adaptation to the development needs of various
industrial modules. We are committed to realizing the grand blueprint of the "three five-year" strategic plan in an
era full of opportunities and challenges.
4. Capital required for future development strategy and capital utilization plan
As of the end of 2023, the company's asset-liability ratio was 56.61%. In 2024, we will continue to promote the
high-quality development of our business in a solid and orderly manner, and we still have a need for funds in the
expansion of new markets and investments of new projects. Along with the improvement of our position in the
industry and stabilization of our relationship with customers, we have obtained certain competitive advantages. We
will continue to strictly control capital expenditures in each project, regularly analyze and review the return on
investment in each capital expenditure project, and continue to improve our management of accounts receivable,
57
Luxshare Precision Industry Co., Ltd. Annual Report 2023
inventories and other areas, to maximize the efficiency of capital utilization. We will fully consider the effective use
of financing instruments at different periods according to the requirements of our development strategy and
reasonably adjust our asset and liability structure so as to create more value for our shareholders.
5. Future risks
(1) Risk of fluctuation of macro economy
The current global macroeconomic environment is characterized by significant uncertainty, influenced by
multiple challenges such as high US dollar interest rates, geopolitical tensions, weak international trade, and
increasing climate disasters. As a result, the overall global economic recovery is sluggish. If the uncertainties of the
macro environment continue for a long time, the industry and the Company will be impacted and face certain
challenges.
(2) Exchange rate risk
At present, our revenue from the overseas market constitutes a large proportion in our total operating revenue,
and our overseas transactions are mainly settled in US Dollars. Our sales on the overseas market totaled
RMB143,452,850,200 and RMB193,803,646,900 and RMB 206,756,020,500 in 2021, 2022 and 2023, representing
93.18%, 90.55% and 89.16% of our revenue from main business respectively. Because China implements the
managed floating rate system, the foreign exchange rates fluctuate along with the changes in domestic and foreign
political and economic environment. If the foreign exchange rates fluctuate greatly, the exchange gains or losses
may affect our operating results. In order to reduce the uncertainties caused by fluctuations of foreign exchange
rates on our operating results, we will strive to keep abreast of the movement of foreign exchange rates, strictly
control the proportion of foreign currency denominated assets in our net assets, and through foreign exchange
derivative transactions, reduce the effect of the fluctuation of foreign exchange rates.
(3) Management risk
We are committed to promoting the high-quality growth of our business and continuously strengthen the
horizontal expansion and vertical integration in consumer electronics, communication, automotive and other fields.
We have a great number of operating entities which are relatively decentralized. Due to the impact of geopolitics,
trade frictions between China and the United States and other factors, our major customers will put forward
increasingly high requirements for the international deployment of our production capacity, which will in turn put
forward higher requirements for our operation and management capabilities and pool of outstanding talents. If our
management level cannot satisfy the requirements of the rapid growth of scale of our operations, we may face certain
management risks.
(4) Risk of relative concentration of customers
We attach great importance to maintaining long-term and stable cooperation relationships with our major
customers. At present, our customers are relatively concentrated, most of whom are engaged in consumer electronics.
58
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Though they are first-class customers in the industry, have strong and leading competencies on the market, and have
maintained years of stable cooperation relationship with us, if any major customer falls into serious difficulties in
its operation, we may face certain operating risks. We will further diversify customers, products and business. With
a focus on process + underlying technologies as the supporting point, we will continue to carry out horizontal
expansion and trans-sector empowerment, and strive to explore new markets and new business.
XII. Investigation, research, communication, interview and other activities
Applicable □N/A
Particulars of the
Method of Main topic of
Type of investigation and
Date Place communica Guests discussion and
guests research activity
tion information provided
available at
No. 313
Refer to the Record of
Beihuan
Introduction about Investor Relations
Road, On-site
Strategic Cooperation Activity dated
Qingxi investigatio Instituti Institutional
February 24, 2023 Framework Agreement February 24, 2023
Town, n and on investors
signed between us and published on
Dongguan, research
Chery Group www.cninfo.com.cn
Guangdon
on February 26, 2023
g
Company
meeting
room at
Refer to the Record of
No. 313
Introduction about our Investor Relations
Beihuan Communic
Instituti Institutional operating status in 2022 Activity dated April
April 28, 2023 Road, ation by
on investors and the first quarter of 28, 2023 published on
Qingxi telephone
2023 www.cninfo.com.cn
Town,
on May 3, 2023
Dongguan,
Guangdon
g
Company
meeting
room at
Refer to the Record of
No. 313 Network
Investor Relations
Beihuan platform
Our performance Activity dated May 4,
May 4, 2023 Road, online Other Investor
briefings in 2022 2023 published on
Qingxi communica
www.cninfo.com.cn
Town, tion
on May 5, 2023
Dongguan,
Guangdon
g
Company
meeting Refer to the Record of
room at On-site Investor Relations
Communications at our
No. 313 investigatio Activity dated May
May 22, 2023 Other Investor annual general meeting
Beihuan n and 22, 2023 published on
of shareholders
Road, research www.cninfo.com.cn
Qingxi on May 24, 2023
Town,
59
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Dongguan,
Guangdon
g
Company
meeting
room at
Refer to the Record of
No. 313
Introduction about our Investor Relations
Beihuan Communic
Instituti Institutional operating results in the Activity dated August
August 29, 2023 Road, ation by
on investors first half of 2023 and 29, 2023 published on
Qingxi telephone
general situation www.cninfo.com.cn
Town,
on August 30, 2023
Dongguan,
Guangdon
g
Company
meeting
room at Refer to the Record of
No. 313 Investor Relations
Beihuan Communic Introduction about our Activity dated
Instituti Institutional
October 22, 2023 Road, ation by operating status for three October 22, 2023
on investors
Qingxi telephone quarters of 2023 published on
Town, www.cninfo.com.cn
Dongguan, on October 22, 2023
Guangdon
g
XIII. Implementation of the Quality Return Double Improvement Action Plan
Has the company disclosed the Quality Return Double Improvement action plan?
Yes □No
The company disclosed the Announcement on the Quality Return Double Improvement Action Plan on
February 18, 2024. The specific contents and the company's specific measures to implement the action plan are as
follows:
1. Deepen Core Business and Focus on Digital Empowerment
Founded in Shenzhen in 2004, and listed on the Shenzhen Stock Exchange in 2010, the company is a precision
intelligent manufacturing enterprise. Its main products cover various fields such as consumer electronics,
automotive, telecommunications, industrial, and medical. It primarily serves leading brands both domestically and
internationally, providing them with a one-stop solution including core components, module products, and system
solutions across multiple product categories. In the field of consumer electronics, the company focuses on the
composite development of underlying technologies and processes, enabling and differentiating products such as
smartphones, smart wearables, and mixed reality devices. By stacking company products to create scenarios, it aims
to build ecosystems across various scenarios. In different ecosystems, scenarios, and product combinations, Lens
60
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Technology is committed to becoming the most complete solution provider. In the field of telecommunications, the
company has long been committed to high-speed interconnection products. Leveraging mature process development
and precision manufacturing capabilities, it starts from core components such as electrical connections, optical
connections, base station RF, cooling, and power supplies, extending widely to module and system-level products,
forming a vertically integrated service capability in the field of communications. In the automotive field, with the
continuous evolution of the global automotive market towards electrification, intelligence, connectivity, and sharing,
the company fully leverages its accumulated capabilities in basic technologies such as sound, light, electricity, heat,
magnetic, and radio frequency, as well as process development experience in the fields of consumer electronics and
telecommunications over the years. It applies these to automotive wiring harnesses, automotive connectors,
intelligent cabins, and intelligent driving products, achieving cross-domain applications. Meanwhile, under the
guidance of the "three five-year" strategic plan, the company's management constantly monitors market dynamics,
adapts to industry trends, and focuses on forward-looking layouts around its main business with the fundamental
goal of coordinated development. It is committed to providing the market with comprehensive and ultimate solutions
for the entire industry chain.
Since its establishment, the company has always adhered to rooting in the real economy, cultivating its main
business, and refining its expertise to nurture core competitiveness. It emphasizes both staying true to its roots and
innovation. By fully leveraging the synergies within its industries, the company has strengthened its main business
and nurtured forward-looking industries with a steady foundation. With the continuous deep integration of new-
generation information technology and manufacturing, the company remains closely aligned with the underlying
logic of precision intelligent manufacturing. It vigorously promotes the empowerment of intelligent and digital
technologies across various key stages of product development, design, mass production, and testing, facilitating
the company's transformation and upgrading towards digitalization and ensuring high-quality development. Based
on this foundation, the company adheres to prudent investment practices to prevent reckless expansion. It
strengthens the management of the use of raised funds, strictly controls investments in specific sensitive industries
or purposes subject to regulations or policy restrictions, and avoids shifting focus away from tangible assets towards
speculative ventures.
2. Uphold Innovation and Stimulate New Growth Drivers
Since its listing, the company has consistently placed research and development (R&D) innovation at the
forefront of its corporate development. It has continuously invested significantly in R&D technology, striving to
innovate traditional manufacturing processes, continuously improve automation production levels, and modularize
various precision manufacturing process platforms. In addition, the company attaches great importance to long-term
cultivation in underlying materials and innovative production technologies. Its R&D team consistently delves into
the forefront of technology, exploring advanced precision manufacturing processes and product applications. It
collaborates with core customers to establish advanced technology development laboratories and jointly develop
61
Luxshare Precision Industry Co., Ltd. Annual Report 2023
cutting-edge technologies.
The company's R&D investment is mainly divided into investment in frontier technology and investment in
product iteration. Investment in frontier technology mainly revolves around the company's medium and long-term
product and business planning layout, allocating about 30% of the total R&D expenses to innovative research and
development in areas such as underlying materials, processes, and processes, aiming to propel the company's
products into global industry leaders within the next 20 years. Product iteration investment focuses on R&D
investment in the process from new concepts to NPI (New Product Introduction) for new solutions and products.
Over the years, the company's R&D investment and achievements have steadily increased. In the past three years,
it has accumulated R&D investment of RMB 23.278 billion and currently holds 6,202 patents.
3. Standardize Operations and Enhance Governance Levels
Continuously strengthening the company's governance foundation, enhancing internal control systems, and
promoting the accountability of the "three meetings and one layer." Standardizing the rights and obligations of the
company and shareholders to prevent the abuse of shareholder rights and the exploitation of the management's
dominant position to the detriment of the rights of small and medium-sized investors. Strengthening investor
relations management, expanding channels for institutional investors to participate in corporate governance, guiding
small and medium-sized investors to actively participate in shareholders' meetings, facilitating various investor
entities' participation in decision-making on major matters, and enhancing investors' right to speak and sense of
achievement.
The company will continue to improve its corporate governance structure and internal control system, conduct
governance activities in depth, enhance its corporate governance level, and provide strong guarantees for the
protection of shareholders' legitimate rights and interests. The company's management will further enhance its
operational management level, continuously improve the company's core competitiveness, profitability, and
comprehensive risk management capabilities, aiming for sustainable development and returning value to investors.
4. Strengthen Disclosure and Efficiently Convey Value
Emphasizing the importance and relevance of information disclosure, actively disclosing useful information for
investors' investment decisions, strengthening key information disclosure such as industry competition, company
business, and risk factors, while reducing redundant information disclosure. Ensuring that information disclosure is
true, accurate, complete, timely, fair, concise, clear, and easy to understand. Conducting regular performance
briefings. Preventing speculative concepts and riding on hot topics, and guarding against stock speculation risks.
The company will actively establish open, fair, transparent, and multidimensional communication channels with
investors, continuing to communicate with investors through various forms such as the "Interactive Easy" platform,
investor email, investor hotline, performance briefings, etc. Deepening investors' understanding of the company's
production and operation, better conveying the company's investment value, enhancing investors' identification with
the company, and building market confidence
62
Luxshare Precision Industry Co., Ltd. Annual Report 2023
5. Share Achievements and Actively Rewarding Investors
The company adheres to a people-centered value orientation, insists on investor-centric principles, and
remembers the contributions of hundreds of millions of small and medium-sized investors to the development of
China's capital market over more than 30 years. It firmly establishes a shareholder return consciousness, ensuring
that investors receive returns and a sense of accomplishment. It strengthens corporate culture construction, fosters
a distinctive development vision, a positive set of values, honest and trustworthy management principles, fulfills
social responsibilities, and promotes an enterprising and innovative corporate spirit. Adhering to legal compliance
and upholding the public nature of public companies, it actively rewards investors, stabilizes the market, and boosts
confidence. To improve and perfect the company's shareholder return mechanism, increase the transparency and
operability of profit distribution policy decisions, and actively reward investors, the company has formulated
multiple shareholder return plans in accordance with the Company Law of the People's Republic of China, the
Regulatory Guidelines for Listed Companies No. 3 - Cash Dividends of Listed Companies (Revised in 2023), and
other laws, regulations, normative documents, as well as the provisions of the Articles of Association. Since its
listing, the company has implemented several "Future Three-Year Shareholder Return Plans". The company has
distributed a total of RMB 2.48 billion in dividends over the past three years, with an annual dividend ratio of no
less than 10%. The cumulative dividend payout over three years accounts for 31.71% (the proportion of profits
distributed in cash dividends over the past three years to the average distributable profits realized over the past three
years).
Meanwhile, based on confidence in the company's future development prospects, recognition of the company's long-term value, and a
shared responsibility to promote the stable and healthy development of the capital market, Mr. Wang Laisheng, one of the company's
actual controllers and vice-chairman, increased his holdings of the company's shares through centralized bidding trading on the
Shenzhen Stock Exchange from May 9, 2022, to May 10, 2022. He acquired 7,030,910 shares at a total amount of RMB 200.041
million (excluding fees). Please refer to the "Announcement on the Completion of the Term of the Share Increase Plan by One of the
Company's Actual Controllers and Vice Chairmen" (Announcement No.: 2022-085) for details. On October 27, 2023, the company
disclosed the "Announcement on the Share Increase Plan by One of the Company's Actual Controllers and Vice Chairmen"
(Announcement No.: 2023-066). Mr. Wang Laisheng intends to increase his holdings of the company's shares through the Shenzhen
Stock Exchange system within six months from October 26, 2023. The amount of the increase is not less than RMB 100 million and
not more than 200 million yuan. In this current increase plan, as of now, Mr. Wang Laisheng has acquired 3,181,037 shares of the
company through centralized bidding trading on the Shenzhen Stock Exchange, with a total amount of RMB 100.3883 million
(excluding fees). Please refer to the "Progress Announcement on the Mid-term of the Share Increase Plan by One of the Company's
Actual Controllers and Vice Chairmen" (Announcement No.: 2024-006) for details.
63
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Section IV Corporate Governance
I. Overview of our corporate governance
We have always been committed to promoting the establishment and improvement of a modern corporate
system, regulating the operation of the listed company and improving the corporate governance structure. During
the reporting period, we kept on improving our corporate governance structure, established and improved rules and
regulations, regulated corporate operations, strengthened information disclosure, actively conducted investor
relations management and improved corporate governance level in strict accordance with the requirements of the
Company Law, the Securities Law, the Rules Governing the Listing of Shares on Shenzhen Stock Exchange (2023
Revision), the Guidelines for Articles of Association of Listed Companies, the Code of Corporate Governance for
Listed Companies, the Guide on Self-regulatory Supervision for Companies Listed on the Shenzhen Stock Exchange
No. 1 – Code of Operations for Companies Listed on the Main Board and other applicable laws, regulations and
normative documents.
(I) Shareholders and general meeting of shareholders We perform the procedures for convening, holding and
voting at shareholders’ meetings in strict accordance with the Company Law, the AOA, the Rules of Procedure of
the Shareholders’ Meeting and other relevant provisions and requirements, and treat all shareholders fairly. We
permit shareholders to elect to vote in person or on line at our shareholders’ meetings, so as to enable minority
shareholders to fully exercise their voting rights. When a general meeting of shareholders considers any related-
party transaction, we require the interested shareholders to abstain from voting, and ensure that such related-party
transaction is conducted on an arm’s length basis without prejudice to the interests of shareholders. When a general
meeting of shareholders considers any material matter that affects the interests of minority shareholders, the votes
cast by them are counted separately. All general meetings of shareholders are convened and held by our Board of
Directors in the presence of lawyers.
(II) Relationship with the controlling shareholder We are independent of our controlling shareholder in
operation, assets, personnel, organization and finance, and each of our Board of Directors, Board of Supervisors
and other internal bodies operates independently. Our controlling shareholder is strict with itself and has not directly
or indirectly interfered with our decision-making and business activities without the authorization of the
shareholders’ meeting, or occupied our funds for non-operating purpose.
(III) Directors and Board of Directors: We elect directors and engage independent directors in strict accordance
with the relevant procedures set forth in the Company Law and the AOA. We now have seven directors, including
three independent directors, who are experts in law, accounting and other areas. The number of members and
composition of our Board of Directors comply with the requirements of the applicable laws and regulations and the
AOA. Our Board of Directors has four committees, including Audit Committee, Strategy Committee, Nomination
64
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Committee and Remuneration and Appraisal Committee, each of which has a reasonable member structure, and
provides scientific and professional opinions and references for the decision-making of the Board of Directors. Our
Board of Directors has convened and held meetings, and implemented the resolutions of the shareholders’ meeting
in strict accordance with the AOA and the Rules of Procedure of the Board of Directors. All directors have performed
their duties diligently, and seriously attended the meetings of the Board of Directors and shareholders, and
safeguarded the legitimate rights and interests of the Company and the shareholders.
(IV) Supervisors and the Board of Supervisors: Our Board of Supervisors has elected supervisors in strict
accordance with the relevant procedures set forth in the Company Law and the AOA. We now have three supervisors,
including one chairman. The number of members and composition of our Board of Supervisors comply with the
requirements of the applicable laws and regulations and the AOA. Our Board of Supervisors has convened and held
meetings in strict with the AOA and the Rules of Procedure of the Board of Supervisors. All supervisors have
seriously performed their duties, effectively supervised and expressed independent opinions on our financial affairs
and the legality and regulatory compliance of the performance of duties by our directors and executives in good
faith and diligently, and safeguarded the legitimate rights and interests of the Company and the shareholders.
(V) Performance appraisal and incentive and restraint mechanisms: In order to establish sound incentive
mechanisms, and enhance the concept of joint sustainable development of the Company and the management and
key employees, we have implemented the share incentive plans to enhance the benefit sharing and restrain
mechanisms between shareholders and key business personnel, maintain the stability of the management team and
key business personnel, ensure the achievement of our development strategy and business objectives, and seek long-
term stable development. The appointment of our executives is open and transparent, and complies with the
applicable laws and regulations.
(VI) Stakeholders: We fully respect the legitimate rights and interests of stakeholders, and strive to coordinate
and balance the interests of society, shareholders, the Company, employees and other stakeholders, and jointly
promote our sustained and steady development.
(VII) Information disclosure and transparency: We have performed our information disclosure obligations
truthfully, accurately, timely and completely in strict accordance with the applicable laws and regulations and our
Information Disclosure Management Measures, and designated the Securities Times, the Shanghai Securities News
and www.cninfo.com.cn as the media for us to disclose information. We have kept non-public information in strict
confidence, seriously registered and reported the insiders pursuant to our Insider Management Policy, established
the filing policy for insiders, and timely submitted the same to the competent regulatory authorities for the record
in accordance with the relevant provisions. We also strictly regulate the reporting of our information to external
information users. When receiving specific visitors, we receive them in strict accordance with the relevant
requirements, require each of them to sign a Letter of Commitment, and timely disclose the relevant record of
investigation and research activity on the e-interaction platform of the Shenzhen Stock Exchange. During the
65
Luxshare Precision Industry Co., Ltd. Annual Report 2023
reporting period, we did not take advantage of any inside information to trade our shares. We have set up hotline
for investors and investor relations management section, and designated special persons responsible for timely
communication with investors. In addition, we take the initiative to timely contact and communicate with, and report
relevant matters to, the competent regulatory authorities, in order to accurately understand the relevant regulatory
requirements for information disclosure and further improve the transparency and quality of our information
disclosure. We have disclosed information in a true, accurate, complete and timely manner in strict accordance with
the requirements for substance and form, to ensure that all shareholders have access to our information through
different channels.
Is there any significant difference between the actual circumstance of corporate governance of the Company and the requirements of
the applicable laws, administrative regulations and the provisions of the CSRC regarding corporate governance of the listed companies?
□Yes No
There is no significant difference between the actual circumstance of our corporate governance and the applicable laws, administrative
regulations and the provisions of the CSRC regarding corporate governance of the listed companies.
II. The Company’s independence of its controlling shareholder and actual controller in assets,
personnel, finance, organization and business
During the reporting period, we operated in strict compliance with the Company Law and the AOA, gradually
improved our corporate governance structure, were independent of our controlling shareholder in assets, personnel,
finance, organization and operation, had our own independent and complete business, were independent in
management, and had independent R&D, production and sales systems. During the reporting period, our production
and operation were stable, and we had sound internal bodies and were able to operate independently in compliance
with the applicable regulations.
(I) Integrity of assets
We are a company limited by shares established through an overall change in organization form according to
the law, and have our own independent and complete assets. We have performed the relevant procedures for changes
in assets and shareholding according to the law. We have not provided any guarantee for the obligations of
shareholders on the security of our assets or credit, or lent any loan or credit line granted to us to any shareholder.
We have full control over all of our assets, and none of our assets or funds is occupied by our controlling shareholder
to the detriment of our interest.
(II) Independence in personnel
Our directors, supervisors and executives have been legally appointed in accordance with the Company Law,
the AOA and other applicable laws, rules and regulations. All of our executives (except independent directors)
exclusively work in and receive remunerations form the Company, and do not hold any post (other than director and
supervisor) concurrently in any affiliate of shareholders or any entity engaging in any business same as or similar
to our business. We are independent in employees, manage their remunerations, social security and other affairs
independently, and have sound personnel management policies and system in place.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
(III) Independence in finance
We have independent financial accounting department and internal audit department, and independent
accounting system and financial management policies in place that comply with the applicable regulations, and
make financial decisions independently. Since our establishment, we have opened separate bank accounts, filed tax
returns and paid taxes independently according to the law, and executed external contracts independently, and had
not shared any bank account or paid any tax in combination with any shareholder.
(IV) Independence in organization
We have established a sound governance structure composed of the shareholders’ meeting, the Board of
Directors and the Board of Supervisors, and independent and complete operation and management bodies that meet
our development requirements and conform to our actual situations, each of which performs its powers and functions
independently in accordance with the AOA and our internal management system. Since our establishment, our
production, operation and offices have been totally independent of our shareholders.
(V) Independence in operation
We have complete corporate property rights and independent R&D, production and sales systems, carry out
business independently, keep separate accounts, and make decisions and assume liabilities and risks independently,
and do not rely on any shareholder or other affiliate in our production and operation activities.
III. Horizontal competition
□Applicable N/A
IV. Annual and extraordinary general meetings of shareholders held during the reporting
period
1. General meetings of shareholders held during the reporting period
Parentage of
Date of
Session Type of meeting investors attending Date of meeting Resolution of the meeting
disclosure
the meeting
A total of 2 proposals, including
the Proposal on the Forecast of the
First extraordinary Extraordinary Company's Daily Connected Party
March 10,
general meeting of general meeting of 54.17% March 09, 2023 Transactions in 2023, were
2023
shareholders in 2023 shareholders approved by vote, as disclosed in
our Announcement 2023-019.
67
Luxshare Precision Industry Co., Ltd. Annual Report 2023
A total of 9 proposals, including
20221 Work Report of the Board
Annual general
Annual general meeting May 23, 2023 of Directors, were approved by
meeting of 46.02% May 22, 2023
of shareholders in 2022 vote, as disclosed in our
shareholders
Announcement No. 2023-038.
2. Extraordinary general meetings of shareholders convened at the request of preferred shareholders with
resumed voting rights
□Applicable N/A
V. Directors, supervisors and executives
1. Particulars
Changes Cause of
No. of
No. of in the increase
Opening additional Closing
End End date shares number or
balance shares balance
date of of the disposed of decrease
Name Gender Age Title Status of acquired of
the term term of of in the shares in the
shares in the shares
of office office reportin held due number of
held reporting held
g period to other shares
period
reasons held
Chairman
WANG and February May 18,
Female 57 Incumbent
Laichun general 22, 2009 2024
manager
WANG Vice February May 18, 12,258,6 12,258,6
Male 60 Incumbent
Laisheng Chairman 22, 2009 2024 10 10
Additional
shares
Director, acquired as
WANG Vice May 21, May 18, 1,331,28 a result of
Male 39 Incumbent 729,656 601,627
Tao General 2021 2024 3 exercise of
Manager incentive
share
options
Additional
shares
Director, acquired as
Vice May 21, May 18, 1,013,97 a result of
LI Wei Male 44 Incumbent 506,989 506,989
General 2021 2024 8 exercise of
Manager incentive
share
options
Independ
ZHANG May 22, May 18,
Female 61 ent Incumbent
Ying 2018 2024
Director
LIU Male 59 Independ Incumbent May 18, May 18,
68
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Zhonghu ent 2021 2024
a Director
Independ
SONG May 18, May 18,
Female 53 ent Incumbent
Yuhong 2021 2024
Director
Chairman
of the
XIA Decembe May 18,
Female 43 Supervis Incumbent
Yanrong r 19, 2017 2024
ory
Board
MO Supervis May 22, May 18,
Female 44 Incumbent
Rongying or 2018 2024
Supervis February May 18,
YI Peizan Female 39 Incumbent
or 22, 2009 2024
Additional
shares
Board
acquired as
Secretary,
HUANG May 25, May 21, a result of
Male 52 Vice Incumbent 659,085 219,695 878,780
Dawei 2018 2024 exercise of
General
incentive
Manager
share
options
Additional
shares
acquired as
Chief
WU April 15, May 21, a result of
Male 54 Financial Incumbent 750,843 232,015 982,858
Tiansong 2019 2024 exercise of
Officer
incentive
share
options
14,905,1 16,465,5
Total -- -- -- -- -- -- 1,560,326 0 0 --
83 09
Whether any director or supervisor retired or any executive was removed during the reporting period?
□Yes No
Changes in directors, supervisors and executives:
□Applicable N/A
2. Positions held
Professional background and main work experience of our current directors, supervisors and executives and main positions held by
them in the Company
(I) Directors
Ms. WANG Laichun, 57 years old, resident of Hong Kong, China; EMBA, Shenzhen Graduate School of
Tsinghua University; a member of the 14th National Committee of the CPPCC; Vice President of the National
Federation of Industry and Commerce Women Entrepreneurs Association; Vice Chairman of Guangdong Federation
of Industry & Commerce; 2022 Guangdong 3.8 Red Flag Bearer; Invited Vice Chairman of China Association of
Women Entrepreneurs; The founder and controlling shareholder of Luxshare Precision Industry Co., Ltd., serving
as Chairman and General Manager.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
Mr. WANG Laisheng, 60 years old, resident of Hong Kong, China; Member of the 14th Dongguan Municipal
Committee of the Chinese People's Political Consultative Conference (CPPCC), is now our Vice Chairman of the
Board of Directors; former Executive Director of the Shenzhen Quality Association and Director of the Guangdong
Laboratory Federation. Mr. WANG Laisheng was engaged in individual business since mid-1980s. Mr. WANG
Laisheng and Ms. WANG Laichun jointly purchased the shares of Luxshare Limited in 1999 and founded Luxshare
Precision Industry (Shenzhen) Co., Ltd. in 2004, and has worked as the Vice Chairman of our Board of Directors
until now.
Mr. LI Wei, 44 years old, Chinese nationality, undergraduate; is now chief of our Precision Component Business
Unit. Mr. LI Wei has nearly 20 years’ experience in precision manufacturing and has been engaged in product design,
validation and quality management in many precision manufacturing companies. He joined Luxshare-ICT in July
2019, responsible for the operation and management of the Corporate Business Division.
Mr. WANG Tao, 39 years old, Chinese nationality, undergraduate; is now chief of our Precision Component
Business Unit. Mr. WANG Tao has rich experience in precision manufacturing of components. He joined Luxshare-
ICT in April 2009, responsible for product development and management.
Ms. ZHANG Ying, 61 years old, Chinese nationality; Doctor of Laws, Wuhan University; postdoctoral
fellowship in law, Chinese Academy of Social Sciences; Current researcher at the Compliance Research Institute of
Shenzhen University. Ms. ZHANG Ying joined the China University of Geosciences in 1984 as a lecturer, and the
Institute of Political Science and Law, Wuhan Academy of Social Sciences in 1994 as an assistant researcher, Began
working at the Law School of Shenzhen University in 2000. Ms. ZHANG Ying has obtained the qualification as an
independent director from the Shenzhen Stock Exchange, and is an Independent Director of our 4th and 5th Board
of Directors.
Mr. LIU Zhonghua, 59 years old, Chinese nationality, without foreign permanent residence, master, professor
of accounting; is now professor and tutor of postgraduates of the Guangdong University of Foreign Studies School
of Accounting, Director of the Accounting Society of China, Vice Chairman of the Accounting Society for Foreign
Economic Relations & Trade of China, Executive Vice Chairman of the Guangdong Association of Management
Accountants, and Executive Director of the Accounting Society of Guangdong. Mr. LIU Zhonghua has obtained the
qualification as an independent director from the Shenzhen Stock Exchange, and is an Independent Director of
Guangdong Provincial Expressway Development Co., Ltd., GEM Co., Ltd. and Guangzhou Yuexiu Capital
Holdings Group Co., Ltd.
Ms. SONG Yuhong, 53 years old, Chinese nationality; Master of Laws, Wuhan University; Bachelor of Laws,
Southwest University of Political Science & Law; MBA, Grandes coles de Commerce; is now senior partner of
DeHeng Law Offices (Shenzhen), and mediator of the International Commercial Mediation Center for Belt and
Road Initiative – Luohu Court of Shenzhen Mediation Center. Ms. SONG Yuhong has obtained the qualification as
an independent director from the Shenzhen Stock Exchange, and is an Independent Director of our 5th Board of
70
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Directors.
(II) Supervisors
Ms. XIA Yanrong, 43 years old, Chinese nationality, undergraduate majoring in financial management, is now
our supervisor. Ms. XIA Yanrong worked at the Finance Department of 3CEMS Group Prime Technology
(Guangzhou) Co., Ltd. from January 2003 to April 2006, and the Finance Department of Dachang Electronic
Technology (Suzhou) Co., Ltd., a subsidiary of P-TWO, from April 2006 to April 2009, and joined us since April
2009, and served as chief of the Finance Department at Kunshan Lanto, and chief of the Finance Department and
chief of the Credit Management Department at Luxshare-ICT, and is now Director of our Central Finance
Department and Credit Management Department. Ms. XIA Yanrong is a member of our 4th and 5th Board of
Supervisors.
Ms. MO Rongying, 44 years old, Chinese nationality, majoring in business administration, is now our supervisor.
She was chief of the Planning Department at Thomson Multimedia (Dongguan) Co., Ltd., before joining us in June
2007 as chief of the Central Customs Affairs Department. Ms. MO Rongying is a member of our 4th and 5th Board
of Supervisors.
Ms. YI Peizan, 39 years old, Chinese nationality, joined our Finance Department in 2004, is now our supervisor.
Ms. YI Peizan is a member of our 1st through 5th Board of Supervisors.
(III) Executives
Ms. WANG Laichun, whose resume is set out in “Directors” above.
Mr. WANG Tao, whose resume is set out in “Directors” above.
Mr. LI Wei, whose resume is set out in “Directors” above.
Mr. HUANG Dawei, 52 years old, citizen of Chinese Taiwan, graduated from the National Tsing Hua University
Institute of Industrial Engineering, Master of Industrial Engineering, is now our Deputy General Manager and Board
Secretary. Mr. HUANG Dawei worked in a Fortune 500 company, responsible for market development and
operation management, before joining Luxshare Electronic Kunshan as the legal representative, director and
General Manager in June 2013. Mr. HUANG obtained a Qualification Certificate for Board Secretary from the
Shenzhen Stock Exchange in October 2017, and meets the qualifications required in the Rules Governing the Listing
of Shares on Shenzhen Stock Exchange (2023 Revision) and other applicable laws and regulations and the AOA.
Mr. WU Tiansong, 54 years old, citizen of Chinese Taiwan, received a bachelor’s degree from the National
Taiwan University of Science and Technology, is now the CFO of Luxshare-ICT. Mr. WU Tiansong served as a
senior auditor at the Audit Department of Deloitte Touche Tohmatsu Limited from August 1996 to August 1999,
and worked in the Underwriting Department of Taiwan Yuanda Securities Corp., and served as the chief of the
Accounting Director at Taiwan P-TWO Industries Inc. and Uniwill Computer Corp., and chief of the Finance
Department at Zhongshan Ichia Electronics Co., Ltd. from September 1999 to March 2009. He joined us in 2011.
Positions held in shareholders
□Applicable N/A
71
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Positions held in other entities
Applicable □N/A
End Whether or not
date of receive
Beginning date of term
Name Entity Position the term remunerations
of office
of and subsidies
office from such entity
WANG Luxsan Precision Technology (Jiangsu)
Director November 25, 2020 No
Laichun Co., Ltd.
WANG Bisaisi Automotive Technology (Suzhou)
Chairman July 18, 2018 No
Laichun Co., Ltd.
WANG
LaichunL
uxcase
Precision
Technolo
gy
Vice Chairman of
(Yanchen
Xiexun Electronic (Ji’an) Co., Ltd. the Board of November 12, 2005 No
g) Co.,
Directors
Ltd.Chair
manFebr
uary 3,
2021No
WANG
Laichun
WANG Luxsan Precision Technology (Jiangsu)
Director November 25, 2020 No
Laichun Co., Ltd.
WANG
Fujian JK Wiring Systems Co., Ltd. Chairman June 18, 2012 No
Laichun
WANG
TIME Interconnect Technology Limited Chairman April 19, 2022 No
Laichun
WANG
Chery Holdings Group Co., Ltd. Director June 21, 2023 No
Laichun
WANG Luxsan Precision Technology (Jiangsu)
Chairman November 25, 2020 No
Laisheng Co., Ltd.
WANG Xunmu Information Technology
General Manager April 27, 2021 No
Laisheng (Shanghai) Co., Ltd.
WANG Lishan Smart Manufacturing Technology Managing Director
November 18, 2020 No
Laisheng (Guangdong) Co., Ltd. & Manager
Managing Director
WANG BCS Automotive Interface Solutions
& General December 29, 2018 No
Laisheng (Xi’an) Co., Ltd.
Manager
WANG
Xiexun Electronic (Ji’an) Co., Ltd. Chairman November 12, 2005 No
Laisheng
Vice Chairman of
WANG
Lanto Electronic Limited the Board of May 12, 2011 No
Laisheng
Directors
WANG Kunshan Luxshare Precision Industry Co.,
Director October 25, 2011 No
Laisheng Ltd.
WANG Dongguan Leader Precision Industry Co.,
Chairman August 16, 2012 No
Laisheng Ltd.
72
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Vice Chairman of
WANG Kunshan Luxshare Precision Industry Co.,
the Board of October 25, 2011 No
Laisheng Ltd.
Directors
WANG Suining Luxshare Precision Industry Co.,
Managing Director January 11, 2013 No
Laisheng Ltd.
WANG Luxshare Precision Industry (Chuzhou)
Managing Director March 24, 2014 No
Laisheng Co., Ltd.
WANG Fengshun Luxshare Precision Industry Co.,
Managing Director July 4, 2014 No
Laisheng Ltd.
WANG Dongguan Luxshare Precision Industry
Chairman November 27, 2015 No
Laisheng Co., Ltd.
WANG Jiangxi Luxshare Intelligent Manufacture
Director December 25, 2015 No
Laisheng Co., Ltd.
WANG
Chery Automobile Co., Ltd. Director April 29, 2022 No
Laisheng
Managing Director
WANG Lishan Enterprise Management (Zhejiang)
& General March 24, 2021 No
Laisheng Co., Ltd.
Manager
WANG Guangdong Luxshare & Merry Electronics
Director December 7, 2017 No
Laisheng Co., Ltd.
Managing Director
WANG
Luxshare Holdings (Guangdong) Co., Ltd. & General November 1, 2021 No
Laisheng
Manager
LIU Septem
Guangdong Provincial Expressway Independent
Zhonghu December 4, 2017 ber 20, Yes
Development Co., Ltd. director
a 2025
LIU March
Independent
Zhonghu GEM Co., Ltd. March 20, 2019 12, Yes
director
a 2025
LIU Septem
Guangzhou Yuexiu Financial Holding Independent
Zhonghu July 19, 2022 ber 17, Yes
Group Co., Ltd. Director
a 2023
Managing Director
Luxshare Intelligent Manufacture
LI Wei & General August 16, 2021 No
Technology (Changshu) Co., Ltd.
Manager
Managing Director
Luxshare Intelligent Equipment (Kunshan)
LI Wei & General December 29, 2020 No
Co., Ltd.
Manager
Kunshan Luxshare Enterprise Management
LI Wei Managing Director November 4, 2020 No
Development Co., Ltd.
WANG
Lanto Electronic Limited Chairman November 20, 2019 No
Tao
Managing Director
WANG Luxshare Precision Technology (Nanjing)
& General October 19, 2021 No
Tao Co., Ltd.
Manager
XIA
Luxshare iTech (Zhejiang) Co., LTD. Supervisor April 8, 2019 No
Yanrong
XIA
Zhuhai Kinwong Flexible Circuit Co., Ltd. Supervisor December 3, 2018 No
Yanrong
XIA Luxshare Precision Industry (Suzhou) Co., Supervisor February 18, 2019 No
73
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Yanrong Ltd.
XIA
Luxshare Electronic (Shanghai) Co., Ltd. Supervisor December 2, 2019 No
Yanrong
XIA Luxshare Precision Industry (Enshi) Co.,
Supervisor October 24, 2018 No
Yanrong Ltd.
YI Peizan Xiexun Electronic (Ji’an) Co., Ltd. Supervisor August 28, 2017 No
YI Peizan Dongguan Luxshare Holdings Co., Ltd. Supervisor September 5, 2023 No
HUANG Luxshare Electronic Technology (Kunshan) Director & General
March 17, 2014 No
Dawei Co., Ltd. Manager
WU Luxshare Electronic Technology (Kunshan)
Supervisor March 17, 2014 No
Tiansong Co., Ltd.
WU
Huzhou Jiuding Electronic Co., Ltd. Supervisor December 15, 2015 No.
Tiansong
Explanati
on about
the posts
N/A
held at
other
entities
Punishments imposed by the securities regulatory authorities in the past three years on the directors, supervisors and executives of the
Company currently in office or leaving office during the reporting period
□Applicable N/A
3. Remunerations of directors, supervisors and executives
Decision-making process, criteria for determination and actual amount in respect of remunerations of directors, supervisors and
executives
During the reporting period, directors, supervisors and executives were subject to performance appraisal, and
their annual income consisted of basic annual salaries and long-terms incentives, and include the performance
related to the sustainable development into assessment, so as to realize our future development strategy and business
objectives. The Remuneration Committee under the Board of Directors discusses and reviews the remuneration-
related issues on an annual basis. The meetings of the Remuneration Committee shall be divided into regular
meetings and interim meetings and each of such meetings shall be held at least once every year. The remunerations
of our independent directors are determined pursuant to the Independent Director Rules for Listed Companies of
the China Securities Regulatory Commission, the AOA and other relevant regulations, and with reference to the
overall economic environment and the remunerations offered by listed companies in the industry in which the
Company operates, and are then implemented after being reviewed and approved by the Board of Directors and the
general meeting of shareholders. At present, our independent directors receive RMB160,000 per year, plus
reimbursement of travel, office and other expenses, from us.
Compensations of directors, supervisors and executives paid in the reporting period:
In RMB 0’000
74
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Total Whether or not
remuneration receiving
received from remunerations
Name Gender Age Title Status
the Company from any
(inclusive of affiliate of the
tax) Company
Chairman of the
WANG
Female 57 Board of Directors Incumbent 200 No
Laichun
& General Manager
Vice Chairman of
WANG
Male 60 the Board of Incumbent 150 No
Laisheng
Directors
Director & Deputy
WANG Tao Male 39 Incumbent 144.61 No
General Manager
Director & Deputy
LI Wei Male 44 Incumbent 116.47 No
General Manager
Independent
ZHANG Ying Female 61 Incumbent 16 No
Director
Independent
LIU Zhonghua Male 59 Incumbent 16 No
Director
Independent
SONG Yuhong Female 53 Incumbent 16 No
Director
XIA Yanrong Female 43 Supervisor Incumbent 74.1 No
MO Rongying Female 44 Supervisor Incumbent 80.13 No
YI Peizan Female 39 Supervisor Incumbent 12.92 No
Board Secretary &
HUANG Dawei Male 52 Deputy General Incumbent 136.28 No
Manager
WU Tiansong Male 54 CFO Incumbent 193.79 No
Total -- -- -- -- 1,156.3 --
Other descriptions
□Applicable N/A
VI. Performance of duties by the directors during the reporting period
1. Meetings of the Board of Directors held during the reporting period
Session Date of meeting Date of disclosure Resolution of the meeting
The 15th Refer to the Announcement on Resolutions of the 15th meeting of
meeting of the the 5th Board of Directors disclosed on www.cninfo.com.cn and the
February 21, 2023 February 22, 2023
5th Board of Securities Times (Announcement No. 2023-005)
Directors
The 16th
Refer to the Announcement on Resolutions of the 16th meeting of
meeting of the
April 27, 2023 April 28, 2023 the 5th Board of Directors disclosed on www.cninfo.com.cn and the
5th Board of
Securities Times (Announcement No. 2023-023)
Directors
75
Luxshare Precision Industry Co., Ltd. Annual Report 2023
The 17th Refer to the Announcement on Resolutions of the 17th meeting of
meeting of the the 5th Board of Directors disclosed on www.cninfo.com.cn and the
June 21, 2023 June 22, 2023
5th Board of Securities Times (Announcement No. 2023-043)
Directors
The 18th Refer to the Announcement on Resolutions of the 18th meeting of
meeting of the the 5th Board of Directors disclosed on www.cninfo.com.cn and the
August 28, 2023 August 29, 2023
5th Board of Securities Times (Announcement No. 2023-052)
Directors
The 19th Refer to the Announcement on Resolutions of the 19th meeting of
meeting of the the 5th Board of Directors disclosed on www.cninfo.com.cn and the
October 20, 2023 October 21, 2023
5th Board of Securities Times (Announcement No. 2023-059)
Directors
The 20th Refer to the Announcement on Resolutions of the 20th meeting of
meeting of the the 5th Board of Directors disclosed on www.cninfo.com.cn and the
November 27, 2023 November 28, 2023
5th Board of Securities Times (Announcement No. 2023-069)
Directors
The 21st Refer to the Announcement on Resolutions of the 15th meeting of
meeting of the the 21st Board of Directors disclosed on www.cninfo.com.cn and the
December 1, 2023 December 2, 2023
5th Board of Securities Times (Announcement No. 2023-074)
Directors
The 22nd Refer to the Announcement on Resolutions of the 15th meeting of
meeting of the the 22nd Board of Directors disclosed on www.cninfo.com.cn and
December 29, 2023 December 30, 2023
5th Board of the Securities Times (Announcement No. 2023-079)
Directors
2. Attendance of the directors at meetings of the Board of Directors and shareholders
Attendance of the directors at meetings of the Board of Directors and general meetings of shareholders
No. of board No. of board
Whether or not No. of
meetings No. of board meetings No. of board
No. of board having been general
attended meetings present by meetings
Director meetings absent from two meetings of
during the present in means of present by
absent from consecutive shareholders
reporting person communicati proxy
board meetings attended
period on equipment
WANG
8 1 7 0 0 No 1
Laichun
WANG
8 2 6 0 0 No 2
Laisheng
LI Wei 8 0 8 0 0 No 2
WANG Tao 8 1 7 0 0 No 2
ZHANG
8 1 7 0 0 No 2
Ying
LIU
8 0 8 0 0 No 2
Zhonghua
SONG
8 1 7 0 0 No 2
Yuhong
76
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Explanation about absence from two consecutive meetings of the Board of Directors
N/A
3. Objections raised by the directors regarding matters of the Company
Whether any director has raised any objection regarding matters of the Company?
□Yes No
No director has raised any objection regarding matters of the Company during the reporting period.
4. Other information regarding the performance of duties by the directors
Whether the suggestions put forward by the directors have been adopted by the Company?
Yes □No
Explanation about the adoption or non-adoption by the Company of the suggestions put forward by the directors
During the reporting period, all of our directors have performed their duties diligently in strict accordance with
the Company Law, the Securities Law, the Code of Corporate Governance for Listed Companies, the AOA, the
Rules of Procedure of the Board of Directors and other relevant provisions and requirements, actively attended
meetings of the Board of Directors and shareholders; taken the initiative to ask for information about our operation,
management, financial position and material events, had deep discussions about all resolutions submitted to the
Board of Directors for consideration, expressed opinions on our material corporate governance issues and business
decisions, and through sufficient communication and discussions, reached a consensus, to ensure the scientificity,
timeliness and effectiveness of decisions, and supervised and urged the implementation of resolutions of the Board
of Directors; actively implemented resolutions of the general meeting of shareholders and the Board of Directors,
and safeguarded the legitimate rights and interests of the Company and all shareholders. We will continue to improve
our corporate governance structure, further enhance the scientific decision-making level of the Board of Directors
and its committees, give full play to the role of independent directors in our corporate governance, and promote our
operational compliance and continued healthy development.
VII. Activities of the committees of the Board of Directors during the reporting period
No. of Performance
Date of Objections
Committee Members meetings Topics Important opinions and suggestions of other
meeting (if any)
held duties
77
Luxshare Precision Industry Co., Ltd. Annual Report 2023
BDO China Shu Lun Pan Certified
LIU Public Accountants introduced the
Zhonghua, 2022 annual audit plan and
ZHANG Communication arrangements, audit procedures and
Ying, SONG Meeting of Audit other issues with respect to the audit
Audit Yuhong and January Committee on of 2022 financial report; and
4
Committee BDO China 10, 2023 Annual Report requested the colleagues of the
Shu Lun Pan Audit Work in accounting firm to pay special
Certified 2022 attention to related party transactions,
Public pledged guarantees, capitalization
Accountants and expensing of intangible assets
and other issues.
Deliberating Pursuant to the Company Law, the
proposals Code of Corporate Governance for
regarding the Listed Companies promulgated by the
2022 annual CSRC and the Work Rules of the
report, the Audit Committee of the Board of
reappointment of Directors, the Audit Committee
LIU
the accounting performed its duties diligently,
Zhonghua,
firm, the work supervised our internal audit policies
Audit ZHANG April 21,
4 report of the and implementation thereof, reviewed
Committee Ying and 2023
internal audit our financial information, guided the
SONG
department for the work of the Internal Audit
Yuhong
year 2022, and the Department, supervised and urged the
work report of the audit conducted by the accounting
internal audit firm, and through sufficient
department for the communication and discussions,
first quarter of unanimously approved all reports
2023 considered.
Pursuant to the Company Law, the
Code of Corporate Governance for
Listed Companies promulgated by the
LIU CSRC and the Work Rules of the
Zhonghua, Audit Committee of the Board of
Audit ZHANG August Deliberating 2023 Directors, the Audit Committee
4
Committee Ying and 21, 2023 Interim Report performed its duties diligently,
SONG expressed opinions taking into
Yuhong account our actual situation, and
through sufficient communication
and discussions, unanimously
approved the Report.
78
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Pursuant to the Company Law, the
Code of Corporate Governance for
Listed Companies promulgated by the
LIU CSRC and the Work Rules of the
Zhonghua, Audit Committee of the Board of
Deliberating 2023
Audit ZHANG October Directors, the Audit Committee
4 Third Quarter
Committee Ying and 18, 2023 performed its duties diligently,
Report
SONG expressed opinions taking into
Yuhong account our actual situation, and
through sufficient communication
and discussions, unanimously
approved the Report.
Pursuant to the relevant provisions of
the Company Law, the Code of
Corporate Governance for Listed
Companies promulgated by the
CSRC and the Work Rules of the
Reviewed the
Remuneration and Appraisal
implementation of
Committee of the Board of Directors,
the performance
the Remuneration and Appraisal
appraisal,
Committee reviewed the
remuneration and
remuneration of the directors,
incentive plan for
supervisors and executives, and
the directors and
determined that we are developing
executives in the
ZHANG and improving fair and effective
Remunerat preceding year,
Ying, LIU performance appraisal criteria and
ion and January put forward a
Zhonghua 1 incentive and restraint mechanisms
Appraisal 10, 2023 reward proposal
and SONG for executives, and the remuneration
Committee for the directors
Yuhong of our executives consists of basic
and executives
monthly salaries and year-end
taking into
performance-based pay. On the basis
account our actual
of such understanding and proposal,
business situation,
we properly adjusted the basic
and studied the
monthly salaries of certain directors
remuneration and
and executives, in order to reflect and
appraisal plan for
produce the effect of incentive and
the next year.
fairness. The remuneration of our
directors, supervisors and executives
during the reporting period are true,
and conform to our performance
metrics.
79
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Pursuant to the
Company Law,
the Code of
Corporate
Governance for
Listed Companies
promulgated by
the CSRC, the
Work Rules of the
Strategy
Committee of the Pursuant to the Company Law, the
Board of Directors Code of Corporate Governance for
and other relevant Listed Companies promulgated by the
provisions, the CSRC, and the Work Rules of the
WANG Strategy Strategy Committee of the Board of
Laichun, Committee Directors, the Strategy Committee
Strategy ZHANG March 10, reviewed the thoroughly analyzed and studied the
1
Committee Ying and 2023 material events industry in which we operate, and put
LIU occurred in 2022, forward reasonable suggestions on
Zhonghua reported our 2023 the planning for and implementation
strategic of the development strategies in
development plan, respect of business, R&D and new
considered the products, which produced significant
Proposal on effect.
Identification of
Climate Risks and
Opportunities and
Response
Strategies; and
studied the
significant
strategic issues in
connection with
our development.
VIII. Activities of the Board of Supervisors
Whether the Board of Supervisors has identified any risk involving the Company in its supervisory activities during the reporting
period?
□Yes No
The Board of Supervisors has not raised any objection to the supervisory matters during the reporting period.
IX. The performance of the duties by the supervisors during the reporting period
(I) Situation of the Board of Supervisors during the Reporting Period
During the reporting period, the company's Board of Supervisors convened a total of eight meetings. The
convening and voting procedures of the meetings complied with the provisions of the Company Law, the Company's
Articles of Association, and other laws, regulations, and normative documents. The specific details are as follows:
Session Date of meeting Date of disclosure Resolution of the meeting
The 15th meeting of February 21, 2023 February 22, 2023 Refer to the Announcement on Resolutions of the 15th meeting
80
Luxshare Precision Industry Co., Ltd. Annual Report 2023
the 5th Board of of the 5th Board of Directors disclosed on www.cninfo.com.cn
Directors and the Securities Times (Announcement No. 2023-006)
Refer to the Announcement on Resolutions of the 16th meeting
The 16th meeting of of the 5th Board of Directors disclosed on www.cninfo.com.cn
the 5th Board of April 27, 2023 April 28, 2023 and the Securities Times (Announcement No. 2023-024)
Directors
Refer to the Announcement on Resolutions of the 17th meeting
The 17th meeting of of the 5th Board of Directors disclosed on www.cninfo.com.cn
the 5th Board of June 21, 2023 June 22, 2023 and the Securities Times (Announcement No. 2023-044)
Directors
Refer to the Announcement on Resolutions of the 18th meeting
The 18th meeting of of the 5th Board of Directors disclosed on www.cninfo.com.cn
the 5th Board of August 28, 2023 August 29, 2023 and the Securities Times (Announcement No. 2023-053)
Directors
Refer to the Announcement on Resolutions of the 19th meeting
The 19th meeting of of the 5th Board of Directors disclosed on www.cninfo.com.cn
the 5th Board of October 20, 2023 October 21, 2023 and the Securities Times (Announcement No. 2023-060)
Directors
Refer to the Announcement on Resolutions of the 20th meeting
The 20th meeting of of the 5th Board of Directors disclosed on www.cninfo.com.cn
November 27, November 28,
the 5th Board of and the Securities Times (Announcement No. 2023-070)
2023 2023
Directors
Refer to the Announcement on Resolutions of the 15th meeting
The 21st meeting of of the 21st Board of Directors disclosed on www.cninfo.com.cn
the 5th Board of December 1, 2023 December 2, 2023 and the Securities Times (Announcement No. 2023-075)
Directors
Refer to the Announcement on Resolutions of the 15th meeting
The 22nd meeting of the 22nd Board of Directors disclosed on www.cninfo.com.cn
December 29, December 30,
of the 5th Board of and the Securities Times (Announcement No. 2023-080)
2023 2023
Directors
(II) Fulfillment of Relevant Duties by the Board of Supervisors
1. Compliance with Company Operations
During the reporting period, members of the Board of Supervisors attended all meetings of the Board of
Directors and shareholders' meetings and supervised the company's operations. The company strictly adhered to the
requirements of the Company Law, the Securities Law, the Shenzhen Stock Exchange Listing Rules (Revised in
2023), the Self-Regulatory Guidelines for Listed Companies on the Shenzhen Stock Exchange Main Board
(Guideline No. 1), and the Company's Articles of Association to ensure compliance with regulations. The decision-
making procedures of the Board of Directors and shareholders' meetings were lawful and effective. Additionally,
the company continued to improve its internal control system. During the reporting period, there were no instances
of directors or senior management violating laws, regulations, or the Company's Articles of Association in the
81
Luxshare Precision Industry Co., Ltd. Annual Report 2023
execution of their duties.
2. Examination of Company Financial Situation
During the reporting period, the Board of Supervisors conducted a meticulous and thorough examination of the
company's financial system and financial condition. It was concluded that the company's financial management was
standardized and orderly. The financial reports for the reporting period objectively and truthfully reflected the
company's financial condition and operating results. The audit report issued by Lixin Certified Public Accountants
(Special General Partnership) for the company, which contained an unqualified opinion, was objective and impartial.
There were no false records, misleading statements, or significant omissions in the audit report.
3. Related Party Transactions
During the reporting period, the Board of Supervisors supervised the related party transactions of the company.
The Board of Supervisors believed that the related party transactions occurred by the company during the reporting
period complied with relevant provisions of the Company Law, the Securities Law, the Shenzhen Stock Exchange
Listing Rules (Revised in 2023), and the Company's Articles of Association. The decision-making procedures were
legal and effective. All related party transactions conducted by the company followed market principles and were
objective, fair, and impartial. There were no situations that harmed the interests of the company or its shareholders.
4. Storage and Use of Raised Funds
During the reporting period, the company did not utilize any raised funds.
5. Establishment and Implementation of Insider Information Management System
The company has formulated an "Insider Information Management System" in accordance with the "Regulatory
Guidelines No. 5 for Listed Companies - Management System for Insider Information Participants of Listed
Companies" and relevant rules. In the year 2023, the company's management, registration, and reporting of insiders
complied with relevant regulations. There were no instances during the reporting period of listed companies or
related individuals engaging in insider trading using insider information.
6. Internal Control Self-Assessment Report
The Board of Supervisors reviewed the company's self-assessment report on internal controls for the year 2023,
as well as the construction and operation of the internal control system. The Board believes that: the company has
established a relatively sound internal control system based on its actual situation and the requirements of laws,
regulations, and normative documents, and it is effectively implemented. The internal control system complies with
relevant laws, regulations, and normative documents as well as the actual needs of the company, playing a good role
in risk prevention and control in the company's management. The 2023 Self-Assessment Report on Internal Controls
truthfully and objectively reflects the construction and operation of the company's internal control.
7. Company Disclosure Situation
During the reporting period, the Board of Supervisors supervised the company's fulfillment of its disclosure
obligations and conducted periodic checks on the implementation of the information disclosure management system.
82
Luxshare Precision Industry Co., Ltd. Annual Report 2023
The Board believes that, during the reporting period, the information disclosed by the company was true, accurate,
timely, and complete, complying with the relevant laws and regulations as well as the requirements of regulatory
authorities such as the China Securities Regulatory Commission and the Shenzhen Stock Exchange.
(III) Work plan of the Supervisory Board for 2024
In 2024, the Board of Supervisors of the company will continue to strictly adhere to the requirements of national
laws, regulations, and normative documents, effectively fulfill the supervisory responsibilities conferred by the
company's articles of association and the Rules of Procedure for the Supervisory Board, supervise the company's
standardized operations, and improve corporate governance. The Board of Supervisors will continue to target the
standardized development of the company, strictly fulfill its supervisory duties on relevant matters, provide
reasonable improvement suggestions, further enhance the level of corporate governance standardization, and
promote the company's sustainable development.
X. Employees
1. Number, structure of profession and education of employees
Number of current employees of the parent at the end of the
523
reporting period (person)
Total number of current employees of the major subsidiaries at
232,062
the end of the reporting period (person)
Total number of current employees at the end of the reporting
232,585
period (person)
Total number of salaried employees during the reporting period
232,585
(person)
Total number of retired employees to or for whom the parent and
0
the major subsidiaries are obligated to make payments (person)
Structure of profession
Type of profession Number of employees (person)
Production staff 193,856
Sales staff 2,806
Technical staff 19,063
Financial staff 451
Administrative staff 5,729
Management staff 10,680
Total 232,585
Education
Degree of education Number of employees (person)
Undergraduate 17,260
College 23,522
Secondary specialized school, senior middle school and below 191,803
Total 232,585
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
2. Remuneration policies
We have established the administrative measures for the salaries, performance-based pay, year-end bonus and
other remuneration of employees of the Group, provided employees with competitive and guaranteed remuneration
in a scientific an reasonable manner, developed sound remuneration management policies, paid contributions to the
social insurance packages and housing provident fund for and salaries to the employees on time in strict accordance
with the applicable laws and regulations, and resolutely rejected any bonded labor. In order to help employees better
understand the match between their job responsibilities and capabilities, we have developed a multi-dimensional
performance appraisal system including self-assessment and supervisor’s assessment, in order to objectively and
comprehensively reflect employees’ annual performance. We conduct annual employee performance
communication activities, to ensure that each employee receives sufficient support and resources for his/her career
development in Luxshare-ICT, and to enhance and optimize the work experience of each employee. The
remuneration packages provided by us to employees consist of year-end bonuses, project bonuses, share incentives
for key officers, and bonuses for outstanding employees, among others. During the reporting period, we further
optimized performance appraisal, fully appraised the performance of teams and individuals, and effectively
improved the execution ability and awareness of responsibility of employees, which will help us retain and attract
outstanding talents, and human resources required for our development.
3. Training programs
We attach great importance to the career development plans of employees, concentrate our efforts on the training
of personnel, and have established a sound personnel training system, to attract and motivate more excellent talents
and promote common growth of employees and the Group. We have built an integrated online and offline learning
platform, providing multi-dimensional specialty training for different types of employees and new projects. The
platform provides all employees with hierarchical targeted training of different categories that target different groups
of people and satisfy different needs. For example, with respect to senior, middle and grassroots managers and key
reserve talents with great potentialities, we conduct the “Star Cultivation Series” training, in order to build an
efficient and dynamic team; and with respect to the personnel in manufacturing, R&D technology, marketing, supply
chain and other critical fields, we conduct the “Juneng Series” training, in order to continuously improve the
professional capabilities of employees on different posts. In addition, we carry out school-enterprise cooperation
projects, and encourage the employees to obtain certification of professional qualifications from the Company and
society, in order to enhance our production level and social recognition of us as a whole. We have also built the
“Jushi Series”, “Luxshare Classroom”, “Senior Management Forum” and other learning and communication
platforms, in order to provide excellent Luxshare employees with stages to demonstrate themselves, create a sound
learning environment and promote the integration and communications among all employees. In addition, with a
view to promoting the implementation of important strategies and changes, we have conducted the “Jubian Series”
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
training according to business needs. In order to regulate the employee training, we have established and periodically
updated the Administrative Measures for Education and training, the Operating Procedures for Education and
training, and Administrative Measures for Internal Lecturers, which define the training system covering all stages
from induction, orientation, on-the-job, transfer to promotion, and each factory has established the Operating
Procedures for Education and training and relevant administrative measures by reference to the Group’s
management standards, and annual training plans for the factory and its departments according to its annual
development plan, to effectively enhance the core competencies of employees and the Company, improve the
employees’ professional capabilities and promote the sustainable growth of the Company.
4. Outsourced workers
□Applicable N/A
XI. Profit distribution and transfer of capital reserve to the share capital
Adoption, implementation or adjustment of the profit distribution policy, in particular, cash dividend policy, during the reporting period
Applicable □N/A
Pursuant to the resolutions adopted by the 16th meeting of the 5th Board of Directors and the 2022 annual
general meeting of shareholders, we proposed to distribute to all shareholders a cash dividend of RMB1.3 (inclusive
of tax) per 10 shares on the basis of the total share capital of 7,130,392,419 shares, totaling RMB926,951,014.47.
In case of any change in our total share capital due to any share repurchase, exercise of share incentives, material
asset restructuring, cancellation of repurchased share or otherwise prior to the record date for the relevant equity
distribution, we would adjust the distribution payable per share accordingly on the principle that the total amount
distributable should remain the same.
During the period from the disclosure of such profit distribution proposal to the implementation thereof, our
total share capital increased by 1,858,932shares, from 7,130,392,419 shares at the time of disclosure of the proposal
to 7,132,251,351 shares as a result of exercise of stock option incentive plan by the relevant grantees at their sole
discretion and conversion of the convertible bonds to shares. On the principle that the total amount distributable
should remain the same, our profit distribution proposal for 2022 was adjusted as follows: to distribute to all
shareholders a cash dividend of RMB1.299661 (inclusive of tax) per 10 shares on the basis of the total share capital
of 7,132,251,351 shares, totaling RMB926,950,892.30 (inclusive of tax).
Special explanation about the cash dividend policy
Whether to comply with the provisions of the AOA or
requirements of resolutions of the general meeting of Yes
shareholders of the Company?
Whether the standard and ratio of cash dividend distribution are
Yes
clear and definite?
Whether the relevant decision-making process and mechanism
85
Luxshare Precision Industry Co., Ltd. Annual Report 2023
are sound? Yes
Whether the independent directors have performed their duties
Yes
and exercised their functions?
If the company has not conducted cash dividends, it should
disclose the specific reasons for this decision and outline the N/A
measures it plans to take next to enhance investor returns.
Whether the minority shareholders have sufficient opportunities
to express their opinions and requests and their legitimate rights Yes
and interests are fully protected?
Whether the conditions and procedures in respect of any
adjustment or amendment of the cash dividend policy comply Yes
with the applicable regulations and are transparent?
Whether the Company has made a profit in the reporting period and the parent has profits available for distribution to the shareholders,
but the Company does not propose to distribute cash dividends?
□Applicable N/A
Particulars of profit distribution and transfer of capital reserve to the share capital for the reporting period:
Applicable □N/A
Number of bonus shares per 10 shares (share) 0
Amount of cash dividends per 10 shares (RMB) (inclusive of
3
tax)
Share capital based on which the distribution proposal was made
7,178,011,313
(share)
Amount of cash dividends (RMB) (inclusive of tax) 2,153,403,393.90
Amount of cash dividends distributed in other ways (such as
0.00
share repurchase) (RMB)
Total amount of cash dividends (including other ways) (RMB) 2,153,403,393.90
Distributable profit (RMB) 8,981,176,754.23
Proportion of total cash dividends (including other ways) to the
100%
distributable profit
Particulars of cash dividends distributed for the reporting period
Others
Particulars of the proposal of profit distribution or for transfer of capital reserve to share capital
Our 2023 Profit Distribution Proposal is as follows: to distribute to all shareholders a cash dividend of RMB3 (inclusive of tax) per
10 shares on the basis of the total share capital of 7,178,011,313 shares, totaling RMB2,153,403,393.90 (inclusive of tax), and to
carry forward the retained profits for distribution in subsequent years.
In case of any change in our total share capital due to any share repurchase, exercise of share incentives, material asset restructuring,
cancellation of repurchased share or otherwise from the disclosure date of this announcement to the record date for the relevant
equity distribution, we would adjust the distribution payable per share accordingly on the principle that the total amount distributable
should remain the same.
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
XII. Implementation of share incentive plans, employee stock ownership plans and other
employee incentives granted by the Company
Applicable □N/A
1. Share incentives
(1) 2018 stock option incentive plan
On December 5, 2022, we held the 14th meeting of the fifth Board of Directors and the 14th meeting of the
fifth Board of Supervisors, deliberating and approving the Proposal on Achievement of Vesting Conditions for the
Third Vesting Period under 2018 Stock Option Incentive Plan. The grantees meeting these vesting conditions may
exercise options in the third vesting period at their sole discretion, and the actual exercisable period is from
December 13, 2022 to September 22, 2023. For details, please refer to the Suggestive Announcement (Revised) on
Exercise at Their Sole Discretion in the Third Vesting Period under 2018 Stock Option Incentive Plan
(Announcement No. 2022-110). During the reporting period, the grantees exercised their options to purchase
1,573,156 shares in total within the second vesting period in initial grant under the 2019 Stock Option Incentive
Plan.
On June 21, 2023, due to the implementation of the equity distribution for the year 2022, the company adjusted
the exercise price of the stock options incentive plan issued in 2018. The exercise price for the unexercised stock
options was adjusted from RMB 10.06 per share to RMB 9.93 per share. For further details, please refer to
Announcement No. 2023-045 titled Announcement on Adjusting the Exercise Prices of Stock Options Incentive
Plans Issued in 2018, 2019, 2021, and 2022, and Cancelling Part of the Stock Options under the 2019 Stock Options
Incentive Plan.
On November 27, 2023, the company held the 20th meetings of the Fifth Board of Directors and the Fifth Board
of Supervisors. The following resolutions were approved: "Proposal on Adjusting the Exercise Quantity and
Cancelling Part of the Stock Option Incentive Plan for 2018" and "Proposal on Achieving the Conditions for the
Fifth Exercise Period of the Stock Option Incentive Plan for 2018." Due to reasons such as the departure of incentive
recipients and failure to meet assessment criteria, the company adjusted the exercise quantity of the stock option
incentive plan for 2018, cancelling 1,314,426 unexercised stock options out of 29,883,882 originally granted. The
number of incentive recipients was adjusted from 1,607 to 1,553. For those meeting the exercise conditions, they
have the option to independently exercise their rights during the fifth exercise period, with the actual exercise period
running from December 6, 2023, to September 24, 2024. For further details, please refer to the announcements with
the reference numbers 2023-071 and 2023-077 respectively.
(2) 2019 stock option incentive plan
On July 6, 2022, we held the 9th meeting of the fifth Board of Directors and the 9th meeting of the fifth Board
of Supervisors, deliberating and approving the Proposal on Achievement of Vesting Conditions for the Second
87
Luxshare Precision Industry Co., Ltd. Annual Report 2023
Vesting Period of the Initial Grant under 2019 Stock Option Incentive Plan. The grantees meeting these vesting
conditions may exercise options in the second vesting period at their sole discretion, and the actual exercisable
period is from July 22, 2022 to April 21, 2023. For details, please see the Suggestive Announcement on Exercise at
Their Sole Discretion in the Second Vesting Period in Initial Grant under 2019 Stock Option Incentive Plan
(Announcement No. 2022-060).
On February 21, 2023, the company convened the 15th meetings of the Fifth Board of Directors and the Fifth
Board of Supervisors. The following resolutions were approved Proposal on Adjusting the Reserved Granting and
Exercising Quantity of Stock Option Incentive Plan for 2019 and Cancelling Part of the Stock Option Incentive Plan
and Proposal on Achieving the Conditions for the Third Exercise Period of the Stock Option Incentive Plan for 2019.
Due to reasons such as the departure of incentive recipients and failure to meet assessment criteria, the company
adjusted the exercising quantity of the reserved granting of the stock option incentive plan for 2019, cancelling
847,851 unexercised stock options out of 11,992,940 originally granted. The number of incentive recipients was
adjusted from 239 to 223. For those meeting the exercise conditions, they have the option to independently exercise
their rights during the third exercise period, with the actual exercise period running from March 1, 2023, to
November 24, 2023. For further details, please refer to the announcements with the reference numbers 2023-007
and 2023-017 respectively.
On June 21, 2023, the company held the 17th meetings of the Fifth Board of Directors and the Fifth Board of
Supervisors. The resolutions approved included the "Proposal on Achieving the Conditions for the Fourth Exercise
Period of the Stock Option Incentive Plan for 2019." For those meeting the exercise conditions, they have the option
to independently exercise their rights during the fourth exercise period, with the actual exercise period running from
July 4, 2023, to April 21, 2024. For further details, please refer to the announcement with the reference number
2023-048.
(3) 2021 stock option incentive plan
On February 21, 2023, the company convened the 15th meeting of the Fifth Board of Directors and the 15th
meeting of the Fifth Board of Supervisors. During the meeting, the resolution regarding the achievement of the
exercise conditions for the first exercise period of the 2021 Stock Option Incentive Plan was approved. In
accordance with this resolution, the incentive recipients who meet the exercise conditions are permitted to exercise
their options independently during the first exercise period, with the actual exercise period spanning from March
13, 2023, to December 1, 2023. For further details, please refer to the informational announcement titled Notice on
the Adoption of Independent Exercise Mode for the First Exercise Period of the 2021 Stock Option Incentive Plan
(Announcement Number 2023-020).
On June 21, 2023, due to the implementation of the 2022 equity distribution, the company adjusted the exercise
price of the 2021 stock option incentive plan accordingly. The exercise price of the unexercised stock options under
88
Luxshare Precision Industry Co., Ltd. Annual Report 2023
the plan was revised from RMB 35.76 per share to RMB 35.63 per share. For further details, please refer to the
announcement titled Notice of Adjustment of Exercise Prices for the Stock Option Incentive Plans of 2018, 2019,
2021, and 2022, and Partial Cancellation of Stock Options under the 2019 Stock Option Incentive Plan
(Announcement Number 2023-045).
On October 20, 2023, the company convened the 19th meetings of the Fifth Board of Directors and the Fifth
Board of Supervisors. The meetings approved the Proposal on Achieving the Conditions for the First Exercise Period
Reservation of the 2021 Stock Option Incentive Plan. In accordance with this proposal, the eligible incentive
recipients can voluntarily exercise their rights during the first exercise period, which is effective from November 3,
2023, to October 18, 2024. For more details, please refer to the Notice Regarding the Use of Voluntary Exercise
Mode for the First Exercise Period Reservation of the 2021 Stock Option Incentive Plan (Announcement Number
2023-067).
(4) 2022 stock option incentive plan
With the approval of the 13th meeting of the 5th Board of Directors, the 13th meeting of the 5th Board of
Supervisors and the 3rd extraordinary general meeting of shareholders in 2022, we introduced the 2022 stock option
incentive plan.
On December 5, 2022, we held the 14th meeting of the fifth Board of Directors and the 14th meeting of the
fifth Board of Supervisors, deliberating and approving the Proposal on Granting Stock Options to Grantees under
the 2022 Stock Option Incentive Plan of Luxshare Precision Industry Co., Ltd., whereby it was determined that the
grant date of stock options would be December 15, 2022 and 172.021 million stock options would be granted to
3,759 eligible grantees. For details, please refer to the Announcement on Granting Stock Options to Grantees under
the 2022 Stock Option Incentive Plan (Announcement No. 2022-106).
On January 19, 2023, we completed the registration of grant under our 2022 Stock Option Incentive Plan, and
granted 168.513 million registered stock options, representing 2.3671% of our total share capital. There are 3,505
grantees, the abbreviation and code of stock options are JLC5 and 037325, respectively. For details, please refer to
the Announcement on Completion of Registration of Grant under the 2022 Stock Option Incentive Plan
(Announcement No. 2023-004).
(5) Exercise of options during the reporting period
During the reporting period, the grantees exercised their options at their sole discretion to purchase 45,356,811
shares in total under the relevant stock option incentive plans.
Share incentives granted to directors and executives
Applicable □N/A
Unit: shares
Openin No No. of No. of Exercise Closing Market Open No. No. of Grant Closi
g . of shares shares price of balance of price at ing of addition price of ng
Name Title
balance ad exercisabl exercised shares stock the end balan share al restricte balan
of stock diti e during during the exercised options of the ce of s restricte d shares ce of
89
Luxshare Precision Industry Co., Ltd. Annual Report 2023
options on the reporting during the held reportin restri veste d shares (RMB restri
held al reporting period reporting g cted d granted per cted
sto period period period share durin during share) share
ck (RMB per (RMB s g the the s
opt share) per held repor reportin held
ion share) ting g
s perio period
gra d
nte
d
dur
ing
the
rep
orti
ng
per
iod
Director &
WANG Deputy 506,9
0 168,996 168,996 13.48 337,993 33.14 0 0 0 0 0
Tao General 89
Manager
Director &
WANG Deputy 865,2
0 432,631 252,631 10.06 432,630 33.14 0 0 0 0 0
Tao General 61
Manager
Director &
WANG Deputy
0 180,000 9.93 33.14 0 0 0 0 0
Tao General
Manager
Director &
WANG Deputy 1,000, 1,000,00
0 30.22 33.14 0 0 0 0 0
Tao General 000 0
Manager
Director &
Deputy 506,9
LI Wei 0 337,993 168,996 13.48 337,993 33.14 0 0 0 0 0
General 89
Manager
Director &
Deputy 675,9
LI Wei 0 675,985 337,993 10.06 337,992 33.14 0 0 0 0 0
General 85
Manager
Director &
Deputy 1,000, 1,000,00
LI Wei 0 30.22 33.14 0 0 0 0 0
General 000 0
Manager
Board
Secretary &
HUANG 439,3
Deputy 0 439,390 219,695 10.06 219,695 33.14 0 0 0 0 0
Dawei 90
General
Manager
Board
HUANG 500,0
Secretary & 0 30.22 500,000 33.14 0 0 0 0 0
Dawei 00
Deputy
90
Luxshare Precision Industry Co., Ltd. Annual Report 2023
General
Manager
WU 263,6
CFO 0 131,817 10,000 10.06 33.14 0 0 0 0 0
Tiansong 34
131,817
WU
CFO 0 121,817 9.93 33.14 0 0 0 0 0
Tiansong
WU 320,5
CFO 0 135,198 50,198 13.48 33.14 0 0 0 0 0
Tiansong 93
220,395
WU
CFO 0 50,000 13.35 33.14 0 0 0 0 0
Tiansong
WU 400,0
CFO 0 30.35 400,000 33.14 0 0 0 0 0
Tiansong 00
6,478, 2,322,01 1,560,32 4,918,51
Total -- 0 -- -- 0 0 0 -- 0
841 0 6 5
Remark (if any) N/A
Performance appraisal and incentives in respect of executives
All of our executives were appointed by the Board of Directors fairly and transparently, in compliance with the
applicable laws and regulations. Our executives report to the Board of Directors and are responsible for achieving
the operating targets set by the Board of Directors. We have established effective incentive and constraint
mechanisms, in order to stimulate the executives to perform their duties diligently, and improve our level of
operation and management and operating results. The performance of our executives is directly linked to their
income, and assessed by comparing the goals set by us with their actual accomplishment of tasks. The Remuneration
and Appraisal Committee of the Board of Directors is responsible for year-end assessment of the achievement of
goals, working ability and performance of duties in respect of our directors, supervisors and executives, and
developing the remuneration and performance appraisal proposals and submitting the same to the Board of Directors
for approval. During the reporting period, our remuneration and performance appraisal policies for the executives
have been implemented effectively.
2. Implementation of employee stock ownership plan
□Applicable N/A
3. Other employee incentives
□Applicable N/A
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
XIII. Establishment and implementation of internal controls during the reporting period
1. Establishment and implementation of internal controls
We have established a relatively sound internal control system that has run effectively in strict accordance with
the Company Law, the Securities Law, the Basic Internal Control Standards for Enterprises, the Application Guide
for Internal Controls of Enterprises and other applicable laws, regulations and normative documents, taking into
account the characteristics of our industry and our actual business situation. From the perspective of corporate
management, technology R&D and business processes, we have established effective internal controls, and
improved our corporate governance level and efficiency of decision-making, which guarantees the legal and
regulatory compliance of our operation and management, security of our assets and the truthfulness and
completeness of our financial reports and other information, and effectively promote the steady implementation of
our strategies.
Our internal control system has a reasonable structure, can satisfy the requirements of our management and
development, and runs effectively. Our internal controls over financial reporting, non-financial reporting and other
material matters are effective, achieve the objectives and protect the interests of the Company and all shareholders.
2. Material weakness in internal control identified during the reporting period
□Yes No
XIV. Management and control of subsidiaries during the reporting period
Problems
Progress of encountered Solutions Progress of Subsequent
Company Integration plan
integration during adopted solution solution
integration
- - - - - - -
XV. Self-assessment report on internal controls or auditor’s report on internal controls
1. Self-assessment report on internal controls
Date of disclose of the self-assessment
April 25, 2024
report on internal controls in its entirety
Disclosure reference of the self-
Internal Control Certification Report 2023 of Luxshare Precision Industry Co., Ltd.
assessment report on internal controls in
published on www.cninfo.com.cn
its entirety
Ratio of total assets of the entities covered
by the assessment to total assets recorded
67.09%
in the consolidated financial statements of
the Company
Ratio of total operating revenue of the
80.27%
entities covered by the assessment to total
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
operating revenue recorded in the
consolidated financial statements of the
Company
Criteria for determination of deficiencies
Category Financial reporting Non-financial reporting
1. The material weaknesses in internal control over 1. The material weaknesses in internal control
financial reporting include: (A) fraud on the part of over non-financial reporting include: (A) any
directors, supervisors and executives; (B) failure to serious violation of the significant national
correct any material weakness in internal control within laws and regulations; (B) great outflow of
a reasonable time after the same was identified and management and technical personnel on key
reported to the management; (C) ineffective control posts; (C) absence of or ineffective control
environment; (D) any material misstatement in the system for important business relating to the
financial report for the current period that is identified production and operation of the Company; (D)
by external auditor but fails to be identified through ineffective internal control over information
internal control; (E) any serious violation of the laws and disclosure, resulting in any public
regulations; (F) the Company running at a loss for condemnation of the Company by any
consecutive years due to any reason other than policy- regulatory authority; and (E) failure to correct
related loss, which might threaten the Company’s ability any problem, in particular, any material
to continue as a going concern; and (G) ineffective weakness or significant deficiency, identified
supervision by the management and related functional in any assessment of internal controls. 2. The
Qualitative criteria
departments over the internal control. 2. The significant significant deficiencies in internal control over
deficiencies in internal control over financial reporting non-financial reporting include: (A) defects in
include: (A) failure to select and apply accounting important business policies or system, or
policies pursuant to the generally accepted accounting unsound internal control system; and (B)
principles; (B) failure to establish anti-fraud procedures failure to review any information disclosed
and controls; (C) absence of or ineffective control externally and untruthfulness of any
system for important business; (D) lack of internal information disclosed. 3. General deficiencies
controls in and disorderly management of subsidiaries; in internal control over financial reporting
and (E) great outflow of or frequent changes in senior include deficiencies in control other than
officers (especially those in charge of internal control, material weakness and significant deficiency.
financial and human resources departments), or great
outflow of personnel on the relevant posts. 3. General
deficiencies in internal control over financial reporting
include deficiencies in control other than material
weakness and significant deficiency.
1. Material weakness: (1) amount of misstated operating 1. Material weakness: resulting in a direct loss
revenue ≥ 0.5% of total operating revenue; (2) amount of more than RMB12 million and having a
of misstated profit ≥ 5% of total profit; (3) amount of material adverse effect on the Company. 2.
misstated assets ≥ 0.5% of total assets; (4) amount of Significant deficiency: resulting in a direct
misstated owners’ equity ≥ 0.5% of total owners’ equity. loss of more than RMB3 million and not more
2. Significant deficiency: (1) 0.2% of total operating than RMB12 million, and any penalty imposed
revenue ≤ amount of misstated operating revenue < 0.5% by any competent government authority of the
of total operating revenue; (2) 2% of total profit ≤ country, but not having an adverse effect on
Quantitative criteria amount of misstated profit < 5% of total profit; (3) 0.2% the Company. 3. General deficiency: resulting
of total assets ≤ amount of misstated assets < 0.5% of in a direct loss of not more than RMB3
total assets; (4) 0.2% of total owners’ equity ≤ amount of million, and any penalty imposed by any
misstated owners’ equity < 0.5% of total owners’ equity. competent government authority at the
3. General deficiency: (1) amount of misstated operating provincial level or below, but not having an
revenue < 0.2% of total operating revenue; (2) amount adverse effect on the Company.
of misstated profit < 2% of total profit; (3) amount of
misstated assets < 0.2% of total assets; (4) amount of
misstated owners’ equity < 0.2% of total owners’ equity.
Number of material weaknesses in
0
financial reporting
Number of material weaknesses in non- 0
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Luxshare Precision Industry Co., Ltd. Annual Report 2023
financial reporting
Number of significant deficiencies in
0
financial reporting
Number of significant deficiencies in
0
non-financial reporting
2. Auditor’s report on internal controls
Applicable □N/A
Opinion issued in the internal control audit report
Pursuant to the Basic Internal Control Standards for Enterprises promulgated by the Ministry of Finance and other relevant
provisions, the Company has maintained effective internal controls in all material respects as of December 31, 2023.
Disclosure of the internal control audit report Disclosed
Date of disclose of the audit report on internal controls in its
April 25, 2024
entirety
Disclosure reference of the audit report on internal controls in its Internal Control Audit Report 2023 of Luxshare Precision
entirety Industry Co., Ltd. published on www.cninfo.com.cn
Type of opinion issued in the internal control audit report Standard unqualified opinion
Whether there’s any material weakness in non-financial
No
reporting
Whether the accounting firm issued a modified internal control certification report?
□Yes No
Whether the internal control audit report issued by the accounting firm conforms to the opinion issued by the self-assessment report of
the Board of Directors?
Yes □No
XVI. Rectification of non-compliance identified in the special self-examination of corporate
governance of the listed company
Our self-examination showed that we operated in compliance with the applicable regulations and was governed
well during the reporting period, and did not identify any material non-compliance in our corporate governance. We
will continue to improve our level of corporate governance and further promote our high-quality development.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
Section V Environment and Social Responsibilities
I. Major environmental issues
Whether the Company or any of its subsidiaries is identified as a major polluter by the environmental protection authority
Yes □No
Policies and industry standards related to environmental protection
I. Luxcase Precision Technology (Yancheng) Co., Ltd.
1. Emission standards of air pollutants
The sulfuric acid mist, nitric acid mist (measured in NOX) and unit product benchmark exhaust volume
generated by our anodic oxidation line comply with the standards provided in Tables 5 and 6 of Discharge Standard
of Electroplating Pollutants (GB21900-2008); Section 3.9 of the Technical Specification for Application and
Issuance of Pollutant Discharge Permit - Electronics Industry (HJ1031-2019) provides that this standard uses non-
methane hydrocarbons as a comprehensive control indicator for VOC emissions; after the release and
implementation of the Discharge Standard of Pollutants for Electronic Industry, such Standard shall apply. In this
project, the particulate matter generated from machining, sulfuric acid mist from aluminum solution concentration,
non-methane hydrocarbon from dispensing, gluing and printing and nitric acid mist from cleaning process
(measured in NOX) comply with Level 2 provided in the Integrated Emission Standard of Air Pollutants
(DB32/4041-2021); the concentration limit for unorganized waste gas monitoring points comply with the standards
provided in Table 2 of the Integrated Emission Standard of Air Pollutants (DB32/4041-2021); the SO2 and NOX
generated by the combustion of natural gas boilers comply with the special emission limits for air pollutants
provided in the Table 3 of the Emission Standards of Boiler Air Pollutants (DB32-4385-2022).
2. Discharge standards of water pollutants
The comprehensive wastewater generated by the said company is discharged to Yancheng Tongqi Water Co.,
Ltd., and the takeover standard is implemented according to the management agreement. The heavy metal
wastewater reuse index in the anodizing surface treatment process complies with the Discharge Standard of
Electroplating Pollutants (GB21900-2008).
3. Emission standards of noise pollution
During the operation of its plant, it complies with Table 3 of the Standards on Noise Emissions at the Boundaries
of Industrial Enterprises (GB12348-2008).
4. Discharge standards of solid wastes
The solid wastes of the said company mainly consist of general solid wastes and hazardous wastes. For storage
of general solid wastes, it refers to the environmental protection requirements on anti-seepage, anti-rain, and anti-
dust of the General Industrial Solid Waste Storage and Landfill Pollution Control Standards (GB 18599-2020). For
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
collection, storage and transportation of hazardous wastes, it complies with the requirements of the Technical
Specifications for the Collection, Storage and Transportation of Hazardous Wastes (HJ2025-2012), the Pollution
Control Standards for the Storage of Hazardous Wastes (GB 18597-2001) and the Amendment (Announcement No.
36 of 2013 of the Ministry of Environmental Protection).
II. Ri Ming Computer Accessory (Shanghai) Co., Ltd.
1. Emission standards of air pollutants
The oil mist generated by the CNC machines, particulate matter generated from machining, and non-methane
hydrocarbon from dispensing and coating processes comply with the corresponding standards provided in Table 3
of Integrated Emission Standard of Air Pollutants (DB31_933-2015); the odor generated in the wastewater
biochemical process complies with the corresponding standards in provided in Table 3 of Emission Standard of
Odor Pollutants (DB311025-2016); the concentration limits at unorganized exhaust monitoring points in the plant
comply with the corresponding standards provided in Appendix A of Control Standard for Unorganized Emissions
of Volatile Organic Compounds (GB37822-2019); the non-methane hydrocarbons and particulate matter
concentrations at unorganized exhaust monitoring points at the plant boundary comply with the special emission
limits for air pollutants provided in Table 3 of Integrated Emission Standard of Air Pollutants (DB31_933-2015);
the odor complies with the corresponding standards provided in Table 3 of Emission Standard of Odor Pollutants
(DB311025-2016).
2. Discharge standards of water pollutants
The production wastewater of the said company is discharged to Jinshan Sea Outfall Engineering Co., Ltd., and
the discharge of the sewage treatment plant complies with Level 3 provided in Table 2 of the Integrated Standard of
Wastewater Discharge (DB31-199-2018).
3. Emission standards of noise pollution
During the operation of its plant, it complies with Table 3 of the Standards on Noise Emissions at the Boundaries
of Industrial Enterprises (GB12348-2008).
4. Discharge standards of solid wastes
The solid wastes of the said company mainly consist of general solid wastes and hazardous wastes. For storage
of general solid wastes, it refers to the environmental protection requirements on anti-seepage, anti-rain, and anti-
dust of the General Industrial Solid Waste Storage and Landfill Pollution Control Standards (GB18599-2020). For
collection, storage and transportation of hazardous wastes, it complies with the requirements of the Technical
Specifications for the Collection, Storage and Transportation of Hazardous Wastes (HJ2025-2012), the Pollution
Control Standards for the Storage of Hazardous Wastes (GB 18597-2001) and the Amendment (Announcement No.
36 of 2013 of the Ministry of Environmental Protection).
III. Rida Intelligent Manufacture Technology (Rugao) Co., Ltd.
1. Emission standards of air pollutants
96
Luxshare Precision Industry Co., Ltd. Annual Report 2022
The emission concentrations of nitrogen oxides and sulfuric acid mist produced by our anode line comply with
the emission limits of air pollutants for new enterprises provided in Table 5 of the Discharge Standard of
Electroplating Pollutants (GB21900-2008), and the benchmark exhaust of the project complies with Table 6. The
emission concentrations of non-methane hydrocarbons from injection molding process complies with the special
emission limits provided in Table 5 of the Emission Standard of Pollutants from Synthetic Resin Industry
(GB31572-2015), and the particulate matter, non-methane hydrocarbons, xylene, benzene series, chromium and its
compounds, nickel and its compounds from other processes comply with the emission limits of atmospheric
pollutants from organized emissions provided in Table 1 of the Integrated Emission Standard of Air Pollutants
(DB32/4041-2021). The emission concentrations of particulate matter, sulfuric acid mist, nitrogen oxides, non-
methane hydrocarbons, xylene, benzene series and its compounds, chromium and its compounds, and nickel and its
compounds from unorganized emissions comply with the concentration limits of air pollutant emission monitoring
at the boundaries of enterprises provided in Table 3 of the Integrated Emission Standard of Air Pollutants
(DB32/4041-2021). The concentrations of unorganized emission of ammonia, hydrogen sulfide and odor comply
with Level 2 standards on new renovation and expansion provided in Table 1 of, and the organized emission
concentrations thereof comply with Table 2 of the Emission Standard of Odorous Pollutants (GB14554-93). The
concentrations of unorganized emission of non-methane hydrocarbons in the plant comply with Table 2 of the
Integrated Emission Standard of Air Pollutants (DB32/4041-2021). Alkali mist and phosphoric acid mist refer to
the standards provided in Table 1 of Integrated Emission Standard of Air Pollutants (DB31/933-2015). In accordance
with the Notice of the Nantong Municipal Government Office on Issuing the 2020 Air Pollution Prevention and
Control Work Plan (Tong Zheng Ban Fa [2020] No. 34), the low-nitrogen transformation task of gas-fired boilers
has been fully completed, with the emission concentrations of nitrogen oxides not exceeding 50 milligrams per
cubic meter. The concentrations of SO2 and particulate matter emitted from the exhaust gas of natural gas
combustion in gas-fired boilers comply with the atmospheric pollutant emission concentration limits provided in
Table 3 of the Emission Standard of Boiler Air Pollutants (GB13271-2014).
2. Discharge standards of water pollutants
After the nickel-containing wastewater and chromium-containing wastewater in this project are treated by the
wastewater pretreatment equipment in the plant, the total chromium and total nickel in wastewater pretreatment
plant outlet comply with the standard limits provided in Table 3 of the Discharge Standard of Electroplating
Pollutants (GB21900-2008); Rugao Fugang Water Treatment Co., Ltd. as the sewage treatment plant in the park
complies with Level 3 provided in Table 4 of Integrated Standards of Wastewater Discharge (GB8979-1996) for
water quality management. The ammonia nitrogen, total nitrogen, and total phosphorus comply with the
management requirements of Rugao Fugang Water Treatment Co., Ltd., and the total aluminum complies with the
standards provided in Table 3 of the Discharge Standard of Electroplating Pollutants (GB21900-2008); the
benchmark drainage of unit products complies with the requirements in Table 2 of the Discharge Standard of
97
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Electroplating Pollutants. The tail water from the sewage treatment plant in the park is discharged into the central
river after reaching the Level 1A standards provided in the Pollutant Discharge Standards for Municipal Wastewater
Treatment Plants (GB18918-2002). The pollutants in the recycled water in the plant are managed in accordance
with standard values of “open circulating cooling water system makeup water and washing water” provided in Table
1 of the Water Quality for Urban Sewage Recycling and Industrial Use (GB/T19923-2005).
3. Emission standards for noise pollution
It complies with Class 3 provided in the Standards on Noise Emissions at the Boundaries of Industrial
Enterprises (GB12348-2008) during the operation of our plant, and the Class 2 provided in the Noise Emissions at
the Boundaries of Industrial Enterprises (GB12348-2008) during the day and night in Dongwei Village.
4. Discharge standards of solid wastes
The solid wastes of the said company mainly consist of general solid wastes and hazardous wastes. The storage
of general solid wastes in the plant are strictly set up and managed in accordance with the requirements of the
General Industrial Solid Waste Storage and Landfill Pollution Control Standards (GB 18599-2020) and its
Amendment. The hazardous waste in the plant is strictly managed in accordance with the Pollution Control
Standards for the Storage of Hazardous Wastes (GB18597-2001) and its Amendment, the Technical Specifications
for the Collection, Storage and Transportation of Hazardous Wastes (HJ2025-2012) and other documents.
IV. Ri Shan Computer Accessory (Jiashan) Co., Ltd.
1. Emission standards of air pollutants
The sulfuric acid mist, nitric acid mist (measured in NOX) and unit product benchmark exhaust volume
generated by our anodic oxidation line comply with the standards provided in Tables 5 and 6 of Discharge Standard
of Electroplating Pollutants (GB21900-2008); Particulate matter generated from machining, and the non-methane
hydrocarbons from dispensing and baking comply with the Level 2 provided in the Integrated Emission Standard
of Air Pollutants (GB16297-1996); the particulate matter generated from sandblasting processes, and non-methane
hydrocarbons from injection molding processes comply with the standard limits provided in Table 5 of the Emission
Standard of Pollutants from Synthetic Resin Industry (GB31572-2015); the non-methane hydrocarbons in
unorganized exhaust gas at the plant boundary complies with the Emission Standard of Pollutants from Synthetic
Resin Industry (GB 31572-2015) and the Control Standards on Unorganized Emissions of Volatile Organic
Compounds (GB37822-2019). Nitrogen oxides, particulate matter, and sulfuric acid mist comply with the Integrated
Emission Standard of Air Pollutants (GB16297-1996); and the odor concentrations comply with the Emission
Standard of Odorous Pollutants (GB 14554-93).
2. Discharge standards of water pollutants
The comprehensive wastewater of the said company is collected and managed by Jiashan County Dadi
Wastewater Treatment Engineering Co., Ltd., and the discharge of such sewage treatment plant comply with
Pollutants Discharge Standards for Electronic Industry (GB 39731-2020). The heavy metal wastewater reuse index
98
Luxshare Precision Industry Co., Ltd. Annual Report 2022
in the anodizing surface treatment process complies with the Discharge Standard of Electroplating Pollutants
(DB33/2260-2020).
3. Emission standards of noise pollution
W comply with Class 3 provided in the Standards on Noise Emissions at the Boundaries of Industrial Enterprises
(GB12348-2008) at the east and south boundaries of the plant, and the Class 4 provided in the Noise Emissions at
the Boundaries of Industrial Enterprises (GB12348-2008) at the west and north boundaries of the plant.
4. Discharge standards of solid wastes
The solid wastes of the said company mainly consist of general solid wastes and hazardous wastes. For storage
of general solid wastes, it refers to the environmental protection requirements on anti-seepage, anti-rain, and anti-
dust of the General Industrial Solid Waste Storage and Landfill Pollution Control Standards (GB18599-2020). For
collection, storage and transportation of hazardous wastes, it complies with the requirements of the Technical
Specifications for the Collection, Storage and Transportation of Hazardous Wastes (HJ2025-2012), the Pollution
Control Standards for the Storage of Hazardous Wastes (GB 18597-2023).
Environmental protection administrative permits
I. Luxcase Precision Technology (Yancheng) Co., Ltd.
Environmental Impact Assessment Report (Table):
1. Computer component production project (phase I);
2. Computer component production project (phase II);
3. 3C precision mechanical parts production expansion project.
44. Precision component manufacturing project in Zone A;
5. Precision component manufacturing projects in Zones F, G, and H;
6. Precision component manufacturing project in Zone I.
Approval and reply of environmental assessment:
1. Ting Huan Biao Fu [2017] No. 123;
2. Ting Huan Ping Shu [2019] No. 2;
3. Yan Huan Shen [2021] No. 02003;
4. Yan Huan Shen [2022] No. 02003;
5. Yan Huan Shen [2022] No. 02001;
6. Yan Huan Shen [2021] No. 02001.
Acceptance report:
1. Acceptance report of computer component production project (phase I);
2. Acceptance report of computer component production project (phase II);
3. Acceptance report of 3C precision mechanical parts production expansion project.
99
Luxshare Precision Industry Co., Ltd. Annual Report 2022
4. Acceptance report for precision component manufacturing project in Zone A;
5. Acceptance report for precision component manufacturing project in Zone F;
6. Acceptance report for precision component manufacturing project in Zone G;
7. Acceptance report for precision component manufacturing project in Zone H;
8. Acceptance report for precision component manufacturing project in Zone I. Pollution Permit No.:
Pollution Permit No.: 91320900MA1R8A0N2B001V Valid period: From April 25, 2023, to April 24, 2028.
II. Ri Ming Computer Accessory (Shanghai) Co., Ltd.
Environmental impact assessment table:
1. Precision electronic component adjustment project (Phase I);
2. Precision electronic component adjustment project (Phase II);
3. Precision electronic component project (Phase III);
4. Precision electronic component technical renovation project;
5. Environmental impact assessment report of Ri Ming watch project.
Approval and reply of environmental assessment:
1. Jin Huan Xu [2014] No. 479;
2. Jin Huan Xu [2015] No. 323;
3. Jin Huan Xu [2018] No. 170;
4. Jin Huan Xu [2019] No. 254;
5. Jin Huan Xu [2020] No. 27;
Acceptance report:
1. Completion acceptance report of precision electronic component adjustment project (phase I);
2. Completion acceptance report of precision electronic component adjustment project (phase II);
3. Completion acceptance report of precision electronic component project (phase III);
4. Completion acceptance report of precision electronic component technical renovation project;
5. Completion acceptance report of Ri Ming watch project.
Pollution Permit No.:
Pollution Permit No.:91310000572654085A001V, Valid period: from January 30, 2022 to January 29, 2027
III. Rida Intelligent Manufacture Technology (Rugao) Co., Ltd.
Approval and reply of environmental assessment:
Smart terminal precision module project: Jiang Zheng Huan Shu Fu [2022] No. 2.
Pollution discharge permit: October 24, 2023, to October 23, 2028.
IV. Ri Shan Computer Accessory (Jiashan) Co., Ltd.
Environmental Impact Assessment Report (Table):
100
Luxshare Precision Industry Co., Ltd. Annual Report 2022
1. Production project for new 75 million pieces of precision electronic components (Phase I);
2. Production project for new 75 million pieces of precision electronic components (Phase II);
3. 3C product display screen project for new 25 million pieces/set;
4. 3C product display screen project for expanded 47 million pieces/set;
5. Technical renovation project for the original scale (annual production of 25 million units/sets of 3C product
displays).
Approval and reply of environmental assessment:
1. Shan Huan Han [2016] No. 91;
2. Shan Huan Han [2018] No. 91;
3. Deng Ji Biao Bei [2020] No. 088;
4. Deng Ji Biao Bei [2022] No. 007;
5. Jia Huan (Shan) Jian Bei [2024] No. 11.
Acceptance report:
1. Acceptance report of production project for new 75 million pieces of precision electronic components (phase
I);
2. Acceptance report of production project for the stage 1 of new 75 million pieces of precision electronic
components (phase II);
3. Acceptance report of production project for the stage 2 of new 75 million pieces of precision electronic
components (phase II);
4. Acceptance report of 3C product display screen project for new 25 million pieces/set;
5. 3C product display screen project for expanded 47 million pieces/set;
Pollution Permit No.:
Pollution Permit No.: 91330421336400470U001Z Valid period: From March 14, 2023 to March 13, 2028.
V. Luxcase Precision Technology (Kunshan) Co., Ltd.
Pollution Discharge Permit:
Pollution Discharge Permit Number (91330583MAC1YPEC08001X) is valid from July 7, 2023, to July 6, 2028.
Industry standards and discharge of pollutants involved in production and business activities
Category Name of
Name of
of main main Pollutant
the Distributio Emission
pollutants pollutants Number of discharge Total
Company Discharge n of concentrat Total Excessive
and and discharge standards approved
or its method discharge ion/intensi emissions emissions
characteris characteris outlets implement emissions
subsidiarie outlets ty
tic tic ed
s
pollutants pollutants
Luxcase Air Nitrogen Treatme 11 Area B, 19 The 6.27005 12.9750 /
101
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Precisio pollutant oxide nt C, A, G, Mg/stan emission 8 tons 37 tons
n s standard F AND I dard standard
Technol s, high- cubic s for
ogy altitude meter electropl
(Yanche emission ating
ng) Co., s pollutant
Ltd. s are
specified
in GB
21900-
2008,
while the
emission
standard
s for
atmosph
eric
pollutant
s from
boilers
are
outlined
in
DB32-
4385-
2022.
Atmosp
heric
Pollutant
Compre
hensive
Emissio
n
Luxcase Standard
Treatme
Precisio (DB32/4
nt 2.05
n 041-
Air standard Area B, Mg/stan
Technol Sulfur 2021) 0.29858
pollutant s, high- 11 C, A, G, dard / /
ogy dioxide and 3 tons
s altitude F AND I cubic
(Yanche Boiler
emission meter
ng) Co., Atmosp
s
Ltd. heric
Pollutant
Emissio
n
Standard
(DB32-
4385-
2022)
Atmosp
Luxcase
Treatme heric
Precisio
Total nt 0.67 Pollutant
n AREA
Air non- standard Mg/stan Compre
Technol B, C, A, 28.3169
pollutant methane s, high- 69 dard hensive / /
ogy G, F, H 1 tons
s hydrocar altitude cubic Emissio
(Yanche AND I
bons emission meter n
ng) Co.,
s Standard
Ltd.
(DB32/4
102
Luxshare Precision Industry Co., Ltd. Annual Report 2022
041-
2021)
Atmosp
heric
Pollutant
Compre
hensive
Emissio
n
Luxcase Standard
Treatme
Precisio (DB32/4
nt 1.85
n Area B, 041-
Air standard Mg/stan 18.1477
Technol Particula E, C, A, 2021)
pollutant s, high- 68 dard 5346 / /
ogy te matter G, F, H and
s altitude cubic tons
(Yanche and I Boiler
emission meter
ng) Co., Atmosp
s
Ltd. heric
Pollutant
Emissio
n
Standard
(DB32-
4385-
2022)
Atmosp
heric
Luxcase
Treatme Pollutant
Precisio
nt Compre
n Area B, 0.60Mg/
Air standard hensive
Technol Sulfuric C, A, G, standard 2.79799
pollutant s, high- 38 Emissio / /
ogy acid fog F, H and cubic tons
s altitude n
(Yanche I meter
emission Standard
ng) Co.,
s (DB32/4
Ltd.
041-
2021)
Atmosp
heric
Luxcase
Treatme Pollutant
Precisio
nt 4.93 Compre
n Area B,
Air standard Mg/stan hensive
Technol Nitric C, A, G, 34.3280
pollutant s, high- 34 dard Emissio / /
ogy acid fog F, H and 35 tons
s altitude cubic n
(Yanche I
emission meter Standard
ng) Co.,
s (DB32/4
Ltd.
041-
2021)
Luxcase Sewage
Precisio Compre
n Sewage hensive
Water Suspend Controll
Technol station 20.5 Emissio 64.1814
pollutant ed ed 1 / /
ogy main mg/l n 45 tons
s matter emission
(Yanche outlet Standard
ng) Co., GB8978
Ltd. -1996
Luxcase Water Ammoni Controll Sewage 2.44 11.6097 151.353
1 / /
Precisio pollutant a ed station mg/l 86 tons 5 tons
103
Luxshare Precision Industry Co., Ltd. Annual Report 2022
n s nitrogen emission main
Technol outlet
ogy
(Yanche
ng) Co.,
Ltd.
Luxcase Sewage
Precisio Compre
n Sewage hensive
Water Controll
Technol Petroleu station 0.47 Emissio 1.31637
pollutant ed 1 / /
ogy m main mg/l n 8 tons
s emission
(Yanche outlet Standard
ng) Co., GB8978
Ltd. -1996
Luxcase Sewage
Precisio Compre
n Sewage hensive
Water Anionic Controll
Technol station 0.02 Emissio 0.04973
pollutant surfactan ed 1 / /
ogy main mg/l n 8 tons
s t emission
(Yanche outlet Standard
ng) Co., GB8978
Ltd. -1996
Luxcase Sewage
Precisio Compre
n Sewage hensive
Water Controll
Technol station 1.02 Emissio 3.97405
pollutant Fluoride ed 1 / /
ogy main mg/l n 4 tons
s emission
(Yanche outlet Standard
ng) Co., GB8978
Ltd. -1996
Luxcase Sewage
Precisio Compre
n Sewage hensive
Water Controll
Technol station Emissio
pollutant PH value ed 1 7.55 / / /
ogy main n
s emission
(Yanche outlet Standard
ng) Co., GB8978
Ltd. -1996
Luxcase Sewage
Precisio Compre
n Sewage hensive
Water Chemica Controll
Technol station 25.67 Emissio 98.1984 1618.58
pollutant l oxygen ed 1 /
ogy main mg/l n 01 tons 4 tons
s demand emission
(Yanche outlet Standard
ng) Co., GB8978
Ltd. -1996
Luxcase
Precisio
n Sewage
Water Total Controll
Technol station 0.29 1.06482 39.7705
pollutant phospho ed 1 / /
ogy main mg/l 4 tons 50 tons
s rus emission
(Yanche outlet
ng) Co.,
Ltd.
Luxcase Water Total Controll 1 Sewage 21.53 / 76.3771 290.202 /
104
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Precisio pollutant nitrogen ed station mg/l 22 tons 5 tons
n s emission main
Technol outlet
ogy
(Yanche
ng) Co.,
Ltd.
Electropl
Luxcase
ating
Precisio
Heavy Pollutant
n Recycle
metal Not Emissio
Technol Total d and not
wastewa 4 discharg 0 n 0 / /
ogy nickel discharg
ter ed Standard
(Yanche ed
recycled GB
ng) Co.,
21900-
Ltd.
2008
Electropl
Luxcase
ating
Precisio
Heavy Pollutant
n Recycle
metal Not Emissio
Technol Total d and not
wastewa 4 discharg 0 n 0 / /
ogy copper discharg
ter ed Standard
(Yanche ed
recycled GB
ng) Co.,
21900-
Ltd.
2008
Electropl
Luxcase
ating
Precisio
Heavy Pollutant
n Recycle
metal Total Not Emissio
Technol d and not
wastewa chromiu 4 discharg 0 n 0 / /
ogy discharg
ter m ed Standard
(Yanche ed
recycled GB
ng) Co.,
21900-
Ltd.
2008
Electropl
Luxcase
ating
Precisio
Heavy Pollutant
n Hexaval Recycle
metal Not Emissio
Technol ent d and not
wastewa 4 discharg 0 n 0 / /
ogy chromiu discharg
ter ed Standard
(Yanche m ed
recycled GB
ng) Co.,
21900-
Ltd.
2008
Atmosp
heric
Ri Ming
Treatme Pollutant
Compute
nt Compre
r
Air standard hensive
Accessor Building
pollutant Oil mist s, high- 63 0.2 Emissio 0.213 / /
y roof
s altitude n
(Shangh
emission Standard
ai) Co.,
s (DB31_
Ltd.
933-
2015)
Ri Ming Air Treatme Atmosp
Particula 6 Building 2.7 0.845 / /
Compute pollutant nt heric
105
Luxshare Precision Industry Co., Ltd. Annual Report 2022
r s te matter standard roof Pollutant
Accessor s, high- Compre
y altitude hensive
(Shangh emission Emissio
ai) Co., s n
Ltd. Standard
(DB31_
933-
2015)
Atmosp
heric
Ri Ming
Treatme Pollutant
Compute
nt Compre
r
Air standard hensive
Accessor Building
pollutant VOC s, high- 3 3.7 Emissio 0.037 / /
y roof
s altitude n
(Shangh
emission Standard
ai) Co.,
s (DB31_
Ltd.
933-
2015)
Atmosp
heric
Ri Ming
Treatme Pollutant
Compute
nt Compre
r
Air standard hensive
Accessor Lampbla Building
pollutant s, high- 1 0.6 Emissio 0.004 / /
y ck roof
s altitude n
(Shangh
emission Standard
ai) Co.,
s (DB31_
Ltd.
933-
2015)
Sewage
Ri Ming
Compre
Compute
hensive
r Sewage
Water Controll Emissio
Accessor station
pollutant PH value ed 1 7.4 n / / /
y main
s emission Standard
(Shangh outlet
(DB31-
ai) Co.,
199-
Ltd.
2018)
Sewage
Ri Ming
Compre
Compute
hensive
r Sewage
Water Suspend Controll Emissio
Accessor station
pollutant ed ed 1 15 n 5.895 / /
y main
s matter emission Standard
(Shangh outlet
(DB31-
ai) Co.,
199-
Ltd.
2018)
Ri Ming Sewage
Compute Compre
Sewage
r Water Controll hensive
Petroleu station
Accessor pollutant ed 1 0.54 Emissio 0.124 / /
m main
y s emission n
outlet
(Shangh Standard
ai) Co., (DB31-
106
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Ltd. 199-
2018)
Sewage
Ri Ming
Compre
Compute
hensive
r Sewage
Water Controll Emissio
Accessor station
pollutant COD ed 1 49 n 18.69 33.842 /
y main
s emission Standard
(Shangh outlet
(DB31-
ai) Co.,
199-
Ltd.
2018)
Sewage
Ri Ming
Compre
Compute
hensive
r Sewage
Water Ammoni Controll Emissio
Accessor station
pollutant a ed 1 2.13 n 0.233 1.0527 /
y main
s nitrogen emission Standard
(Shangh outlet
(DB31-
ai) Co.,
199-
Ltd.
2018)
Sewage
Ri Ming
Compre
Compute
hensive
r Sewage
Water Anionic Controll Emissio
Accessor station
pollutant surfactan ed 1 0.07 n 0.009 / /
y main
s t emission Standard
(Shangh outlet
(DB31-
ai) Co.,
199-
Ltd.
2018)
Sewage
Ri Ming
Compre
Compute
hensive
r Sewage
Water Total Controll Emissio
Accessor station
pollutant phospho ed 1 0.42 n 0.14 / /
y main
s rus emission Standard
(Shangh outlet
(DB31-
ai) Co.,
199-
Ltd.
2018)
Sewage
Ri Ming
Compre
Compute
hensive
r Sewage
Water Controll Emissio
Accessor Total station
pollutant ed 1 3.1 n 1.358 5.25 /
y nitrogen main
s emission Standard
(Shangh outlet
(DB31-
ai) Co.,
199-
Ltd.
2018)
Ri Ming Sewage
Compute Compre
r Sewage hensive
Water Controll
Accessor station Emissio
pollutant BOD5 ed 1 31.6 5.772 / /
y main n
s emission
(Shangh outlet Standard
ai) Co., (DB31-
Ltd. 199-
107
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2018)
Rida
Electropl
Intellige Treatme
ating
nt nt
Pollutant
Manufac Air standard
NOx Emissio
ture pollutant s, high- 2 A2/A14 0 0 11.987 /
(anode) n
Technol s altitude
Standard
ogy emission
(GB219
(Rugao) s
00-2008)
Co., Ltd.
Rida
Intellige Treatme
(Tong
nt nt
A2/A14/ Zheng
Manufac Air standard
NOx Waste Ban)
ture pollutant s, high- 3 26 1.838 11.987 /
(Boiler) treatmen {2020
Technol s altitude
t station } No.
ogy emission
34 号
(Rugao) s
Co., Ltd.
Boiler
Rida
Atmosp
Intellige Treatme
heric
nt nt
A2/A14 Pollutant
Manufac Air Particula standard
/Waste Emissio
ture pollutant te matter s, high- 3 1.9 0.147 8.698 /
treatmen n
Technol s (boiler) altitude
t station Standard
ogy emission
(GB132
(Rugao) s
71-2014)
Co., Ltd.
Table 3
Boiler
Rida
Atmosp
Intellige Treatme
heric
nt nt
A2/A14/ Pollutant
Manufac Air standard
SO2(Boi Waste Emissio
ture pollutant s, high- 1 0 0 4.854 /
ler) treatmen n
Technol s altitude
t station Standard
ogy emission
(GB132
(Rugao) s
71-2014)
Co., Ltd.
Table 3
A2/A3/
Atmosp
Rida A14/A1
heric
Intellige Treatme 5/A16/A
Pollutant
nt nt 17/Wast
Compre
Manufac Air standard e
Particula hensive
ture pollutant s, high- 22 treatmen 2.1 4.78 8.698 /
te matter Emissio
Technol s altitude t station
n
ogy emission and
Standard
(Rugao) s hazardou
(GB315
Co., Ltd. s waste
72-2015)
bin
Rida Treatme A1/A2/ Atmosp
Total
Intellige nt A3/A14/ heric
Air non-
nt standard A16/A1 Pollutant
pollutant methane 18 1.11 5.58 8.948 /
Manufac s, high- 7/Waste Compre
s hydrocar
ture altitude treatmen hensive
bons
Technol emission t station Emissio
108
Luxshare Precision Industry Co., Ltd. Annual Report 2022
ogy s and n
(Rugao) hazardou Standard
Co., Ltd. s waste (GB315
bin 72-2015)
Rida
Intellige Treatme Odor
Waste
nt nt Pollutant
treatmen
Manufac Air standard Emissio
Ammoni t station/
ture pollutant s, high- 2 0.27 n 0.25 0.388 /
a hazardou
Technol s altitude Standard
s waste
ogy emission (GB145
bin
(Rugao) s 54-93)
Co., Ltd.
Rida
Atmosp
Intellige Treatme
heric
nt nt
Pollutant
Manufac Air standard Waste
Caustic Emissio
ture pollutant s, high- 1 treatmen 0.6 0.067 0.099 /
fog n
Technol s altitude t station
Standard
ogy emission
(DB31/9
(Rugao) s
33-2015)
Co., Ltd.
Rida
Electropl
Intellige Treatme A2/A14/
ating
nt nt Waste
Pollutant
Manufac Air standard treatmen
Sulfuric Emissio
ture pollutant s, high- 4 t station/ 0.25 0.331 0.508 /
acid fog n
Technol s altitude hazardou
Standard
ogy emission s waste
(GB219
(Rugao) s bin
00-2008)
Co., Ltd.
Rida
Air
Intellige Treatme
pollutant
nt nt
Nickel s
Manufac Air standard
and its Emissio
ture pollutant s, high- 2 A2/A14 0.006 0.002 0.00463 /
compou n
Technol s altitude
nds Standard
ogy emission
(GB315
(Rugao) s
72-2015)
Co., Ltd.
Atmosp
Rida
heric
Intellige Treatme
Pollutant
nt nt
Compre
Manufac Air standard
Benzene hensive
ture pollutant s, high- 2 A1 0.068 0.003 0.034 /
series Emissio
Technol s altitude
n
ogy emission
Standard
(Rugao) s
(GB315
Co., Ltd.
72-2015)
Rida Treatme Atmosp
Intellige nt heric
Air Phospho
nt standard Pollutant
pollutant ric acid 2 A2/A14 0 0 / /
Manufac s, high- Compre
s fog
ture altitude hensive
Technol emission Emissio
109
Luxshare Precision Industry Co., Ltd. Annual Report 2022
ogy s n
(Rugao) Standard
Co., Ltd. (DB31/9
33-2015)
Electropl
ating
Pollutant
Emissio
n
Standard
(GB219
00-2008)
Table 3
Standard
, Sewage
Compre
hensive
Emissio
n
Standard
GB8978
Rida -1996
Intellige Table 4
nt Level
Sewage
Manufac Water Controll Three
station
ture pollutant PH ed 1 7.1 Standard / / /
main
Technol s emission ,
outlet
ogy Require
(Rugao) ments
Co., Ltd. for
Takeove
r by
Fugang
Water
Treatme
nt Co.,
Ltd.,
Electropl
ating
Pollutant
Emissio
n
Standard
GB2190
0-2008
Table 3
Standard
Electropl
Rida
ating
Intellige
Pollutant
nt
Sewage Emissio
Manufac Water Suspend Controll
station n
ture pollutant ed ed 1 16 4.659 19.791 /
main Standard
Technol s matter emission
outlet (GB219
ogy
00-2008)
(Rugao)
Table 3
Co., Ltd.
Standard
110
Luxshare Precision Industry Co., Ltd. Annual Report 2022
, Sewage
Compre
hensive
Emissio
n
Standard
GB8978
-1996
Table 4
Level
Three
Standard
,
Require
ments
for
Takeove
r by
Fugang
Water
Treatme
nt Co.,
Ltd.,
Electropl
ating
Pollutant
Emissio
n
Standard
GB2190
0-2008
Table 3
Standard
Electropl
ating
Pollutant
Emissio
n
Standard
(GB219
00-2008)
Rida
Table 3
Intellige
Standard
nt
Sewage , Sewage
Manufac Water Chemica Controll
station Compre
ture pollutant l oxygen ed 1 47 7.598 98.956 /
main hensive
Technol s demand emission
outlet Emissio
ogy
n
(Rugao)
Standard
Co., Ltd.
GB8978
-1996
Table 4
Level
Three
Standard
,
Require
111
Luxshare Precision Industry Co., Ltd. Annual Report 2022
ments
for
Takeove
r by
Fugang
Water
Treatme
nt Co.,
Ltd.,
Electropl
ating
Pollutant
Emissio
n
Standard
GB2190
0-2008
Table 3
Standard
Electropl
ating
Pollutant
Emissio
n
Standard
(GB219
00-2008)
Table 3
Standard
, Sewage
Compre
hensive
Emissio
n
Rida
Standard
Intellige
GB8978
nt
Sewage -1996
Manufac Water Ammoni Controll
station Table 4
ture pollutant a ed 1 0.503 0.790 9.896 /
main Level
Technol s nitrogen emission
outlet Three
ogy
Standard
(Rugao)
,
Co., Ltd.
Require
ments
for
Takeove
r by
Fugang
Water
Treatme
nt Co.,
Ltd.,
Electropl
ating
Pollutant
Emissio
n
112
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Standard
GB2190
0-2008
Table 3
Standard
Electropl
ating
Pollutant
Emissio
n
Standard
(GB219
00-2008)
Table 3
Standard
, Sewage
Compre
hensive
Emissio
n
Standard
GB8978
Rida -1996
Intellige Table 4
nt Level
Sewage
Manufac Water Total Controll Three
station
ture pollutant phospho ed 1 0.53 Standard 0.156 0.990 /
main
Technol s rus emission ,
outlet
ogy Require
(Rugao) ments
Co., Ltd. for
Takeove
r by
Fugang
Water
Treatme
nt Co.,
Ltd.,
Electropl
ating
Pollutant
Emissio
n
Standard
GB2190
0-2008
Table 3
Standard
Rida Electropl
Intellige ating
nt Pollutant
Sewage
Manufac Water Controll Emissio
Total station
ture pollutant ed 1 27.6 n 7.573 29.687 /
nitrogen main
Technol s emission Standard
outlet
ogy (GB219
(Rugao) 00-2008)
Co., Ltd. Table 3
113
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Standard
, Sewage
Compre
hensive
Emissio
n
Standard
GB8978
-1996
Table 4
Level
Three
Standard
,
Require
ments
for
Takeove
r by
Fugang
Water
Treatme
nt Co.,
Ltd.,
Electropl
ating
Pollutant
Emissio
n
Standard
GB2190
0-2008
Table 3
Standard
Electropl
ating
Pollutant
Emissio
n
Standard
(GB219
Rida 00-2008)
Intellige Table 3
nt Standard
Biochem Sewage
Manufac Water Controll , Sewage
ical station
ture pollutant ed 1 15 Compre 1.961 19.791 /
oxygen main
Technol s emission hensive
demand outlet
ogy Emissio
(Rugao) n
Co., Ltd. Standard
GB8978
-1996
Table 4
Level
Three
Standard
,
114
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Require
ments
for
Takeove
r by
Fugang
Water
Treatme
nt Co.,
Ltd.,
Electropl
ating
Pollutant
Emissio
n
Standard
GB2190
0-2008
Table 3
Standard
Electropl
ating
Pollutant
Emissio
n
Standard
(GB219
00-2008)
Table 3
Standard
, Sewage
Compre
hensive
Emissio
Rida n
Intellige Standard
nt GB8978
Sewage
Manufac Water Total Controll -1996
station
ture pollutant aluminu ed 1 1.25 Table 4 0.161 0.297 /
main
Technol s m emission Level
outlet
ogy Three
(Rugao) Standard
Co., Ltd. ,
Require
ments
for
Takeove
r by
Fugang
Water
Treatme
nt Co.,
Ltd.,
Electropl
ating
Pollutant
Emissio
115
Luxshare Precision Industry Co., Ltd. Annual Report 2022
n
Standard
GB2190
0-2008
Table 3
Standard
Atmosp
heric
Ri Shan Treatme Pollutant
Compute nt Compre
r Air standard hensive
Sulfuric Building
Accessor pollutant s, high- 8 1.09 Emissio 2.1764 / /
acid fog roof
y s altitude n
(Jiashan) emission Standard
Co., Ltd. s (DB32/4
041-
2021)
Electropl
Ri Shan Treatme
ating
Compute nt
Pollutant
r Air standard
Building Emissio
Accessor pollutant NOx s, high- 8 0.164 0.8186 0.903 /
roof n
y s altitude
Standard
(Jiashan) emission
(GB219
Co., Ltd. s
00-2008)
Atmosp
heric
Pollutant
Compre
hensive
Emissio
n
Ri Shan Treatme Standard
Compute nt (DB32/4
r Air standard 041-
Particula Building
Accessor pollutant s, high- 9 12.8 2021) 5.00661 10.595 /
te matter roof
y s altitude Syntheti
(Jiashan) emission c Resin
Co., Ltd. s Industry
Pollutant
Emissio
n
Standard
(GB
31572-
2015)
Atmosp
heric
Ri Shan Treatme
Pollutant
Compute nt
Compre
r Air standard
Building hensive
Accessor pollutant VOCs s, high- 21 2.54 3.28968 14.5972 /
roof Emissio
y s altitude
n
(Jiashan) emission
Standard
Co., Ltd. s
(DB32/4
041-
116
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2021)
Syntheti
c Resin
Industry
Pollutant
Emissio
n
Standard
(GB
31572-
2015)
Electroni
c
Ri Shan Industry
Compute Water
Sewage
r Water Ammoni Controll Pollutant
station
Accessor pollutant a ed 1 0.506 Emissio 2.896 49.04 /
main
y s nitrogen emission n
outlet
(Jiashan) Standard
Co., Ltd. (GB
39731-
2020)
Electroni
c
Ri Shan Industry
Compute Water
Sewage
r Water Total Controll Pollutant
station
Accessor pollutant phospho ed 1 0.105 Emissio 0.89 / /
main
y s rus emission n
outlet
(Jiashan) Standard
Co., Ltd. (GB
39731-
2020)
Electroni
c
Ri Shan Industry
Compute Water
Sewage
r Water Controll Pollutant
Total station
Accessor pollutant ed 1 35.567 Emissio 34.421 / /
nitrogen main
y s emission n
outlet
(Jiashan) Standard
Co., Ltd. (GB
39731-
2020)
Electroni
c
Ri Shan Industry
Compute Water
Sewage
r Water Anionic Controll Pollutant
station
Accessor pollutant surfactan ed 1 0.4988 Emissio 0.18 / /
main
y s t emission n
outlet
(Jiashan) Standard
Co., Ltd. (GB
39731-
2020)
Ri Shan Water Chemica Controll 1 Sewage 28 Electroni 49.717 112.172 /
117
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Compute pollutant l oxygen ed station c
r s demand emission main Industry
Accessor outlet Water
y Pollutant
(Jiashan) Emissio
Co., Ltd. n
Standard
(GB
39731-
2020)
Electroni
c
Ri Shan Industry
Compute Water
Sewage
r Water Controll Pollutant
station
Accessor pollutant PH value ed 1 7.4 Emissio / / /
main
y s emission n
outlet
(Jiashan) Standard
Co., Ltd. (GB
39731-
2020)
Electroni
c
Ri Shan Industry
Compute Water
Sewage
r Water Suspend Controll Pollutant
station
Accessor pollutant ed ed 1 15.5 Emissio 18.953 / /
main
y s matter emission n
outlet
(Jiashan) Standard
Co., Ltd. (GB
39731-
2020)
Electroni
c
Ri Shan Industry
Compute Water
Sewage
r Water Controll Pollutant
Petroleu station
Accessor pollutant ed 1 0.39 Emissio 0.775 / /
m main
y s emission n
outlet
(Jiashan) Standard
Co., Ltd. (GB
39731-
2020)
Electropl
Ri Shan ating
Compute Pollutant
Heavy Hexaval Sewage
r Controll Emissio
metal ent station
Accessor ed 1 0.011 n 0.0041 / /
wastewa chromiu main
y emission Standard
ter m outlet
(Jiashan) GB
Co., Ltd. 21900-
2008
Ri Shan Heavy Sewage Electropl
Controll
Compute metal Total station ating
ed 1 0.025 0.001 0.02 /
r wastewa nickel main Pollutant
emission
Accessor ter outlet Emissio
118
Luxshare Precision Industry Co., Ltd. Annual Report 2022
y n
(Jiashan) Standard
Co., Ltd. GB
21900-
2008
Electropl
Ri Shan ating
Compute Pollutant
Heavy Sewage
r Total Controll Emissio
metal station
Accessor chromiu ed 1 0.037 n 0.005 0.026 /
wastewa main
y m emission Standard
ter outlet
(Jiashan) GB
Co., Ltd. 21900-
2008
Luxcase
Precisio Centraliz Factory Urban
n ed F8/9 - 1 Sewage
Technol Domesti disposal unit, Treatme
Sewage 2 / 5688t/a 25753t/a /
ogy c sewage of Factory nt Plant
(Kunsha emission F10/11 - Pollutant
n) Co., s 1 unit Standard
Ltd.
Tin paste
printing,
cleaning,
reflow
Luxcase solderin
Precisio g, 1 unit in
Collect,
n dispensi Factory
dispose DB/32/4
Technol Waste ng, F9 and 4 0.2736t/ 0.30042t
and then 9 / 041- /
ogy gas curing, units in a /a
discharg 2021
(Kunsha maintena Factory
e
n) Co., nce F10/11
Ltd. cleaning,
laser
engravin
g,
cutting
Luxcase
Dispensi
Precisio
ng Sound
n
machine, insulatio
Technol GB1234
Nose laser n, shock / / / / / /
ogy 8-2008
engravin absorpti
(Kunsha
g on
n) Co.,
machine
Ltd.
Packagin
Luxcase g, raw The
Precisio material collectio
n packagin n is
Technol Solid g, entrusted GB1859
/ / / 51.5t/a / /
ogy waste cleaning, to a 7-2023
(Kunsha sanitatio qualified
n) Co., n, tin unit for
Ltd. paste disposal
printing,
119
Luxshare Precision Industry Co., Ltd. Annual Report 2022
dispensi
ng,
cutting,
testing,
exhaust
gas
treatmen
t, staff
domestic
waste
Treatment of pollutants
I. Luxcase Precision Technology (Yancheng) Co., Ltd.
1. Prevention measures for exhaust gas pollution:
Exhaust gas from CNC machining is treated by oil mist scrubber through oil mist absorption; exhaust gas from
glue coating, dispensing, and printing is treated through secondary activated carbon adsorption. According to routine
monitoring reports of existing projects, the removal rate of CNC machining exhaust gas after treatment by oil mist
scrubber can reach over 85%.
According to the secondary adsorption activated carbon manual, with respect to the adsorption capacity of
activated carbon for various organic substances in the printing and dispensing exhaust gas, the removal efficiency
of organic substances is 70% for primary activated carbon particle adsorption and 90% for secondary activated
carbon particle adsorption, which can meet the relevant requirements of Level 2 of non-methane hydrocarbons in
the Integrated Emission Standard of Air Pollutants (DB32/4041-2021);
Dust generated from sandblasting, drilling, and laser engraving is treated by wet dust collector after collection.
The emission concentration and emission rate of dust generated from sandblasting, drilling, and laser engraving can
meet the corresponding limits provided in the Integrated Emission Standard of Air Pollutants (DB32/4041-2021).
According to the Industrial Source Coefficient Handbook for the Second National Pollution Source Census as the
mechanical industry coefficient handbook - pre-treatment - dry pre-treatment - shot blasting, dust can be removed
by the single tube (multi-tube parallel) cyclone device with a removal efficiency of 60%. Then after wet dust
collector treatment, the removal efficiency can reach over 90%. Based on the actual operation of the project, the
removal efficiency of sandblasting dust after treatment by its own dust collector and then by wet dust collector can
reach over 90%, and the removal efficiency of drilling and laser engraving dust is around 85%. Therefore, the said
company’s dust, after treatment by wet dust collector, can be discharged in steady compliance with standards.
Natural gas boilers use domestically advanced low-nitrogen combustion technology, which is a feasible
technology for the Technical Specification for Application and Issuance of Pollutant Discharge Permits - Boilers.
According to routine monitoring data of existing projects and low-nitrogen combustion retrofitting and
commissioning reports, the SO2, NOx, and particulate matter in boiler flue gas can meet the corresponding limits
120
Luxshare Precision Industry Co., Ltd. Annual Report 2022
of the Emission Standard of Boiler Air Pollutants (DB32/4385-2022).
2. Prevention measures for wastewater pollution:
The said company implements the principle of “separation of rainwater and sewage, and separation of clean
water and polluted water”. Different kinds of wastewater enter the corresponding sewage pool through different
pipes. The pipes are overhead and pasted with signs of flow direction. The completeness of the pipes is checked
regularly, and any abnormality, if found, will be handled immediately. All pools and floors of the sewage station are
paved and hardened for anti seepage and anti corrosion. Domestic wastewater is treated using a two-stage septic
tank system. The two-stage septic tank is composed of two interconnected sealed septic tanks. Feces enter the first
tank through an inlet pipe and flow downstream to the second tank, where suspended organic matter in domestic
wastewater is removed by sedimentation and anaerobic fermentation. This treatment facility is a primary transitional
domestic treatment structure. Comprehensive wastewater is degraded in the A/O biochemical system to remove
organic pollutants such as COD, nitrogen, and phosphorus. The system’s denitrification capacity is strengthened
through a two-stage biochemical system, and the treated wastewater is discharged to the sewage treatment plant.
According to existing testing reports, the quality of the said company’s effluent meets the relevant standards for the
sewage station. Heavy metal wastewater is treated and reused through a process of “sterilization + membrane
treatment + evaporation and crystallization + ion exchange." The main process remains unchanged. The
concentrated water of low-concentration wastewater is subject to ultrafiltration, sand filtration, and reverse osmosis,
while high-concentration wastewater is subject to sedimentation and pressure filtration before entering PFET
evaporation, and then the purified water is reused in the anodizing process.
3. Measures for noise pollution prevention:
The outdoor equipment, equipment near the plant boundary and cooling towers are environmentally friendly.
In the layout plan of the plant, the main workshop with concentrated noise is located in the center of the plant as
much as possible. Other noise sources are located as far away from the plant boundary as possible to reduce their
impact on the external environment. Soundproof windows (or double-layer soundproof windows) and soundproof
doors are installed on the side of the workshop adjacent to the plant boundary to reduce the impact of workshop
noise on the external environment by enhancing sound insulation and reducing the strength of the noise source.
Vertical greening belts are planted within the plant area to effectively provide certain sound insulation and noise
reduction.
4. Prevention measures for hazardous waste pollution:
Hazardous waste warehouses, domestic waste rooms, and solid waste garbage rooms are set up in the plant to
comprehensively manage solid waste from various aspects such as generation, collection, storage, transportation,
and disposal. Effective measures are taken to prevent the loss of solid waste in the process of generation, collection,
storage, and transportation, and the “three defenses” are implemented. Effective disposal methods and technologies
are adopted, and by focusing on the reuse of useful materials to “turn waste into treasure’, we recycle a part of the
121
Luxshare Precision Industry Co., Ltd. Annual Report 2022
resources and reduce the disposal burden. For those waste materials that cannot be recycled yet, we effectively
dispose of them in light of the principle of “harmlessness”.
II. Ri Ming Computer Accessory (Shanghai) Co., Ltd.
1. Prevention measures for exhaust gas pollution:
(1) A closed operation room is set up for the CNC machining process. All oil mist generated therefrom is treated
through a cyclone tower oil mist washing tower and discharged through a 17-meter-high exhaust duct. The oil mist
in the discharged exhaust gas meets the emission limits for air pollutants provided in the Integrated Emission
Standard of Air Pollutants (DB31/933-2015); according to routine monitoring reports of existing projects, the
removal rate of CNC machining exhaust gas after treatment by oil mist scrubber can reach over 85%.
(2) A closed operation room is set up for the laser engraving process. All dust generated therefrom is treated
through a wet dust collector and then discharged through a 22-meter-high exhaust duct. The removal efficiency can
reach more than 75%, and the particulate matter in the discharged waste gas meets the emission limits for air
pollutants provided in the Integrated Emission Standard of Air Pollutants (DB31/933-2015);
(3) All waste gas generated in the dispensing and coating process is collected and treated through an activated
carbon purification box, and then discharged through a 17-meter-high exhaust duct. The removal efficiency can
reach more than 90%, and the pollutants in the discharged waste gas meet the emission limits for air pollutants in
the Integrated Emission Standard of Air Pollutants (DB31/933-2015).
2. Prevention measures for wastewater pollution:
The said company implements the principle of “separation of rainwater and sewage, and separation of clean
water and polluted water”. Different kinds of wastewater enter the corresponding sewage pool through different
pipes. The pipes are overhead and pasted with signs of flow direction. The completeness of the pipes is checked
regularly, and any abnormality, if found, will be handled immediately. All pools and floors of the sewage station are
paved and hardened for anti seepage and anti corrosion. After comprehensive wastewater is treated through
emulsion breaking, precipitation, and biochemical treatment, it is discharged through the same pipeline as the tail-
water from pure water preparation and domestic wastewater. Some tail-water from pure water preparation is reused
as domestic facility water, and the intermediate water after treated in the sewage treatment station is reused in the
wet polishing process. The wastewater discharge outlet is equipped with online monitoring equipment and
connected to the Environmental Protection Bureau and Water Affairs Bureau. According to existing testing reports,
the quality of the said company’s effluent meets the relevant standards for the sewage station.
3. Measures for noise pollution prevention:
The outdoor equipment, equipment near the plant boundary and cooling towers are environmentally friendly.
In the layout plan of the plant, the main workshop with concentrated noise is located in the center of the plant as
much as possible. Other noise sources are located as far away from the plant boundary as possible to reduce their
impact on the external environment. Soundproof windows (or double-layer soundproof windows) and soundproof
122
Luxshare Precision Industry Co., Ltd. Annual Report 2022
doors are installed on the side of the workshop adjacent to the plant boundary to reduce the impact of workshop
noise on the external environment by enhancing sound insulation and reducing the strength of the noise source.
Vertical greening belts are planted within the plant area to effectively provide certain sound insulation and noise
reduction.
4. Prevention measures for hazardous waste pollution:
Hazardous waste warehouses, domestic waste rooms, and solid waste garbage rooms are set up within the plant
area to comprehensively manage solid waste from various aspects such as generation, collection, storage,
transportation, and disposal. Effective measures are taken to prevent the loss of solid waste in the process of
generation, collection, storage, and transportation, and the “three defenses” are implemented. Effective disposal
methods and technologies are adopted, and by focusing on the reuse of useful materials to “turn waste into treasure’,
we recycle a part of the resources and reduce the disposal burden. For those waste materials that cannot be recycled
yet, we effectively dispose of them in light of the principle of “harmlessness”.
III. Rida Intelligent Manufacture Technology (Rugao) Co., Ltd.
1. Prevention measures for exhaust gas pollution:
I, For the cutting fluid evaporates organic gases (measured in non-methane hydrocarbons) due to high-
temperature cutting in the CNC machining process of this project, the organic waste gas is collected by the overall
workshop negative pressure system after being treated by an oil mist separator that is equipped with the equipment,
and treated through filtration and absorption by activated carbon, and is then discharged in an organized manner
through an exhaust pipe. The removal rate of non-methane hydrocarbons is conservatively estimated to be 75%. For
the non-methane hydrocarbons generated in processes such as injection molding, gluing, and drying, this project
adopts a treatment measure of “filtration + activated carbon adsorption." For organic waste gases (measured as non-
methane hydrocarbons) generated in gluing and drying processes, they are planned to be collected by a gas-
collecting hood and then treated by the “filtration + activated carbon adsorption” process before being discharged
in an organized manner. For organic waste gases (measured as particulate matter) generated in spraying and drying
processes, they are planned to be collected by a gas-collecting hood and then treated by the “filtration + activated
carbon adsorption” process before being discharged in an organized manner. Particulate matter is mainly generated
in the sandblasting process, and a two-stage wet dust removal treatment measure is adopted. Through the wet dust
removal technology, the dust particles are removed by being condensed into large particles through strong collision
with water mist, or being captured by inertia and centrifugal force. By taking two-stage wet dust removal measure
in this project, a removal efficiency of particulate matter is about 80%. Two-stage alkaline spraying is used for acid
and alkali waste gas in this project. According to the provided waste gas treatment design plan, this system has a
removal efficiency of about 95% for sulfuric acid mist and phosphoric acid mist, and an 85% removal efficiency
for nitrogen oxides, and ensures that the waste gas meets the emission standards. The sewage station waste gas in
this project includes particulate matter, ammonia, hydrogen sulfide, non-methane hydrocarbons produced in sewage
123
Luxshare Precision Industry Co., Ltd. Annual Report 2022
treatment, as well as sulfuric acid mist, alkaline mist, and non-methane hydrocarbons produced in the tank storage
area. After being collected, the waste gas from the storage tank and sewage treatment is treated by “alkali washing
+ water washing + defogging + microwave UV catalysis” before being discharged together with the drying dust
generated by the “bag filter” treatment. In accordance with the Notice of the Nantong Municipal Government Office
on Issuing the 2020 Air Pollution Prevention and Control Work Plan (Tong Zheng Ban Fa [2020] No. 34), the low-
nitrogen transformation task of gas-fired boilers has been fully completed, with the emission concentrations of
nitrogen oxides not exceeding 50 milligrams per cubic meter. Based on the monitoring data of the boiler running at
about 80% load inside the plant, the nitrogen oxide emissions can meet the requirements of the Document (Tong
Zheng Ban Fa) [2020] No. 34, with an emission concentration not exceeding 50 milligrams/cubic meter.
2. Prevention measures for wastewater pollution:
The wastewater generated by this project include process wastewater, wastewater from waste gas treatment,
wastewater from workshop and plant floor washing, concentrated wastewater and backwash wastewater, emissions
from gas-fired boilers, wastewater from circulating cooling systems, initial rainwater, and domestic wastewater. The
system at the wastewater treatment station is mainly divided into five categories: chromium-containing wastewater
treatment system, nickel-containing wastewater treatment system, phosphorus-containing wastewater treatment
system, organic wastewater treatment system, and general wastewater treatment system.
The condensate from chromium-containing wastewater, after undergoing “reduced pressure evaporation”
treatment, is treated with the chromium-containing wastewater through “chemical precipitation + sand and charcoal
filtration + ultrafiltration + ion exchange + two-stage reverse osmosis (RO)” before being reused. The condensate
from nickel-containing wastewater, after undergoing “reduced pressure evaporation” treatment, is treated with the
nickel-containing wastewater through “chemical precipitation + sand and charcoal filtration + ultrafiltration + ion
exchange + two-stage RO” before being reused. The condensate from phosphorus-containing wastewater, after
undergoing “two-stage coagulation and sedimentation + pressure filtration” treatment, is treated with phosphorus-
containing wastewater and wastewater from phosphorus-containing air pollution control through “two-stage
reaction and precipitation” treatment before being discharged into the receiving pool. Wastewater containing oil and
compressor wastewater are pre-treated with “acidification, breaking emulsion, and oil-water separation”, and then,
together with acidic wastewater and other wastewater from exhaust gas treatment, undergo “acidification, breaking
emulsion, flotation, Fenton oxidation, and coagulation and sedimentation” treatment. Then, together with organic
wastewater/liquid, they undergo “coagulation and sedimentation + catalytic oxidation” treatment, and finally,
together with alkaline wastewater/liquid that has been pre-treated with “coagulation and sedimentation”, plant floor
washing wastewater, and initial rainwater, they undergo “hydrolysis, acidification, precipitation + anaerobic and
aerobic treatment + two-stage sedimentation tank” treatment before being discharged into the receiving pool.
General cleaning wastewater, grinding wastewater, and wastewater from pure water preparation are treated with
“coagulation and sedimentation + sand and charcoal filtration + ultrafiltration” before being reused.
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3. Measures for noise pollution prevention:
When purchasing equipment, it selects equipment with small power and low noise as much as possible; use
vibration reduction mounts to weaken the vibration generated when the fan rotates; sets the sound source indoors
as much as possible to achieve sound insulation and noise reduction. It uses double-layer soundproof windows for
lighting windows in workshops with high noise equipment; arrange the main noise sources in the overall layout in
the middle of the workshop, away from the plant boundary, and add soundproof covers to equipment such as fans;
equip the high-power equipment with special vibration reduction and noise reduction equipment when purchasing
it; and strengthen the greening of the factory area and establish a green isolation belt. In addition, it plants trees and
shrubs to create a green noise barrier around the factory boundary, absorbing sound and reducing noise.
4. Prevention measures for hazardous waste pollution:
It sets up a hazardous waste warehouse within the plant; establish a hazardous waste ledger management system
to track and record the entire process of hazardous waste circulation within the said company, combine it with
production records to establish a hazardous waste ledger; set up hazardous waste identification signs for the
containers and packaging of hazardous waste, as well as for the facilities and places for collecting, storing,
transporting, and disposing of hazardous waste; it is forbidden to collect, store, transport, or dispose of hazardous
waste mixed with incompatible substances that have not been disposed of safely, and it is forbidden to mix hazardous
waste into non-hazardous waste for storage and disposal.
IV. Ri Shan Computer Accessory (Jiashan) Co., Ltd.
1. Prevention measures for exhaust gas pollution:
It uses the electrostatic oil removal to absorb and treat oil mist of the exhaust gas from CNC machining, and
uses secondary activated carbon adsorption to treat exhaust gas from dispensing and injection molding. According
to routine monitoring reports of existing projects, the removal efficiency of electrostatic oil removal equipment for
CNC machining can reach more than 85%; sulfuric acid mist and nitric acid mist are treated with an alkali spray
tower after being collected, and are only discharged after meeting the emission standards.
According to the secondary adsorption activated carbon manual, with respect to the adsorption capacity of
activated carbon for various organic substances in the dispensing exhaust gas, the removal efficiency of organic
substances is 70% for primary activated carbon particle adsorption and 90% for secondary activated carbon particle
adsorption, which can meet the relevant requirements of Level 2 of non-methane hydrocarbons in the Integrated
Emission Standard of Air Pollutants (GB16297-1996);
The exhaust gases from sandblasting and grinding machines are collected and treated using wet scrubbers. The
emission concentrations and rates of particulate matter from sandblasting and grinding dust meet the corresponding
standard limits specified in Table 2 of the Comprehensive Emission Standards for Air Pollutants (GB16297-1996)
and the relevant standards for particulate matter specified in Table 5 of the Emission Standards for Pollutants in
Synthetic Resin Industry (GB31572-2015).
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2. Prevention measures for wastewater pollution:
The said company implements the principle of “separation of rainwater and sewage, and separation of clean
water and polluted water”. Different kinds of wastewater enter the corresponding sewage pool through different
pipes. The pipes are overhead and pasted with signs of flow direction. The completeness of the pipes is checked
regularly, and any abnormality, if found, will be handled immediately. All pools and floors of the sewage station are
paved and hardened for anti seepage and anti corrosion. Domestic wastewater is treated using a two-stage septic
tank system. The two-stage septic tank is composed of two interconnected sealed septic tanks. Feces enter the first
tank through an inlet pipe and flow downstream to the second tank, where suspended organic matter in domestic
wastewater is removed by sedimentation and anaerobic fermentation. This treatment facility is a primary transitional
domestic treatment structure. Comprehensive wastewater is degraded in the A/O biochemical system to remove
organic pollutants such as COD, nitrogen, and phosphorus. The system’s denitrification capacity is strengthened
through a two-stage biochemical system, and the treated wastewater is discharged to the sewage treatment plant.
According to existing testing reports, the quality of the said company’s effluent meets the relevant standards for the
sewage station. Heavy metal wastewater is treated and reused through a process of “sterilization + membrane
treatment + evaporation and crystallization + ion exchange." The main process remains unchanged. The
concentrated water of low-concentration wastewater is subject to ultrafiltration, sand filtration, and reverse osmosis,
while high-concentration wastewater is subject to sedimentation and pressure filtration before entering PFET
evaporation, and then the purified water is reused in the anodizing process.
3. Measures for noise pollution prevention:
The outdoor equipment, equipment near the plant boundary and cooling towers are environmentally friendly.
In the layout plan of the plant, the main workshop with concentrated noise is located in the center of the plant area
as much as possible. Other noise sources are located as far away from the plant boundary as possible to reduce their
impact on the external environment. Soundproof windows (or double-layer soundproof windows) and soundproof
doors are installed on the side of the workshop adjacent to the plant boundary to reduce the impact of workshop
noise on the external environment by enhancing sound insulation and reducing the strength of the noise source.
Vertical greening belts are planted within the plant area to effectively provide certain sound insulation and noise
reduction.
4. Prevention measures for hazardous waste pollution:
Hazardous waste warehouses, domestic waste rooms, and solid waste garbage rooms are set up within the plant
area to comprehensively manage solid waste from various aspects such as generation, collection, storage,
transportation, and disposal. Effective measures are taken to prevent the loss of solid waste during the process of
generation, collection, storage, and transportation, and the “three defenses” are implemented. Effective disposal
methods and technologies are adopted, and by focusing on the recycling of useful materials to “turn waste into
treasure’, it recycles a part of the resources and reduce the disposal burden. For those waste materials that cannot
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
be recycled yet, it effectively disposes of them in light of the principle of “harmlessness”.
V. Luxcase Precision Technology (Kunshan) Co., Ltd.
1. Waste water pollution control measures: Discharge into the municipal sewage pipe network for treatment at
Kunsheng Precision Water Purification Co., Ltd. in Kunshan Development Zone.
2. Noise pollution control measures: Use low-noise equipment, and adopt measures such as sound insulation,
vibration reduction, and greening of the factory area to achieve sound insulation and noise reduction.
3. Air pollution control measures: According to the secondary adsorption activated carbon manual, the
adsorption capacity of activated carbon for various organic substances, the removal efficiency of organic matter by
first-stage activated carbon particles is 70%, and the adsorption efficiency of two-stage activated carbon particles is
90%, both of which can meet the relevant requirements of the Secondary Standard for Non-Methane Total
Hydrocarbons in the Comprehensive Emission Standard for Air Pollutants (GB16297-1996).
4. Hazardous waste pollution control measures: Set up hazardous waste warehouses, domestic waste rooms,
and solid waste garbage rooms in the factory area, comprehensively manage solid waste from generation, collection,
storage, transportation, and disposal, take effective measures to prevent the loss of solid waste during the generation,
collection, storage, and transportation process, implement "three defenses", adopt effective disposal schemes and
technologies, focus on recycling useful materials from waste, "turning waste into treasure", recover some resources
while reducing the disposal burden, and for those that cannot be recycled at present, effective disposal should be
carried out following the principle of "harmlessness."
Environmental self-monitoring program
I. Luxcase Precision Technology (Yancheng) Co., Ltd.
It updates and prepares the self-monitoring plan for next year at the end of each year according to the pollution
discharge permit and environmental impact assessment requirements, tests the organized exhaust gas at the emission
outlet once every half a year generally, the unorganized exhaust gas once every half a year, wastewater discharge
outlets once every quarter, and noise once every six months, with the relevant test reports as data compliance support.
II. Ri Ming Computer Accessory (Shanghai) Co., Ltd.
It updates and prepares the self-monitoring plan for next year at the end of each year according to the pollution
discharge permit and environmental impact assessment requirements, tests the organized exhaust gas at the emission
outlet once every half a year generally, the unorganized exhaust gas once every half a year, wastewater discharge
outlets once every month, and noise once every half quarter, with the relevant test reports as data compliance support.
III. Rida Intelligent Manufacture Technology (Rugao) Co., Ltd.
It updates and prepares the self-monitoring plan for next year at the end of each year according to the
environmental impact assessment requirements, tests the organized exhaust gas at the emission outlet once every
quarter, VOC waste gas once every half a year, the unorganized exhaust gas once every half a year, wastewater
discharge outlets once every month, and noise once every quarter, with the relevant test reports as data compliance
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
support.
IV. Ri Shan Computer Accessory (Jiashan) Co., Ltd.
It updates and prepares the self-monitoring plan for next year at the end of each year according to the pollution
discharge permit and environmental impact assessment requirements, tests the organized exhaust gas at the emission
outlet once every half a year, the unorganized exhaust gas once every half a year, wastewater discharge outlets once
every quarter, noise once every quarter and rain outlets once every six months, with the relevant test reports as data
compliance support.
V. Luxcase Precision Technology (Kunshan) Co., Ltd.
Sewage
S/N Cate Monitori Monitorin Conventio Executive standard
gory ng content g position nal monitoring
frequency
1 Do COD, Main Once/year Comprehensive Sewage Discharge
mestic SS, NH3-N, discharge Standard
sewage TP outlet of the GB8978-1996 Table 4 Tertiary
factory Standards
Water Quality Standard for Sewage
Discharged into Urban Sewers
GB-T31962-2015 Table Class 1B
Standard
Noise:
Cate Monitori Monitoring Conventional Executive standard
gory ng content position monitoring frequency
Noi Equivale 1 meter Once/quarter Emission Standard for Industrial
se nt continuous outside the Enterprise Noise at Boundary
A sound level boundary GB12348-2008 Class 3 standard
Waste gas:
Category Monitoring Monitoring Conventional Executive
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
location factor monitoring frequency standard
Waste gas Exhaust funnel Non-methane Once/year Jiangsu
DA009 hydrocarbon, tin Integrated
and its compounds Emission
Standard of Air
Pollutants
（ DB32/4041-
2021) Table 1
standards
Enterprise Non-methane Once/year Jiangsu
boundary hydrocarbon, tin Integrated
and its compounds, Emission
and particulate Standard of Air
matter Pollutants
（ DB32/4041-
2021) Table 3
standards
Within the Non-methane Once/year Jiangsu
factory hydrocarbon Integrated
Emission
Standard of Air
Pollutants
（ DB32/4041-
2021) Table 2
standards
Emergency plan for abrupt environmental pollution accidents
I. Luxcase Precision Technology (Yancheng) Co., Ltd.
Luxcase Plant has prepared the Emergency Plan for Abrupt Environmental Pollution Accidents (3rd Edition) in
2022, and has completed the formalities for expert review and filing with the filing No.: 320902-2022-003-H.
II. Ri Ming Computer Accessory (Shanghai) Co., Ltd.
Ri Ming Plant has prepared the Emergency Plan for Abrupt Environmental Pollution Accidents (3rd Edition) in
2022, and has completed the formalities for expert review and filing with the filing No.: 02-310116-2022-060-L.
III. Rida Intelligent Manufacture Technology (Rugao) Co., Ltd.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
Completed in June 2021, with the filing No.: 320682-2021-065-M.
IV. Ri Shan Computer Accessory (Jiashan) Co., Ltd.
Ri Shan Plant has prepared the Emergency Plan for Abrupt Environmental Pollution Accidents (3rd Edition) in
2021, and has completed the formalities for expert review and filing with the filing No.: 320421-2021-105-M.
Investment in environment governance and protection, and payment of environmental protection taxes
I. Luxcase Precision Technology (Yancheng) Co., Ltd.
In 2023, approximately CNY 14.8 million was invested in the operation, maintenance, and upkeep of
environmental protection equipment. Additionally, the total amount of environmental protection tax paid on a
quarterly basis, averaging CNY 19.98 million per month, was reported.
II. Rida Intelligent Manufacture Technology (Rugao) Co., Ltd.
In 2023, approximately CNY 8 million was invested in environmental protection, and the environmental
protection tax paid amounted to CNY 16,167.34.
III. Ri Shan Computer Accessory (Jiashan) Co., Ltd.
In 2023, approximately CNY 30 million was invested in environmental protection equipment, and the total
amount of environmental protection tax paid for quarterly declarations averaged CNY 0.878 million per month.
IV. Luxcase Precision Technology (Kunshan) Co., Ltd.
In 2023, approximately CNY 1 million was invested in environmental management and protection for new
projects, and about CNY 500,000 was invested for expansion projects.
Measures taken to reduce carbon emissions during the reporting period and their effects
Applicable □N/A
I. Luxcase Precision Technology (Yancheng) Co., Ltd.
Reduction in
Improvement Electricity
Program Carbon Emissions
project Saved (kWh)
(tCO2e)
Photovoltaic Power Constructing a photovoltaic station on the 6,261,091 3,898.16
Generation rooftop to generate electricity
Variable Frequency Installing frequency converters to convert 5,136,667 3,198.09
Conversion Retrofit for the operation of original fixed-frequency fans to
Air Conditioning Fans variable frequency
Boiler Pipeline Lowering the boiler pipeline pressure from 10,683,867 6,651.78
Pressure Reduction and 0.75MPa to 0.65MPa
Improvement
II. Ri Ming Computer Accessory (Shanghai) Co., Ltd.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
Improvement Investment Income Improvement
Program
project (RMB0’000) (0’000 kwh) project
Compressed air
Compressed air leakage
leakage 0 25.2 30
improvement
improvement
CNC machine Independent small
centralized pressure transformer of CNC replaced by 24 28.0 35.0
conversion centralized pressure conversion
Conventional adsorption
Replacement of
dryers replaced by zero-loss 0 54.4 68
air compressors
suction dryers
Replacement
Ordinary lamps replaced by
by energy saving 0 3.3 4.1
high-efficiency LED lamps
lamps
III. Rida Intelligent Manufacture Technology (Rugao) Co., Ltd.
Annual Annual
Improvement Investment
Program power savings cost savings
project (RMB0’000)
(kwh) (RMB)
Photovoltaic 1: Photovoltaic electricity Contract 13,252,500 10,071,900
Revenue generation discount revenue, with a energy
15% discount compared to the market management
electricity price:
2: Revenue Method: Long-term
revenue
3: Photovoltaic Phase 1 starts
generating revenue in February of the
23rd year; Phase 2 starts generating
revenue in April; Phase 3 starts
generating revenue in June.
Variable 1: The frequency of the cooling
Frequency water circulation pump for mechanical
0 285,120 216,691
Installation seals at the wastewater station is
Improves Water adjusted to run at 50Hz through
131
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Pump variable frequency control. The
circulation water volume far exceeds
the minimum water usage for on-site
mechanical seal cooling, resulting in
surplus supply and wastage. By
adjusting the frequency converter, the
operating frequency of the mechanical
seal cooling water circulation pump is
reduced to 35Hz, meeting the minimum
demand standard for on-site
mechanical seal cooling and reducing
waste.
2: Revenue Method: Long-term
revenue (10 months can be saved over
23 years)
1: Principle: Based on the unique
geographical conditions of Rugao, the
cold plate exchange system can be
enhanced to utilize outdoor low-
temperature air for cooling water
Import of
towers to provide refrigeration for dust-
Cold Plates for
free workshops, thereby saving energy 13.3 565,488 429,771
Air Conditioning
consumption of air conditioning chiller
in Building A17
units.
2: Revenue Method: Long-term
revenue, saving 3 months annually
(from late November to early February
the following year)
1: At the wastewater station, the
Installation
cooling water tower fan for mechanical
of Temperature
seals is manually operated (unable to
Control for 0.0 48,180 36,617
automatically start and stop based on
Cooling Water
external temperature changes).
Tower
Continuous operation for extended
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
periods leads to energy wastage. After
evaluation, it is feasible to install a
temperature control device. A
temperature-controlled automatic start-
stop controller will be added to the
control loop of the cooling water tower
fan for mechanical seals. It will be set
to start when the water temperature
exceeds 28°C and stop when it falls
below 24°C, aiming to achieve energy
savings. It is estimated that energy
consumption can be reduced for 6
months per year.
Building A2's anode exhaust tower
currently operates at 50Hz. By
Reduced
verifying that this adjustment doesn't
Frequency
affect production, it's proposed to lower
Operation of 0.0 2,308,800 1,754,688
the frequency to 35Hz to reduce energy
Anode Exhaust
consumption costs. This sustainable
Tower
adjustment can yield benefits
throughout the year.
Building A7's BGA warehouse is
currently maintained as a constant
temperature and humidity warehouse
(control standards: temperature ≤ 12°C
Energy & ≥ 25°C, humidity ≤ 32% & ≥ 69%).
Management for Based on testing, it's proposed to adjust
Dust-free the warehouse temperature and 0.0 3,783,996 2,875,837
Warehouse in humidity control standards from
Building A7 constant to ordinary (room temperature
management), as it won't impact
product quality. According to the
analysis of the energy consumption
supplied by the constant temperature
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
and humidity air conditioning system in
Building A7, it's estimated that energy
consumption costs for air conditioning
can be saved for 9 months annually
(considering three months of summer
when the warehouse staff require a
comfortable working environment, so
the air conditioning will be
operational). This yields an annual
revenue for 9 months.
1: By conducting regular weekly
inspections of energy waste phenomena
in the perimeter and workshops of the
factory, timely identification and
rectification of energy waste can be
achieved, reducing the energy waste
rate and lowering energy consumption
Energy
costs.
Waste
2: Based on the audit anomalies 0.0 422,606 482,153
Investigation and
from May to November of the 22nd
Reduction
year, the average monthly energy
savings are calculated using the
"Leakage Volume Calculation and
Leakage Cost Calculation Tool."
3: Revenue Method: Energy
management and control for long-term
benefits.
IV. Ri Shan Computer Accessory (Jiashan) Co., Ltd.
Improvement Investment Income Improvement
Program
project (RMB0’000) (0’000 kwh) project
Photovoltaic Utilization of the parking lot near
0 79 519.3
Project Gate 1 and idle rooftops in the Rishan
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
factory area for the construction of
solar photovoltaic power generation.
The project is funded by the
manufacturer, which also includes
the provision of photovoltaic carports
and charging piles.
Optimization
Rational distribution of vacuum
of Compressed Air
systems according to production 36.4 179.35 219.3
and Vacuum
arrangements.
Systems
Installation of throttle valves to
Improvement
control air volume in the gas pipeline,
in Compressed Air 0.4 2.96 3.65
resulting in monthly energy savings
Supply
of 218 kWh per unit.
Energy Implementation of intelligent Energy
Efficiency in frequency conversion control for Management 64.04 426.19
Chiller Units chiller unit systems. Contract
Actual operating energy
Replacement consumption current of vacuum
of Vacuum Pumps pumps for CNC numerically
132 1.54 13.44
with Permanent controlled lathes: the three-phase
Magnet Motors average current has decreased from
206A to 171A.
Conversion of
Screw Air
Compressors from Conversion of 4 fixed-frequency
60 47.16 64.15
Fixed Frequency air compressors to variable frequency
to Variable
Frequency
Connection of pipelines for
Rectification cooling water towers on the rooftops
of Cooling Water of F11 and F3 buildings, saving the 120 44.57 60.4
Tower Pipelines number of water pump startups,
enabling mutual support between
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
multiple devices
Conversion of For the original automated
old piping in the assembly lines on floors F10 to 1F,
cleanroom to new each of the 6 lines has 58 vacuum
Lipo piping generators per line. During the Lipo
35.19 149.87 203.87
(conversion from transformation, all vacuum suction
compressed air to devices will be replaced with
direct vacuum centralized negative pressure
suction) machines to reduce energy waste.
The original cooling lines for
fixtures used compressed air,
Energy-saving
resulting in high air consumption and
transformation of
energy consumption. After
cooling fixtures Energy
improvement, each cooling module
for IPI fixtures in Management 20.94 29.12
set will be equipped with 2 air-cooled
the cleanroom to Contract
cooling units and 1 blowing module
reduce
to rapidly cool down the fixtures,
temperature
thereby reducing energy
consumption.
Administrative penalties imposed due to environmental issues during the reporting period
Effects on the
Name of the Rectification
Reasons for listed company’s
Company or its Violations Penalty results measures of the
penalties production and
subsidiaries Company
operation
None None None None None None
Other environmental information to be disclosed
I. Luxcase Precision Technology (Yancheng) Co., Ltd.
The said company takes the initiative to make PRTR information disclosure at the platform of the Institute of
Public and Environmental Affairs (IPE) to the public, disclosing the emissions of wastewater and exhaust gas and
related implementation standards every year; and fills out and reports the annual environmental information in the
pollution resource management system “One Enterprise and One File” of Jiangsu Province (column of disclosure
of enterprise environmental information according to the law).
II. Ri Ming Computer Accessory (Shanghai) Co., Ltd.
The said company takes the initiative to make PRTR information disclosure at the platform of the Institute of
136
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Public and Environmental Affairs (IPE) to disclose to the public the emissions of wastewater and exhaust gas and
related implementation standards every year; and fills out and reports the annual environmental information in the
system of disclosure of the enterprise environmental information according to the law (Shanghai), and make to the
public the wastewater, exhaust gas, noise and other pollution emission factors on the national pollution source
information disclosure platform every month.
III. Rida Intelligent Manufacture Technology (Rugao) Co., Ltd.
The said company takes the initiative to make PRTR information disclosure at the platform of the Institute of
Public and Environmental Affairs (IPE) to the public, disclosing the emissions of wastewater and exhaust gas and
related implementation standards every year.
IV. Ri Shan Computer Accessory (Jiashan) Co., Ltd.
The said company takes the initiative to make PRTR information disclosure at the platform of the Institute of
Public and Environmental Affairs (IPE) to the public, disclosing the emissions of wastewater and exhaust gas and
related implementation standards every year; and fills out and reports the annual environmental information in the
system of the disclosure of enterprise environmental information according to the law (Zhejiang).
Other environmental information
Luxshare-ICT attaches great importance to possible impact of climate changes on the Company, and has
established a carbon neutral working group led by the Board of Directors, coordinated by the sustainable
development center and participated in by all plants to respond to issues related to climate changes in a
comprehensive manner. Based on our actual business and with reference to the external standards, it identifies the
applicable climate risks and opportunities, rank them according to the increasing probability of occurrence and
degree of impact, and then submit them to the Strategy Committee of the Board of Directors for deliberation and
approval. When necessary, our risk management departments prepare or add the countermeasures for risks and
opportunities of higher importance and urgency. In addition, it works out a claim change action plant and implement
a low-carbon energy transition plan, and is committed to achieving carbon neutrality by 2025. During the reporting
period, we actively used clean energy and reduced greenhouse gas emissions by 1,037,334.21 tons of carbon dioxide
equivalent through rooftop photovoltaic, green procurement, direct purchase of green power and green energy fund
investment or otherwise. Meanwhile, we promoted 266 energy-saving renovation projects for five major energy-
using modules, including production electricity, gas supply system, central air conditioning, workshop fan and living
office, thereby reducing greenhouse gas emissions by a total of 89,691.80 tons of carbon dioxide equivalent.
II. Description of social responsibilities
The Company’s 2023 Sustainable Development Report has been published at Cninfo (www.cninfo.com.cn), the
information disclosure website designated by the Company, together with this report on the same day.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
III. Consolidation and expansion of poverty alleviation and rural revitalization
The Company actively participated in and contributed to the community development and building, and
conducted colorful activities to care for special groups and give back to society, and made contribution to a
harmonious society. The Company did not carry out the work on poverty alleviation and rural revitalization during
the reporting period or have subsequent relevant plans.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
Section VI Significant Matters
I. Fulfillment of commitments
1. Complete and incomplete commitments of the Company and its actual controller, shareholders, related
parties, acquirers, and other related parties for the commitments by the end of the reporting period.
Applicable □ N/A
Committe Commitment Commitment Commitment Fulfillment of
Commitments Commitment details
d by Type date period commitments
In order to seriously protect the legitimate rights
and interests of the Company and all of its
shareholders, each of all directors and executives
of the Company hereby makes commitments as
follows:
1. I promise not to damage the Company’s
interest by transferring benefits to any other
entity or individual free of charge or under unfair
conditions or otherwise;
2. I promise to restrain the duty-related
consumption of directors and executives;
3. I promise not to use the Issuer’s assets to
engage in investment and consumption
HUANG
irrelevant to their performance of powers and
Dawei; LI
duties;
Wei; LIU
Zhonghua 4. I promise to link the remuneration rules
; SONG developed by the Board of Directors or the
Commitments Remuneration Committee and the
Yuhong;
relating to any implementation of the Issuer’s remedial
WANG
initial public Other measures for diluted earnings; February 21,
Laichun; Long-term Ongoing
offering or commitments 2022
WANG 5. I promise to link the conditions for the
subsequent
Laisheng; exercise of the Issuer’s stock option incentives
fund raising
WANG to be issued and the implementation of the
Tao; WU Issuer’s remedial measures for diluted earnings;
Tiansong; and
ZHANG 6. I promise to strictly fulfill the aforesaid
Ying commitments to ensure that the Issuer’s remedial
measures for diluted earnings can be fulfilled
effectively. If I breach or refuse to fulfill any
commitments set forth above, I will make
explanations and apologies and perform other
obligations required by the applicable
regulations, and agree to accept any punishment
or regulatory action that may be imposed on or
taken against me by the CSRC, the Shenzhen
Stock Exchange or any other competent
securities regulatory authority in accordance
with the applicable rules and regulations
established or promulgated by such regulatory
authorities, and indemnify the Issuer or its
139
Luxshare Precision Industry Co., Ltd. Annual Report 2022
shareholders for the losses (if any) arising
therefrom according to the law.
7. From the date of issuing this Letter of
Commitment until the completion of this non-
public offering of stocks by the Issuer, if the
CSRC has issued other new provisions on
measures to compensate for diluted returns and
commitments, and the aforesaid commitments
fail to meet such new regulatory provisions
issued by the CSRC, I undertake to give
supplementary commitments in accordance with
the latest provisions of the CSRC.
In order to seriously protect the legitimate rights
and interests of the Company and all of its
shareholders, each of the controlling shareholder
and actual controllers of the Company hereby
makes commitments as follows:
1. We/I will not interfere with management and
operation of the Company beyond our/my
powers, or infringe on the interest of the
Company.
2. We/I promise to strictly fulfill the aforesaid
commitments to ensure that the Issuer’s remedial
measures for diluted earnings can be fulfilled
effectively. If we/I breach or refuse to fulfill any
commitment set forth above, I will make
explanations and apologies and perform other
Commitments Luxshare obligations required by the applicable
relating to any Limited; regulations, and agree to accept any punishment
initial public WANG Other or regulatory action that may be imposed on or February 21,
Long-term Ongoing
offering or Laichun; commitments taken against me by the CSRC, the Shenzhen 2022
subsequent WANG Stock Exchange or any other competent
fund raising Laisheng securities regulatory authority in accordance
with the applicable rules and regulations
established or promulgated by such regulatory
authorities, and indemnify the Issuer or its
shareholders for the losses (if any) arising
therefrom according to the law.
3. From the date of issuing this Letter of
Commitment until the completion of this non-
public offering of stocks by the Company, if the
CSRC has issued other new provisions on
measures to compensate for diluted returns and
commitments, and the aforesaid commitments
fail to meet such new regulatory provisions
issued by the CSRC, we/I undertake to give
supplementary commitments in accordance with
the latest provisions of the CSRC.
Commitments After the completion of the transactions
Commitments relating to contemplated by the announcement on external
relating to any horizontal investment and related-party transactions
initial public Luxshare competition, disclosed by the Company on November 13, November 13,
Long-term Ongoing
offering or Limited related-party 2020, we and our affiliates will not engage in any 2022
subsequent transactions business that is the same as or substantially in
fund raising and competition with the business of the Company
occupation of or any entity controlled by the Company in any
140
Luxshare Precision Industry Co., Ltd. Annual Report 2022
funds manner.
In accordance with the applicable regulations of
the CSRC, in order to ensure the effective
implementation of the Company’s remedial
measures for diluted earnings, each of the
directors and executives of the Company hereby
makes commitments as follows:
1. I will not transfer benefits to any other entity
or individual without compensation or on unfair
terms, or otherwise damage the interest of the
Company.
2. I will exercise self-discipline in consumption
in performing my duties.
HUANG 3. I will not use the assets of the Company to
Dawei; LI engage in any investment or consumption
Bin; LIN activity not in connection with my duties.
Yifei; 4. I will, within my powers, procure the linkage
WANG between the remuneration system adopted by the
Laichun; Board of Directors or the Remuneration and
WANG Appraisal Committee and the implementation of
Commitments
Laisheng; the Company’s remedial measures for diluted
relating to any
WU earnings.
initial public Other
Tiansong; 5. I will, within my powers, procure the linkage July 11, 2019 Long-term Ongoing
offering or commitments
XIONG between the vesting conditions in respect of any
subsequent
Tengfang; share incentives granted by the Company and the
fund raising
XU implementation of the Company’s remedial
Huaibin, measures for diluted earnings.
XUE
6. I promise to strictly fulfill the aforesaid
Haigao;
commitments to ensure that the Company’s
YE Yiling;
remedial measures for diluted earnings can be
ZHANG
fulfilled effectively. If I breach or refuse to fulfill
Ying
any commitment set forth above, I will make
explanations and apologies and perform other
obligations required by the applicable
regulations, and agree to accept any punishment
or regulatory action that may be imposed on or
taken against me by the CSRC, the Shenzhen
Stock Exchange or any other competent
securities regulatory authority pursuant to the
applicable rules and regulations established or
promulgated by such regulatory authorities, and
indemnify the Company or its shareholders for
the losses (if any) arising therefrom according to
the law.
In order to seriously protect the legitimate rights
and interests of the Company and all of its
shareholders, each of the controlling shareholder
Commitments Luxshare and actual controllers of the Company hereby
relating to any Limited; commitments as follows:
initial public WANG Other 1. We/I will not interfere with management and
July 11, 2019 Long-term Ongoing
offering or Laichun; commitments operation of the Company beyond our/my
subsequent WANG powers, or infringe on the interest of the
fund raising Laisheng Company.
2. We/I promise to effectively implement the
remedial measures for diluted earnings
formulated by the Company and fulfill our/my
141
Luxshare Precision Industry Co., Ltd. Annual Report 2022
corresponding commitments on the remedial
measures for diluted earnings. If we/I breach or
fail to perform the commitments set forth above,
we/I agree to accept any punishment or
regulatory action that may be imposed on or
taken against us/me by the CSRC, the Shenzhen
Stock Exchange or any other competent
securities regulatory authority pursuant to the
applicable rules and regulations established or
promulgated by such regulatory authorities. If
we/I breach or fail to fulfill the commitments set
forth above, resulting in losses to the Company
or the investors, we/I are/am willing to
compensate for such losses according to the law.
3. From the date of this commitment till the date
of completion of this offering, if the CSRC or
any other competent securities regulatory
authority adopts any new regulation regarding
the remedial measures for diluted earnings and
commitments in connection therewith, and the
commitments set forth above do not satisfy the
requirements of such new regulation, we/I will
make supplementary commitments pursuant to
the new regulation.
Each of all directors and executives of the
Company hereby commitments as follows:
BAI (1) I will not transfer benefits to any other entity
Rujing; or individual without compensation or on unfair
CHEN terms, or otherwise damage the interest of the
Chaofei; Company;
DONG (2) I will exercise self-discipline in consumption
Jianhai; LI in performing my duties;
Bin; LI (3) I will not use the assets of the Company to
Commitments Jing; LI engage in any investment or consumption
relating to any Xiongwei; activity not in connection with my duties;
initial public LIN Yifei; Other (4) I will procure the linkage between the March 11,
Long-term Ongoing
offering or WANG Ji; commitments remuneration system adopted by the Board of 2016
subsequent WANG Directors or the Remuneration and Appraisal
fund raising Laichun; Committee and the implementation of the
WANG Company’s remedial measures for diluted
Laisheng; earnings;
XU
(5) If the Company establishes any share
Huaibin;
incentive plan in the future, I will procure the
YE Yiling;
linkage between the vesting conditions in
ZHANG
respect of any share incentives granted by the
Lihua
Company and the implementation of the
Company’s remedial measures for diluted
earnings.
Luxshare Limited, as the controlling shareholder
Commitments Luxshare of the Company, and WANG Laichun and
relating to any Limited; WANG Laisheng, as the actual controllers of the
initial public WANG Other Company, hereby make commitments as March 11,
Long-term Ongoing
offering or Laichun; commitments follows: 2016
subsequent WANG 1. We, Luxshare Limited, as the controlling
fund raising Laisheng shareholder of the Company, undertake not to
interfere with management and operation of the
142
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Company beyond our powers, or infringe on the
interest of the Company.
2. I, WANG Laichun, as the actual controller,
Chairman and General Manager of the
Company, undertake to perform my duties in
accordance with the applicable laws and
regulations and the articles of association of the
Company, and not to interfere with management
and operation of the Company beyond my
powers, or infringe on the interest of the
Company.
3. I, WANG Laisheng, as the actual controller
and Vice Chairman of the Company, undertake
to perform my duties in accordance with the
applicable laws and regulations and the articles
of association of the Company, and not to
interfere with management and operation of the
Company beyond my powers, or infringe on the
interest of the Company.
The commitments relating to horizontal
competition, related-party transactions and
occupation of funds are as follows: 1. We and
other entities controlled by us will reduce
related-party transactions with the Company to
the maximum extent practicable. 2. With respect
to any related-party transaction between us or
any other entity controlled by us and the
Company that is unavoidable or exists
reasonably, we will carry out such transaction on
Commitments an arm’s length basis and customary commercial
relating to terms, ensure the fairness of the transaction
Commitments
horizontal price, perform the relevant decision-making
relating to any
competition, process according to the law, and guarantee that
initial public Luxshare October 15,
related-party the legitimate rights and interests of the Long-term Ongoing
offering or Limited 2014
transactions Company and its shareholders will not be
subsequent
and damaged as a result of such transaction. 3. We or
fund raising
occupation of any other entity controlled by us will not request
funds the Company to offer any terms more favorable
than the terms that may be offered by any third
party in an arm’s length transaction, or accept
any such terms offered by the Company. 4. For
so long as we remain the controlling shareholder
of Luxshare-ICT, the commitments set forth
above shall be unconditional and irrevocable. If
we breach any commitment set forth above, we
will, jointly and severally, fully, timely and
adequately indemnify the losses of the Company
arising therefrom.
The commitments relating to horizontal
Commitments
competition, related-party transactions and
Commitments relating to
occupation of funds are as follows: 1. We and all
relating to any horizontal
other entities controlled by us at present or in the
initial public Luxshare competition, October 15,
future will not, directly or indirectly, engage in Long-term Ongoing
offering or Limited related-party 2014
any business or activity that competes, might
subsequent transactions
compete or potentially competes with the main
fund raising and
business of the Company. 2. If any amendment
occupation of
of any applicable law or change in any
143
Luxshare Precision Industry Co., Ltd. Annual Report 2022
funds applicable policy of the country results in any
actual or potential horizontal competition
between us or any other entity controlled by us
and the Company in any business, the Company
shall have the preemptive right on the same
terms in respect of any entrusted management
(or management under contract or lease) or
acquisition in connection with such business. 3.
For so long as we remain the controlling
shareholder of Luxshare-ICT, the commitments
set forth above shall be unconditional and
irrevocable. If we breach any commitment set
forth above, we will, jointly and severally, fully,
timely and adequately indemnify the losses of
the Company arising therefrom.
The commitments relating to horizontal
competition, related-party transactions and
occupation of funds are as follows: we/I will not
take advantage of our/my position as the
controlling shareholder, actual controller or
shareholder (as applicable) and our/my
affiliation with the Issuer to engage in any act to
the detriment of the interest of the Issuer or its
Luxshare
Commitments other shareholders. With respect to any related-
Limited;
relating to party transaction between us/me or any other
Commitments Shenzhen
horizontal entity controlled by us/me and the Issuer, we/I
relating to any Zixin
competition, will carry out such transaction on an arm’s length
initial public Investmen
related-party basis and customary commercial terms, and will July 30, 2010 Long-term Ongoing
offering or t Co., Ltd.;
transactions not request the Issuer to offer any terms more
subsequent WANG
and favorable than the terms that may be offered by
fund raising Laichun;
occupation of any third party in an arm’s length transaction, or
WANG
funds accept any such terms offered by the Issuer. We/I
Laisheng
will strictly perform all related-party transaction
agreements (if any) entered into with the Issuer
in good faith, and will not seek any interest or
benefit in contravention of the commitments set
forth above. If we/I breach any commitment set
forth above, we/I agree to indemnify the Issuer
and its minority shareholders for all losses
arising therefrom.
The commitments relating to horizontal
competition, related-party transactions and
occupation of funds are as follows: We are not
engaged in any business that is the same as or
Commitments similar to the business of the Issuer or any entity
relating to controlled by the Issuer. For so long as we retain
Commitments Luxshare
horizontal control over the Issuer directly or indirectly, we
relating to any Limited;
competition, will strictly comply with the applicable laws,
initial public Shenzhen
related-party regulations and codes of the country, and will July 30, 2010 Long-term Ongoing
offering or Zixin
transactions not, directly or indirectly, engage in any business
subsequent Investmen
and that is the same as, similar to or substantially in
fund raising t Co., Ltd.
occupation of competition with the business of the Issuer or
funds any entity controlled by the Issuer, or have
substantial or relative control over any other
company, organization or economic entity
engaging in any business that is the same as,
similar to or substantially in competition with
144
Luxshare Precision Industry Co., Ltd. Annual Report 2022
the business of the Issuer or any entity controlled
by the Issuer in or outside China. We will use our
control over the other entities controlled by us to
cause such entities to fulfill the commitments set
forth above in the same manner. If we breach any
commitment set forth above, we agree to assume
the relevant legal liabilities, including without
limitation, to indemnify the Issuer and its
minority shareholders for all losses arising
therefrom.
The commitments relating to horizontal
competition, related-party transactions and
occupation of funds are as follows: I and other
entities controlled by me are not engaged in any
business that is the same as or similar to the
business of the Issuer or any entity controlled by
the Issuer. For so long as I retain control over the
Issuer directly or indirectly, I will strictly comply
with the applicable laws, regulations and codes
Commitments of the country, and will not, directly or indirectly,
relating to engage in any business that is the same as,
Commitments
horizontal similar to or substantially in competition with
relating to any WANG
competition, the business of the Issuer or any entity controlled
initial public Laichun;
related-party by the Issuer, or have substantial or relative July 30, 2010 Long-term Ongoing
offering or WANG
transactions control over any other company, organization or
subsequent Laisheng
and economic entity engaging in any business that is
fund raising
occupation of the same as, similar to or substantially in
funds competition with the business of the Issuer or
any entity controlled by the Issuer in or outside
China. I will use my control over the other
entities controlled by me to cause such entities
to fulfill the commitments set forth above in the
same manner. If I breach any commitment set
forth above, I agree to assume the relevant legal
liabilities, including without limitation, to
indemnify the Issuer and its minority
shareholders for all losses arising therefrom.
(1) For this shareholding increase plan and
subsequent share management, I will not
conduct insider trading or short-term trading, or
purchase or sell shares during the sensitive
Commitments period in strict accordance with the relevant
Other WANG on provisions of applicable laws, regulations and October 26, Completed as
April 27, 2024
commitments Laisheng Shareholding normative documents. (2) I will not reduce 2023, scheduled
Increase shares of the Company during the period of the
shareholding increase and within the statutory
period, and will complete this shareholding
increase plan during the aforesaid period of
implementation.
Whether the
commitments
have been Yes
fulfilled on
time?
If any
N/A
commitment
145
Luxshare Precision Industry Co., Ltd. Annual Report 2022
is overdue,
explain
specific
reasons for the
incomplete
performance
and detailed
plan of next
steps
2. If the Company has made any profit forecast on its assets or project and the reporting period falls within
the period of such profit forecast, explanation about whether the goal has been achieved and the relevant
reasons
□ Applicable N/A
II. Occupation of funds of the listed company by the controlling shareholder and other related
parties for non-operating purposes
□ Applicable N/A
During the reporting period, no controlling shareholder or its related party used capital of the listed company for non-operating purposes.
III. Illegal provision of guarantees for external parties
□ Applicable N/A
We have not provided any external guarantee in contravention of the applicable regulations during the reporting period.
IV. Explanation made by the Board of Directors about the modified audit opinion for the latest
period
□ Applicable N/A
V. Explanation by the Board of Directors, the Board of Supervisors and the independent
directors (if any) about the modified auditor’s report issued by the accounting firm for the
reporting period
□ Applicable N/A
VI. Explanation about changes in accounting policies and accounting estimates or correction of
significant accounting errors when compared to the previous financial year
Applicable □N/A
On December 31, 2021, the Ministry of Finance issued the Notice on Issuing the Interpretation No. 15 of
Enterprise Accounting Standards (Cai Kuai [2021] No. 35), hereinafter referred to as Interpretation No. 15,
interpreting contents related to Reporting on Centralized Fund Management, etc.
146
Luxshare Precision Industry Co., Ltd. Annual Report 2022
On December 13, 2022, the Ministry of Finance issued the Notice on Issuing the Interpretation No. 16 of
Enterprise Accounting Standards (Cai Kuai [2022] No. 31), hereinafter referred to as Interpretation No. 16,
interpreting contents related to Accounting Treatment of Deferred Income Tax not Exempted from Initial
Recognition for Assets and Liabilities arising from Single Transactions, Accounting Treatment of Income Tax
Effects of Dividends Related to Financial Instruments Classified as Equity Instruments by the Issuer, Accounting
Treatment of Changing Share Payments Settled in Cash by Enterprises to Share Payments Settled in Equity, etc.
In accordance with the above notifications, the company will make corresponding changes to its current
accounting policies and implement them from the specified effective date.
VII. Explanation about changes in consolidation scope when compared to the previous financial
year
Applicable □N/A
Refer to “Section X Financial Report” - “IX. Changes in scope of consolidation”.
VIII. Appointment and dismissal of accounting firms
Accounting firm currently engaged:
Name of domestic accounting firm BDO China Shu Lun Pan Certified Public Accountants LLP
Remuneration of domestic accounting firm (in RMB0’000) 246.33
Consecutive years in which the domestic accounting firm has
16
provided auditing service
Certified public accountant of the domestic accounting firm LI Jing and DANJie
Consecutive years in which the certified public accountant of the
5
domestic accounting firm has provided auditing service
Whether a new accounting firm was engaged during the reporting period?
□ Yes No
Engagement of accounting firm for auditing internal controls, financial advisor or sponsor:
Applicable □N/A
During the reporting period, the company engaged BDO China Shu Lun Pan Certified Public Accountants LLP (Special General
Partnership) as the auditor and internal control auditor for the year 2023. The total audit fees paid to RSM China Certified Public
Accountants LLP (Special General Partnership) during the reporting period amounted to RMB 2.4633 million.
IX. Possibility of listing suspension and termination after disclosure of the annual report
□ Applicable N/A
147
Luxshare Precision Industry Co., Ltd. Annual Report 2022
X. Matters relating to bankruptcy and reorganization
□ Applicable N/A
We have not been involved in any bankruptcy or reorganization proceedings during the reporting period.
XI. Material litigation and arbitration proceedings
Applicable □ N/A
Amount Whether a Enforcement of Information
Date of
Background claimed provision is Status Result and effect judgment/ disclosure
disclosure
(RMB0’000) recognized award available at
The case has been
settled/ closed by
Other litigation mediation or
Already
during the reporting 7,375.29 No Closed judgment, and N/A
enforced
period (arbitration) does not have a
material effect on
us.
The case is
Other litigation pending, and will
during the reporting 5,562.66 No Pending not have a Pending N/A
period (arbitration) material effect on
us.
XII. Penalty and rectification
□ Applicable N/A
We have not been subject to any punishment or required to make any rectification during the reporting period.
XIII. Integrity of the Company, its controlling shareholder and actual controller
Applicable □N/A
There wasn’t any outstanding court judgment or overdue debt of a large amount involving us or our controlling shareholder or actual
controllers during the reporting period.
XIV. Material related-party transactions
1. Related-party transactions relating to day-to-day operation
Applicable □ N/A
Related Amo % of Approve Wheth Method Market Inform
Transac Date of
Counterpart Relations -party Pricing unt the d limit er or of price ation
Type tion disclos
y hip transact principle (in total of not settlem availab disclos
price ure
ions RM amount transacti excee ent le for ure
148
Luxshare Precision Industry Co., Ltd. Annual Report 2022
B0 of the on d the the availab
， same amount appro same le at
000) type of (in ved type of
transact RMB0 limit transact
ions ，000) ions
Anno
Purchasi Febru unce
Associat Purch Fair Bank Fair
Suzhou ng goods Market 1,87 ary ment
ed legal asing marke 0.01% 4,500 No transf marke
Lisheng from pricing 0.07 22, No.:2
person goods t price er t price
affiliates 2023 023-
013
Anno
Purchasi Febru unce
Associat Purch Fair Bank Fair
BCS ng goods Market 3,65 ary ment
ed legal asing marke 0.02% 7,000 No transf marke
Germany from pricing 9.58 22, No.:2
person goods t price er t price
affiliates 2023 023-
013
Anno
Purchasi Febru unce
Hong Associat Purch Fair 119, Bank Fair
ng goods Market 120,00 ary ment
Kong ed legal asing marke 061. 0.67% No transf marke
from pricing 0 22, No.:2
Luxsan person goods t price 78 er t price
affiliates 2023 023-
013
Anno
Purchasi Febru unce
Luxsan Associat Purch Fair Bank Fair
ng goods Market 3,69 ary ment
Investmen ed legal asing marke 0.02% 13,000 No transf marke
from pricing 9.9 22, No.:2
t person goods t price er t price
affiliates 2023 023-
013
Anno
Purchasi Febru unce
BCS Associat Purch Fair Bank Fair
ng goods Market ary ment
United ed legal asing marke 9.29 0.00% 10,000 No transf marke
from pricing 22, No.:2
States person goods t price er t price
affiliates 2023 023-
013
Anno
Selling Febru unce
Associat Sellin Fair 39,6 Bank Fair
Suzhou goods Market ary ment
ed legal g marke 98.3 0.17% 85,000 No transf marke
Lisheng from pricing 22, No.:2
person goods t price 8 er t price
affiliates 2023 023-
013
Sellin Anno
Selling g Febru unce
Hong Associat Fair Bank Fair
goods goods Market 855. 180,00 ary ment
Kong ed legal marke 0.00% No transf marke
from /provi pricing 05 0 22, No.:2
Luxsan person t price er t price
affiliates ding 2023 023-
labor 013
Anno
Selling Febru unce
Hong Associat Sellin Fair Bank Fair
goods Market 4,74 ary ment
Kong ed legal g marke 0.02% 36,000 No transf marke
from pricing 8.38 22, No.:2
Gaowei person goods t price er t price
affiliates 2023 023-
013
Luxsan Associat Selling Sellin Market Fair 23,0 0.10% 35,000 No Bank Fair Febru Anno
149
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Equipmen ed legal goods g pricing marke 41.7 transf marke ary unce
t person from goods t price 7 er t price 22, ment
affiliates 2023 No.:2
023-
013
Anno
Selling Febru unce
Luxsan Associat Sellin Fair Bank Fair
goods Market 504. ary ment
Investmen ed legal g marke 0.00% 5,500 No transf marke
from pricing 74 22, No.:2
t person goods t price er t price
affiliates 2023 023-
013
Anno
Selling Febru unce
BCS Associat Sellin Fair Bank Fair
goods Market 2,42 ary ment
United ed legal g marke 0.01% 4,000 No transf marke
from pricing 2.68 22, No.:2
States person goods t price er t price
affiliates 2023 023-
013
199,
500,00
Total -- -- 571. -- -- -- -- -- --
0
62
Particulars of huge-amount sales returns N/A
When expecting the annual daily related party transactions, the Company conducts the appraisal and calculation
If the total amount of daily related-party transactions of possible related party transactions according to the market situation, but the actually accrued amount is
that are expected to occur during the reporting period determined based on market situation, the two parties’ business development, actual demands and specific
is estimated by type, the actual transactions occurred implementation progress, resulting in certain differences between actually accrued amount and expected amount.
during the reporting period (if any) The foregoing belongs to the acts of normal business and will not have a significant impact on daily operation
and performance of the Company.
Reason of any great difference between transaction
N/A
price and reference market price (if applicable)
2 Related-party transactions involving acquisition or sales of assets or equities
□ Applicable N/A
We have not conducted any related-party transaction involving acquisition or sales of assets or equities during the reporting period.
3. Related-party transactions involving joint external investment
□ Applicable N/A
The Company had no related-party transactions on joint investments during the reporting period.
4. Accounts receivable from and payable to related parties
□ Applicable N/A
We did not have any accounts receivable from or payable to any related party during the reporting period.
5. Financial business with its related financial companies
□ Applicable N/A
There are no deposits, loans, credits or other financial transactions between the Company, its related financial companies and related
150
Luxshare Precision Industry Co., Ltd. Annual Report 2022
parties.
6. Financial business between the financial companies controlled by the Company and related parties
□ Applicable N/A
There are no deposits, loans, credits or other financial transactions between the financial companies controlled by the Company and
related parties.
7. Other significant related-party transactions
□ Applicable N/A
We have not conducted any other material related-party transaction during the reporting period.
XV. Significant contracts and performance thereof
1. Trusteeship, contracting and leases
(1) Trusteeship
□ Applicable N/A
No such case during the reporting period.
(2) Contracting
□ Applicable N/A
No such case during the reporting period.
(3) Leases
□ Applicable N/A
No such case during the reporting period.
2. Material guarantees
Applicable □ N/A
In RMB0,000
External guarantees provided by the Company and its subsidiaries (excluding those provided for the subsidiaries)
Whether
Disclosur
Amount of or not
e date of Actual Counter Fully
Guarante guaranteed Actual date Type of Collateral Term of provided
quota guarantee guarantee executed
e party quota of occurrence guarantee (if any) guarantee for a
announce amount (if any) or not
approved related
ment
party
Guarantees provided by the Company for its subsidiaries
Guarante Disclosur Amount of Actual date Actual Type of Collateral Counter Term of Fully Whether
151
Luxshare Precision Industry Co., Ltd. Annual Report 2022
e party e date of guaranteed of occurrence guarantee guarantee (if any) guarantee guarantee executed or not
quota quota amount (if any) or not provided
announce approved for a
ment related
party
LUXS Joint
April
HARE July 28, liability Five
20, 70,118.73 0 No Yes
PRECI 2021 guarant years
2022
SION y
Total amount of
guarantee approved to Total actual guarantee
be provided for balance for subsidiaries at
70,118.73
subsidiaries as at the the end of the reporting
end of the reporting period (B4)
period (B3)
The situation of guarantees provided by subsidiary companies to other subsidiary companies.
Whether
Disclosur
Amount of or not
e date of Actual Counter Fully
Guarante guaranteed Actual date Type of Collateral Term of provided
quota guarantee guarantee executed
e party quota of occurrence guarantee (if any) guarantee for a
announce amount (if any) ?
approved related
ment
party
TIME
Six
Interco
months
nnect
Joint and from the
Server June 21,
168.37 168.37 several expiratio No Yes
Technol 2022
guarantee n date of
ogy
main
Co.,
debts
Ltd.
Dachua
ng Six
Precisio months
n from
Joint
Intellig the
December liability
ent 58.9 58.9 maturit No Yes
19, 2022 guarant
Manufa y date
y
cture of the
(Kunsh main
an) Co., debt
Ltd.
Dachua
ng
Precisio
n
Joint
Intellig
April 11, liability 2025/4/
ent 11,771.95 11,771.95 No Yes
2023 guarant 10
Manufa
y
cture
(Kunsh
an) Co.,
Ltd.
Linkz Joint Continu
September
Internat 9,062.2 0 liability ing No Yes
4, 2020
ional guarant guarant
152
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Limited y ee
and
TIME
Interco
nnect
Industri
al Co.,
Ltd.
Linkz Joint Continu
Internat December liability ing
5,890.43 0 No Yes
ional 14, 2020 guarant guarant
Limited y ee
TIME
Interco Joint Continu
nnect June 27, liability ing
3,171.77 0 No Yes
Industri 2017 guarant guarant
al Co., y ee
Ltd.
Linkz
Internat
ional
Limited
, TIME
Interco
nnect
Industri
al Co.,
Ltd.,
TIME
Interco Joint Continu
nnect September liability ing
15,405.74 0 No Yes
Wiring 5, 2022 guarant guarant
Technol y ee
ogy
Co.,
Ltd. and
TIME
Interco
nnect
Server
Technol
ogy
Co.,
Ltd.
TIME
Interco Joint Continu
nnect June 25, liability ing
2,743.67 0 No Yes
Industri 2021 guarant guarant
al Co., y ee
Ltd.
Linkz
Joint Continu
Internat
March 21, liability ing
ional 10,421.53 0 No Yes
2023 guarant guarant
Limited
y ee
, TIME
153
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Interco
nnect
Industri
al Co.,
Ltd. and
TIME
Interco
nnect
Server
Technol
ogy
Co.,
Ltd.
Linkz
Internat
ional
Limited
, TIME
Interco
nnect
Industri Joint Continu
al Co., February liability ing
16,765.07 0 No Yes
Ltd. and 27, 2023 guarant guarant
TIME y ee
Interco
nnect
Server
Technol
ogy
Co.,
Ltd.
Linkz
Internat
ional
Limited
Joint Continu
and
October 9, liability ing
TIME 7,249.76 0 No Yes
2020 guarant guarant
Interco
y ee
nnect
Industri
al Co.,
Ltd.
Linkz
Internat
ional
Limited
Joint Continu
and
September liability ing
TIME 815.6 0 No Yes
27, 2021 guarant guarant
Interco
y ee
nnect
Industri
al Co.,
Ltd.
Linkz Joint Continu
September
Internat 1,274.89 0 liability ing No Yes
27, 2021
ional guarant guarant
154
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Limited y ee
and
TIME
Interco
nnect
Industri
al Co.,
Ltd.
TIME
Interco
nnect Joint Continu
Server October liability ing
7,249.76 0 No Yes
Technol 18, 2023 guarant guarant
ogy y ee
Co.,
Ltd.
TIME
Interco
nnect Joint Continu
Server October liability ing
815.6 0 No Yes
Technol 18, 2023 guarant guarant
ogy y ee
Co.,
Ltd.
TIME
Interco
nnect Joint Continu
Server October liability ing
1,274.89 0 No Yes
Technol 18, 2023 guarant guarant
ogy y ee
Co.,
Ltd.
TIME
Interco Joint Continu
nnect November liability ing
6,343.54 2,945.22 No Yes
Technol 15, 2021 guarant guarant
ogy y ee
Limited
TIME
Interco
nnect Joint Continu
Technol April 27, liability ing
5,000 168.54 No Yes
ogy 2020 guarant guarant
(Huizho y ee
u)
Limited
TIME
Interco
nnect Joint
Technol January 1, liability 2023/12
6,000 1,000 No Yes
ogy 2018 guarant /31
(Huizho y
u)
Limited
TIME 10,800 January 24, 0 Joint 2025/1/ No Yes
155
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Interco 2022 liability 23
nnect guarant
Technol y
ogy
(Huizho
u)
Limited
Expired
on the
TIME debt
Interco repaym
nnect Joint ent
Technol June 1, liability deadlin
10,000 2,920 No Yes
ogy 2022 guarant e, there
(Huizho y is a
u) grace
Limited period
of three
years
Huaxun
Industri Joint
al July 1, liability 2024/6/
5,000 2,000 No Yes
(Suzho 2021 guarant 30
u) Co., y
Ltd.
Expired
on the
debt
Huaxun repaym
Industri Joint ent
al January 12, liability deadlin
11,000 6,579.74 No Yes
(Suzho 2022 guarant e, there
u) Co., y is a
Ltd. grace
period
of three
years
TIME
Interco
nnect Joint
Technol May 12, liability 2024/12
8,000 1,000 No Yes
ogy 2023 guarant /31
(Huizho y
u)
Limited
TIME
Interco
nnect Joint Continu
Technol April 17, liability ing
10,000 0 No Yes
ogy 2023 guarant guarant
(Huizho y ee
u)
Limited
TIME June 16, Joint 2028/3/
6,000 186.13 No Yes
Interco 2023 liability 9
156
Luxshare Precision Industry Co., Ltd. Annual Report 2022
nnect guarant
Technol y
ogy
(Huizho
u)
Limited
TIME
Interco Joint Continu
nnect June 28, liability ing
13,593.3 9,062.2 No Yes
Industri 2023 guarant guarant
al Co., y ee
Ltd.
Total guarantee quota Total actual amount of
approved for guarantees for subsidiaries
22,020.28
subsidiaries within the within the reporting period
reporting period (C1) (C2)
Total guarantee quota
Total actual guarantee
approved for the
balance for subsidiaries at
subsidiaries at the end 185,876.96 37,861.04
the end of the reporting
of the reporting period
period (C4)
(C3)
Total amount of guarantee provided by the Company (the sum of the above three items)
Total amount of Total actual amount of
guarantee approved guarantees within the
22,020.28
during the reporting reporting period (i.e.
period (A1+B1+C1) A2+B2+C2)
Total amount of
Total actual guarantee
guarantee approved as
balance at the end of the
at the end of the 255,995.69 37,861.04
reporting period
reporting period
(A4+B4+C4)
(A3+B3+C3)
Ratio of total amount of guarantee actually provided
0.67%
(A4+B4+C4) to the net assets of the Company
Among which,
Amount of guarantee for shareholders, de facto controller
0
and their related parties (D)
Amount of debt guarantee provided for guaranteed party
whose asset-liability ratio is not less than 70% directly or 0
indirectly (E)
Amount of total guarantee over 50% of net assets (F) 0
Total amount guaranteed (D+E+F) 0
Particulars of the guarantees provided using complex method:
N/A
3. Entrusted management of cash assets
(1) Entrusted wealth management
Applicable □ N/A
Entrusted wealth management during the reporting period:
157
Luxshare Precision Industry Co., Ltd. Annual Report 2022
In RMB0’000
Impairment
amount made for
Outstanding overdue
Type Source of funds Total amount Overdue amount
amount uncollected wealth
management
products
Bank wealth
management Self-owned funds 306,041.78 162,827.9 0 0
amount
Bank wealth
management Fund raising 0 0 0 0
amount
Total 306,041.78 162,827.9 0 0
Details of entrusted wealth management with individually significant amount or low safety, poor liquidity, high risk
□ Applicable N/A
Entrusted wealth management products the principal of which may be unrecoverable or which may otherwise be impaired:
□ Applicable N/A
(2) Entrusted loans
Applicable □ N/A
Entrusted loans during the reporting period:
In RMB0’000
Total amount Source of funds Outstanding amount Overdue amount
4,381,506.13 Self-owned funds 4,381,506.13 0
Details of entrusted loans with individually significant amount or low safety, poor liquidity, high risk
□ Applicable N/A
Entrusted loans the principal of which may be unrecoverable or which may otherwise be impaired:
□ Applicable N/A
4. Other significant contracts
□ Applicable N/A
We have not entered into any other material contract during the reporting period.
XVI. Other significant matters
□ Applicable N/A
The Company has no other significant matters to be explained during the reporting period.
158
Luxshare Precision Industry Co., Ltd. Annual Report 2022
XVII. Significant events of subsidiaries of the Company
□ Applicable N/A
159
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Section VII Changes in shares and shareholders
I. Changes in shares
1. Changes in shares
Unit: Share
Before the change ＋,－ After the change
Shares
New Stock
converted
Number Proportion shares divide Other Subtotal Number Proportion
from capital
issued nd
reserve
I. Restricted Shares 11,178,887 0.16% 1,170,244 1,170,244 12,349,131 0.17%
1. Shares held by the
State
2. Shares held by State-
owned corporations
3. Shares held by other
927,484 0.01% 831,462 831,462 1,758,946 0.02%
domestic investors
Incl.: Shares
held by domestic non-
State-owned corporations
Shares held by
927,484 0.01% 831,462 831,462 1,758,946 0.02%
domestic natural persons
4. Shares held by
10,251,403 0.14% 338,782 338,782 10,590,185 0.15%
foreign investors
Incl.: Shares held by
foreign corporations
Shares held by
10,251,403 0.14% 338,782 338,782 10,590,185 0.15%
foreign natural persons
II. Tradable shares 7,104,305,121 99.84% 44,027,946 44,027,946 7,148,333,067 99.83%
1. RMB-denominated
7,104,305,121 99.84% 44,027,946 44,027,946 7,148,333,067 99.83%
ordinary shares
2. Foreign currency-
denominated shares listed
domestically
3. Foreign currency-
denominated shares listed
overseas
4. Others
100.00 100.00
III. Total shares 7,115,484,008 45,198,190 45,198,190 7,160,682,198
% %
Reasons of changes in shares:
160
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Applicable □ N/A
1. During the reporting period, the Company issued 45,356,811 shares to the grantees under the stock option
incentive plan exercising their options at their sole discretion, the details of which are shown in “Section IV” - “XI.
Implementation of share incentive plans, employee stock ownership plans and other employee incentives granted
by the Company”.
2. The Company publicly offered 30 million convertible corporate bonds (abbreviation: Luxshare Convertible
Bonds; bond code: 128136) on November 3, 2020, and the period for which the convertible corporate bonds can be
converted into shares is from May 10, 2021 to November 2, 2026. During the reporting period, the number of shares
converted into by bonds was 3,010.
Approval of changes in shares:
Applicable □ N/A
1. Deliberation and approval by the 9th meeting of the fifth Board of Directors and the 9th meeting of the fifth
Board of Supervisors of the Company on July 6, 2022.
2. Deliberation and approval by the 14th meeting of the fifth Board of Directors and the 14th meeting of the
fifth Board of Supervisors of the Company on December 5, 2022.
3. Deliberation and approval by the 15th meeting of the fifth Board of Directors and the 15th meeting of the
fifth Board of Supervisors of the Company on February 21, 2023.
4. Deliberation and approval by the 17th meeting of the fifth Board of Directors and the 17th meeting of the
fifth Board of Supervisors of the Company on July 21, 2023.
5. Deliberation and approval by the 19th meeting of the fifth Board of Directors and the 19th meeting of the
fifth Board of Supervisors of the Company on October 20, 2023.
6. Deliberation and approval by the 20th meeting of the fifth Board of Directors and the 20th meeting of the
fifth Board of Supervisors of the Company on November 27, 2023
Transfer of share ownership:
Applicable □ N/A
1. Period in which the stock options vested in the second vesting period of the initial grant under the 2019 stock
option incentive plan may be exercised by the relevant grantees: From July 22, 2022 to April 21, 2023.
2. Period in which the stock options vested in the third vesting period under the 2018 stock option incentive
plan may be exercised by the relevant grantees: From December 13, 2022 to September 22, 2023.
3. Period in which the stock options vested in the third vesting period in reserved grant under the 2019 stock
option incentive plan may be exercised by the relevant grantees: From March 1, 2023 to November 24, 2023.
4. Period in which the stock options vested in the third vesting period in initial grant under the 2021 stock option
incentive plan may be exercised by the relevant grantees: From March 13, 2023 to December 1, 2023.
5. Period in which the stock options vested in the fourth vesting period in initial grant under the 2021 stock
option incentive plan may be exercised by the relevant grantees: From July 4, 2023 to April 21, 2024.
161
Luxshare Precision Industry Co., Ltd. Annual Report 2022
6. Period in which the stock options vested in the first vesting period in reserved grant under the 2021 stock
option incentive plan may be exercised by the relevant grantees: From November 3, 2023 to October 18, 2024.
7. Period in which the stock options vested in the fifth vesting period under the 2018 stock option incentive
plan may be exercised by the relevant grantees: From December 6, 2023 to September 24, 2024.
Effect of changes in shares on the basic earnings per share, diluted earnings per share, net assets per share attributable to ordinary
shareholders and other financial indicators of the Company in the preceding year and the most recent reporting period:
□ Applicable N/A
Other information disclosed as the Company deems necessary or required by the securities regulatory authorities:
□ Applicable N/A
2. Changes in non-tradable shares
□Applicable N/A
II. Offering and listing of securities
1. Offering of securities (other than preferred shares) during the reporting period
□ Applicable N/A
2. Changes in total number of shares, shareholding structure, and structure of assets and liabilities of the
Company
Applicable □ N/A
1. Upon review and approval by the 9th meeting of the fifth Board of Directors, the 14th meeting of the fifth Board of Directors,
the 15th meeting of the fifth Board of Directors, the 17th meeting of the fifth Board of Directors, the 19th meeting of the fifth Board
of Directors, and the 20th meeting of the fifth Board of Directors of the Company, the vesting conditions for the third vesting period
in initial grant under 2019 stock option incentive plan, the fourth vesting period under 2018 stock option incentive plan, the third
vesting period in reserved grant under 2019 stock option incentive plan, the first vesting period in initial grant under 2021 stock option
incentive plan, the fourth vesting period under 2019 stock option incentive plan, the first vesting period in reserved grant under 2021
stock option incentive plan and the fifth vesting period under 2018 stock option incentive plan were satisfied, and the Company agreed
that the relevant stock option grantees of the Company exercise options at their sole discretion, and a total of additional 45,356,811
shares were issued to the grantees exercising options at their sole discretion during the reporting period.
2. The Company publicly offered 30 million convertible corporate bonds (abbreviation: Luxshare Convertible Bonds; bond code:
128136) on November 3, 2020, and the period for which the convertible corporate bonds can be converted into shares is from May 10,
2021 to November 2, 2026. During the reporting period, the number of shares converted into by bonds was 3,010.
3. Outstanding employee shares
□ Applicable N/A
162
Luxshare Precision Industry Co., Ltd. Annual Report 2022
III. Shareholders and actual controllers
1. Number of shareholders and shareholding structure of the Company
Unit: Share
Total ordinary Total number of preferred
Total number of
Total number of shareholders as stockholders with voting
preferred shareholders
ordinary of the end of the rights restored at the end of
with voting rights
shareholders at 238,772 month prior to 319,082 0 last month before the 0
restored at the end of
the end of the the disclosure disclosure date of the
the reporting period (if
reporting period date of annual annual report (if any) (see
any) (see note 8)
report note 8)
Shareholders holding more than 5% of shares or shares of the top 10 shareholders (excluding shares lent through refinancing)
Number Pledge, mark or freeze
Number of No. of non-
Increase or decrease of
Name of Type of Shareholding shares held at tradable Status
of shares within the restricted
shareholders shareholder percentage the end of the ordinary shares of Qty
reporting period shares
reporting period held shares
held
Luxshare
Foreign legal 2,731,537,6 2,731,537,6 Pled
Co., Ltd. 38.15% 0 0 1,075,610,000.00
person 36 36 ge
Hong Kong
Central
Foreign legal 406,591,46 406,591,46
Clearing 5.68% -155,210,803 0 N/A 0
person 5 5
Company
Limited
China Domestic
Securities non-state-
Finance owned 1.18% 84,428,888 0 0 84,428,888 N/A 0
Corporatio legal
n Limited person
Central
Huijin
State-
Asset
owned
Manageme 0.81% 58,041,012 0 0 58,041,012 N/A 0
legal
nt Limited
person
Liability
Company
Domestic
Changshuo
non-state-
Technology
owned 0.56% 39,845,105 0 0 39,845,105 N/A 0
(Shanghai)
legal
Co., Ltd.
person
E Fund -
Agricultura
Domestic
l Bank - E
non-state-
Fund CSI
owned 0.54% 38,656,343 0 0 38,656,343 N/A 0
Financial
legal
Asset
person
Manageme
nt Plan
Huaxia Domestic 0.54% 38,576,831 0 0 38,576,831 N/A 0
163
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Fund - non-state-
Agricultura owned
l Bank - legal
Huaxia CSI person
Financial
Asset
Manageme
nt Plan
CITIC-
Prudential
Fund -
Agricultura
Domestic
l Bank -
non-state-
CITIC-
owned 0.54% 38,557,184 0 0 38,557,184 N/A 0
Prudential
legal
CSI
person
Financial
Asset
Manageme
nt Plan
CITIC-
Prudential
Fund -
Agricultura
Domestic
l Bank -
non-state-
CITIC-
owned 0.54% 38,508,814 0 0 38,508,814 N/A 0
Prudential
legal
CSI
person
Financial
Asset
Manageme
nt Plan
Shenwan State-
Hongyuan owned
0.52% 37,322,698 33,510,673 0 37,322,698 N/A 0
Securities legal
Co., Ltd person
Strategic investor or general legal person becomes the top 10 shareholders due to the placement of new
N/A
shares (if any) (See Note 3)
1. Luxshare Limited is the controlling shareholder of the Company;
Affiliates or concert parties among the shareholders listed above 2. The Company is not aware of whether there are affiliates or persons
acting in concert among the shareholders listed above.
Delegation or waiver of voting rights or ownership of voting rights as a proxy in respect of the
N/A
shareholders listed above
Description (if any) of special repurchase shareholders among top 10 shareholders (refer to Note 10) N/A
Shareholdings of top 10 unrestricted shareholders
Number of unrestricted shares Type
Name of shareholders held at the end of the reporting
Type Qty
period
Luxshare Limited 2,731,537,636 RMB ordinary shares 2,731,537,636
Hong Kong Securities Clearing Company Limited 406,591,465 RMB ordinary shares 406,591,465
China Securities Finance Corporation Limited 84,428,888 RMB ordinary shares 84,428,888
Central Huijin Investment Ltd. 58,041,012 RMB ordinary shares 58,041,012
Changshuo Technology (Shanghai) Co., Ltd. 39,845,105 RMB ordinary shares 39,845,105
164
Luxshare Precision Industry Co., Ltd. Annual Report 2022
E Fund Management Co., Ltd. - Agricultural Bank of China -
38,656,343 RMB ordinary shares 38,656,343
E Fund CSI Financial Asset Management Plan
Huaxia Fund Management Co., Ltd. - Agricultural Bank of
38,576,831 RMB ordinary shares 38,576,831
China - Huaxia CSI Financial Asset Management Plan
China Europe Fund Management Co., Ltd. - Agricultural Bank
of China - China Europe CSI Financial Asset Management 38,557,184 RMB ordinary shares 38,557,184
Plan
Yinhua Fund Management Co., Ltd. - Agricultural Bank of
38,508,814 RMB ordinary shares 38,508,814
China - Yinhua CSI Financial Asset Management Plan
Shenwan Hongyuan Securities Co., Ltd 37,322,698 RMB ordinary shares 37,322,698
Affiliates or concert parties among top 10 holders of tradable ordinary shares, and among
N/A
top 10 holders of tradable ordinary shares and top 10 ordinary shareholders
Engagement by top 10 ordinary shareholders in margin trading (if any) (Note 4) N/A
Top ten shareholders participating in securities lending business for the reporting period:
Applicable N/A
Changes in the top ten shareholders compared to the previous period:
Applicable N/A
Did any top 10 ordinary shareholder or top 10 holder of tradable ordinary shares conduct any transaction under repurchase agreement
during the reporting period?
□ Yes No
No top 10 ordinary shareholder or top 10 holder of tradable ordinary shares has conducted any transaction under repurchase agreement
during the reporting period
2. Controlling shareholder of the Company
Nature of controlling shareholder: Controlled by foreign investor
Type of controlling shareholder: Corporation
Name of controlling Legal representative/ Change in organization
Date of establishment Main business
shareholder principal code
WANG Laichun, Investment and share
Luxshare Limited August 27, 1999 686629
WANG Laisheng holding
Shares held by the controlling
shareholder in other
companies listed on domestic None
or foreign stock exchanges
during the reporting period
Change in the controlling shareholder during the reporting period:
□ Applicable N/A
Our controlling shareholder has remained unchanged during the reporting period.
165
Luxshare Precision Industry Co., Ltd. Annual Report 2022
3. Actual controllers of the Company and their concerted parties
Nature of actual controllers: Natural person
Type of actual controllers: Natural person
Relationship with the Whether or not hold a residence permit in any
Name of actual controller Nationality
actual controller other country or region
WANG Laichun Herself Hong Kong No
WANG Laisheng Himself Hong Kong No
Ms. WANG Laichun is the Chairman of the Board of Directors & General Manager of the
Company. In 1999, Ms. WANG Laichun and Mr. WANG Laisheng jointly purchased the shares
of Luxshare Limited. In 2004, she founded Luxshare Precision Industry (Shenzhen) Co., Ltd.
(now known as “Luxshare Precision Industry Co., Ltd.”) through Luxshare Limited and acted
as its Chairman of the Board of Directors.
Main occupations and titles Mr. WANG Laisheng serves as the Vice Chairman of the Board of Directors of the Company.
Mr. WANG Laisheng and Ms. WANG Laichun jointly purchased the shares of Luxshare
Limited in 1999, and in 2004, Mr. WANG Laisheng and Ms. WANG Laisheng jointly
established founded Luxshare Precision Industry (Shenzhen) Co., Ltd. (now known as
“Luxshare Precision Industry Co., Ltd.”).
Whether or not control any other
company listed on a domestic or
None
foreign stock exchange in the past
ten years
Change in the actual controllers during the reporting period:
□ Applicable N/A
Our actual controllers have remained unchanged during the reporting period.
Diagram of ownership and control relationship between the Company and its actual controllers:
166
Luxshare Precision Industry Co., Ltd. Annual Report 2022
through any ways asset
Whether the actual controllers control the CompanyWANG Laichun trust or other WANGofLaishengmanagement?
□ Applicable N/A
4. The Company’s controlling shareholder or top 1 shareholder and its persons acting in concert pledged
account for 80% in total of the Company’s sharesLuxsharebyLimited
held them
□ Applicable N/A
Luxshare-ICT
5. Other institutional shareholders owning over 10% of shares
□ Applicable N/A
6. Restrictions on shareholding reduction of the controlling shareholder, actual controller, restructuring
parties, and other commitment subjects
□ Applicable N/A
IV. Specific implementation of share repurchases during the reporting period
Progress of share repurchase:
□ Applicable N/A
Progress of sales of repurchased shares through call auction:
167
Luxshare Precision Industry Co., Ltd. Annual Report 2022
□ Applicable N/A
168
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Section VIII Preference Shares
□ Applicable N/A
We did not have any preferred share during the reporting period.
169
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Section IX Bonds
Applicable □ N/A
I. Enterprise bonds
□ Applicable N/A
The Company had no enterprise bonds during the reporting period.
II. Corporate bonds
□ Applicable N/A
The Company had no corporate bonds during the reporting period.
III. Non-financial corporate debt financing instruments
Applicable □ N/A
1. Basic information of non-financial corporate debt financing instruments
In RMB 10,000
Principal
and
Bond Bond Issue Maturity Bond Interest Trading
Bond name Start date interest
abbreviation code date date balance rate venue
payment
method
Phase IV A lump
ultra-short- sum
term financing payment
Interbank
bonds in 2022 22 Luxshare- 0122821 June 15, June 17, March of
100,000 2.40% bond
of Luxshare ICT SCP004 52 2022 2022 14, 2023 principal
market
Precision and
Industry Co., interest at
Ltd maturity
Phase VI A lump
ultra-short- sum
term financing payment
Interbank
bonds in 2022 22 Luxshare- 0122824 July 14, July 15, April 11, of
120,000 2.20% bond
of Luxshare ICT SCP006 91 2022 2022 2023 principal
market
Precision and
Industry Co., interest at
Ltd maturity
Phase VII A lump
ultra-short- sum Interbank
22 Luxshare- 0122825 July 21, July 22, April 18,
term financing 80,000 2.15% payment bond
ICT SCP007 85 2022 2022 2023
bonds in 2022 of market
of Luxshare principal
170
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Precision and
Industry Co., interest at
Ltd maturity
Phase VIII A lump
ultra-short- sum
term financing payment
Interbank
bonds in 2022 22 Luxshare- 0122826 July 28, July 29, April 25, of
80,000 2.15% bond
of Luxshare ICT SCP008 74 2022 2022 2023 principal
market
Precision and
Industry Co., interest at
Ltd maturity
Phase I ultra- A lump
short-term sum
financing payment
Interbank
bonds in 2023 23 Luxshare- 0123816 April 21, April 21, July 20, of
120,000 2.77% bond
of Luxshare ICT SCP001 57 2023 2023 2023 principal
market
Precision and
Industry Co., interest at
Ltd. maturity
Phase II ultra- A lump
short-term sum
financing payment
Novembe Interbank
bonds in 2023 23 Luxshare- 0123819 May 23, May 23, of
r 17, 80,000 2.42% bond
of Luxshare ICT SCP002 30 2023 2023 principal
2023 market
Precision and
Industry Co., interest at
Ltd. maturity
Phase III ultra- A lump
short-term sum
financing payment
Novembe Novembe Interbank
bonds in 2023 23 Luxshare- 0123841 May 10, of
r 14, r 15, 80,000 2.70% bond
of Luxshare ICT SCP003 22 2024 principal
2023 2023 market
Precision and
Industry Co., interest at
Ltd. maturity
Institutional investors on the national interbank bond market (except for purchasers
Investors’ appropriate arrangements (if any)
prohibited by laws and regulations of China)
Applicable trading mechanism Public trading
Whether there is the risk of termination of
No
listing (if any) and countermeasures
Bonds overdue but not yet repaid
□ Applicable N/A
2. Trigger and implementation of the issuer or investor option provisions or investor protection provisions
□ Applicable N/A
171
Luxshare Precision Industry Co., Ltd. Annual Report 2022
3. Intermediaries
Name of
Name of accountants Contact person
Name of bond project Office address Phone
intermediary signing this of Intermediary
report
No. 22
Phase IV ultra-short-term
Jianguomennei
financing bonds in 2022 of Huaxia Bank
Avenue, None LI Bailu 010-85237515
Luxshare Precision Industry Co., Co., Ltd.
Dongcheng
Ltd.
District, Beijing
Phase IV ultra-short-term Shanghai No. 168
financing bonds in 2022 of Pudong Yincheng
None SHI Yuzhou 021-68476774
Luxshare Precision Industry Co., Development Middle Road,
Ltd. Bank Co., Ltd. Shanghai
20th Floor,
Tower 3, Kerry
Phase IV ultra-short-term Han Kun Law
Plaza, No. 1
financing bonds in 2022 of Offices
Zhongxin 4th None TONG Linwen 0755-36806500
Luxshare Precision Industry Co., (Shenzhen)
Road, Futian
Ltd. Beijing Branch
District,
Shenzhen
10th Floor,
Building 7, No.
Phase IV ultra-short-term RSM China
16 Courtyard,
financing bonds in 2022 of (Special LI Jing, ZHEN
West Fourth ZHU Jiandi 010-88210608
Luxshare Precision Industry Co., General Zhijie
Ring Middle
Ltd. Partnership)
Road, Haidian
District, Beijing
Building 1,
South Tower,
EASTMONEY
11th Floor,
Phase IV ultra-short-term Ratings
Units 1101,
financing bonds in 2022 of International
1102, 1103, No. None XING Dong 010-62299850
Luxshare Precision Industry Co., Credit
3 Chaowai West
Ltd. Assessment
Street,
Co., Ltd.
Chaoyang
District, Beijing
33rd-34th
Floors, Oriental
Phase IV ultra-short-term China Central
International
financing bonds in 2022 of Depository &
Finance Plaza, None XIE Zhong 021-63326662
Luxshare Precision Industry Co., Clearing Co.,
318 Zhongshan
Ltd. Ltd.
South Road,
Shanghai
China
Phase VI ultra-short-term Merchants Bank
China
financing bonds in 2022 of Tower, No.
Merchants Bank None LUO Yingying 0755-88026159
Luxshare Precision Industry Co., 7088 Shennan
Co., Ltd.
Ltd. Avenue,
Shenzhen
Phase VI ultra-short-term Han Kun Law 20th Floor,
financing bonds in 2022 of Offices Tower 3, Kerry None TONG Linwen 0755-36806500
Luxshare Precision Industry Co., (Shenzhen) Plaza, No. 1
172
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Ltd. Beijing Branch Zhongxin 4th
Road, Futian
District,
Shenzhen
10th Floor,
Building 7, No.
Phase VI ultra-short-term RSM China
16 Courtyard,
financing bonds in 2022 of (Special LI Jing, ZHEN
West Fourth ZHU Jiandi 010-88210608
Luxshare Precision Industry Co., General Zhijie
Ring Middle
Ltd. Partnership)
Road, Haidian
District, Beijing
Building 1,
South Tower,
EASTMONEY
11th Floor,
Phase VI ultra-short-term Ratings
Units 1101,
financing bonds in 2022 of International
1102, 1103, No. None XING Dong 010-62299850
Luxshare Precision Industry Co., Credit
3 Chaowai West
Ltd. Assessment
Street,
Co., Ltd.
Chaoyang
District, Beijing
33rd-34th
Floors, Oriental
Phase VI ultra-short-term China Central
International
financing bonds in 2022 of Depository &
Finance Plaza, None XIE Zhong 021-63326662
Luxshare Precision Industry Co., Clearing Co.,
318 Zhongshan
Ltd. Ltd.
South Road,
Shanghai
Phase VII ultra-short-term Shanghai No. 168
financing bonds in 2022 of Pudong Yincheng
None DU Zhong 021-68476774
Luxshare Precision Industry Co., Development Middle Road,
Ltd. Bank Co., Ltd. Shanghai
20th Floor,
Tower 3, Kerry
Phase VII ultra-short-term Han Kun Law
Plaza, No. 1
financing bonds in 2022 of Offices
Zhongxin 4th None GUO Qilin 0755-36806500
Luxshare Precision Industry Co., (Shenzhen)
Road, Futian
Ltd. Beijing Branch
District,
Shenzhen
10th Floor,
Building 7, No.
Phase VII ultra-short-term Han Kun Law
16 Courtyard,
financing bonds in 2022 of Offices LI Jing, ZHEN
West Fourth ZHU Jiandi 010-88210608
Luxshare Precision Industry Co., (Shenzhen) Zhijie
Ring Middle
Ltd. Beijing Branch
Road, Haidian
District, Beijing
Building 1,
South Tower,
EASTMONEY
11th Floor,
Phase VII ultra-short-term Ratings
Units 1101,
financing bonds in 2022 of International
1102, 1103, No. None XING Dong 010-62299850
Luxshare Precision Industry Co., Credit
3 Chaowai West
Ltd. Assessment
Street,
Co., Ltd.
Chaoyang
District, Beijing
Phase VII ultra-short-term China Central 33rd-34th None XIE Zhong 021-63326662
173
Luxshare Precision Industry Co., Ltd. Annual Report 2022
financing bonds in 2022 of Depository & Floors, Oriental
Luxshare Precision Industry Co., Clearing Co., International
Ltd. Ltd. Finance Plaza,
318 Zhongshan
South Road,
Shanghai
China
Phase VIII ultra-short-term Merchants Bank
China
financing bonds in 2022 of Tower, No.
Merchants Bank None LUO Yingying 0755-88026159
Luxshare Precision Industry Co., 7088 Shennan
Co., Ltd.
Ltd. Avenue,
Shenzhen
20th Floor,
Tower 3, Kerry
Phase VIII ultra-short-term Han Kun Law
Plaza, No. 1
financing bonds in 2022 of Offices
Zhongxin 4th None TONG Linwen 0755-36806500
Luxshare Precision Industry Co., (Shenzhen)
Road, Futian
Ltd. Beijing Branch
District,
Shenzhen
10th Floor,
Building 7, No.
Phase VIII ultra-short-term RSM China
16 Courtyard,
financing bonds in 2022 of (Special LI Jing, ZHEN
West Fourth ZHU Jiandi 010-88210608
Luxshare Precision Industry Co., General Zhijie
Ring Middle
Ltd. Partnership)
Road, Haidian
District, Beijing
Building 1,
South Tower,
EASTMONEY
11th Floor,
Phase VIII ultra-short-term Ratings
Units 1101,
financing bonds in 2022 of International
1102, 1103, No. None XING Dong 010-62299850
Luxshare Precision Industry Co., Credit
3 Chaowai West
Ltd. Assessment
Street,
Co., Ltd.
Chaoyang
District, Beijing
33rd-34th
Floors, Oriental
Phase VIII ultra-short-term China Central
International
financing bonds in 2022 of Depository &
Finance Plaza, None XIE Zhong 021-63326662
Luxshare Precision Industry Co., Clearing Co.,
318 Zhongshan
Ltd. Ltd.
South Road,
Shanghai
No. 1788
Hongning
Phase I ultra-short-term financing Road, Xiaoshan
Zheshang Bank
bonds in 2023 of Luxshare District, None CAI Yingni 0755-23888727
Co., Ltd.
Precision Industry Co., Ltd. Hangzhou City,
Zhejiang
Province
Shanghai No. 168
Phase I ultra-short-term financing
Pudong Yincheng
bonds in 2023 of Luxshare None DU Zhong 021-68476774
Development Middle Road,
Precision Industry Co., Ltd.
Bank Co., Ltd. Shanghai
Phase I ultra-short-term financing Han Kun Law 20th Floor,
None TONG Linwen 0755-36806500
bonds in 2023 of Luxshare Offices Tower 3, Kerry
174
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Precision Industry Co., Ltd. (Shenzhen) Plaza, No. 1
Beijing Branch Zhongxin 4th
Road, Futian
District,
Shenzhen
10th Floor,
Building 7, No.
RSM China
Phase I ultra-short-term financing 16 Courtyard,
(Special LI Jing, ZHEN
bonds in 2023 of Luxshare West Fourth ZHU Jiandi 010-88210608
General Zhijie
Precision Industry Co., Ltd. Ring Middle
Partnership)
Road, Haidian
District, Beijing
Building 1,
South Tower,
EASTMONEY
11th Floor,
Ratings
Phase I ultra-short-term financing Units 1101,
International
bonds in 2023 of Luxshare 1102, 1103, No. None XING Dong 010-62299850
Credit
Precision Industry Co., Ltd. 3 Chaowai West
Assessment
Street,
Co., Ltd.
Chaoyang
District, Beijing
33rd-34th
EASTMONEY
Floors, Oriental
Ratings
Phase I ultra-short-term financing International
International
bonds in 2023 of Luxshare Finance Plaza, None XIE Zhong 021-63326662
Credit
Precision Industry Co., Ltd. 318 Zhongshan
Assessment
South Road,
Co., Ltd.
Shanghai
Phase II ultra-short-term Shanghai No. 168
financing bonds in 2023 of Pudong Yincheng DONG
None 021-68476774
Luxshare Precision Industry Co., Development Middle Road, Wenchao
Ltd. Bank Co., Ltd. Shanghai
20th Floor,
Tower 3, Kerry
Phase II ultra-short-term Han Kun Law
Plaza, No. 1
financing bonds in 2023 of Offices
Zhongxin 4th None TONG Linwen 0755-36806500
Luxshare Precision Industry Co., (Shenzhen)
Road, Futian
Ltd. Beijing Branch
District,
Shenzhen
10th Floor,
Building 7, No.
Phase II ultra-short-term RSM China
16 Courtyard,
financing bonds in 2023 of (Special LI Jing, ZHEN
West Fourth ZHU Jiandi 010-88210608
Luxshare Precision Industry Co., General Zhijie
Ring Middle
Ltd. Partnership)
Road, Haidian
District, Beijing
Building 1,
South Tower,
EASTMONEY
11th Floor,
Phase II ultra-short-term Ratings
Units 1101,
financing bonds in 2023 of International
1102, 1103, No. None XING Dong 010-62299850
Luxshare Precision Industry Co., Credit
3 Chaowai West
Ltd. Assessment
Street,
Co., Ltd.
Chaoyang
District, Beijing
175
Luxshare Precision Industry Co., Ltd. Annual Report 2022
33rd-34th
Floors, Oriental
Phase II ultra-short-term China Central
International
financing bonds in 2023 of Depository &
Finance Plaza, None XIE Zhong 021-63326662
Luxshare Precision Industry Co., Clearing Co.,
318 Zhongshan
Ltd. Ltd.
South Road,
Shanghai
Phase III ultra-short-term Shanghai No. 168
financing bonds in 2023 of Pudong Yincheng DONG
None 021-68476774
Luxshare Precision Industry Co., Development Middle Road, Wenchao
Ltd. Bank Co., Ltd. Shanghai
20th Floor,
Tower 3, Kerry
Phase III ultra-short-term Han Kun Law
Plaza, No. 1
financing bonds in 2023 of Offices
Zhongxin 4th None TONG Linwen 0755-36806500
Luxshare Precision Industry Co., (Shenzhen)
Road, Futian
Ltd. Beijing Branch
District,
Shenzhen
10th Floor,
Building 7, No.
Phase III ultra-short-term RSM China
16 Courtyard,
financing bonds in 2023 of (Special LI Jing, ZHEN
West Fourth ZHU Jiandi 010-88210608
Luxshare Precision Industry Co., General Zhijie
Ring Middle
Ltd. Partnership)
Road, Haidian
District, Beijing
Building 1,
South Tower,
11th Floor,
Phase III ultra-short-term RSM China
Units 1101,
financing bonds in 2023 of (Special
1102, 1103, No. None XING Dong 010-62299850
Luxshare Precision Industry Co., General
3 Chaowai West
Ltd. Partnership)
Street,
Chaoyang
District, Beijing
33rd-34th
Floors, Oriental
Phase III ultra-short-term China Central
International
financing bonds in 2023 of Depository &
Finance Plaza, None XIE Zhong 021-63326662
Luxshare Precision Industry Co., Clearing Co.,
318 Zhongshan
Ltd. Ltd.
South Road,
Shanghai
Did the above-mentioned intermediaries change during the reporting period?
□ Yes No
4. Use of raised funds
In RMB 10,000
Operation of Rectification Consistent
Total Unused
Name of bond project Used amount special s of use of with the
proceeds amount
account for the proceeds usage, use
176
Luxshare Precision Industry Co., Ltd. Annual Report 2022
proceeds (if in violation plan and
any) of laws and other
regulations agreements
(if any) as promised
in the
prospectus or
not
Phase IV ultra-short-term
financing bonds in 2022 of
100,000 100,000 0 Normal N/A Yes
Luxshare Precision Industry
Co., Ltd.
Phase VI ultra-short-term
financing bonds in 2022 of
120,000 120,000 0 Normal N/A Yes
Luxshare Precision Industry
Co., Ltd.
Phase VII ultra-short-term
financing bonds in 2022 of
80,000 80,000 0 Normal N/A Yes
Luxshare Precision Industry
Co., Ltd.
Phase VIII ultra-short-term
financing bonds in 2022 of
80,000 80,000 0 Normal N/A Yes
Luxshare Precision Industry
Co., Ltd.
Phase I ultra-short-term
financing bonds in 2023 of
120,000 120,000 0 Normal N/A Yes
Luxshare Precision Industry
Co., Ltd.
Phase II ultra-short-term
financing bonds in 2023 of
80,000 80,000 0 Normal N/A Yes
Luxshare Precision Industry
Co., Ltd.
Phase III ultra-short-term
financing bonds in 2023 of
80,000 80,000 0 Normal N/A Yes
Luxshare Precision Industry
Co., Ltd.
Use of proceeds in the construction projects
□ Applicable N/A
Change by the Company of the usage of the above-mentioned proceeds during the reporting period
□ Applicable N/A
5. Adjustment of credit rating results during the reporting period
□ Applicable N/A
6. Implementation and changes of guarantees, debt repayment plans and other debt repayment security
measures during the reporting period and their effects on bond investors
□ Applicable N/A
177
Luxshare Precision Industry Co., Ltd. Annual Report 2022
IV. Convertible corporate bonds
□Applicable N/A
1. Historic adjustment of conversion price
I. 2020
(1) The initial conversion price of the company's convertible bonds was set at CNY 58.62 per share.
(2) Due to the voluntary exercise of stock options by incentive recipients under the company's equity incentive
plan from November 3, 2020 (the issuance date of the convertible bonds) to December 10, 2020, the company issued
an additional 3,281,228 shares, resulting in an adjustment of the conversion price from CNY 58.62 per share to
CNY 58.60 per share, effective from December 14, 2020.
(3) Due to the voluntary exercise of stock options by incentive recipients under the company's equity incentive
plan on December 25, 2020, the company issued an additional 17,765,322 shares, resulting in an adjustment of the
conversion price from CNY 58.60 per share to CNY 58.48 per share, effective from December 30, 2020.
(4) As of the end of the reporting period, the conversion price of the company's convertible bonds stands at
CNY 58.48 per share.
II. 2021
(1) The initial conversion price of the company's convertible bonds was set at RMB 58.48 per share.
(2) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 4,304,601 shares, and the exercise by incentive recipients of the first grant of stock
options under the 2019 stock option incentive plan, resulting in the addition of 445,471 shares, the conversion price
was adjusted from RMB 58.48 per share to RMB 58.44 per share, effective from January 13, 2021.
(3) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 5,459,122 shares, and the exercise by incentive recipients of the first grant of stock
options under the 2019 stock option incentive plan, resulting in the addition of 3,767,011 shares, the conversion
price was adjusted from RMB 58.44 per share to RMB 58.38 per share, effective from February 24, 2021.
(4) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 2,649,238 shares, and the exercise by incentive recipients of the first grant of stock
options under the 2019 stock option incentive plan, resulting in the addition of 967,132 shares, the conversion price
was adjusted from RMB 58.38 per share to RMB 58.36 per share, effective from March 11, 2021.
(5) Due to the implementation of the 2020 annual equity distribution, with the company's existing total share
capital of 7,035,428,828 shares as the base, a cash dividend of RMB 1.099999 per 10 shares was distributed to all
shareholders, resulting in an adjustment of the conversion price from RMB 58.36 per share to RMB 58.25 per share,
effective from July 8, 2021.
(6) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
178
Luxshare Precision Industry Co., Ltd. Annual Report 2022
plan, resulting in the addition of 1,032,246 shares, and the exercise by incentive recipients of the first grant of stock
options under the 2019 stock option incentive plan, resulting in the addition of 7,360,758 shares, the conversion
price was adjusted from RMB 58.25 per share to RMB 58.20 per share, effective from July 22, 2021.
(7) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 374,655 shares, the exercise by incentive recipients of the first grant of stock options
under the 2019 stock option incentive plan, resulting in the addition of 3,417,190 shares, and the reservation of
shares for future issuance to incentive recipients, the conversion price was adjusted from RMB 58.20 per share to
RMB 58.18 per share, effective from September 6, 2021.
(8) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 34,828 shares, the exercise by incentive recipients of the first grant of stock options
under the 2019 stock option incentive plan, resulting in the addition of 2,501,419 shares, and the reservation of
shares for future issuance to incentive recipients, the conversion price was adjusted from RMB 58.18 per share to
RMB 58.16 per share, effective from November 10, 2021.
(9) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 14,413,326 shares, the exercise by incentive recipients of the first grant of stock
options under the 2019 stock option incentive plan, resulting in the addition of 1,112,879 shares, and the reservation
of shares for future issuance to incentive recipients, the conversion price was adjusted from RMB 58.16 per share
to RMB 58.05 per share, effective from December 29, 2021.
(10) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option
incentive plan, resulting in the addition of 5,184,144 shares, the exercise by incentive recipients of the first grant of
stock options under the 2019 stock option incentive plan, resulting in the addition of 365,642 shares, and the
reservation of shares for future issuance to incentive recipients, the conversion price was adjusted from RMB 58.05
per share to RMB 58.01 per share, effective from December 31, 2021.
(11) As of the end of the reporting period, the conversion price of the company's convertible bonds stands at
RMB 58.01 per share.
III. 2022
(1) As of the beginning of the reporting period, the conversion price of convertible bonds of the Company was
RMB58.48 per share.
(2) The conversion price was adjusted from RMB58.01 per share to RMB57.98 per share, which became
effective on January 13, 2022, because 3,747,618 shares were added arising from exercise by grantees under 2018
stock option incentive plan and 560,728 shares were added arising from exercise by grantees in initial grant under
2019 stock option incentive plan of the Company.
(3) The conversion price was adjusted from RMB57.98 per share to RMB57.97 per share, which became
179
Luxshare Precision Industry Co., Ltd. Annual Report 2022
effective on January 25, 2022, because 1,132,798 shares were added arising from exercise by grantees under 2018
stock option incentive plan and 270,342 shares were added arising from exercise by grantees in initial grant under
2019 stock option incentive plan of the Company.
(4) The conversion price was adjusted from RMB57.97 per share to RMB57.93 per share, which became
effective on March 8, 2022, because 2,212,582 shares were added arising from exercise by grantees under 2018
stock option incentive plan and 508,705 shares were added arising from exercise by grantees in initial grant under
2019 stock option incentive plan and 3,011,626 reserved shares were exercised by grantees under 2019 stock option
incentive plan of the Company.
(5) The conversion price was adjusted from RMB57.93 per share to RMB57.92 per share, which became
effective on March 22, 2022, because 873,526 shares were added arising from exercise by grantees under 2018
stock option incentive plan and 233,381 shares were added arising from exercise by grantees in initial grant under
2019 stock option incentive plan and 424,954 reserved shares were exercised by grantees under 2019 stock option
incentive plan of the Company.
(6) The conversion price was adjusted from RMB57.92 per share to RMB57.91 per share, which became
effective on May 25, 2022, because 627.019 shares were added arising from exercise by grantees under 2018 stock
option incentive plan and 148,641 shares were added arising from exercise by grantees in initial grant under 2019
stock option incentive plan of the Company.
(7) The conversion price was adjusted from RMB57.91 per share to RMB57.80 per share, which become
effective on July 13, 2022 because the Company implemented the annual equity distribution in 2021, and distributed
RMB1.099820 in cash per 10 shares to all shareholders based on the Company’s existing total share capital of
7,085,454,576 shares.
(8) The conversion price was adjusted from RMB57.80 per share to RMB57.75 per share, which became
effective on July 27, 2022, because 880,088 shares were added arising from exercise by grantees under 2018 stock
option incentive plan and 7,580,662 shares were added arising from exercise by grantees in initial grant under 2019
stock option incentive plan and 79,033 reserved shares were exercised by grantees under 2019 stock option incentive
plan of the Company.
(9) The conversion price was adjusted from RMB57.75 per share to RMB57.73 per share, which became
effective on September 7, 2022, because 468,709 shares were added arising from exercise by grantees under 2018
stock option incentive plan and 2,920,986 shares were added arising from exercise by grantees in initial grant under
2019 stock option incentive plan and 139,180 reserved shares were exercised by grantees under 2019 stock option
incentive plan of the Company.
(10) The conversion price was adjusted from RMB57.73 per share to RMB57.71 per share, which became
effective on November 22, 2022, because 379,470 shares were added arising from exercise by grantees under 2018
stock option incentive plan and 1,911,486 shares were added arising from exercise by grantees in initial grant under
180
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2019 stock option incentive plan and 91,549 reserved shares were exercised by grantees under 2019 stock option
incentive plan of the Company.
(11) The conversion price was adjusted from RMB57.71 per share to RMB57.63 per share, which became
effective on December 20, 2022, because 11,412,022 shares were added arising from exercise by grantees under
2018 stock option incentive plan and 294,313 shares were added arising from exercise by grantees in initial grant
under 2019 stock option incentive plan of the Company.
(12) As of the end of the reporting period, the conversion price of convertible bonds of the Company was
RMB57.63 per share.
IV. 2023
(1) At the beginning of the reporting period, the conversion price of the company's convertible bonds was RMB
57.63 per share.
(2) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 3,752,347 shares, and the exercise by incentive recipients of the first grant of stock
options under the 2019 stock option incentive plan, resulting in the addition of 116,679 shares, the conversion price
was adjusted from RMB 57.63 per share to RMB 57.60 per share, effective from January 4, 2023.
(3) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 9,094,213 shares, and the exercise by incentive recipients of the first grant of stock
options under the 2019 stock option incentive plan, as well as the reservation of shares for future issuance to
incentive recipients, resulting in a total addition of 5,811,753 shares, the conversion price was adjusted from RMB
57.60 per share to RMB 57.50 per share, effective from March 24, 2023.
(4) Due to the implementation of the 2022 annual equity distribution, with the company's existing total share
capital of 7,132,251,351 shares as the base, a cash dividend of RMB 1.299661 per 10 shares was distributed to all
shareholders, resulting in an adjustment of the conversion price from RMB 57.91 per share to RMB 57.37 per share,
effective from June 15, 2023.
(5) Due to the exercise of stock options by incentive recipients under the company's 2018 stock option incentive
plan, resulting in the addition of 2,508,221 shares, and the exercise by incentive recipients of the first grant of stock
options under the 2019 stock option incentive plan, as well as the reservation of shares for future issuance to
incentive recipients, resulting in a total addition of 7,575,022 shares, the conversion price was adjusted from RMB
57.37 per share to RMB 57.31 per share, effective from July 26, 2023.
(6) As of the end of the reporting period, the conversion price of the company's convertible bonds stands at
RMB 57.31 per share.
2. Accumulative conversion of convertible bonds into shares
Applicable □ N/A
Convertible Beginning Total Total issue Amount of Number of Proportion Amount of Proportion
181
Luxshare Precision Industry Co., Ltd. Annual Report 2022
bond and ending issued amount accumulati accumulati of unconverte of amount
abbreviatio dates convertible ve ve accumulati d bonds of
n bonds converted converted ve (RMB) unconverte
(piece) shares shares converted d bonds to
(RMB) (share) share to the the total
total shares issued
issued by amount
the
Company
before
conversion
Convertible 30,000,000 3,000,000,0 174,100.00 3,010 0.00% 2,999,088,9 99.97%
May 10,
bonds of 00.00 00.00
2021
Luxshare
3. Top 10 holders of convertible corporate bonds
Nature of Number of Amount of Percentage of
holder of convertible convertible convertible
Name of holder of convertible convertibl corporate bonds corporate bonds corporate bonds
S.N.
corporate bonds e held at the end of held at the end of held at the end of
corporate the reporting the reporting the reporting
bonds period period (RMB) period
China Construction Bank Corporation -
Zhong Ou New Blue Chip Flexible
1 Others 1,451,370 49,999,696.50 4.84%
Allocation Hybrid Securities Investment
Fund
Foreign
The HongKong and Shanghai Banking
2 legal 907,650 31,268,542.50 3.03%
Corporation Limited
person
ICBC Credit Suisse Tianfeng
3 Convertible Bond Fixed Income Pension Others 888,242 30,599,936.90 2.96%
Product - Bank of China Limited
China Construction Bank Corporation
4 Limited - Xinhua Zengyi bond securities Others 828,154 28,529,905.30 2.76%
investment fund
Fuguo Fuyi Enterprising Fixed Income
5 Pension Product - Industrial and Others 711,580 24,513,931.00 2.37%
Commercial Bank of China Limited
China Construction Bank Corporation
6 Limited - Huashang Credit enhanced Others 696,214 23,984,572.30 2.32%
bond securities investment fund
China Merchants Bank Co., LTD-
7 Industrial income enhancement bond Others 656,139 22,603,988.55 2.19%
securities investment fund
Foreign
8 UBS AG legal 624,992 21,530,974.40 2.08%
person
Industrial and Commercial Bank of
9 Others 441,671 15,215,565.95 1.47%
China – Nu'an Balanced Securities
182
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Investment Fund
State-
owned
10 Northeast Securities Co., Ltd. 420,053 14,470,825.85 1.40%
legal
person
4. Significant changes in the profitability, assets and credit status of the guarantors
□ Applicable N/A
5. The Company’s liabilities, changes in credit at the end of the reporting period and cash arrangements for
debt repayment in future years
According to the Credit Rating Report (Lian He [2023] No. 4797) issued by China Lianhe Credit Rating Co., Ltd. on June 21,
2023, the long-term credit rating of the Company as the entity is AA+ and the credit rating of the convertible bonds of the Company is
AA+. There is no significant change in the Company’s liabilities and credit. For main accounting data and financial indicators, please
see the “VIII Main Accounting Date and Financial Indicators in the Past Two Years” under Section IX of this report.
V. The loss in the scope of consolidated statements of the Company during the reporting period
exceeded 10% of the net assets at the end of previous reporting period
□ Applicable N/A
VI. Overdue interest-bearing debts other than bonds at the end of the reporting period
□ Applicable N/A
VII. Was there violations of rules and regulations during the reporting period?
□ Yes No
VIII. Main accounting data and financial indicators of the Company for most recent two years
as of the end of the reporting period
In RMB0’000
Item December 31, 2023 December 31, 2022 Y/Y% Change
Current ratio 1.2591 1.183 6.43%
Equity-debt ratio 56.61% 60.38% -3.77%
Quick ratio 0.8615 0.6824 26.25%
2023 2022 Y/Y% Change
Net profit, excluding non-
1,018,555.36 844,205.29 20.65%
recurring profit and loss
EBITDA - total debt ratio 61.41% 60.45% 0.96%
183
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Interest coverage ratio 10.36 11.75 -11.83%
Cash interest coverage ratio 22.58 14.99 50.63%
EBITDA-to-interest coverage
17.98 19.43 -7.46%
ratio
Rate of loans due and repaid 100.00% 100.00% 0.00%
Rate of interest due and paid 100.00% 100.00% 0.00%
184
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Section X Financial Report
I. Auditor’s report
Audit opinion Standard Unqualified Opinion
Signing date of audit report April 24, 2024
Auditor BDO China Shu Lun Pan Certified Public Accountants LLP
Auditor report document number Xin Kuai Shi Bao Zi [2024] No. ZB10481
Name of certified public accountants LI Jing and DAN Jie
Main Body of Auditor’s Report
Auditor’s Report
Xin Kuai Shi Bao Zi [2023] No. ZB10828
To all shareholders of Luxshare Precision Industry Co., Ltd.,
I. Audit opinion
We have audited the financial statements of Luxshare Precision Industry Co., Ltd. (“Luxshare Precision”), which
comprise the consolidated and parent company’s balance sheets as at December 31, 2023, and the consolidated and parent
company’s income statements, the consolidated and parent company’s statements of cash flows and the consolidated and
parent company’s statements of changes in owners’ equity for the year then ended, and the notes to the financial statements.
In our opinion, the accompanying financial statements are prepared in all material respects in accordance with the
Accounting Standards for Business Enterprises and fairly present the consolidated and parent company’s financial
position as of December 31, 2023, and the consolidated and parent company’s operating results and cash flows for the
year then ended.
II. Basis for opinion
We conducted our audit in accordance with the Auditing Standards for Certified Public Accountants of China. Our
responsibilities under those standards are further described in the “Auditor ’s responsibilities for the audit of the financial
statements” section of our report. We are independent of Luxshare Precision with the Code of Ethics for Chinese Certified
Public Accountants, and we have fulfilled our other ethical responsibilities in accordance with the Code. We believe that
the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
III. Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
financial statements of the current period. These matters were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matters identified in our audit are summarized as below:
Key audit matters How we addressed the matter in our audit
(I) Revenue recognition
For details of the accounting policy for and analysis 1. Understand, evaluate and test the design of the
on revenue recognition, please see the accounting key internal controls of the management related to
policies described in the Item (26) under the Note “III. revenue recognition and the operational effectiveness of
Significant accounting policies and accounting those controls;
estimates” and the Item (45) under the Note “V. Notes to 2. Sample the product sales revenue to make test
consolidated financial statements” to the financial thereof according to different regions and customers:
statements (48). check supporting documents related to revenue
In 2023, Luxshare Precision’s operating income recognition;
presented in its consolidated financial statements 3. Implement the analytical procedures on income
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
amounted to RMB231,905,459,800.00. Luxshare and gross profit and determine whether there are
Precision has a large number of customers at home and abnormal fluctuations in the amount of revenue for the
abroad. Under different delivery methods, the Company current period;
recognizes revenue upon the transfer of control of a 4. Understand the modes of cooperation between
related product to a customer. If a customer is also the the Company and customers and suppliers, and evaluate
supplier of some raw materials, the Company recognizes the product liability share and the transfer of control;
the purchase of raw materials and sales of products 5. Evaluate the accuracy and completeness of
respectively based on the transfer of inventory risks and revenue in conjunction with the confirmation
rewards, product liability, credit risk bearers and procedures for receivables & payables and inventories;
business nature, that is, the sales revenue is recognized and
based on the gross amount. The revenue is one of the 6. Analyze the post-period recovery of accounts
Company’s key performance indicators and the main receivable.
source of the Company’s profits, so we identify the
revenue from product sales as the key audit matter based
on the importance of the accounting policy for revenue
recognition and the amount involved.
(II) Provision for decline in value of inventories
Please see the accounting policies described in the 1. Understand, evaluate and test the design of the
Item (11) under the Note “III. Significant accounting key internal controls of the management related to the
policies and accounting estimates” and the Item (7) provision for decline in value of inventories and the
under the Note “V. Notes to consolidated financial operational effectiveness of those controls;
statements” to the financial statements (8). 2. Obtain the Company’s calculation sheet of the
As at December 31, 2023, Luxshare Precision’s provision for decline in value of inventories, review the
inventories and provision for decline in value of net realizable value of inventories and the provision for
inventories presented in its consolidated financial decline in value of inventories, and evaluate whether the
statements amounted to RMB 30,886,474,500.00 and judgment made by the management in determining the
RMB1,128,544,200.00 respectively. Inventories of the net realizable value of inventories is reasonable;
Company are stated at the lower of cost or net realizable 3. Check the quantity and conditions of
value. For finished products, their net realizable value is inventories, focus on inspecting the long-term
determined at the estimated selling price of these inventories, and analyze the adequacy of the provision
inventories less the estimated costs necessary to make for decline in value of inventories if any indication
the sale and relevant taxes; for the inventories that need exists that such inventories may be impaired, in
to be processed, in the ordinary production and operation conjunction with roll-forward procedures; and
process, their net realizable value is determined at the 4. Check the current changes of the provision for
estimated selling price of finished products less the decline in value of inventories made in previous years
estimated costs of completion and the estimated costs and analyze the rationality of the changes in the
necessary to make the sale and relevant taxes. The provision for decline in value of inventories.
determination of the net realizable value of inventories
involves the management’s use of significant accounting
estimates and judgments, and the provision for decline in
value of inventories is of significance to the consolidated
financial statements, so we identify the provision for
decline in value of inventories as the key audit matter.
IV. Other information
The management of Luxshare Precision (“management”) is responsible for other information. Other information
comprises the information included in the 2022 Annual Report of Luxshare Precision, but does not include the financial
statements and our auditor’s report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge
obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact. We have nothing to report in this regard.
V. Responsibilities of the management and those charged with governance for the financial statements
The management is responsible for the preparation and fair presentation of the financial statements in accordance
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
with Accounting Standards for Business Enterprises, and designing, implementing and maintaining internal control that
is necessary to enable the financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the management is responsible for assessing Luxshare Precision’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless the management either intends to liquidate Luxshare Precision or to cease operations, or have no
realistic alternative but to do so.
Those charged with governance of Luxshare Precision (hereinafter referred to as “those charged with governance”)
are responsible for overseeing Luxshare Precision’s financial reporting process.
VI. Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with China Standards
on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with China Standards on Auditing, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
(1) Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate
to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than
that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the
override of internal control;
(2) Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are
appropriate in the circumstances;
(3) Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and
related disclosures made by the management;
(4) Conclude on the appropriateness of the management’s use of the going concern basis of accounting, and
meanwhile, based on the audit evidence obtained, on whether a material uncertainty exists related to events or conditions
that may cast significant doubts on Luxshare Precision’s ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the
financial statements. If such disclosures are inadequate, we are required to modify our opinion. Our conclusions are based
on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause
Luxshare Precision to cease to continue as a going concern;
(5) Evaluate the overall presentation (including disclosure), structure and content of the financial statements and
whether the financial statements represent the underlying transactions and events in a manner that achieves fair
presentation; and
(6) Obtain sufficient and appropriate audit evidence regarding the financial information of the entities or business
activities within Luxshare Precision to express an opinion on the consolidated financial statements. We are responsible
for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing
of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most
significance in the audit of the financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the
adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.
BDO China Shu Lun Pan Certified Public Accountants LLP Chinese CPA: LI Jing (Project Partner)
Chinese CPA: DAN Jie
Shanghai China April 27, 2023
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
II. Financial statements
Statements in notes to the financial statements are dominated in RMB.
1. Consolidated balance sheet
Prepared by: Luxshare Precision Industry Co., Ltd.
December 31, 2023
In RMB
Item December 31, 2023 January 1, 2023
Current assets:
Cash and bank balances 33,619,539,457.51 19,367,209,441.41
Balances with clearing agencies
Placements with banks and other
financial institutions
Held-for-trading financial assets 1,720,764,175.32 1,353,266,499.91
Derivative financial assets
Notes receivable 261,073,349.06 949,767,020.69
Accounts receivable 23,504,481,889.07 26,043,354,859.19
Receivable financing 587,585,009.82
Prepayments 486,702,941.36 586,577,865.23
Premiums receivable
Amounts receivable under reinsurance
contracts
Reinsurer’s share of insurance contract
reserves
Other receivables 322,407,052.71 431,123,451.91
Including: Interest receivable
Dividends receivable
Financial assets purchased under resale
agreements
Inventories 29,757,930,319.35 37,363,329,476.66
Contract assets
Held-for-sale assets
Non-current assets due within one year 1,047,566,017.54
Other current assets 2,920,078,401.07 2,197,204,594.09
Total current assets 94,228,128,612.81 88,291,833,209.09
Non-current assets:
Loans and advances to customers
Debt investments 1,739,251,540.45
Other debt investments
Long-term receivables
Long-term equity investment 4,232,941,741.05 2,000,007,642.66
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
Other investments in equity
249,122,251.32 440,106,992.66
instruments
Other non-current financial assets 35,700,000.00 35,700,000.00
Investment properties 23,353,936.24 92,782,410.06
Fixed assets 44,560,506,279.62 44,026,022,703.69
Construction in progress 2,226,217,016.31 2,695,377,794.32
Bearer biological assets
Oil and gas assets
Right-of-use assets 648,963,968.09 941,749,814.66
Intangible assets 2,663,069,103.86 2,695,684,053.67
Development expenditure
Goodwill 1,729,242,734.88 1,730,047,190.39
Long-term deferred expenses 590,266,003.15 810,913,529.72
Deferred tax assets 872,943,835.40 1,208,582,281.01
Other non-current assets 9,931,644,112.92 1,676,259,912.33
Total non-current assets 67,763,970,982.84 60,092,485,865.62
Total assets 161,992,099,595.65 148,384,319,074.71
Current liabilities:
Short-term borrowings 20,514,182,240.47 14,911,899,668.93
Loans from the central bank
Taking from banks and other financial
institutions
Held-for-trading financial liabilities 117,942,421.18 44,318,321.50
Derivative financial liabilities
Notes payable 492,585,900.03 515,054,217.52
Accounts payable 45,908,515,295.43 49,786,483,552.54
Receipts in advance
Contract liabilities 243,566,923.42 501,765,453.24
Financial assets sold under repurchase
agreements
Customer deposits and deposits from
banks and other financial institutions
Funds from securities trading agency
Funds from underwriting securities
agency
Employee benefits payable 2,330,318,991.75 2,368,135,762.48
Taxes payable 1,021,324,275.18 841,385,173.92
Other payables 406,677,940.53 472,880,196.48
Including: Interest payable
Dividends payable 11,894,022.29 15,089,486.78
Fees and commissions payable
Amounts payable under reinsurance
contracts
Held-for-sale liabilities
189
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Non-current liabilities due within one
2,867,295,870.89 1,232,252,431.14
year
Other current liabilities 932,701,803.30 3,957,037,125.24
Total current liabilities 74,835,111,662.18 74,631,211,902.99
Non-current liabilities:
Insurance contract reserves
Long-term borrowings 12,038,771,289.92 9,205,313,060.94
Bonds payable 2,799,499,850.29 2,689,623,546.98
Including: Preferred shares
Perpetual bonds
Lease liabilities 552,488,888.66 800,739,041.51
Long-term payables
Long-term employee benefits payable
Provisions 642,733.24 682,513.39
Deferred income 595,323,601.05 665,910,095.66
Deferred tax liabilities 883,924,973.73 1,606,645,177.00
Other non-current liabilities 1,471,770.36 324,039.05
Total non-current liabilities 16,872,123,107.25 14,969,237,474.53
Total liabilities 91,707,234,769.43 89,600,449,377.52
Owners’ equity:
Share capital 7,148,168,213.00 7,099,908,647.00
Other equity instruments 527,289,020.28 527,319,637.88
Including: Preferred shares
Perpetual bonds
Capital reserve 5,011,944,633.92 3,652,626,861.74
Less: Treasury shares
Other comprehensive income 148,762,176.88 651,458,316.25
Special reserve 3,528,369.80 2,094,879.61
Surplus reserve 1,443,520,185.47 1,121,072,698.83
General risk reserve
Unappropriated profit 42,026,971,911.25 32,288,416,277.22
Total owners’ equity attributable to equity
56,310,184,510.60 45,342,897,318.53
holders of the parent company
Minority interests 13,974,680,315.62 13,440,972,378.66
Total owners’ equity 70,284,864,826.22 58,783,869,697.19
Total liabilities and owners’ equity 161,992,099,595.65 148,384,319,074.71
Legal representative: WANG Laichun Chief financial officer: WU Tiansong Head of accounting department: CHEN Huiyong
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
2. Balance sheet of the parent company
In RMB
Item December 31, 2023 January 1, 2023
Current assets:
Cash and bank balances 5,363,878,981.02 2,470,873,229.56
Held-for-trading financial assets 339,580,922.63 425,160,741.00
Derivative financial assets
Notes receivable 18,385,072.78 96,318,451.09
Accounts receivable 5,232,436,622.29 6,130,919,579.55
Receivable financing 5,119,974.62
Prepayments 192,114,139.17 153,214,652.87
Other receivables 575,065,087.05 250,596,765.44
Including: Interest receivable
Dividends receivable 522,000,000.00 150,000,000.00
Inventories 306,259,656.55 365,123,547.22
Contract assets
Held-for-sale assets
Non-current assets due within one year 106,998,410.96
Other current assets 14,458,131,132.12 6,550,429,892.93
Total current assets 26,597,969,999.19 16,442,636,859.66
Non-current assets:
Debt investments 509,574,733.25
Other debt investments
Long-term receivables
Long-term equity investment 23,601,999,275.38 22,333,083,031.91
Other investments in equity
244,726,548.92 436,416,576.65
instruments
Other non-current financial assets 570,000,000.00 614,489,717.42
Investment properties
Fixed assets 148,762,324.80 156,454,801.57
Construction in progress 3,826,779.93 6,477,655.44
Bearer biological assets
Oil and gas assets
Right-of-use assets 41,694,063.64 60,287,106.95
Intangible assets 307,619,939.12 312,566,547.35
Development expenditure
Goodwill 53,174,339.31 53,174,339.31
Long-term deferred expenses 7,326,817.04
Deferred tax assets 5,787,962.17
Other non-current assets 899,875,137.66 2,465,600.00
Total non-current assets 25,879,005,225.80 24,490,778,072.02
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
Total assets 52,476,975,224.99 40,933,414,931.68
Current liabilities:
Short-term borrowings 1,981,237,500.00 1,000,555,555.56
Held-for-trading financial liabilities 12,958,840.00
Derivative financial liabilities
Notes payable 3,206,774,263.00 1,665,344,848.22
Accounts payable 2,294,947,814.95 3,869,002,157.32
Receipts in advance
Contract liabilities 11,589,195.43 11,694,420.46
Employee benefits payable 50,854,577.38 49,737,492.15
Taxes payable 42,236,138.27 5,987,485.42
Other payables 6,064,454,178.70 1,568,456,509.82
Including: Interest payable
Dividends payable
Held-for-sale liabilities
Non-current liabilities due within one
1,975,796,524.14 378,055,420.51
year
Other current liabilities 804,229,371.60 3,841,635,343.15
Total current liabilities 16,432,119,563.47 12,403,428,072.61
Non-current liabilities:
Long-term borrowings 9,676,736,000.00 5,645,155,501.44
Bonds payable 2,799,499,850.29 2,689,623,546.98
Including: Preferred shares
Perpetual bonds
Lease liabilities 27,210,286.03 45,690,389.15
Long-term payables
Long-term employee benefits payable
Provisions
Deferred income 3,619,077.63 5,765,818.86
Deferred tax liabilities 19,506,623.16 60,231,489.77
Other non-current liabilities
Total non-current liabilities 12,526,571,837.11 8,446,466,746.20
Total liabilities 28,958,691,400.58 20,849,894,818.81
Owners’ equity:
Share capital 7,148,168,213.00 7,099,908,647.00
Other equity instruments 527,289,020.28 527,319,637.88
Including: Preferred shares
Perpetual bonds
Capital reserve 5,304,433,127.03 4,069,645,567.93
Less: Treasury shares
Other comprehensive income 113,696,524.40 294,991,891.50
Special reserve
192
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Surplus reserve 1,443,520,185.47 1,121,072,698.83
Unappropriated profit 8,981,176,754.23 6,970,581,669.73
Total owners’ equity 23,518,283,824.41 20,083,520,112.87
Total liabilities and owners’ equity 52,476,975,224.99 40,933,414,931.68
3. Consolidated income statement
In RMB
Item 2023 2022
I. Total operating income 231,905,459,829.83 214,028,394,291.44
Including: Operating income 231,905,459,829.83 214,028,394,291.44
Interest income
Premiums earned
Fee and commission income
II. Total operating costs 220,679,633,964.41 203,642,032,034.98
Including: Operating costs 205,041,300,458.59 187,928,880,285.38
Interest expenses
Fee and commission expenses
Surrenders
Claims and policyholder
benefits (net of mounts recoverable from
reinsurers)
Changes in insurance contract
reserves (net of reinsurers’ share)
Insurance policyholder
dividends
Expenses for reinsurance
accepted
Taxes and levies 534,815,230.06 476,325,439.67
Selling expenses 889,024,421.63 831,398,139.60
General expenses 5,542,856,994.26 5,075,668,085.35
R&D expenses 8,188,767,532.85 8,447,038,946.21
Financial expenses 482,869,327.02 882,721,138.77
Including: Interest expenses 1,376,870,146.38 1,038,070,641.24
Interest income 1,005,580,557.62 504,344,274.59
Add: Other income 825,189,115.07 602,294,263.90
Investment income (Loss is
1,771,282,791.44 998,278,358.77
indicated by “-”)
Including: Income from
investments in associates and joint 2,044,361,609.89 794,759,492.42
ventures
Income from
-741,342,548.75 -400,156,146.02
derecognition of financial assets
193
Luxshare Precision Industry Co., Ltd. Annual Report 2022
measured at amortized cost
Foreign exchange gains (Loss is
indicated by “-”)
Net exposure hedging income
(Loss is indicated by “-”)
Income from changes in fair value
210,346,832.18 13,625,720.11
(Loss is indicated by “-”)
Impairment losses of credit (Loss
23,273,879.47 -47,181,938.93
is indicated by “-”)
Impairment losses of assets (Loss
-1,318,867,316.40 -846,822,131.05
is indicated by “-”)
Income from disposal of assets
122,867,177.52 47,931,529.63
(Loss is indicated by “-”)
III. Operating profit (Loss is indicated by
12,859,918,344.70 11,154,488,058.89
“-”)
Add: Non-operating income 93,459,027.40 34,312,299.74
Less: Non-operating expenses 68,334,885.79 30,805,374.33
IV. Total profit (Total losses are indicated
12,885,042,486.31 11,157,994,984.30
by “-”)
Less: Income tax expenses 641,829,343.18 667,318,205.34
V. Net profit (Net loss is indicated by “-”) 12,243,213,143.13 10,490,676,778.96
(I) Categorized by the nature of
continuing operation
1. Net profit from continuing
12,243,213,143.13 10,490,676,778.96
operations (Net loss is indicated by “-”)
2. Net profit from discontinued
operations (Net loss is indicated by “-”)
(II) Categorized by ownership
1. Net profit attributable to
10,952,656,702.16 9,163,104,849.54
shareholders of the parent company
2. Net profit attributable to non-
1,290,556,440.97 1,327,571,929.42
controlling interests
VI. Other comprehensive income, net of
-491,540,544.45 647,909,759.47
tax
Other comprehensive income
attributable to owners of the parent -464,912,752.55 687,259,787.54
company, net of tax
(I) Other comprehensive income that
cannot be subsequently reclassified to -142,656,996.94 131,579,091.87
profit or loss
1. Changes from re-measurement
of defined benefit plans
2. Other comprehensive income
that cannot be reclassified to profit or loss
under the equity method
3. Changes in fair value of other
-142,656,996.94 131,579,091.87
investments in equity instruments
4. Changes in fair value of
194
Luxshare Precision Industry Co., Ltd. Annual Report 2022
enterprises’ own credit risks
5. Others
(II) Other comprehensive income
-322,255,755.61 555,680,695.67
that will be reclassified to profit or loss
1. Other comprehensive income
that will be reclassified to profit or loss
under the equity method
2. Changes in fair value of other
debt investments
3. Amounts of financial assets
reclassified into other comprehensive
income
4. Provision for credit impairment
of other debt investments
5. Reserve for cash flow hedges
6. Translation differences of
financial statements denominated in -322,255,755.61 555,680,695.67
foreign currencies
7. Others
Other comprehensive income
attributable to minority interests, net of -26,627,791.90 -39,350,028.07
tax
VII. Total comprehensive income 11,751,672,598.68 11,138,586,538.43
Total comprehensive income
attributable to owners of the parent 10,487,743,949.61 9,850,364,637.08
company
Total comprehensive income
1,263,928,649.07 1,288,221,901.35
attributable to minority interests
VIII. Earnings per share:
(I) Basic earnings per share 1.54 1.29
(II) Diluted earnings per share 1.53 1.28
For any business combination involving enterprises under common control for the reporting period, the net profits of the absorbed
party prior to the combination are RMB0.00 in the reporting period, and were RMB0.00 in prior period.
Legal representative: WANG Laichun Chief financial officer: WU Tiansong Head of accounting department: CHEN Huiyong
4. Income statement of the parent company
In RMB
Item 2023 2022
I. Total operating income 10,777,958,983.45 12,952,813,735.54
Less: Operating costs 10,090,180,041.66 12,051,823,934.39
Taxes and levies 11,450,527.78 12,941,878.95
Selling expenses 47,016,319.95 27,577,223.42
General expenses 195,484,624.80 146,709,569.94
R&D expenses 359,110,228.82 437,028,645.07
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
Financial expenses 374,684,104.32 333,162,964.83
Including: Interest expenses 541,490,816.64 462,146,428.54
Interest income 209,233,345.56 117,198,473.67
Add: Other income 56,987,568.94 52,979,889.49
Investment income (Loss is
3,417,911,679.37 1,361,112,472.06
indicated by “-”)
Including: Income from
investments in associates and joint -24,693,501.41 16,056,804.17
ventures
Income from
derecognition of financial assets
-39,618,411.95 -43,522,172.22
measured at amortized cost (Loss is
indicated by “-”)
Net exposure hedging income
(Loss is indicated by “-”)
Income from changes in fair value
46,992,155.68 16,705,913.20
(Loss is indicated by “-”)
Impairment losses of credit (Loss
11,896,794.95 -8,375,363.61
is indicated by “-”)
Impairment losses of assets (Loss
-15,796,979.97 -4,468,874.95
is indicated by “-”)
Income from disposal of assets
54,423.89 -192,009.60
(Loss is indicated by “-”)
II. Operating profit (Loss is indicated by
3,218,078,778.98 1,361,331,545.53
“-”)
Add: Non-operating income 10,152,797.38 4,192,819.73
Less: Non-operating expenses 6,700,314.33 248,053.30
III. Total profit (Total losses are indicated
3,221,531,262.03 1,365,276,311.96
by “-”)
Less: Income tax expenses -2,943,604.35 6,164,389.77
IV. Net profit (Net loss is indicated by “-”) 3,224,474,866.38 1,359,111,922.19
(I) Net profit from continuing operation
3,224,474,866.38 1,359,111,922.19
(Net loss is indicated by “-”)
(II) Net profit from discontinued
operations (Net loss is indicated by “-”)
V. Other comprehensive income, net of
-143,511,980.28 132,040,246.83
tax
(I) Other comprehensive income that
cannot be subsequently reclassified to -143,511,980.28 132,040,246.83
profit or loss
1. Changes from re-measurement
of defined benefit plans
2. Other comprehensive income
that cannot be reclassified to profit or loss
under the equity method
3. Changes in fair value of other
-143,511,980.28 132,040,246.83
investments in equity instruments
4. Changes in fair value of
196
Luxshare Precision Industry Co., Ltd. Annual Report 2022
enterprises’ own credit risks
5. Others
(II) Other comprehensive income
that will be reclassified to profit or loss
1. Other comprehensive income
that will be reclassified to profit or loss
under the equity method
2. Changes in fair value of other
debt investments
3. Amounts of financial assets
reclassified into other comprehensive
income
4. Provision for credit impairment
of other debt investments
5. Reserve for cash flow hedges
6. Translation differences of
financial statements denominated in
foreign currencies
7. Others
VI. Total comprehensive income 3,080,962,886.10 1,491,152,169.02
VII. Earnings per share
(I) Basic earnings per share
(II) Diluted earnings per share
5. Consolidated statement of cash flows
In RMB
Item 2023 2022
I. Cash flows from operating activities:
Cash receipts from the sales of goods
233,972,359,867.88 231,311,294,189.07
and the rendering of services
Net increase in customer deposits and
deposits from banks and other financial
institutions
Net increase in loans from the central
bank
Net increase in taking from other
financial institutions
Cash payments for claims and
policyholders’ benefits under direct
insurance contracts
Net cash receipts from reinsurance
business
Net cash receipts from policyholders’
deposits and investment contract
liabilities
Cash receipts from interest, fees and
197
Luxshare Precision Industry Co., Ltd. Annual Report 2022
commissions
Net increase in taking from banks and
other financial institutions
Net increase in financial assets sold
under repurchase arrangements
Net cash received from securities
trading agency
Receipts of tax refunds 7,825,905,318.68 9,595,383,015.24
Other cash receipts relating to
4,251,043,986.66 2,681,301,179.71
operating activities
Sub-total of cash inflows from operating
246,049,309,173.22 243,587,978,384.02
activities
Cash payments for goods purchased
190,579,479,133.20 204,048,286,382.64
and services received
Net increase in loans and advances to
customers
Net increase in balance with the central
bank and due from banks and other
financial institutions
Cash payments for claims and
policyholders’ benefits under direct
insurance contracts
Net increase in placements with banks
and other financial institutions
Cash payments for interest, fees and
commissions
Cash payments for insurance
policyholder dividends
Cash payments to and on behalf of
19,100,916,568.64 20,086,575,874.76
employees
Payments of various types of taxes 2,107,851,414.79 1,799,647,577.54
Other cash payments relating to
6,656,001,645.43 4,925,858,229.74
operating activities
Sub-total of cash outflows from operating
218,444,248,762.06 230,860,368,064.68
activities
Net cash flow from operating activities 27,605,060,411.16 12,727,610,319.34
II. Cash flows from investing activities:
Cash receipts from disposals and
16,307,306,597.29 8,259,554,985.04
recovery of investments
Cash receipts from investment income 640,454,107.13 526,570,852.82
Net cash receipts from disposals of
fixed assets, intangible assets and other 498,863,695.83 506,778,473.84
long-term assets
Net cash receipts from disposals of
subsidiaries and other business entities
Other cash receipts relating to investing
427,650,270.00 745,017,358.71
activities
Sub-total of cash inflows from investing 17,874,274,670.25 10,037,921,670.41
198
Luxshare Precision Industry Co., Ltd. Annual Report 2022
activities
Cash payments to acquire or construct
fixed assets, intangible assets and other 11,387,449,010.98 13,584,140,261.73
long-term assets
Cash payments to acquire investments 25,906,263,865.11 8,390,295,501.05
Net increase in pledged loans
receivables
Net cash payments for acquisitions of
961,816,227.15
subsidiaries and other business entities
Other cash payments relating to
140,474,000.00 428,035,523.59
investing activities
Sub-total of cash outflows from investing
37,434,186,876.09 23,364,287,513.52
activities
Net cash flow from investing activities -19,559,912,205.84 -13,326,365,843.11
III. Cash flows from financing activities:
Cash receipts from capital
546,698,698.52 1,596,922,470.96
contributions
Including: Cash receipts from capital
contributions from minority owners of 1,030,300,000.00
subsidiaries
Cash receipts from borrowings 89,681,515,957.31 67,739,900,243.50
Other cash receipts relating to
3,531,424,971.41 7,527,472,775.23
financing activities
Sub-total of cash inflows from financing
93,759,639,627.24 76,864,295,489.69
activities
Cash repayments of borrowings 81,148,610,559.40 58,773,171,168.15
Cash payments for distribution of
dividends or profits or settlement of 2,530,927,017.73 1,796,754,390.90
interest expenses
Including: Payments for distribution of
dividends or profits to minority owners of 89,877,050.50
subsidiaries
Other cash payments relating to
6,009,836,397.50 8,138,121,749.19
financing activities
Sub-total of cash outflows from financing
89,689,373,974.63 68,708,047,308.24
activities
Net cash flow from financing activities 4,070,265,652.61 8,156,248,181.45
IV. Effect of foreign exchange rate
256,320,033.21 833,389,043.75
changes on cash and cash equivalents
V. Net increase in cash and cash
12,371,733,891.14 8,390,881,701.43
equivalents
Add: Opening balance of cash and cash
17,312,418,429.51 8,921,536,728.08
equivalents
VI. Closing balance of cash and cash
29,684,152,320.65 17,312,418,429.51
equivalents
199
Luxshare Precision Industry Co., Ltd. Annual Report 2022
6. Statement of cash flows of the parent company
In RMB
Item 2023 2022
I. Cash flows from operating activities:
Cash receipts from the sales of goods
13,856,860,176.69 10,929,088,841.65
and the rendering of services
Receipts of tax refunds 131,023,274.74 169,862,322.46
Other cash receipts relating to
26,805,451,217.01 12,206,141,292.86
operating activities
Sub-total of cash inflows from operating
40,793,334,668.44 23,305,092,456.97
activities
Cash payments for goods purchased
18,017,487,335.51 12,697,462,668.02
and services received
Cash payments to and on behalf of
321,167,044.00 224,427,747.93
employees
Payments of various types of taxes 7,503,228.53 21,569,336.18
Other cash payments relating to
22,673,942,894.86 10,060,056,726.22
operating activities
Sub-total of cash outflows from operating
41,020,100,502.90 23,003,516,478.35
activities
Net cash flow from operating activities -226,765,834.46 301,575,978.62
II. Cash flows from investing activities:
Cash receipts from disposals and
6,536,880,258.56 2,711,452,000.00
recovery of investments
Cash receipts from investment income 3,348,825,836.10 1,448,310,422.70
Net cash receipts from disposals of
fixed assets, intangible assets and other 315,031.34 467,498.85
long-term assets
Net cash receipts from disposals of
3,319,956.47
subsidiaries and other business entities
Other cash receipts relating to investing
activities
Sub-total of cash inflows from investing
9,889,341,082.47 4,160,229,921.55
activities
Cash payments to acquire or construct
fixed assets, intangible assets and other 76,811,665.74 237,037,719.00
long-term assets
Cash payments to acquire investments 10,673,528,047.25 8,385,526,433.53
Net cash payments for acquisitions of
subsidiaries and other business entities
Other cash payments relating to
investing activities
Sub-total of cash outflows from investing
10,750,339,712.99 8,622,564,152.53
activities
Net cash flow from investing activities -860,998,630.52 -4,462,334,230.98
III. Cash flows from financing activities:
200
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Cash receipts from capital
546,698,698.52 566,622,470.96
contributions
Cash receipts from borrowings 12,787,980,000.00 9,777,071,023.06
Other cash receipts relating to
3,089,161,930.69 7,521,511,778.98
financing activities
Sub-total of cash inflows from financing
16,423,840,629.21 17,865,205,273.00
activities
Cash repayments of borrowings 6,182,849,970.00 5,560,227,961.58
Cash payments for distribution of
dividends or profits or settlement of 1,470,835,061.65 1,133,386,845.40
interest expenses
Other cash payments relating to
5,986,958,422.03 5,344,266,086.84
financing activities
Sub-total of cash outflows from financing
13,640,643,453.68 12,037,880,893.82
activities
Net cash flow from financing activities 2,783,197,175.53 5,827,324,379.18
IV. Effect of foreign exchange rate
6,410,280.81 114,413,815.11
changes on cash and cash equivalents
V. Net increase in cash and cash
1,701,842,991.36 1,780,979,941.93
equivalents
Add: Opening balance of cash and cash
2,461,535,715.54 680,555,773.61
equivalents
VI. Closing balance of cash and cash
4,163,378,706.90 2,461,535,715.54
equivalents
7. Consolidated statement of changes in owners’ equity
Current period
201
Luxshare Precision Industry Co., Ltd. Annual Report 2022
In RMB
2023
Equity attributable to owners of the parent company Minority interests Total owners’ equity
C
Othe
a
r
pi Less:
com Spec Surp
ta Trea Unappro
Other equity preh ial lus General risk
l sury priated Others Subtotal
instruments ensiv reser reser reserve
re share profit
e ve ve
se s
inco
rv
me
e
P
Item
Share e
capital r
p
e
Pref
t
erre
u Othe
d
a rs
shar
l
es
b
o
n
d
s
527, 3,65 651, 1,12
I. Closing 2,09 32,288,4
7,099,90 319, 2,62 458, 1,07 45,342,897, 58,783,869,
balance of the 4,87 16,277.2 13,440,972,378.66
8,647.00 637. 6,86 316. 2,69 318.53 697.19
preceding year 9.61 2
88 1.74 25 8.83
Add:
Changes in
accounting
policies
Corr
ections of
prior period
202
Luxshare Precision Industry Co., Ltd. Annual Report 2022
errors
Busi
ness
combination
involving
enterprises
under
common
control
527, 3,65 651, 1,12
II. Opening 2,09 32,288,4
7,099,90 319, 2,62 458, 1,07 45,342,897, 58,783,869,
balance of the 4,87 16,277.2 13,440,972,378.66
8,647.00 637. 6,86 316. 2,69 318.53 697.19
current year 9.61 2
88 1.74 25 8.83
III. Changes -
- 1,35 322,
for the year 502, 1,43
48,259,5 30,6 9,31 447, 9,738,55 10,967,287, 11,500,995,
(Decrease is 696, 3,49 533,707,936.96
66.00 17.6 7,77 486. 5,634.03 192.07 129.03
indicated by 139. 0.19
0 2.18 64
“-”) 37
-
(I) Total 464, 10,952,6
10,487,743, 11,751,672,
comprehensiv 912, 56,702.1 1,263,928,649.07
949.61 598.68
e income 752. 6
55
(II) Owners’ - 1,35
contributions 48,259,5 30,6 9,31 1,407,546,7 766,683,312
-640,863,408.11
and reduction 66.00 17.6 7,77 20.58 .47
in capital 0 2.18
1. Ordinary 498,
shares 48,256,5 442, 546,698,698 546,698,698
contributed by 56.00 142. .52 .52
owners 52
2. Capital
-
contribution 170,
30,6
from holders 3,010.00 204. 142,596.76 142,596.76
17.6
of other equity 36
0
instruments
203
Luxshare Precision Industry Co., Ltd. Annual Report 2022
3. Share-based 731,
payment 177, 731,177,177 780,664,929
49,487,751.93
recognized in 177. .72 .65
owners’ equity 72
129,
-
528, 129,528,247
4. Others -690,351,160.04 560,822,912
247. .58
.46
58
322,
- - -
(III) Profit 447,
1,251,88 929,436,968 -89,877,050.50 1,019,314,0
distribution 486.
4,454.95 .31 18.81
64
322,
1. Transfer to -
447,
surplus 322,447,
486.
reserve 486.64
64
2. Transfer to
general risk
reserve
3.
- - -
Distributions
926,948, 926,948,678 -89,877,050.50 1,016,825,7
to owners (or
678.85 .85 29.35
shareholders)
- - -
4. Others 2,488,28 2,488,289.4 2,488,289.4
9.46 6 6
-
(IV) Transfers 37,7
37,783,3
within 83,3
86.82
owners’ equity 86.8
2
1.
Capitalization
of capital
reserve (or
share capital)
204
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2.
Capitalization
of surplus
reserve (or
share capital)
3. Loss offset
by surplus
reserve
4. Retained
earnings
carried
forward from
changes in
defined
benefit plans
5. Retained
earnings
carried
forward from
other
comprehensiv
e income
-
37,7
37,783,3
6. Others 83,3
86.82
86.8
2
1,43
(V) Special 1,433,490.1 1,953,236.6
3,49 519,746.50
reserve 9 9
0.19
1. Transfer to 32,0
special reserve 93,6 32,093,607. 62,247,318.
30,153,711.05
in the current 07.3 36 41
period 6
2. Amount 30,6
30,660,117. 60,294,081.
utilized in the 60,1 29,633,964.55
17 72
current period 17.1
205
Luxshare Precision Industry Co., Ltd. Annual Report 2022
7
(VI) Others
527, 5,01 148, 1,44
IV. Closing 3,52 42,026,9
7,148,16 289, 1,94 762, 3,52 56,310,184, 70,284,864,
balance of the 8,36 71,911.2 13,974,680,315.62
8,213.00 020. 4,63 176. 0,18 510.60 826.22
current period 9.80 5
28 3.92 88 5.47
Prior period
In RMB
2022
Equity attributable to owners of the parent company
Other equity instruments
Item Other Minorit Total
Less: General Unappro y owners’
Share Capital compreh Special Surplus
Treasury risk priated Others Subtotal interests equity
capital Preferre Perpetua reserve ensive reserve reserve
Others shares reserve profit
d shares l bonds income
I.
Closing
- 24,040,6 35,288,5 10,494,0 45,782,6
balance 7,050,48 527,358, 2,719,69 1,018,78 985,161,
35,801,4 37,144.0 54,748.7 88,800.8 43,549.5
of the 5,477.00 025.98 5,281.67 4.75 506.61
71.29 0 2 5 7
precedin
g year
206
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Ad
d:
Changes
in
accounti
ng
policies
C
orrectio
ns of
prior
period
errors
B
usiness
combina
tion
involvin
g
enterpris
es under
common
control
207
Luxshare Precision Industry Co., Ltd. Annual Report 2022
II.
Opening
- 24,040,6 35,288,5 10,494,0 45,782,6
balance 7,050,48 527,358, 2,719,69 1,018,78 985,161,
35,801,4 37,144.0 54,748.7 88,800.8 43,549.5
of the 5,477.00 025.98 5,281.67 4.75 506.61
71.29 0 2 5 7
current
year
III.
Changes
for the
- 10,054,3 13,001,2
year 49,423,1 932,931, 687,259, 1,076,09 135,911, 8,247,77 2,946,88
38,388.1 42,569.8 26,147.6
(Decrea 70.00 580.07 787.54 4.86 192.22 9,133.22 3,577.81
0 1 2
se is
indicate
d by “-”)
(I) Total
11,138,5
compreh 687,259, 9,163,10 9,850,36 1,288,22
86,538.4
ensive 787.54 4,849.54 4,637.08 1,901.35
3
income
208
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(II)
Owners’
contribu
-
tions 49,423,1 932,931, 982,316, 1,658,66 2,640,97
38,388.1
and 70.00 580.07 361.97 1,676.46 8,038.43
0
reductio
n in
capital
1.
Ordinar
y shares 49,419,4 517,203, 566,622, 1,030,30 1,596,92
contribu 33.00 037.96 470.96 0,000.00 2,470.96
ted by
owners
2.
Capital
contribu
tion
-
from 213,452. 178,801. 178,801.
3,737.00 38,388.1
holders 63 53 53
0
of other
equity
instrume
nts
209
Luxshare Precision Industry Co., Ltd. Annual Report 2022
3.
Share-
based
payment 426,597, 426,597, 46,691,3 473,288,
recogniz 450.75 450.75 36.87 787.62
ed in
owners’
equity
- -
4. 581,670, 570,587,
11,082,3 11,082,3
Others 339.59 978.32
61.27 61.27
(III)
- - -
Profit 135,911,
915,325, 779,414, 779,414,
distribut 192.22
716.32 524.10 524.10
ion
1.
Transfer -
135,911,
to 135,911,
192.22
surplus 192.22
reserve
210
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2.
Transfer
to
general
risk
reserve
3.
Distribu
tions to - - -
owners 779,270, 779,270, 779,270,
(or 547.26 547.26 547.26
sharehol
ders)
- - -
4.
143,976. 143,976. 143,976.
Others
84 84 84
(IV)
Transfer
s within
owners’
equity
211
Luxshare Precision Industry Co., Ltd. Annual Report 2022
1.
Capitali
zation of
capital
reserve
(or share
capital)
2.
Capitali
zation of
surplus
reserve
(or share
capital)
3. Loss
offset by
surplus
reserve
212
Luxshare Precision Industry Co., Ltd. Annual Report 2022
4.
Retaine
d
earnings
carried
forward
from
changes
in
defined
benefit
plans
5.
Retaine
d
earnings
carried
forward
from
other
compreh
ensive
income
6.
Others
213
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(V)
1,076,09 1,076,09 1,076,09
Special
4.86 4.86 4.86
reserve
1.
Transfer
to
special 5,435,46 5,435,46 5,435,46
reserve 9.87 9.87 9.87
in the
current
period
2.
Amount
utilized 4,359,37 4,359,37 4,359,37
in the 5.01 5.01 5.01
current
period
(VI)
Others
214
Luxshare Precision Industry Co., Ltd. Annual Report 2022
IV.
Closing
32,288,4 45,342,8 13,440,9 58,783,8
balance 7,099,90 527,319, 3,652,62 651,458, 2,094,87 1,121,07
16,277.2 97,318.5 72,378.6 69,697.1
of the 8,647.00 637.88 6,861.74 316.25 9.61 2,698.83
2 3 6 9
current
period
215
Luxshare Precision Industry Co., Ltd. Annual Report 2022
8. Statement of changes in owners’ equity of the parent company
Current period
In RMB
2023
Other equity instruments
Other
Item Less: Total
Share Capital comprehen Special Surplus Unappropr
Preferred Perpetual Treasury Others owners’
capital Others reserve sive reserve reserve iated profit
shares bonds shares equity
income
I. Closing
balance of
7,099,908, 527,319,63 4,069,645, 294,991,89 1,121,072, 6,970,581, 20,083,520
the
647.00 7.88 567.93 1.50 698.83 669.73 ,112.87
preceding
year
Add:
Changes in
accounting
policies
C
orrections
of prior
period
errors
O
thers
216
Luxshare Precision Industry Co., Ltd. Annual Report 2022
II. Opening
balance of 7,099,908, 527,319,63 4,069,645, 294,991,89 1,121,072, 6,970,581, 20,083,520
the current 647.00 7.88 567.93 1.50 698.83 669.73 ,112.87
year
III.
Changes
-
for the year 48,259,566 1,234,787, 322,447,48 2,010,595, 3,434,763,
-30,617.60 181,295,36
(Decrease .00 559.10 6.64 084.50 711.54
7.10
is indicated
by “-”)
(I) Total
-
comprehen 3,224,474, 3,080,962,
143,511,98
sive 866.38 886.10
0.28
income
(II)
Owners’
contributio 48,259,566 1,234,787, 1,283,016,
-30,617.60
ns and .00 559.10 507.50
reduction
in capital
1. Ordinary
shares 48,256,556 498,442,14 546,698,69
contributed .00 2.52 8.52
by owners
217
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2. Capital
contributio
n from
holders of
3,010.00 -30,617.60 170,204.36 142,596.76
other
equity
instrument
s
3. Share-
based
payment 780,664,92 780,664,92
recognized 9.65 9.65
in owners’
equity
- -
4. Others 44,489,717 44,489,717
.43 .43
(III) Profit - -
322,447,48
distributio 1,251,663, 929,215,68
6.64
n 168.70 2.06
1. Transfer -
322,447,48
to surplus 322,447,48
6.64
reserve 6.64
218
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2.
Distributio
- -
ns to
926,948,67 926,948,67
owners (or
8.85 8.85
shareholde
rs)
- -
3. Others 2,267,003. 2,267,003.
21 21
(IV)
Transfers -
37,783,386
within 37,783,386
.82
owners’ .82
equity
1.
Capitalizat
ion of
capital
reserve (or
share
capital)
2.
Capitalizat
ion of
surplus
reserve (or
share
capital)
219
Luxshare Precision Industry Co., Ltd. Annual Report 2022
3. Loss
offset by
surplus
reserve
4. Retained
earnings
carried
forward
from
changes in
defined
benefit
plans
5. Retained
earnings
carried
forward
from other
comprehen
sive
income
-
37,783,386
6. Others 37,783,386
.82
.82
(V) Special
reserve
220
Luxshare Precision Industry Co., Ltd. Annual Report 2022
1. Transfer
to special
reserve in
the current
period
2. Amount
utilized in
the current
period
(VI) Others
IV. Closing
balance of 7,148,168, 527,289,02 5,304,433, 113,696,52 1,443,520, 8,981,176, 23,518,283
the current 213.00 0.28 127.03 4.40 185.47 754.23 ,824.41
period
Last period
In RMB
2022
Item
Share Other equity instruments Capital Less: Other Special Surplus Unappropr Others Total
221
Luxshare Precision Industry Co., Ltd. Annual Report 2022
capital reserve Treasury comprehen reserve reserve iated profit owners’
Preferred Perpetual shares sive equity
Others
shares bonds income
I. Closing
balance of
7,050,485, 527,358,02 3,080,149, 162,951,64 985,161,50 6,526,651, 18,332,757
the
477.00 5.98 716.35 4.67 6.61 487.02 ,857.63
preceding
year
Add:
Changes in
accounting
policies
C
orrections
of prior
period
errors
O
thers
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
II. Opening
balance of 7,050,485, 527,358,02 3,080,149, 162,951,64 985,161,50 6,526,651, 18,332,757
the current 477.00 5.98 716.35 4.67 6.61 487.02 ,857.63
year
III.
Changes
for the year 49,423,170 989,495,85 132,040,24 135,911,19 443,930,18 1,750,762,
-38,388.10
(Decrease .00 1.58 6.83 2.22 2.71 255.24
is indicated
by “-”)
(I) Total
comprehen 132,040,24 1,359,111, 1,491,152,
sive 6.83 922.19 169.02
income
(II)
Owners’
contributio 49,423,170 989,495,85 1,038,880,
-38,388.10
ns and .00 1.58 633.48
reduction
in capital
223
Luxshare Precision Industry Co., Ltd. Annual Report 2022
1. Ordinary
shares 49,419,433 517,203,03 566,622,47
contributed .00 7.96 0.96
by owners
2. Capital
contributio
n from
holders of
3,737.00 -38,388.10 213,452.63 178,801.53
other
equity
instrument
s
3. Share-
based
payment 473,288,78 473,288,78
recognized 7.62 7.62
in owners’
equity
- -
4. Others 1,209,426. 1,209,426.
63 63
(III) Profit - -
135,911,19
distributio 915,181,73 779,270,54
2.22
n 9.48 7.26
224
Luxshare Precision Industry Co., Ltd. Annual Report 2022
1. Transfer -
135,911,19
to surplus 135,911,19
2.22
reserve 2.22
2.
Distributio
- -
ns to
779,270,54 779,270,54
owners (or
7.26 7.26
shareholde
rs)
3. Others
(IV)
Transfers
within
owners’
equity
1.
Capitalizat
ion of
capital
reserve (or
share
capital)
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
2.
Capitalizat
ion of
surplus
reserve (or
share
capital)
3. Loss
offset by
surplus
reserve
4. Retained
earnings
carried
forward
from
changes in
defined
benefit
plans
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
5. Retained
earnings
carried
forward
from other
comprehen
sive
income
6. Others
(V) Special
reserve
1. Transfer
to special
reserve in
the current
period
2. Amount
utilized in
the current
period
(VI)
Others
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
IV. Closing
balance of 7,099,908, 527,319,63 4,069,645, 294,991,89 1,121,072, 6,970,581, 20,083,520
the current 647.00 7.88 567.93 1.50 698.83 669.73 ,112.87
period
228
Luxshare Precision Industry Co., Ltd. Annual Report 2022
III. Basic information
(I) Company profile
Luxshare Precision Industry Co., Ltd. (“Company” or “the Company”) is a company limited by shares established by Shenzhen
Zixin Investment Co., Ltd. (“Zixin Investment”) and Luxshare Limited as founders after being approved by Shenzhen People’s
Government and Shenzhen Bureau of Trade and Industry in February 2009. Company’s Uniform Social Credit Code:
91440300760482233Q. The Company was listed on Shenzhen Stock Exchange in September 2010. The Company pertains to the
communication equipment industry.
As of December 31, 2023, the Company issued 7,148,168,213.00 shares in total, with its registered capital amounting to
RMB7,148,168,213.00. The Company’s registered office is located at 2/F, Block A, Sanyo New Industrial Zone, West Haoyi
Community, Shajing Street, Bao’an District, Shenzhen, China, while its place of business is located at No. 313 North Ring Road,
Qingxi Town, Dongguan City, Guangdong, China. The main business activities of the Company include production and operation of
connecting wires, connectors, computer peripherals, and plastic hardware products. The Company’s parent company is Luxshare
Limited, and its de facto controllers are WANG Laichun and WANG Laisheng.
The financial statements were approved by the Company’s board of directors on April 24, 2024 for issuance.
IV. Basis of preparation of financial statements
1. Basis of preparation
The Company has prepared its financial statements in accordance with the requirements of the Accounting Standards for Business
Enterprises - Basic Standard promulgated by the Ministry of Finance of the PRC, specific accounting standards, guidelines for
application of accounting standards for enterprises, interpretation of accounting standards for enterprises and other relevant regulations
successively promulgated (collectively, “Accounting Standards for Business Enterprises”) and the Preparation Rules for Information
Disclosure by Companies Offering Securities to the Public No. 15 - General Provisions on Financial Reports issued by China Securities
Regulatory Commission.
2. Going concern
The Company prepares its financial statements on a going concern basis. The Company has the ability to continue as a going
concern within 12 months from the end of the reporting period, and detected no major events that may affect such ability.
V. Significant accounting policies and accounting estimates
Reminders on specific accounting policies and accounting estimates:
The disclosed content already includes the specific accounting policies and accounting estimates formulated by the company based
on its actual production and operation characteristics. Please refer to Note V, (11) Financial Instruments, Note V, (13) Inventories,
Note V, (17) Property, Plant, and Equipment, Note V, (20) Intangible Assets, Note V, (27) Revenue, etc.
1. Statement of compliance with the Accounting Standards for Business Enterprises
The financial statements prepared by the Company conform to the requirements of the Accounting Standards for Business
Enterprises issued by the Ministry of Finance, and truly and completely reflect the consolidated and parent company’s financial
positions as of December 31, 2023, and the consolidated and parent company’s operating results and cash flows for the year then ended.
229
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2. Accounting period
The Company’s accounting year is from January 1 to December 31 of each calendar year.
3. Operating cycle
The Company’s operating cycle is 12 months.
4. Functional currency
The company adopts the Chinese Renminbi (RMB) as the functional currency for accounting purposes. The subsidiary companies
under our company determine their functional currencies based on the primary economic environment in which they operate. For
subsidiary companies located within mainland China, the functional currency is the Chinese Renminbi. For subsidiary companies
located outside mainland China, they independently decide their functional currencies based on their primary economic environment,
which mainly include the US Dollar, New Taiwan Dollar, Hong Kong Dollar, Vietnamese Dong, etc. The financial statements are
presented in Chinese Renminbi.
5. Method for determining importance criteria and selection basis
Applicable □N/A
Item Significant Criteria
Individual provision amount accounts for over 10% of the total
Significant individual provision for doubtful accounts receivable provision for bad debts of various receivables and exceeds RMB
500 million
Individual contract liabilities with an aging of over 1 year
Significant contract liabilities with an aging of over one year account for over 10% of the total contract liabilities and exceed
RMB 500 million
Individual accounts payable/other payables with an aging of
Significant accounts payable and other payables over 1 year account for over 10% of the total accounts
payable/other payables and exceed RMB 1 billion
Significant construction in progress Individual project budget exceeds RMB 500 million
Individual amount accounts for over 10% of the total goodwill
Significant goodwill
and exceeds RMB 200 million
One of the total assets, operating income, or total profit (or
absolute value of loss) individually or simultaneously accounts
Significant non-wholly-owned subsidiaries
for over 10% of the corresponding item in the consolidated
financial statements
The carrying amount of long-term equity investments in a
single investee entity accounts for over 5% of the group's net
Significant joint ventures or associates assets and exceeds RMB 1 billion, or the investment profit or
loss under the equity method for long-term equity investments
accounts for over 10% of the group's consolidated net profit
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
6. Accounting treatment of business combinations involving enterprises under common control and business
combinations not involving enterprises under common control
Business combination involving enterprises under common control: The assets and liabilities acquired by the absorbing party in
a business combination (including goodwill formed through the acquisition by the ultimate controller of the absorbed party) are
measured according to the carrying amount of the assets and liabilities of the absorbed party in the financial statements of ultimate
controller on the combination date. The difference between the carrying amount of the net assets obtained in a business combination
and the carrying amount of the consideration paid for the combination (or the aggregate face value of shares issued as consideration)
is adjusted to the equity premium in the capital reserve. If the equity premium in the capital reserve is not sufficient to absorb the
difference, any excess shall be adjusted against retained earnings.
Business combination not involving enterprises under common control: The cost of combination is the aggregate of the fair values,
at the acquisition date, of the assets given, liabilities incurred or assumed, and equity securities issued by the acquirer, in exchange for
control of the acquiree. Where the cost of a business combination exceeds the acquirer’s interest in the fair value of the acquiree’s
identifiable net assets, the difference is recognized as goodwill; where the cost of a business combination is lower than the acquirer’s
interest in the fair value of the acquiree’s identifiable net assets, the difference is recognized in profit or loss for the current period. The
acquiree’s identifiable assets, liabilities and contingent liabilities that are acquired in the combination meeting the recognition criteria
are measured at the fair value on the date of acquisition.
The costs incurred directly attributable to the business combination are recognized in profit or loss for the current period when
incurred; the transaction costs for issue of equity securities or debt securities are recognized in the amount initially recognized of equity
securities or debt securities.
7. Criterion of control and the preparation method of consolidated financial statements
1. Criterion of control
The scope of consolidated financial statements is determined on the basis of control, and includes those of the Company and all
of its subsidiaries. “Control” means the power of the Company over the investee, through which the Company will enjoy variable
returns by participating in the relevant activities and has the ability to use the power over the investee to affect the Company’s return
amount.
2. Consolidation procedures
The Company regards the entire enterprise group as an accounting entity and prepares the consolidated financial statements
according to the uniformed accounting policies, reflecting the overall financial positions, operating results and cash flows of this
enterprise group. The effects of other intragroup transactions (between the Company and its subsidiaries or between subsidiaries) are
eliminated. Where the intragroup transactions show that relevant assets have suffered impairment losses, those losses are recognized
fully. Where the accounting policies and periods adopted by all subsidiaries are not in line with those of the Company, the necessary
adjustments are made to the financial statements of these subsidiaries based on the accounting policies and periods of the Company
when preparing the consolidated financial statements.
The portions of owner’s equities, net profits or losses and comprehensive income of subsidiaries for the period attributable to
minority interests are separately presented in the consolidated balance sheet below the “owners’ equity” line item, and in the
consolidated income statement below the “net profit” and “total comprehensive income” as “minority interests”. When the amount of
loss for the current period attributable to the minority shareholders of a subsidiary exceeds the minority shareholders’ share of the
opening balance of owners’ equity of the subsidiary, the excess is allocated against minority interests.
(1) Increase in subsidiaries or businesses
Where a subsidiary or business is acquired during the reporting period through a business combination involving enterprises under
common control, operating results and cash flows of this subsidiary or business from the beginning of the period in which the
combination takes place to the end of the reporting period are included in the consolidated financial statements. Meanwhile, the
231
Luxshare Precision Industry Co., Ltd. Annual Report 2022
adjustments are made to the opening balances of the consolidated financial statements and the relevant items of the comparative
statement, and the combined reporting entity is deemed to have existed since the time when the ultimate controller begins to exercise
control.
Where the Company becomes capable of exercising control over an investee under the common control due to additional
investments or other reasons, for equity investments held before acquiring control of the absorbed party, the relevant gains or losses,
other comprehensive income and other changes in net assets recognized during the period from the later of the date of acquisition of
original equity or the date when the absorbing party and the absorbed party are under the common control until the combination date
are respectively offset against opening balances of retained earnings during the comparative reporting period or profit or loss for the
current period.
Where a subsidiary or business is acquired during the reporting period through a business combination not involving enterprises
under common control, it is included in the consolidated financial statements from the date of acquisition based on the fair value of
identifiable assets, liabilities and contingent liabilities determined on the date of acquisition.
Where the Company becomes capable of exercising control over an investee not under common control due to additional
investments or other reasons, for the acquiree’s equity held prior to the date of acquisition, the Company remeasures the fair value of
the equity on the date of acquisition, and the difference between the fair value of the equity and its carrying amount is recognized in
profit or loss for the current period. Where the acquiree’s equity held prior to the date of acquisition involves other comprehensive
income that can be reclassified to profit or loss and changes in other owners’ equity under equity method, such other comprehensive
income and changes are transferred to the income of the period in which the date of acquisition falls.
(2) Disposal of subsidiaries
① General disposal
When the Company loses control over the investee due to disposal of partial equity investments or other reasons, for the remaining
equity investments after disposal, the Company remeasures the remaining equity investments after disposal at the fair value on the date
when the Company loses its control. The difference between the sum of the consideration from disposal of equity and the fair value of
remaining equity less the sum of an original subsidiary’s share of net assets and goodwill continuously calculated from the date of
acquisition or combination according to original shareholding ratio is recognized as the investment return for the period in which the
control is lost. Other comprehensive income relating to the original subsidiary’s equity investments that will be reclassified to profit or
loss and changes in other owners’ equity under the equity method is transferred into the investment income for the period when the
control is lost.
② Disposal of subsidiaries by steps
Where the subsidiary’s equity investments are disposed by steps through multiple transactions until the control is lost, and the
terms and conditions of all transactions on disposal of the subsidiary’s equity investments and the economic impact thereof fall within
one or more of the following circumstances, it usually indicates that multiple transaction events belong a single package:
i. these transactions are concluded simultaneously or after the influence on each other is considered;
ii. these transactions as a whole can achieve a complete commercial result;
iii. the occurrence of one transaction depends on that of at least one other transaction; and/or
iv. a transaction is not economical alone, but economical when considered together with other transactions.
Where all transactions belong to a single package, the Company accounts for such transactions as one transaction to dispose of
and lose its control over the subsidiary; however, the difference between the proceeds from each disposal before loss of control and the
share owned by the Company in the net assets of the subsidiary in relation to the investment disposed of is recognized in other
comprehensive income in the consolidated financial statements, which is wholly transferred to the profit or loss in the period in which
the control is lost.
Where all transactions do not belong to a single package, prior to the loss of control, the Company accounts for such transactions
as partial disposal of a subsidiary’s equity investments in the event that the control is not lost; and when the control is lost, the Company
accounts for such transactions in accordance with the general methods of disposal of subsidiaries.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
(3) Acquisition of a subsidiary’s minority equity
The difference between the long-term equity investments newly obtained by the Company due to acquisition of minority equity
and its share of the subsidiary’s net assets continuously calculated from the date of acquisition or combination according to new
shareholding ratio is adjusted against the equity premium in the capital reserve in the consolidated balance sheet. If the equity premium
in the capital reserve is not sufficient to absorb the difference, any excess shall be adjusted against retained earnings.
(4) Partial disposal of the subsidiary’s equity investments in the event that the control is not lost
The difference between the proceeds from disposal and the share owned by the Company in the net assets of the subsidiary in
relation to the long-term equity investment disposed of that is calculated continuously from the date of acquisition or combination is
adjusted against the equity premium in the capital reserve in the consolidated balance sheet. In case the equity premium in the capital
reserve is not sufficient to absorb the difference, the remaining balance is adjusted against the retained earnings.
8. Classification of joint arrangements and accounting treatment of joint operations
Joint arrangements are classified into joint operations and joint ventures.
Where a party to a joint arrangement enjoys relevant assets and assumes relevant liabilities of such an arrangement, this case
belongs to a joint operation.
The Company recognizes the following items relating to its interest in the joint operation:
(1) the assets held individually by the Company, and the Company’s share of the assets held jointly;
(2) the liabilities incurred individually by the Company, and the Company’s share of the liabilities incurred jointly;
(3) the Company’s revenue from the sales of its share of output of the joint operation;
(4) the Company’s share of revenue from the sales of assets by the joint operation; and
(5) the expenses incurred individually by the Company, and the Company’s share of the expenses incurred jointly by the joint
operation.
The Company accounts for investments in joint ventures using the equity method and the details are seen in Note “III. (14) Long-
term equity investments”.
9. Recognition of cash and cash equivalents
Cash comprises cash on hand and deposits of the Company that can be readily withdrawn on demand. Cash equivalents comprise
short-term, highly liquid investments held by the Company that are readily convertible into known amounts of cash and which are
subject to an insignificant risk of changes in value.
10. Foreign currency transactions and translation of foreign currency financial statements
1. Foreign currency transactions
The foreign currency transactions are recorded by translating the amount of a foreign currency into RMB at the spot exchange
rate prevailing on the 1st of each month.
The balances of foreign currency monetary items are translated using the spot exchange rate at the balance sheet date. Exchange
differences arising therefrom are recognized in profit or loss for the current period, except for exchange differences generated by
specific-purpose borrowings in a foreign currency related to acquisition of qualifying assets, which should be accounted for according
to the capitalization principles of borrowing costs.
2. Translation of financial statements denominated in foreign currencies
The asset and liability items in the balance sheet are translated at the spot exchange rates at the balance sheet date. Items of owners’
equity except for “unappropriated profit” are translated at the spot exchange rates at the dates on which such items arose. Income and
expenses in the income statement are translated at the exchange rates similar to the spot exchange rates at the dates of the transactions.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
When the Company disposes of a foreign operation, it transfers the translation differences relating to translation of the financial
statements of that foreign operation from the owners’ equity to profit or loss for the current period.
11. Financial instruments
When the Company becomes a party to a financial instrument contract, a financial asset, liability or equity instrument is recognized.
1. Classification of financial instruments
Based on the Company’s business model for managing financial assets and the cash flow characteristics of financial assets, the
financial assets are classified into on initial recognition: financial assets measured at its amortized cost, financial assets at fair value
through other comprehensive income, and financial assets at fair value through profit or loss.
The Company classifies financial assets that meet the following criteria at the same time and are not designated as at fair value
through profit or loss as the financial assets measured at amortized cost:
－ the business model aims to collect contractual cash flows; and
－ the contractual cash flows are generated only from payment of principal and interest on the outstanding principal.
The Company classifies financial assets that meet the following criteria at the same time and are not designated as at fair value
through profit or loss as the financial assets (debt instruments) at fair value through other comprehensive income:
－ the business model aims to collect contractual cash flows and sell such financial assets; and
－ the contractual cash flows are generated only from payment of principal and interest on the outstanding principal.
The Company irrevocably designates the non-trading equity instruments as financial assets (equity instruments) at fair value
through other comprehensive income on initial recognition. Such designation is made on the basis of a single investment, and the
relevant investments meet the definition of an equity instrument from the issuer’s perspective.
Except for the financial assets measured at amortized cost and the financial assets at fair value through other comprehensive
income, the Company classifies all of other remaining financial assets as the financial assets at fair value through profit or loss. If the
accounting mismatch can be eliminated or significantly reduced on initial recognition, the Company may irrevocably designate the
financial assets that should have been classified as those measured at amortized cost or those at fair value through other comprehensive
income as the financial assets at fair value through profit or loss.
On initial recognition, financial liabilities are classified into the following two categories: financial liabilities at fair value through
profit or loss and financial liabilities measured at amortized cost.
A financial liability may be designated as at fair value through profit or loss on initial measurement if one of the following
conditions is met:
1) the designation eliminates or significantly reduces accounting mismatch;
2) a group of financial liabilities or a group of financial assets and financial liabilities is managed and its performance is evaluated
on a fair value basis, and information about the group is reported on that basis to the enterprise’s key management personnel according
to such risk management or investment strategy set out in official written documents; or
3) this financial liability contains embedded derivatives that need to be split separately.
Based on the aforementioned conditions, these financial liabilities designated by the Company mainly include: (to describe the
specific designation in details)
2. Recognition and measurement of financial instruments
(1) Financial assets measured at amortized cost
The financial assets measured at amortized cost, including notes receivable, accounts receivable, other receivables, long-term
receivables and debt investments, are initially measured at fair value, and the relevant transaction costs are charged to the initially
recognized amount; the accounts receivable that do not contain any significant financing component and are recognized by the
Company without taking into consideration the significant financing components under the contracts with a term of less than one year
are initially measured at the contractual trading price.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
The interest calculated using the effective interest method during the holding period is recognized in the profit or loss for the
current period.
On recovery or disposal of a financial asset, the difference between the proceeds and the carrying amount of the financial asset is
recognized in profit or loss for the current period.
(2) Financial assets (debt instruments) at fair value through other comprehensive income
Financial assets (debt instruments) at fair value through other comprehensive income, including receivable financing and other
debt investments, are initially measured at fair value, and the relevant transaction costs are recognized in initially recognized amount.
These financial assets are subsequently measured at fair value, and changes in fair value other than the interest calculated using the
effective interest method, impairment loss or gain and profit or loss on exchange are recognized in other comprehensive income.
On derecognition, the cumulative gain or loss previously included in other comprehensive income is removed out from other
comprehensive income and recognized in profit or loss for the current period.
(3) Financial assets (equity instruments) at fair value through other comprehensive income
Financial assets (equity instruments) at fair value through other comprehensive income, including other equity investments, are
initially measured at fair value, and the relevant transaction costs are recognized in initially recognized amount. These financial assets
are subsequently measured at fair value, and changes in fair value are recognized in other comprehensive income. The dividends
received are recognized in profit or loss for the current period.
On derecognition, the cumulative gain or loss previously included in other comprehensive income is removed out from other
comprehensive income and included in retained earnings.
(4) Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss, including held-for-trading financial assets, derivative financial assets and other
non-current financial assets, are initially measured at fair value, and the relevant transaction costs are included in profit or loss for the
current period. These financial assets are subsequently measured at fair value, and changes in fair value are included in profit or loss
for the current period.
(5) Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss, including held-for-trading financial liabilities and derivative financial
liabilities, are initially measured at fair value, and the relevant transaction costs are recognized in profit or loss for the current period.
These financial liabilities are subsequently measured at fair value, and changes in fair value are recognized in profit or loss for the
current period.
On derecognition, the difference between their carrying amount and the consideration paid is included in profit or loss for the
current period.
(6) Financial liabilities measured at the amortized cost
The financial liabilities measured at the amortized cost, including short-term borrowings, notes payable, accounts payable, other
payables, long-term borrowings, bonds payable, long-term payables, are initially measured at fair value, and the relevant transaction
costs are charged to the initially recognized amount.
The interest calculated using the effective interest method during the holding period is recognized in the profit or loss for the
current period.
On derecognition, the difference between the consideration paid and the carrying amount of these financial liabilities is recognized
in profit or loss for the current period.
3. Termination recognition and transfer recognition of financial assets are based on relevant accounting standards and
measurement methods
The Company derecognizes a financial asset when one of the following conditions is met:
－ the contractual right to receive cash flows from the financial assets has expired;
－ the financial asset has been transferred and all the risks and rewards of ownership of the financial asset are substantially
transferred to the transferee; or
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
－ the financial asset has been transferred, and the Company neither transferred nor retained a substantial portion of all risks and
rewards incidental to the ownership of the financial asset, but did not retain control over the financial asset.
If the company modifies or renegotiates a contract with a counterparty, and such modification constitutes a substantive
modification, the original financial asset is derecognized, and a new financial asset is recognized according to the modified terms.
When a financial asset is transferred, if the Company retains substantially all the risks and rewards of ownership of a financial
asset, it does not derecognize the financial asset.
When the Company determines whether a transfer of a financial asset satisfies the derecognizing criteria prescribed above, it gives
weight to the substance rather than form.
The Company divides a transfer of a financial asset into a transfer of the financial asset in its entirety or a transfer of part of the
financial asset. For a transfer of a financial asset in its entirety that satisfies the derecognizing criteria, the difference between the
following two amounts is recognized in profit or loss for the current period:
(1) the carrying amount of the financial asset transferred; and
(2) the sum of the consideration received from the transfer and (if the financial asset transferred is a financial asset (debt instrument)
measured at fair value through other comprehensive income) any cumulative changes in fair value that was originally recognized in
owners’ equity.
If part of the transferred financial asset qualifies for derecognition, the carrying amount of the transferred financial asset in its
entirety is allocated between the part that continues to be recognized and the part that is derecognized, based on the relative fair values
of those parts. The difference between the following two amounts is recognized in profit or loss for the current period:
(1) the carrying amount allocated to the part derecognized; and
(2) the sum of the consideration received for the part derecognized and (if the financial asset transferred is a financial asset (debt
instrument) measured at fair value through other comprehensive income) the amount of the part derecognized corresponding to the
cumulative changes in fair value that was originally recognized in owners’ equity.
A financial asset that does not qualify for derecognition continues to be recognized, and the consideration received is recognized
as a financial liability.
4. Derecognition of financial liabilities
If the present obligations of a financial liability are discharged in part or whole, the financial liability or any part thereof is
derecognized; an agreement between the Company and the creditor to replace the existing financial liability with a new financial
liability with substantially different terms is accounted for as an extinguishment of the existing financial liability and the recognition
of a new financial liability.
A substantial modification to the terms of an existing financial liability or any part thereof is accounted for as an extinguishment
of the existing financial liability or any part thereof, and the financial liability with modified terms is recognized as a new financial
liability at the same time.
When the Company derecognizes a financial liability or any part thereof, it recognizes the difference between the carrying amount
of the financial liability derecognized and the consideration paid (including any non-cash assets transferred or new financial liabilities
assumed) in profit or loss for the current period.
If the Company repurchases part of a financial liability, it allocates the carrying amount of the financial liability in its entirety
between the part that continues to be recognized and the part that is derecognized based on the relative fair values of those parts on the
date of the repurchase. The difference between the carrying amount of the financial liability derecognized and the consideration paid
(including any non-cash assets transferred or new financial liabilities assumed) is recognized in profit or loss for the current period.
5. Method of determination of the fair value of financial assets and financial liabilities
If there is an active market for a financial instrument, the quoted price in the active market is used to establish the fair value of
the financial instrument. If there is no active market for a financial instrument, a valuation technique is used to establish the fair value
of the financial instrument. On valuation, the Company adopts the valuation technique which applies to the current circumstances and
is supported by sufficient data available and other information, selects the input value consistent with the characteristics of the asset or
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
liability considered by the market participants in the transaction of the relevant asset or liability, and prioritizes using the relevant
observable input value. The unobservable input value can be used only when the relevant observable input value cannot be obtained or
it is impracticable to obtain the relevant observable input value.
6. Test and accounting treatment of impairment of financial tools
The Company estimates the expected credit losses of financial assets measured at amortized cost, financial assets (debt instruments)
at fair value through other comprehensive income and financial guarantee contracts on a single or joint basis.
The Company comprehensively considers reasonable and well-founded information about past events, current conditions, and
predictions of future economic conditions as well as the possibility of default to calculate the probability-weighted amount of the
present value of the difference between cash flows receivable from contracts and cash flows expected to be recovered and include it in
the expected credit loss.
For receivables and contract assets formed by transactions regulated by Enterprise Accounting Standards No. 14 - Revenue,
regardless of whether they contain significant financing components, the company always measures their allowance for expected credit
losses equivalent to the amount expected throughout the entire term.
For lease receivables formed by transactions regulated by Enterprise Accounting Standards No. 21 - Leases, the company chooses
to measure its allowance for expected credit losses equivalent to the amount expected throughout the entire term.
For other financial instruments, the company evaluates the credit risk of the relevant financial instruments on each balance sheet
date based on changes since initial recognition.
The Company compares the possibility of default at the balance sheet date with the possibility of default upon initial recognition,
to determine the relative change in the default risks of financial instrument during the expected lifetime, and assess whether the credit
risk of the financial instruments has increased significantly since initial recognition. If a financial instrument is past due for more than
30 days, the Company usually believes that credit risk of the financial instrument has increased significantly, unless there is clear
evidence that credit risk of the financial instrument has not increased significantly since initial recognition.
If a financial instrument has low credit risk on the balance sheet date, the Company believes that credit risk of the financial
instrument has not increased significantly since initial recognition.
If the credit risk of a financial instrument has significantly increased since initial recognition, the company measures its allowance
for expected credit losses equivalent to the amount expected throughout the entire term. If the credit risk of a financial instrument has
not significantly increased since initial recognition, the company measures its allowance for expected credit losses equivalent to the
amount expected over the next 12 months. The increase or reversal of allowance for expected credit losses resulting from this is
recognized as impairment losses or gains in the current period's profit or loss. For financial assets (debt instruments) measured at fair
value with changes recognized in other comprehensive income, the allowance for expected credit losses is recognized in other
comprehensive income, and impairment losses or gains are recognized in the profit or loss for the period without reducing the carrying
amount of the financial asset in the balance sheet.
1) The basis for recognizing accounts receivable confirmation combinations is as follows:
Item Combination Categories Basis for determination
Combination 1: Bank acceptance
Accounts receivable Acceptance draft types
draft
Combination 2: Commercial
Accounts receivable Acceptance draft types
acceptance draft
Upon recognizing revenue, our company initially recognizes accounts receivable, which are then transferred to settle with
commercial bills. In accordance with the principle of continuous aging calculation, the aging of accounts receivable is traced back to
the corresponding starting date of accounts receivable for aging calculation.
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2) The basis for determining the combination of accounts receivable is as follows:
Combination
Item Basis for determination
Categories
If there is objective evidence indicating that a financial asset has
Combination 1:
Accounts incurred credit impairment, our company makes an individual
Individual provision
receivable provision for impairment on that financial asset.
Our company refers to historical credit loss experience,
combines it with current conditions and forecasts for future economic
Accounts Combination 2: Aging
conditions, and prepares a table comparing the aging of accounts
receivable combination
receivable with the expected credit loss rate for the entire duration.
This is used to calculate the expected credit loss.
The company starts calculating the aging of accounts receivable when the conditions for revenue recognition are met and initially
recognized. The actual aging period extends from the initial recognition date to the balance sheet date.
3) The basis for determining the combination of other receivables is as follows:
Combination
Item Basis for determination
Categories
Other accounts If there is objective evidence indicating that a financial
Combination 1:
receivable asset has incurred credit impairment, our company makes an
Individual provision
individual provision for impairment on that financial asset
Our company refers to historical credit loss experience,
combines it with current conditions and forecasts for future
Other accounts Combination 2: Aging economic conditions, and prepares a table comparing the aging
receivable combination of other receivables with the expected credit loss rate for the
entire duration. This is used to calculate the expected credit
loss
The company starts calculating the aging of other receivables when they are initially recorded. The actual aging period extends
from the initial recognition date to the balance sheet date.
4) The basis for confirming the combination of accounts receivable financing is as follows:
Item Combination Categories Basis for determination
Combination 1: Bank acceptance
Accounts receivable financing Acceptance draft types
draft
5) Criteria for determining individual provision for bad debt
The company utilizes available reasonable and substantiated forward-looking information to assess the risk of default of financial
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instruments at the balance sheet date compared to the risk at the initial recognition date. This assessment involves considering whether
there have been significant changes in the debtor's operating results, either actual or expected; whether there have been significant
adverse changes in regulatory, economic, or technological environments; whether there have been significant changes in the value of
collateral serving as security for the debt, or in the quality of third-party guarantees or credit enhancements, which are expected to
reduce the debtor's economic incentives to repay according to the terms of the contract or affect the probability of default; whether
there have been significant changes in the debtor's expected performance and repayment behavior, among other factors. Based on this
analysis, the company determines that credit risk has significantly increased. The company also conducts a comprehensive analysis to
assess whether the debtor is experiencing significant financial difficulties, has breached contracts or is in default, or if the debtor's
financial difficulties have reduced the asset's liquidity, among other factors, to determine if impairment has occurred. If the company's
customers or other debtors experience severe financial difficulties, defaults on repayments, and have not provided effective credit
enhancements or other safeguards, the company conducts impairment testing separately for them, considering the risk of default and
the expected credit loss rate for the entire duration. A provision for bad debts is then recognized based on the difference between the
carrying amount of the financial asset and the present value of expected future cash flows.
The company directly writes down the carrying amount of the financial asset if it no longer reasonably expects to recover all or
part of the contractual cash flows associated with the financial asset.
12. Contract Assets
1. Recognition method and criteria for contract assets
The company recognizes contract assets or contract liabilities on the balance sheet based on the relationship between performance
obligations and customer payments. The right to consideration for goods transferred or services provided to customers (and where that
right is conditional on factors other than the passage of time) is recognized as a contract asset. Contract assets and contract liabilities
for the same contract are presented as a net amount. The unconditional right to consideration from customers (based solely on the
passage of time) that the company holds is separately presented as accounts receivable.
2. Method for determining expected credit losses on contract assets and the accounting treatment
The method for determining expected credit losses on contract assets and the accounting treatment thereof are detailed in Note X
6 Methods for Testing and Accounting Treatment of Financial Instrument Impairment in this attachment.
13 Inventories
1. Classification and cost of inventories
Inventories are classified into: materials in transit, raw materials, revolving materials, goods on hand, products in process, goods
sold, work in process - outsourced, contract performance cost, etc.
Inventories are initially measured at cost. Cost of inventories comprises all costs of purchase, costs of conversion and other
expenditures incurred in bringing the inventories to their present location and condition.
2. Pricing methods of inventories transferred out
The Company delivers inventories at the price calculated using the weighted-average system monthly in arrears.
3. Inventory system
Adopts a perpetual inventory system.
4. Amortization method for low-value consumables and packaging materials
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The company's inventory includes low-value consumables, packaging materials, etc. For high-value turnover materials, monthly
amortization is carried out based on the estimated useful life upon issuance; for other low-value consumables, one-time amortization
is carried out upon issuance; packaging materials are amortized using the one-time amortization method upon issuance.
5. Criteria for recognition and provision method of inventory impairment
At the balance sheet date, inventories are measured at the lower of cost or net realizable value. If the cost of inventories is higher
than the net realizable value, a provision for decline in value of inventories is made. Net realizable value is the estimated selling price
in the ordinary course of business less costs expected to be incurred until completion and the estimated costs necessary to make the
sale and relevant taxes.
For finished products, goods on hand, materials available for sales and other merchandise inventories available for sales, in the
ordinary production and operation process, their net realizable value is determined at the estimated selling price of these inventories
less the estimated costs necessary to make the sale and relevant taxes; and for the inventories that need to be processed, in the ordinary
production and operation process, their net realizable value is determined at the estimated selling price of finished products less the
costs to be incurred until completion and the estimated costs necessary to make the sale and relevant taxes. The net realizable value of
the inventories held to satisfy sales or service contracts is based on the contract price. If the quantity of inventories held is more than
the quantity ordered in the sales contracts, the net realizable value of the excess portion of inventories is based on general selling prices.
After the provision for decline in value of inventories is made, if the circumstances that previously caused inventories to be written
down below cost no longer exist so that the net realizable value is higher than the carrying amount of inventories, the reversal is made
to the extent of the amount originally provided for the decline in value of inventories. The amount of the reversal is recognized in profit
or loss for the current period.
14. Held-for-sale assets
1. Hold-for-sale
The assets of which carrying amount is recovered mainly through sales (including through exchange of non-monetary assets with
commercial substance) rather than continuous use of non-current assets or disposal groups are classified as the held-for-sale assets.
The Company classifies the non-current assets or disposal groups which meet all the following conditions as the held-for-sale
assets:
(1) they can be sold immediately under current conditions according to the practice of sales of such assets or disposal groups in
similar transactions; and
(2) the sale is very likely to happen, that is, the Company has made a resolution on a sale plan and obtained a confirmed purchase
commitment, and such sale is expected to be completed within one year. The sale has been approved by the relevant authority or
regulatory department of the Company if it is required to be so approved by the relevant provisions.
2. Termination of operations
Termination of operations is a distinguishable component that meets one of the following conditions and has been disposed of or
classified as held for sale by the company:
(1) The component represents a separate major business or a separate major operating area.
(2) The component is part of a related plan to dispose of a separate major business or a separate major operating area.
(3) The component is a subsidiary acquired solely for resale.
Profit or loss from continuing operations and profit or loss from termination of operations are separately presented in the income
statement. Impairment losses and reversals, operating losses, and gains from disposal related to termination of operations are reported
as profit or loss from termination of operations. For termination of operations reported in the current period, the company reclassifies
the information previously reported as profit or loss from continuing operations as profit or loss from termination of operations in the
financial statements for the current period.
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15.Long-term equity investments
1. Judgment criteria of joint control and significant influence
Joint control is the agreed sharing of control over an arrangement, and the relevant activities of such arrangement must be decided
upon the unanimous consent of the parties sharing control. If the Company can exercise joint control over the investee along with other
parties to joint ventures and enjoy rights over net assets of the investee, the investee is a joint venture of the Company.
Significant influence is the power to participate in the financial and operating policy decisions of an investee, but is not control or
joint control with other parties over the establishment of those policies. If the Company can have significant influence over the investee,
the investee is an associate of the Company.
2. Determination of initial investment cost
(1) Long-term equity investments formed by business combination
In case of a long-term equity investment of a subsidiary acquired through a business combination involving entities under common
control, the initial investment cost of the long-term equity investment is the Company’s share of the carrying amount of the owners’
equity of the absorbed party in the consolidated financial statements of the ultimate controller at the date of combination. The difference
between the initial investment cost of the long-term equity investment and the carrying amount of the consideration paid for the
combination is treated as an adjustment to the equity premium in the capital reserve. In case the equity premium in the capital reserve
is not sufficient to absorb the difference, the remaining balance is adjusted against the retained earnings. Where the Company becomes
capable of exercising control over an investee under the common control due to additional investments or other reasons, the difference
between the initial investment cost of the long-term equity investment recognized in the light of above principles and the sum of the
carrying amount of the long-term equity investment prior to combination plus the carrying amount of new consideration paid for further
acquisition of shares on combination date is adjusted to the equity premium. If the equity premium is not sufficient to absorb the
difference, any excess is adjusted against retained earnings.
In case of a long equity investment acquired through a business combination not involving enterprises under common control, the
Company regards the cost of combination determined on the date of acquisition as the initial investment cost of the long-term equity
investment. If the Company becomes capable of exercising control over an investee not under common control due to additional
investments or other reasons, the initial investment cost is the sum of the carrying amount of the equity investment originally held and
the new investment cost.
(2) Long-term equity investments obtained through forms other than business combination
For a long-term equity investment acquired by paying cash, the initial investment cost is the actual purchase price.
For a long-term equity investment acquired by the issue of equity securities, the initial investment cost is the fair value of equity
securities issued.
3. Subsequent measurement and determination of profit or loss
(1) Long-term equity investments accounted for using the cost method
The Company accounts for the long-term equity investments of the subsidiaries using the cost method, unless these investments
meet the held-for-sale conditions. Except for cash dividends or profit distributions declared but undistributed included in the price or
consideration actually paid on acquisition of investments, the Company recognizes its cash dividends or profit distributions declared
by the investee as investment income in the current period.
(2) Long-term equity investments accounted for using the equity method
The long-term equity investments of associates and joint ventures are accounted for using the equity method. Where the initial
investment cost of a long-term equity investment exceeds the Company’s interest in the fair values of the investee’s identifiable net
assets at the acquisition date, no adjustment is made to the initial investment cost of the long-term equity investment. Where the initial
investment cost is less than the Company’s interest in the fair values of the investee’s identifiable net assets at the acquisition date, the
difference is charged to profit or loss for the current period, and the cost of the long-term equity investment is adjusted accordingly.
The Company respectively recognizes its share of the net profits or losses and other comprehensive income made by the investee
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as investment income and other comprehensive income, and adjusts the carrying amount of the long-term equity investment accordingly.
The carrying amount of the long-term equity investment is reduced by the portion of any profit distributions or cash dividends declared
by the investee that is attributed to the Company. The Company adjusts the carrying amount of the long-term equity investment for
other changes in owners’ equity of the investee other than net profits or losses, other comprehensive income and profit distributions
(“changes in other owners’ equity”), and includes the corresponding adjustment in owners’ equity.
For recognition of its share of the investee’s net profits or losses or other comprehensive income and changes in other owners’
equity, the Company recognizes its share of the investee’s net profits and other comprehensive income after making appropriate
adjustments based on the fair value of the investee’s identifiable net assets at the date of acquisition in accordance with its accounting
policies and period.
For unrealized profits or losses resulting from intragroup transactions between the Company and associates or joint ventures, the
portion attributable to the Company is eliminated, and based on this, the investment income is recognized, unless the invested or sold
assets constitute the business. The impairment loss of assets in the unrealized losses resulting from intragroup transactions between the
Company and the investee is fully recognized.
The Company discontinues recognizing its share of net losses of the associate or joint venture after the carrying amount of the
long-term equity investment together with any long-term interests that in substance form part of the Company’s net investment in the
associate or joint venture are reduced to zero, except to the extent that the Company has incurred obligations to assume additional
losses. Where the associate or joint venture makes net profits subsequently, the Company resumes recognizing its share of those profits
only after its share of the profits equals the share of losses not recognized.
(3) Disposal of long-term equity investments
On disposal of a long term equity investment, the difference between the proceeds actually received and the carrying amount is
recognized in profit or loss for the current period.
If, on partial disposal of long-term equity investments accounted for using the equity method, the remaining equity is still
accounted for using the equity method, the portion previously included in other comprehensive income is accounted for on a pro-rata
basis, with the same basis as the relevant assets or liabilities directly disposed of by the investee, and changes in other owners’ equity
are transferred to profit or loss for the current period on a pro-rata basis.
When the Company loses joint control or significant influence on the investee due to disposal of equity investments or other
reasons, the original equity investment included in other comprehensive income due to the use of equity method is accounted for on
the same basis as the relevant assets or liabilities directly disposed of by the investee when the equity method discontinues, and the
changes in other owners’ equity are fully transferred to profit or loss for the current period when the equity method discontinues.
Where the Company loses control over the investee due to disposal of partial equity investments, if in preparing separate financial
statements, the Company can exercise joint control or significant influence on the investee by virtue of its remaining equity, the
remaining equity switches to the equity method for accounting, and is adjusted as if it is accounted for using the equity method since
acquisition. Other comprehensive income recognized prior to acquisition of the control on the investee is carried forward proportionally
on the same basis as the investee’s direct disposal of related assets or liabilities, and changes in other owners’ equity recognized using
the equity method are transferred to profit or loss for the current period on a pro-rata basis; if the Company cannot exercise joint control
or significant influence on the investee by virtue of its remaining equity, the remaining equity is recognized as financial assets, and the
difference between the fair value and the carrying amount on the date when the Company loses control is recognized in profit or loss
for the current period, and other comprehensive income and changes in other owners’ equity recognized prior to acquisition of the
control on the investee are fully carried forward.
Where all transactions from disposal of equity investments in a subsidiary through multiple transactions by steps until the loss of
control belong to a single package, the Company accounts for each transaction as a disposal of equity investments in a subsidiary and
the loss of control; however, the difference between the proceeds from each disposal before loss of control and the carrying amount of
the long-term equity investments corresponding to the equity disposed of is first recognized in other comprehensive income in separate
financial statements and then transferred to the profit or loss in the period in which the control is lost. Where all transactions do not
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belong to a single package, the Company accounts for each transaction respectively.
16. Investment properties
Measurement of investment properties
Measured at cost
Depreciation or amortization methods
The Company’s investment property is property held to earn rentals or for capital appreciation or both, including land use rights
that have been leased out, land use rights that are held and ready to be transferred after appreciation, and buildings that have been
leased out (including those that are available for rental after being built by the Company itself or completion of development activities,
and are being built or in progress for rental in the future).
Subsequent costs incurred for an investment property are included in the cost of the investment property when it is probable that
the associated economic benefits will flow to the Company and the cost of the asset can be measured reliably. Subsequent costs that
fail to meet the recognition criteria above are recognized in profit or loss in the period in which they are incurred.
The Company measures the existing investment properties using the cost model. For investment properties measured using cost
model for measurement - the buildings available for rental follow the same depreciation policies as those of the Company’s fixed assets,
and land use rights available for rental follow the same amortization policies as those of intangible assets.
17. Fixed assets
(1) Recognition of fixed assets
Fixed assets are held for use in the production or supply of goods or services, for rental to others, or for administrative purposes,
and have useful lives more than one accounting year. A fixed asset is recognized only when both of the following conditions are met:
(1) it is probable that economic benefits associated with the fixed asset will flow to the enterprise; and
(2) the cost of fixed assets can be measured reliably.
A fixed asset of the Company is initially measured at its cost, and in determining the cost of a fixed asset, the Company considers
the effect of any expected costs of abandoning the asset at the end of its use.
Subsequent expenditures incurred for a fixed asset are included in the cost of the fixed asset when it is probable that the associated
economic benefits will flow to the Company and the cost of the asset can be measured reliably; the carrying amount of the part to be
replaced is derecognized; and all of other subsequent expenditures are recognized in profit or loss in the period in which they are
incurred.
(2) Method of depreciation
Estimated useful life Annual depreciation rate
Category Method of depreciation Residual value rate
(year) (%)
Buildings Straight-line method 20, 30 and 43 0, 1, 10 2.35-5
Machinery equipment Straight-line method 3-15 1, 10 6-33
Auxiliary production
Straight-line method 5-10 10 9-18
equipment
Transportation
Straight-line method 3-5 1, 10 18-33
equipment
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Mould equipment Straight-line method 3-10 10 9-30
Office equipment Straight-line method 3-5 1, 10 18-33
Computer equipment Straight-line method 3-10 1, 10 10-33
Other equipment Straight-line method 3-15 1, 10 6-33
The Company provides for depreciation of fixed assets by category using the straight-line method, and determines the
depreciation rate on the category, estimated useful life and estimated net residual value of fixed assets. For fixed assets with the
provision for impairment, the depreciation amount will be determined in the future based on the carrying amount after deduction of
the provision for impairment and remaining useful life. If a fixed asset has various component parts which have different useful lives
or provide benefits to the enterprise in different manners, these component parts are depreciated separately by selecting different
depreciation rates or methods.
The depreciation methods, useful life, residual value rate, and annual depreciation rate for various types of fixed assets are as
follows:
(3) Disposal of fixed assets
A fixed asset is derecognized when it is disposed of or when no future economic benefits are expected to be generated from its
use or disposal. When a fixed asset is sold, transferred, retired or damaged, the Company recognizes the amount of any proceeds on
disposal net of the carrying amount and related taxes and fee in profit or loss for the current period.
18. Construction in progress
A construction in progress is measured at the actual cost incurred. Actual cost includes construction and installation fees,
qualifying borrowing costs and other necessary expenses necessarily incurred for bringing the asset to working condition for its
intended use. The construction in progress is transferred to fixed assets when meeting working conditions for its intended use and the
Company begins to make provision from next month.
The standard and timing for capitalizing construction in progress into fixed assets for our company are as follows:
Criteria and timing for transferring construction in progress to fixed
Category
assets
(1) The main construction project and supporting projects have
substantially completed.
(2) The construction project meets the predetermined design
requirements and has been accepted by survey, design, construction, and
Real estate and
supervision units.
buildings
(3) It has passed inspections by external departments such as fire,
land, and planning.
(4) If the construction project reaches the predetermined usable state
but has not yet undergone final settlement, it will be transferred to fixed
assets based on the actual construction cost according to the estimated
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Criteria and timing for transferring construction in progress to fixed
Category
assets
value from the date it reaches the predetermined usable state.
(1) Relevant equipment and other supporting facilities have been
fully installed.
Machinery and (2) The equipment has been debugged and can maintain normal
equipment requiring stable operation for a period of time.
installation and (3) Production equipment is capable of producing qualified products
commissioning steadily for a period of time.
(4) The equipment has been accepted by asset management
personnel and users.
19. Borrowing costs
1. Recognition of capitalization of borrowing costs
Borrowing costs incurred by the company that are directly attributable to the acquisition, construction or production of a
qualifying asset are capitalized as part of the cost of the relevant asset. The amounts of other borrowing costs incurred are recognized
as an expense in the period in which they are incurred, and recorded into profit or loss for the current period.
Qualifying assets are assets (fixed assets, investment property, inventories, etc.) that necessarily take a substantial period of time
for acquisition, construction or production to get ready for their intended use or sale.
2. Capitalization period of borrowing costs
Capitalization period is the period from the date of commencement of capitalization of borrowing costs to the date of cessation
of capitalization, excluding any period over which capitalization is suspended.
The capitalization of borrowing costs can commence only when all of the following conditions are satisfied:
(1) expenditures for the asset are being incurred, and such expenditures include those expenditures incurred for the acquisition,
construction or production of the qualifying asset that have resulted in payments of cash, transfer of non-cash assets, or the assumption
of interest-bearing liabilities;
(2) borrowing costs are being incurred; and
(3) activities relating to the acquisition, construction or production of the asset that are necessary to prepare the asset for its
intended use or sale have commenced.
When the qualifying asset being acquired, constructed or produced has become ready for its intended use or sale, the capitalization
ceases.
3. Period over which capitalization is suspended
Capitalization of borrowing costs is suspended during periods in which the acquisition, construction or production of a qualifying
asset is interrupted abnormally, when the interruption is for a continuous period of more than 3 months. However, capitalization of
borrowing costs continues when the interruption is a necessary part of the process of preparing that asset for its intended use or sale.
The borrowing costs incurred during these periods of interruption are recognized as profit or loss for the current period, and the
capitalization of borrowing costs does not continue until the acquisition, construction or production of that asset is resumed.
4. Calculation methods of rate and amount of capitalization of borrowing cost
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Where funds are borrowed under a specific-purpose borrowing for the acquisition, construction or production of a qualifying
asset, the amount of borrowing costs to be capitalized is the actual borrowing costs incurred for the current period less any bank
interest earned from depositing the borrowed funds before being used on the asset or any investment income on the temporary
investment of those funds.
Where funds are borrowed under general-purpose borrowings and are utilized for the acquisition, construction or production of
a qualifying asset, the Company determines the amount of borrowing costs to be capitalized on such borrowings by multiplying a
capitalization rate of the utilized general-purpose borrowings by the weighted average of the excess amounts of cumulative
expenditures on the asset over and above the amounts of specific-purpose borrowings. The capitalization rate is the weighted average
of the actual interest rates applicable to the general-purpose borrowings.
During the capitalization period, exchange differences related to the principal and interest on a specific-purpose borrowing
denominated in foreign currency are capitalized as part of the cost of the qualifying asset. The exchange differences arising from
foreign currency borrowings and interest thereon other than specific-purpose borrowings denominated in foreign currency are
recognized in profit or loss for the current period.
20. Intangible assets
(1) Service life of assets and its determination basis, estimation, amortization method, or review procedures
1. Pricing methods of intangible assets
(1) The Company initially measures an intangible asset at cost of acquisition;
The cost of a separately acquired intangible asset comprises its purchase price, related taxes and any directly attributable
expenditure for preparing the asset for its intended use.
(2) Subsequent measurement
The Company analyzes and assesses the useful life of an intangible asset on its acquisition.
A finite-lived intangible asset is amortized during the period over which the asset generates economic benefits for the enterprise;
an intangible asset is regarded as having an indefinite useful life when there is no foreseeable limit to the period over which the asset
is expected to generate economic benefits for the enterprise, and is not be amortized.
2. Estimated useful lives of intangible assets with finite life
Item Estimated useful Amortization method Residual value rate Basis
life (year)
Software 3-10 Straight-line method None Estimated period of
benefit
Land use right 50 Straight-line method None Certificate of land
use rights
Patent right 10 Straight-line method None Right term
Non-patent technology 10 Straight-line method None Estimated period of
benefit
Others 6-18 Straight-line method Estimated period of
None
benefit
3. Basis for judgement of an intangible asset with indefinite useful life and procedures for review of useful life
The Company reviews the useful life of the indefinite intangible assets at the end of each period.
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(2) Scope of capitalization for research and development (R&D) expenses and related accounting treatment
methods.
1. The scope of capitalization for research and development (R&D) expenses includes personnel salaries related to R&D activities,
materials consumed, related depreciation and amortization expenses, utilities, and other related expenses incurred during the R&D
process.
2. Specific criteria for an internal research and development project that are classified into the research phase and the development
phase
Expenditure on an internal research and development project is classified into expenditure on the research phase and expenditure
on the development phase.
Research phase: The company considers preparatory activities for further development activities as the research phase and
expenses related to intangible asset research phase are recognized in the current period's profit or loss when incurred.
Development Phase: Activities conducted after completing the research phase are considered as the development phase.
3. Specific criteria of expenditure on the development phase qualifying for capitalization
Expenditure on the research phase is recognized in profit or loss for the period in which it is incurred. Expenditure on the
development phase is recognized as an intangible asset only when the Company demonstrates that all of the following conditions are
met; otherwise, it is recognized in profit or loss for the current period:
(1) the technical feasibility of completing the intangible asset so that it will be available for use or sale;
(2) the intention to complete the intangible asset and use or sell it;
(3) how the intangible asset will generate economic benefits. Among other things, the Company can demonstrate the existence
of a market for the output of the intangible asset or the intangible asset itself or, if it is to be used internally, the usefulness of the
intangible asset;
(4) the availability of adequate technical, financial and other resources to complete the development of and the ability to use or
sell the intangible asset; and
(5) its ability to measure reliably the expenditure attributable to the intangible asset during its development phase.
If the Company fails to discriminate between expenditure on the research phase and expenditure on the development phase, all
expenditures on research and development are recognized in the profit or loss for the current period.
21. Impairment of long-term assets
Where any indication exists that long-term equity investments, investment properties measured at the cost model, fixed assets,
construction in progress, right-of-use assets, intangible assets with finite useful life, oil and gas assets and other long-term assets may
be impaired at the balance sheet date, the Company performs an impairment test thereon. If the result of the impairment test shows
that the recoverable amount of an asset is lower than its carrying amount, the provision for impairment is made for the difference and
the difference is included in the impairment loss. The recoverable amount of an asset is the higher of its fair value less disposal costs
or the present value of the future cash flows expected to be derived from the asset. The provision for impairment of assets is calculated
and recognized for an individual asset, and if it is not possible to estimate the recoverable amount of the individual asset, the Company
determines the recoverable amount of the asset group to which the asset belongs. An asset group is the smallest identifiable group of
assets that generates cash inflows.
Goodwill generated in a business combination, indefinite-lived intangible assets and intangible assets which do not meet the
working conditions for its use are tested for impairment at least at the end of each year, irrespective of whether there is any indication
that the asset may be impaired.
For the purpose of impairment testing of the Company, the carrying amount of goodwill generated in a business combination is,
from the acquisition date, allocated on a reasonable basis to each of the related asset groups. If it is not possible to allocate to the
related asset groups, it is allocated to each of the related sets of asset groups. Each of the related asset groups or sets of asset groups
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shall be an asset group or a set of asset groups that is able to benefit from the synergies of the business combination.
In testing an asset group or a set of asset groups to which goodwill has been allocated for impairment, there may be an indication
that a related asset group or set of asset groups may be impaired. In such circumstances, the Company firstly tests the asset group or
set of asset groups excluding the amount of goodwill allocated for impairment, calculates its recoverable amount, compares the
recoverable amount with the related carrying amount and recognizes any impairment loss. Then, the Company tests the asset group
or set of asset groups to which goodwill has been allocated for impairment and compares its carrying amount and recoverable amount.
When the recoverable amount is less than its carrying amount, the amount of impairment loss first reduces the carrying amount of any
goodwill allocated to the asset group or set of asset groups, and then reduces the carrying amount of other assets (other than goodwill)
within the asset group or set of asset groups, pro rata on the basis of the carrying amount of each asset.
Once an impairment loss on the asset above is recognized, it will not be reversed in a subsequent period.
22. Long-term deferred expenses
Long-term deferred expenses mean those that have been incurred but should be amortized in the current period and the subsequent
periods of more than one year.
The amortization period and method of expenses are shown as follows:
Item Amortization method Amortization period
Housing decoration fees Straight-line method Period of benefit
Others Straight-line method Period of benefit
23. Contract liabilities
The Company presents the contract assets or liabilities in the balance sheet based on the relationship between performance
obligations and customer payments. The Company presents the obligations to transfer goods or offer services to customers as the
consideration received or receivable from customers as the contract liabilities. The Company lists the contract assets and liabilities
under the same contract as net amount.
24. Employee benefits
(1) Accounting treatment of short-term benefits
The Company recognizes the short-term benefits actually incurred during the accounting period when the employees serve the
Company as liabilities, and includes the same as part of the cost of related assets or in profit or loss for the current period.
The employee benefits corresponding to payments of social security contributions and housing funds for employees by the
Company and the appropriation to labor union funds and employee education fees are determined on such provision basis and at such
provision rate as stipulated during the period when the employees provide services for the Company.
The staff welfare incurred by the Company is stated as the amount actually incurred and recorded into profit or loss for the current
period or cost of related assets; non-monetary benefits are measured at fair value.
(2) Accounting treatment of post-employment benefits
(1) Defined contribution plans
The Company pays basic endowment insurance and unemployment insurance for employees pursuant to the relevant regulations
of the local government. The amounts payable therefor, during the accounting period when the employees serve the Company, are
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calculated according to the payment base and proportion stipulated by the local regulations, which are recognized in profit or loss for
the current period or the cost of related assets as liabilities.
(3) Accounting treatment of termination benefits
The Company recognizes the employment remuneration liabilities generated by termination benefits and records them into the
profit or loss for the current period on the earlier of: when the Company cannot unilaterally withdraw the severance benefits provided
as a result of the labor relationship termination plan or layoff proposal, or when it recognizes the costs or expenses related to the
restructuring of the severance benefits payment.
25. Provisions
The Company recognizes an obligation related to a contingency as a provision when all of the following conditions are satisfied:
(1) the obligation is a present obligation of the Company;
(2) it is probable that an outflow of economic benefits from the Company will be required to settle the obligation; and
(3) the amount of the obligation can be measured reliably.
Provisions are initially measured at the best estimate of the expenditure required to settle the related present obligation.
Factors pertaining to a contingency such as the risks, uncertainties and time value of money are taken into account as a whole
when the Company reaches the best estimate. Where the effect of the time value of money is material, the best estimate is determined
by discounting the related future cash outflows.
Where there is a continuous range of the expenditure required, and each possible outcome in that range is as likely as any other,
the best estimate is the mid-point of that range. Under any other circumstances, the best estimate is accounted for as follows:
where the contingency involves a single item, the best estimate is the most likely amount; or
where the contingency involves a large population of items, the best estimate is determined by weighting all possible outcomes
by their associated probabilities.
Where all or some of the expenditure required to settle an estimated liability is expected to be reimbursed by a third party, the
reimbursement is recognized as a separate asset when it is virtually certain that reimbursement will be received. The amount
recognized for the reimbursement does not exceed the carrying amount of the estimated liability.
The Company reviews the carrying amount of a provision at the balance sheet date. Where there is clear evidence that the carrying
amount of a provision does not reflect the current best estimate, the carrying amount is adjusted to the current best estimate.
26. Share-based payment
A share-based payment of the Company is a transaction in which the Company grants equity instruments, or incurs liabilities for
amounts that are determined based on the price of equity instruments, in return for services rendered by employees or other parties. A
share-based payment of the Company is classified as either an equity-settled share-based payment or a cash-settled share-based
payment.
1. Equity-settled share-based payment and equity instruments
An equity-settled share-based payment in exchange for services received from the employees is measured at the fair value of
equity instruments granted to the employees. If the right under the share-based payment vests immediately following the grant, the
Company, on grant date, recognizes related costs or expenses at an amount equal to the fair value of the equity instruments, with a
corresponding increase in capital reserve. If the rights under the share-based payment do not vest until the completion of services for
a vesting period, or until the achievement of a specified performance condition, at each balance sheet date during the vesting period,
the Company makes the best estimate of the number of equity instruments expected to vest, and based on this, recognizes the services
received in the current period in the related costs or expenses at an amount equal to the fair value on the grant date, with a
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corresponding increase in capital reserve.
If the terms of equity-settled share-based payment are modified, the services received are recognized at least pursuant to the
unmodified terms. In addition, any modifications that increase the fair value of the equity instruments, or changes that are beneficial
to employees on the modification date are recognized as an increase in services.
If the granted equity instrument is cancelled within the vesting period, the Company treats the cancellation of equity instrument
granted as the accelerated exercise, and the amount to be recognized during the remaining vesting period is immediately charged to
profit or loss for the current period, and the capital reserve is recognized at the same time. However, if a new equity instrument is
granted, and on the grant date thereof, is deemed to replace the cancelled equity instrument, the substitute equity instrument granted
is accounted for pursuant to the terms and conditions for accounting for original equity instrument.
27. Revenue
Disclosure of revenue recognition and measurement accounting policies adopted by business type.
The revenue is recognized at the time when the Company has discharged the performance obligations in the contract, that is,
when the customer obtains the control of the related goods or services. Obtainment of the control of the related goods or services
means the ability to direct the use of such goods or services and obtain substantially all of economic benefits from them.
If the contract has two or more performance obligations, the Company allocates the transaction price to each individual
performance obligation on the inception of the contract by reference to relative standalone selling prices of goods or services promised
thereby. The Company measures revenue based on the transaction price allocated to each individual performance obligation.
The transaction price is the amount of consideration to which the Company is entitled arising from the transfer of goods or
services to the customer, excluding the amount collected on behalf of a third party and expected to be returned to the customer. The
Company determines the transaction price with reference to the contract terms and in conjunction with past customary practices, and
in doing so, considers variable consideration, significant financing components in the contract, non-cash consideration, consideration
payable to customers and other factors. The Company determines the transaction price including variable consideration to the extent
that it is highly probable that its inclusion will not result in a significant revenue reversal of accumulatively recognized revenue in the
future when the uncertainty has been subsequently resolved. If there is a significant financing component in the contract, the Company
determines the transaction price based on the presumed amount payable in cash when the customer obtains the control of goods or
services, and amortizes the differences between the transaction price and the contract consideration using the actual interest method
within the term of the contract.
When meeting one of the following criteria, it belongs to the obligation performed over time, otherwise it constitutes the
obligation performed at a point in time:
the customer obtains and consumes the economic benefits generated by the Company’s performance when the Company
performs the contract;
the customer can control the products in progress in the performance of the contract by the Company; or
the products produced in the process of the Company’s performance have irreplaceable uses, and the Company has the right
to collect payment for the cumulative performance that has been completed up to date throughout the term of the contract.
For the obligation performed over time, the Company recognizes the revenue based on the performance progress over time,
unless the performance progress cannot be reasonably determined. The Company determines the progress of performance obligation
by taking the nature of goods or services and using the output/input method. When the performance progress cannot be reasonably
determined, and the costs incurred are expected to be recoverable, the Company recognizes the revenue to the extent of costs incurred
until the performance progress can be reasonably determined.
For the obligation performed at a point in time, the Company recognizes the revenue at the point in time when the customer
obtains the control of the related goods or services. When judging whether the customer has obtained the control of goods or services,
the Company considers the following signs:
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the Company has the current right to receive payment for such goods or services, that is, the customer has the current
obligation to make payment for such goods or services;
the Company has transferred the legal ownership of such goods to the customer, that is, the customer has the legal ownership
of such goods;
the Company has transferred such goods to the customer physically, that is, the customer has taken possession of such
goods physically;
the Company has transferred major risks and rewards of ownership of such goods to the customer, that is, the customer has
obtained major risks and rewards of ownership of such goods; and
the customer has accepted such goods or services.
The company determines its role as a principal or agent based on whether it has control over the goods or services before
transferring them to customers. If the company can control the goods or services before transferring them to customers, it acts as a
principal and recognizes revenue based on the total amount received or receivable. Otherwise, if the company acts as an agent, it
recognizes revenue based on the amount of commission or fees expected to be entitled to.
Different revenue recognition methods and measurement methods are applied for similar businesses with different operating
models.
The Company organizes the production according to the sales contracts signed with or the orders placed by customers, and
identifies the following models based on different geographical locations of customers and inventory management methods:
(1) General sales
For domestic sales, the Company ships goods to the delivery location designated by a customer, and recognizes the revenue after
the customer has signed the receipt of the products; and for foreign sales, the goods are delivered according to specific trade terms,
and the revenue is recognized at a point in time when the control is transferred.
(2) Supplier management inventory
Under this model, the Company ships the goods to the designated warehouse, the customer picks up the goods from the warehouse,
and the revenue is recognized at a point in time when the control is transferred.
28. Contract costs
Contract costs include contract performance cost and contract acquisition costs.
The cost incurred by the Company to perform a contract is not be governed by the standards on inventories, fixed assets or
intangible assets, and if meeting the following criteria, is recognized as an asset as the contract performance cost:
such cost is directly related to an existing or expected contract;
such cost increases the Company’s future resources for fulfilling its performance obligations; and
such cost is expected to be recovered.
If the incremental cost incurred by the Company to obtain a contract is expected to be recovered, it is recognized as an asset as
the cost for contract acquisition.
The Company amortizes the asset related to the contract cost on the same basis as the recognition of the revenue of the goods or
services related to the asset; provided that if the cost for contract acquisition is amortized for not more than one year, the Company
includes it into the profit or loss for the current period in which it is incurred.
If the carrying amount of the asset related to the contract cost is higher than the difference between the following two amounts,
the Company makes a provision for impairment of the excess and recognizes it as an impairment loss for the asset:
1. the remaining consideration expected to be obtained due to the transfer of the goods or services related to the asset; and
2. the cost to be incurred due to the transfer of the relevant goods or services.
If the impairment factors for prior periods have changed afterwards so that the above difference is higher than the carrying amount of
the asset, the Company reverses a provision for impairment originally made and includes it in the profit or loss for the current period,
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provided that the carrying amount after reverse should not exceed the carrying amount the asset would have reached on the date of
reverse had the provision for impairment been not made.
29. Government grants
1. Category
Government grants are monetary assets or non-monetary assets from the government to the Company at no consideration.
Government grants are classified into government grants related to assets and government grants related to income.
Government grants related to assets are government grants whose primary condition is that the Company should purchase,
construct or otherwise acquire long-term assets. Government grants related to income are government grants other than those related
to assets.
The specific standard based on which the Company classifies a grant as a government grant related to assets is that: the grant
obtained by the Company is used to purchase, construct or otherwise acquire long-term assets.
The specific standard based on which the Company classifies a grant as a government grant related to income is that: government
grants related to income are government grants other than those related to assets.
When classifying a grant whose subsidy object is not clearly specified in the government documents as a government grant
related to assets or a government grant related to income, the Company judges whether the grant is used to purchase, construct or
otherwise acquire long-term assets.
2. Recognition time point
When the Company actually receives the government grant, a government grant related to assets of the Company is recognized,
and since the long-term assets are available for use, the Company equally amortizes the deferred income based on the estimated useful
life of long-term assets and then transfers the same to the profit or loss for the current period.
When the Company actually receives the government grant, a government grant related to income of the Company is recognized,
and the Company recognizes it in the non-operating income or other income over the periods in which the related costs are recognized
if the grant is a compensation for related expenses or losses to be incurred by the Company in subsequent periods, and directly
recognizes it in the non-operating income or other income for the current period on acquisition if the grant is a compensation for
related expenses or losses incurred by the Company. The government grant is recognized when the Company meets the conditions
attaching to the government grant and can receive the government grant.
3. Accounting treatment
The government grants related to assets are offset against the carrying amount of the related assets or recognized as deferred
income. If a grant is recognized as deferred income, it is charged to profit or loss for the current period in a reasonable and systematic
manner within the useful life of related assets (the grant related to the daily activities of the Company is recognized in other income,
otherwise it is recognized in non-operating income);
The government grant related to income which is a compensation for related expenses or losses to be incurred by the Company
in subsequent periods is recognized as the deferred income and charged to the profit or loss over the period when related costs or
losses are recognized (the grant related to the daily activities of the Company is recognized in other income, otherwise it is recognized
in non-operating income) or offset against related costs or losses; and the government grant related to income which is a compensation
for related expenses or losses incurred by the Company is directly recognized in profit or loss for the current period (the grant related
to the daily activities of the Company is recognized in other income, otherwise it is recognized in non-operating income) or offset
against related costs or losses.
The policy-related preferential loan interest discounts obtained by the Company are accounted for separately according to the
following two circumstances:
(1) If the finance department allocates the interest discount funds to the lending bank, and then the lending bank offers a loan to
the Company at the policy-based preferential interest rate, the Company recognizes the loan amount actually received as the recorded
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amount of the loan, and calculates the borrowing costs according to the loan principal and such policy-based preferential interest rate.
(2) If the finance department directly allocates the interest discount funds to the Company, the Company offsets the corresponding
interest subsidy against the related borrowing costs.
30. Deferred tax assets/deferred tax liabilities
Income tax includes current and deferred tax. Except for the income tax arising from business combinations and transactions or
events recognized directly in owners’ equity (including other comprehensive income), the Company recognizes current tax and
deferred tax in profit or loss for the current period.
The deferred tax assets and deferred tax liabilities are calculated and recognized based on the difference (temporary difference)
between the tax base of assets and liabilities and the carrying amount of assets and liabilities.
A deferred tax asset is recognized for the deductible temporary difference to the extent that it is probable that future taxable
income amounts will be available against which the deductible temporary difference can be utilized. A deferred tax asset is recognized
for the carryforward of unused deductible losses and tax credits to the extent that it is probable that future taxable income amounts
will be available against which the deductible losses and tax credits can be utilized.
A deferred tax liability is recognized for taxable temporary difference, except for special circumstances.
Special circumstances under which the deferred tax assets or deferred tax liabilities are not recognized for the taxable temporary
difference include:
the initial recognition of goodwill; and
Transactions or events that neither constitute business combinations nor affect accounting profits and taxable income (or
deductible losses) at the time of occurrence, and where the initial recognition of assets and liabilities does not result in the creation of
temporary taxable differences and deductible temporary differences.
A deferred tax liability is recognized for the taxable temporary difference related to investments in subsidiaries, associates and
joint ventures, unless the Company is able to control the timing of the reversal of the temporary difference and it is probable that the
temporary difference will not reverse in the foreseeable future. A deferred tax asset is recognized for the deductible temporary
difference related to investments in subsidiaries, associates and joint ventures when it is probable that the temporary difference will
reverse in the foreseeable future and taxable income amounts will be available in the future against which the deductible temporary
difference can be utilized.
At the balance sheet date, deferred tax assets and deferred tax liabilities are measured at the tax rates that are expected to apply
to the period when the asset is realized or the liability is settled, according to the requirements of tax laws.
The Company reviews the carrying amount of the deferred tax assets at the balance sheet date. The Company reduces the carrying
amount of a deferred tax asset to the extent that it is no longer probable that sufficient taxable income amounts will be available in
future periods to allow the benefit of the deferred tax asset to be utilized. Any such reduction in amount is reversed to the extent that
it becomes probable that sufficient taxable income amounts will be available.
The current tax assets and current tax liabilities are offset and presented on a net basis when the Company has the statutory right
to settle on a net basis, and intends to settle on a net basis or to obtain assets and settle liabilities simultaneously.
At the balance sheet date, deferred tax assets and deferred tax liabilities are offset and presented on a net basis when both of the
following conditions are satisfied:
the taxpayer has the statutory right to settle the current tax assets and current tax liabilities on a net basis; and
the deferred tax assets and deferred tax liabilities are related to income taxes levied by the same tax authority on the same
taxpayer or different taxpayers, provided that during the period in which each material deferred tax asset and liability will be reversed,
the taxpayer involved intends to settle the current tax assets and liabilities on a net basis or obtain assets and settle liabilities
simultaneously.
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31. Leases
(1) Accounting treatment method for lessees leasing
The term “lease” refers to an agreement whereby the lessor conveys to the lessee the right to use an asset for consideration in an
agreed period of time. The Company shall assess whether a contract is a lease contract or contains a lease at the commencement date
of the contract, which can be identified if one party to the contract conveys the right to use one or more identified assets for exchange
of consideration in an agreed period of time.
If a contract contains several individual leases, the Company will split the contract and account for each individual lease separately.
If a contract contains both lease and non-lease components, the lessee and the lessor will separate the lease and non-lease components.
1. The Company as a lessee
(1) Right-of-use assets
At the commencement date of the lease, the Company recognizes right-of-use assets for leases excluding short-term leases and
leases of low-value assets. The right-of-use assets are initially measured at cost comprising the following:
the amount of the initial measurement of lease liability;
any lease payments made at or before the commencement date less any lease incentives received (if any);
any initial direct costs incurred to the Company; and
costs expected to be incurred to the Company for disassembly and removal of leased assets, restoration of the site where the
leased asset is located, or recovery of the leased asset to the condition agreed upon under the terms of the lease, excluding costs
incurred to produce inventories.
The right-of-use assets are depreciated by using a straight-line method subsequently. A leased asset is depreciated over its
remaining useful life if the ownership of this leased asset can be reasonably obtained at the maturity date of the lease term, otherwise,
the leased asset is depreciated over the shorter of its remaining useful life or the lease term.
The Company determines whether the right-of-use assets are impaired and accounts for the identified impairment losses in
accordance with the principles stated in Note “III. (20) Impairment of long-term assets”.
(2) Lease liabilities
At the commencement date of the lease, the Company recognizes lease liabilities for leases excluding short-term leases and leases
of low-value assets. The lease liabilities are initially measured at the present value of the outstanding lease payments including:
fixed payments (including in-substance fixed payments), less any lease incentives receivable (if any);
variable lease payments that are based on an index or a rate;
amounts expected to be payable by the Company for the guaranteed residual value;
the exercise price of a purchase option if the Company is reasonably certain to exercise that option; and
payments of penalties for terminating the lease, if the lease term reflects the Company exercising that option.
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, the
Company’s incremental borrowing rate is applied.
Interest expenses incurred to the lease liabilities over the term of the relevant lease are calculated by the Company based on fixed
periodic interest rate, and recognized in the current profit or loss or the cost of the related assets.
Variable lease payments excluded from the measurement of lease liabilities are charged to profit or loss in the period when they
are incurred or included in cost of related assets.
After the commencement date of the lease term, the Company will re-measure the lease liabilities and adjust relevant right-of-
use assets in one of the following cases, and charge the difference to the current profit or loss if the carrying amount of the right-of-
use assets is decreased to zero but that of the lease liabilities needs to be deducted further:
When there is a change in the assessment of a purchase option, lease renewal option or termination option, or the actual exercise
of the aforementioned options is not consistent with the original assessment, the Company will re-measure the lease liabilities at the
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present value of the modified lease payments discounted by using the revised discount rate; or
When there is a change in the in-substance fixed payments, the expected payable for the guaranteed residual value, or the index
or rate used to determine the lease payments, the Company will re-measure the lease liabilities at the present value of the modified
lease payments discounted by using the original discount rate. However, if the change in the lease payments is caused by the fluctuation
of the floating interest, the present value shall be discounted by using the revised discount rate.
(3) Short-term leases and leases of low-value assets
The Company chooses not to recognize the right-of-use assets and lease liabilities for short-term leases and leases of low-value
assets, and recognize in the current profit or loss or the cost of the related assets payments associated with short-term leases and leases
of low-value assets on a straight-line basis over the term of the relevant lease. Short-term leases are leases with a lease term of 12
months or less without a purchase option at the commencement date of leases. Leases of low-value assets are leases for which the
single leased asset is of low value when it is brand new. The company classifies leases for individual lease assets with a fair value of
no more than 40,000 yuan when new as low-value asset leases. Lease of an asset that is sub-leased or that is expected to be sub-leased
by the Company is not included in the lease of low-value assets.
(4) Lease modification
The Company accounts for a lease modification as a separate lease if both of the following conditions exist:
The modification has increased the scope of the lease by adding the right to use one or more leased assets; and
The consideration for the lease increases equals to the standalone price for the increase in scope of lease and any appropriate
adjustments to that standalone price to reflect the circumstances of the particular contract.
For a modification that is not accounted for as a separate lease, at the effective date of the modification, the Company will allocate
the consideration in the modified contract, determine the lease term of the modified lease and re-measure the lease liabilities at the
present value of the modified lease payments discounted by using the revised discount rate.
For modifications that decrease the scope of the lease or shorten the lease term, the Company decreases the carrying amount of
the right-of-use asset accordingly, and recognizes a gain or loss arising from the partial or full termination of the lease into the current
profit or loss. For other modifications resulting to a re-measurement of lease liabilities, the Company makes a corresponding
adjustment to the carrying amount of right-of-use assets.
2. Accounting treatment method for lessors leasing
At the commencement date of the lease, the Company classifies leases as finance leases and operating leases. Finance leases refer
to the leases to which the Company has transferred substantially all the risks and rewards of ownership of the leased assets regardless
whether the ownership has transferred or not. All other leases are classified as operating leases. The Company, when acting as a sub-
lease lessor, classifies the sub-leases based on the right-of-use assets arising from the original leases.
(1) Accounting treatment for operating lease
Rent receipts from operating lease are recognized as rental income on a straight-line basis over the term of the relevant lease.
Initial direct costs related to operating lease are capitalized when incurred, and are allocated to profit or loss on the same basis as
rental income over the lease term. Variable lease payments not included in the rent receipts are recognized in profit or loss when
incurred actually. An operating lease, if modified, is accounted for as a new lease from the effective date of the modification, with
receipts in advance or rent receivables related to the lease before the modification recognized as the rent receipts of the new lease.
(2) Accounting treatment for finance lease
At the commencement date of the lease, the Company recognizes finance lease receivables and derecognizes assets held under
finance leases. Lease receivables are presented at an amount equal to the net investment in the lease for the initial measurement. The
net investment in the lease is the sum of any unguaranteed residual value and the present value of the rent receipts not received yet as
of the commencement date of the lease discounted at the interest rate implicit in the lease.
Interest incomes over the term of the relevant lease are calculated and recognized by the Company based on fixed periodic interest
rate. The Company accounts for derecognition and impairment of finance lease receivables in accordance with Note “III. (10) Financial
instruments”.
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Variable lease payments that are not included in the measurement of the net investment in the lease are recognized in profit or
loss when incurred actually.
The Company accounts for a finance lease modification as a separate lease if both of the following conditions exist:
● The modification has increased the scope of the lease by adding the right to use one or more leased assets; and
● The consideration for the lease increases equals to the standalone price for the increase in scope of lease and any appropriate
adjustments to that standalone price to reflect the circumstances of the particular contract.
For a modification to a finance lease that is not accounted for as a separate lease, the Company accounts for the modification as
follows:
● if the lease would have been classified as an operating lease had the modification been in effect at the commencement date of
the lease, the Company accounts for the lease modification as a new lease from the effective date of the modification, and measures
the carrying amount of the leased asset as the net investment in the lease immediately before the effective date of the lease modification;
or
● if the lease would have been classified as a finance lease had the modification been in effect at the commencement date of the
lease, the Company accounts for the lease modification in accordance with the requirements in Note “III. (10) Financial instruments
- Policies on the contract modifications or re-negotiation”.
Sale and leaseback transactions
The Company assesses and determines whether the transfer of an asset in the sale and leaseback transactions is accounted for as
a sale of that asset pursuant to the principles stated in Note “III. (26) Revenue”.
(1) The Company as a lessee
If the transfer of an asset in the sale and leaseback transactions satisfies the requirements to be accounted for as a sale of the asset,
the Company, as a lessee, measures the right-of-use asset arising from the leaseback at the proportion of the previous carrying amount
of the asset that relates to the right of use retained, and recognizes only the amount of any gain or loss that relates to the rights
transferred to the lessor accordingly.
If the transfer of an asset in the sale and leaseback transactions does not satisfy the requirements to be accounted for as a sale of
the asset, the Company, as a lessee, continues to recognize the transferred asset and a financial liability equal to the transfer proceeds.
Please refer to Note “III. (10) Financial instruments” for accounting treatment of the financial liability.
(2) The Company as a lessor
If the transfer of an asset in the sale and leaseback transactions satisfies the requirements to be accounted for as a sale of the asset,
the Company, as a lessor, accounts for the purchase of the asset and for the lease subject to the above policies stated in “2. The
Company as a lessor”; and if the transfer of an asset in the sale and leaseback transactions does not satisfy the requirements to be
accounted for as a sale of the asset, the Company, as a lessor, does not recognize the transferred asset and instead, recognizes a financial
asset equal to the transfer proceeds. Please refer to Note “III. (10) Financial instruments” for accounting treatment of the financial
asset.
32. Other significant accounting policies and accounting estimates
None
33. Changes in significant accounting policies and accounting estimates
(1) Changes in significant accounting policies
Applicable □ N/A
In RMB
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Content and reasons for changes in Names of significant affected items in
Amount of impact
accounting policies. the financial statements.
1. Significant Accounting Policy Change
(1) Implementation of Accounting Standards Interpretation No. 16 Accounting Treatment for Deferred Income Tax Exemption on
Initial Recognition Arising from Single Transactions
On November 30, 2022, the Ministry of Finance issued the Notice on Printing and Issuing the Interpretation No. 16 of the Accounting
Standards for Business Enterprises (No. 31 [2022] of the Ministry of Finance). The provision regarding the accounting treatment for
deferred income tax exemption on initial recognition arising from single transactions, as outlined in Accounting Standards
Interpretation No. 16, came into effect on January 1, 2023.
Interpretation No. 16 provides that the provisions of the Accounting Standards for Business Enterprises No. 18 - Income Tax on the
exemption from the initial recognition of deferred income tax liabilities and deferred income tax assets shall not apply to a single
transaction that is not a business combination, that does not affect accounting profits or the amount of taxable income (or deductible
loss) upon the occurrence of a transaction, and in which the initially recognized assets and liabilities result in an equal amount of taxable
temporary differences and deductible temporary differences (including lease transactions in which lease liabilities are initially
recognized by the lessee on the lease inception date and included in the right-of-use assets, and transactions in which estimated liabilities
are recognized and included in the relevant asset costs due to the disposal obligations of fixed assets, among others, hereinafter referred
to as “single transactions to which this Interpretation applies”). As for the taxable temporary differences and deductible temporary
differences arising from the initial recognition of assets and liabilities in a transaction, the enterprise shall, in accordance with the
Accounting Standards for Business Enterprises No. 18 - Income Tax and other relevant provisions, respectively recognize the
corresponding deferred income tax liabilities and deferred income tax assets upon the occurrence of the transaction.
For a single transaction to which this Interpretation applies and which occurs from the beginning of the earliest period of
presentation of financial statements when this Interpretation is implemented for the first time to the effective date of this Interpretation,
and if taxable temporary differences and deductible temporary differences arise from the lease liabilities and right-of-use assets
recognized as a result of a single transaction to which this Interpretation applies as well as the recognized estimated liabilities and
corresponding assets relating to disposal obligations at the beginning of the earliest period of presentation of financial statements when
this Interpretation is implemented for the first time, the enterprise shall make adjustments in accordance with the provisions of this
Interpretation.
As the company had already separately recognized deferred tax assets and deferred tax liabilities for lease liabilities and right-
of-use assets in accordance with the new leasing standard, the implementation of Interpretation No. 16 did not have a significant impact
on the company's financial position and operating results.
(2) Changes in significant accounting estimates
Applicable □N/A
Content and reasons for Names of significant affected Effective date of application The effective date of
changes in accounting items in the financial application.
policies. statements.
During this reporting period, there were no significant changes in accounting estimates for the company.
34. Key accounting estimates and judgments
In the application of accounting policies, the company, due to the inherent uncertainties in its operations, needs to make judgments,
estimates, and assumptions regarding the measurement of items in the financial statements that cannot be accurately quantified.
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These judgments, estimates, and assumptions are based on the company's management's historical experience and other relevant
factors. They affect the reported amounts of income, expenses, assets, and liabilities, as well as disclosures of contingent liabilities at
the balance sheet date. However, the actual results resulting from the uncertainty of these estimates may differ from the company
management's current estimates, leading to significant adjustments to the carrying amounts of affected assets or liabilities in the
future.
The company periodically reviews these judgments, estimates, and assumptions on a going concern basis. Changes in accounting
estimates affect only the period of change, and their impact is recognized in the period of change. If they affect both the current
period and future periods, their impact is recognized in both the period of change and future periods.
At the balance sheet date, the company needs to make judgments, estimates, and assumptions in the following significant areas of the
financial statements:
(1) Revenue Recognition
As described in Note 3, (26) Revenue, the company's revenue recognition involves the following significant accounting judgments
and estimates: identifying customer contracts; estimating the collectability of consideration from customers for goods transferred;
identifying performance obligations in contracts; estimating variable consideration in contracts and the amount of cumulative
revenue recognized to date that is likely to be reversed when related uncertainties are resolved; determining whether significant
financing components exist in contracts; estimating the standalone selling price of each distinct performance obligation in contracts;
determining whether performance obligations are satisfied over time or at a point in time; determining progress towards satisfaction
of performance obligations, etc.
The company primarily relies on past experience and work to make these judgments, and these significant judgments and estimate
changes may impact revenue, cost of goods sold, and income for the period, as well as the period's financial results, and may
constitute significant impacts.
(2) Leasing
1. Lease Recognition
When determining whether a contract is a lease or contains a lease, the company evaluates whether there is an identified asset over
which the customer has control for a certain period. In this assessment, consideration is given to the nature of the asset, substantive
substitution rights, and whether the customer has the right to obtain almost all of the economic benefits generated by using the asset
during that period and can direct the use of the asset.
2. Lease Classification
As a lessor, the company classifies leases as operating leases or finance leases. When making classifications, management analyzes
and determines whether all risks and rewards related to the ownership of the leased asset have substantially transferred to the lessee.
3. Lease Liabilities
As a lessee, lease liabilities are initially measured at the present value of the lease payments unpaid at the commencement date of the
lease term. When measuring the present value of lease payments, the company estimates the discount rate used and the lease term for
leases with renewal or termination options. In assessing the lease term, the company considers all relevant facts and circumstances that
bring economic benefits to the company from exercising the option, including expected changes in facts and circumstances between
the commencement date of the lease term and the exercise date of the option. Different judgments and estimates may affect the
recognition of lease liabilities and right-of-use assets and subsequently impact profit or loss in subsequent periods.
(3) Impairment of Financial Assets
The company assesses impairments of financial instruments using the expected credit loss model, which requires significant judgments
and estimates based on all reasonable and supportable information, including forward-looking information. In making such judgments
and estimates, the company infers expected changes in the credit risk of debtors based on historical data combined with changes in
economic policies, macroeconomic indicators, industry risks, external market conditions, technological environments, and customer
situations.
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(4) Inventory Impairment Provision
In accordance with the inventory accounting policy, the company recognizes inventory impairment provisions for inventory with a cost
higher than net realizable value and for obsolete and slow-moving inventory. Inventory impairment to net realizable value is based on
an assessment of the salability of inventory and its net realizable value. Identifying inventory impairment requires management to make
judgments and estimates based on obtaining conclusive evidence and considering factors such as the purpose of holding inventory and
the impact of post-balance sheet events. Differences between actual results and original estimates will affect the carrying value of
inventory and the recognition or reversal of inventory impairment provisions during the period when estimates are changed.
(5) Fair Value of Financial Instruments
For financial instruments with no active market, the company determines their fair value using various valuation methods, including
discounted cash flow model analysis, etc. When valuing, the company estimates aspects such as future cash flows, credit risks, market
volatility, and correlations, and selects appropriate discount rates. These related assumptions have uncertainties, and changes in them
will affect the fair value of financial instruments. For equity instrument investments or contracts with quoted prices, the company does
not consider cost as the best estimate of their fair value.
(6) Impairment of Long-term Assets
The company assesses whether there are indications of impairment for non-financial assets other than financial assets as of the balance
sheet date. For intangible assets with uncertain useful lives, impairment tests are performed when there are indicators of impairment in
addition to annual impairment tests. For other non-financial assets other than financial assets, impairment tests are conducted when
there are indications that their carrying amounts may not be recoverable.
When the carrying amount of an asset or asset group exceeds its recoverable amount, which is the higher of its fair value less costs to
sell and the present value of expected future cash flows, an impairment is recognized.
The net amount after deducting costs to sell from fair value is determined by reference to the sale agreement price of similar assets in
fair transactions or observable market prices, minus incremental costs directly attributable to the disposal of the asset.
In estimating the present value of expected future cash flows, significant judgments are made regarding the production, selling price,
relevant operating costs of the asset (or asset group), and the discount rate used in the calculation of present value. The company uses
all relevant information available to estimate recoverable amount, including forecasts of production, selling prices, and relevant
operating costs based on reasonable and supportable assumptions.
Goodwill is tested for impairment at least annually. This requires estimating the present value of future cash flows of the cash-generating
units or groups of cash-generating units to which goodwill is allocated. In estimating the present value of future cash flows, the company
needs to forecast the future cash flows generated by the cash-generating units or groups of cash-generating units and select appropriate
discount rates to determine the present value of future cash flows.
(7) Depreciation and Amortization
The company depreciates and amortizes investment properties, property, plant, and equipment, and intangible assets using the straight-
line method over their estimated useful lives after considering their residual values. The company periodically reviews the useful lives
to determine the amount of depreciation and amortization expense to be recognized in each reporting period. The useful lives are
determined by the company based on past experience with similar assets and anticipated technological changes. If there is a significant
change in previous estimates, depreciation and amortization expenses will be adjusted in future periods.
(8) Deferred Tax Assets
The company recognizes deferred tax assets for all unused tax losses to the extent that it is probable that sufficient taxable profits will
be available to offset the losses. This requires significant judgment by management to estimate the timing and amount of future taxable
profits, considering tax planning strategies, to determine the amount of deferred tax assets to be recognized.
(9) Income Taxes
In the normal course of business, there is inherent uncertainty in the final tax treatment and calculation of certain transactions. Approval
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from the tax authorities is required for some items to be deducted before tax. If the final determination of these tax matters differs from
the originally estimated amount, the difference will affect the current income tax and deferred income tax recognized in the period of
final determination.
VI. Taxes
1. Major categories of taxes and tax rates
Tax category Taxation basis Tax rate
VAT payable is the output tax based on the
sales of goods and taxable labor income
16%, 13%, 10%, 9%, 8%, 6%, 5%, 3%,
Value added tax calculated pursuant to the tax law, net of
0%
the input tax that is allowed to be deducted
in the current period
Subject to the actual payment of VAT and
Urban maintenance and construction tax 7 %, 5%
consumption tax
25%, 20%, 19%, 17%, 16.5%, 15%, 10%,
Enterprise income tax Subject to the taxable income amount
0%
Disclosure of taxpayers (if any) with different rates of enterprise income tax:
Taxpayer Rate of enterprise income tax
Luxshare Precision Industry Co., Ltd. 15
Xiexun Electronic (Ji’an) Co., Ltd. 15
ASAP Technology (Jiangxi) Co., Ltd. 15
Lanto Electronic Limited 15
Bozhou Lanto Electronic Limited 15
Huzhou Jiuding Electronic Co., Ltd. 15
Luxshare Automation (Jiangsu) Ltd. 15
Merry Electronics (Suzhou) Co., Ltd. 15
Luxshare Electronic Technology (Kunshan) Co., Ltd. 15
Yongxin County Boshuo Electronics Co., Ltd. 15
Chuzhou Luxshare Precision Industry Co., Ltd. 15
Merry Electronics (Huizhou) Co., Ltd. 15
Fujian JK Wiring Systems Co., Ltd. 15
Jiangxi Luxshare Intelligent Manufacture Co., Ltd. 15
Jiangxi ASAP Electronic Co., Ltd. 15
Suzhou Luxshare Technology Co., Ltd. 15
Suining Luxshare Precision Industry Co., Ltd. 15
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Luxshare Precision Industry (Baoding) Co., Ltd. 15
Luxshare Precision Industry (Shanxi) Co., Ltd. 15
Dongguan Xuntao Electronic Co., Ltd. 15
Kunshan Luxshare Precision Industry Co., Ltd. 15
Luxshare iTech (Zhejiang) Co., Ltd. 15
Shenzhen Luxshare Acoustics Technology Ltd. 15
Enshi Luxshare Precision Industry Co., Ltd. 15
Luxshare Precision Industry (Jiangsu) Co., Ltd. 15
Luxshare Electric (Shanghai) Co., Ltd. 15
Luxshare Technology (Kunshan) Co., Ltd. 15
Dongguan Luxshare Technology Co., Ltd. 15
Luxshare Precision Limited Note 1
Luxshare Precision Technology Co., Ltd. 16.5
Taiwan Luxshare Precision Limited 20
ICT-LANTOLIMITED (HK) Note 1
Luxshare Standard Limited (HK) Note 1
Luxshare Technologies Limited Note 1
LUXSHAREICT (Japan) Note 2
Yunding Technology Co., Ltd. Note 1
Luxis Technology Limited Note 1
Luxshare Precision Investment Co., Ltd. Note 1
SpeedTech Corp. 20
Luxshare India Private Limited 25
Luxshare Lanto India Private Limited 25
LuxshareICT, Inc. Note 3
LUXSHARE-ICT EUROPE LIMITED 19
ICT Legend S. DE R.L. DE C.V. 30
Luxshare Technologies Mexico S. de.
30
R.L.de c.v.
Linkz Cables Mexico S.deR.L. de C.V. 30
SukkunststofftechnikGmbH 15
KoreaLuxshareICTCo.,Ltd Note 4
Luxshare-ICT (Vietnam) Limited 10
Luxshare-ICT (Van Trung) Company Limited 10
Luxshare-ICT (Nghe An) Limited 0
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Singapore Luxshare Co., Ltd. 17
Xuancheng Luxshare Precision Industry Co., Ltd. 15
Dongguan Huarong Communications Technology Co., Ltd. 15
Shenzhen Huarong Technology Co., Ltd. 15
TIME Interconnect Technology (Huizhou) Limited 15
Huaxun Industrial (Suzhou) Co., Ltd. 15
Lixin Precision Intelligent Manufacturing (Kunshan) Co., Ltd. 15
TIME Interconnect Technology Limited 16.5
TIME Interconnect Investment Limited 16.5
Time Interconnect Investment Limited 0
TIME Interconnect (HK) Limited 16.5
TIME Interconnect Wiring Technology Co., Ltd. 16.5
TIME Interconnect Industrial Co., Ltd. 16.5
Huaxun Hong Kong Limited 16.5
Huaxun Cable Co., Ltd. 0
Linkz International Limited 16.5
HOVER MANUFACTURING COMPANY LIMITED 16.5
TIME Interconnect Server Technology Co., Ltd. 16.5
Other subsidiaries 25
2. Tax incentives
Corporate income tax
1. The Company was identified as a high-tech enterprise by the Science, Technology and Innovation Commission of Shenzhen
Municipality, Finance Bureau of Shenzhen Municipality, and Shenzhen Tax Service, State Taxation Administration on December 23,
2021, with the High-tech Enterprise Certificate No. GR202144203830 valid for three years. As provided for in the Notice by the
Ministry of Finance and the State Administration of Taxation on Preferential Policies for Enterprise Income Taxes Related to
Enterprises’ Technological Innovation and the Notice by the State Administration of Taxation on Issues Concerning the Implementation
of Preferential Enterprise Income Taxes for High-tech Enterprises, the Company enjoys an enterprise income tax of 15% for 2023.
2. The subsidiary, Xiexun Electronic (Ji’an) Co., Ltd. (“Ji’an Xiexun”), was identified as a high-tech enterprise by the Science
and Technology Department of Jiangxi Province, Jiangxi Provincial Finance Bureau, and Jiangxi Provincial Tax Service, State
Taxation Administration on November 22, 2023, with the High-tech Enterprise Certificate No. GR202336001430 valid for three years.
According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it enjoys an enterprise
income tax rate of 15% for 2023.
3. The subsidiary, ASAP Technology (Jiangxi) Co., Ltd. (“ASAP Jiangxi”), was identified as a high-tech enterprise by the
Science and Technology Department of Jiangxi Province, Jiangxi Provincial Finance Bureau, and Jiangxi Provincial Tax Service, State
Taxation Administration on December 14, 2022, with the High-tech Enterprise Certificate No. GR202236001286 valid for three years.
According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it enjoys an enterprise
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income tax rate of 15% for 2023.
4. The subsidiary, Lanto Electronic Limited (“Lanto Kunshan”), was identified as a high-tech enterprise by the Jiangsu Provincial
Department of Science and Technology, Department of Finance of Jiangsu Province, and Jiangsu Provincial Tax Service, State
Taxation Administration on November 6, 2023, with the High-tech Enterprise Certificate No. GR202332005205 valid for three years.
According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it enjoys an enterprise
income tax rate of 15% for 2023.
5. The sub-subsidiary, Bozhou Lanto Electronic Limited (“Lanto Bozhou”), was identified as a high-tech enterprise by the Anhui
Provincial Department of Science and Technology, Department of Finance of Anhui Province, and Anhui Provincial Tax Service, State
Taxation Administration on September 18, 2021, with the High-tech Enterprise Certificate No. GR202134001185 valid for three years.
According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it enjoys an enterprise
income tax rate of 15% for 2023.
6. The sub-subsidiary, Huzhou Jiuding Electronic Co., Ltd. (“Huzhou Jiuding”), was identified as a high-tech enterprise by the
Department of Science and Technology of Zhejiang Province, Zhejiang Provincial Department of Finance, Zhejiang Provincial Tax
Service, State Taxation Administration and Local Taxation Bureau of Zhejiang Province on December 8, 2023, with the High-tech
Enterprise Certificate No. GR202333009628 valid for three years. According to relevant provisions of the national high-tech enterprise
income tax preferential policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
7. The subsidiary, Luxshare Automation (Jiangsu) Ltd. (“Luxshare Automation Jiangsu”), was identified as a high-tech enterprise
by the Jiangsu Provincial Department of Science and Technology, Department of Finance of Jiangsu Province, and Jiangsu Provincial
Tax Service, State Taxation Administration on November 30, 2021, with the High-tech Enterprise Certificate No. GR202132006272
valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it
enjoys an enterprise income tax rate of 15% for 2023.
8. The sub-subsidiary, Merry Electronics (Suzhou) Co., Ltd. (“Meite Suzhou”), was identified as a high-tech enterprise by the
Jiangsu Provincial Department of Science and Technology, Department of Finance of Jiangsu Province, and Jiangsu Provincial Tax
Service, State Taxation Administration on November 6, 2023, with the High-tech Enterprise Certificate No. GR202332001066 valid
for three years. According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it enjoys
an enterprise income tax rate of 15% for 2023.
9. The subsidiary, Luxshare Electronic Technology (Kunshan) Co., Ltd. (“Luxshare Electronic Kunshan”), was identified as a
high-tech enterprise by the Jiangsu Provincial Department of Science and Technology, Department of Finance of Jiangsu Province,
and Jiangsu Provincial Tax Service, State Taxation Administration on November 30, 2021, with the High-tech Enterprise Certificate
No. GR202132006555 valid for three years. According to relevant provisions of the national high-tech enterprise income tax
preferential policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
10. The sub-subsidiary, Yongxin County Boshuo Electronics Co., Ltd. (“Yongxin Boshuo”), was identified as a high-tech
enterprise by the Science and Technology Department of Jiangxi Province, Jiangxi Provincial Finance Bureau, and Jiangxi Provincial
Tax Service, State Taxation Administration on December 8, 2023, with the High-tech Enterprise Certificate No. GR202336002349
valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it
enjoys an enterprise income tax rate of 15% for 2023.
11. The subsidiary, Chuzhou Luxshare Precision Industry Co., Ltd. (“Luxshare Chuzhou”), was identified as a high-tech
enterprise by the Anhui Provincial Department of Science and Technology, Department of Finance of Anhui Province, and Anhui
Provincial Tax Service, State Taxation Administration on October 18, 2022, with the High-tech Enterprise Certificate No.
GR202234002571 valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential
policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
12. The sub-subsidiary, Merry Electronics (Huizhou) Co., Ltd. (“Merry Huizhou”), was identified as a high-tech enterprise by
the Department of Science and Technology of Guangdong Province, Department of Finance of Guangdong Province, and Guangdong
Provincial Tax Service, State Taxation Administration on December 20, 2021, with the High-tech Enterprise Certificate No.
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
GR202144005561 valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential
policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
13. The subsidiary, Fujian JK Wiring Systems Co., Ltd. (“Fujian JK”), was identified as a high-tech enterprise by the Fujian
Provincial Department of Science and Technology, Fujian Provincial Department of Finance, and Fujian Provincial Tax Service, State
Taxation Administration on December 28, 2023, with the High-tech Enterprise Certificate No. GR202335000667 valid for three years.
According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it enjoys an enterprise
income tax rate of 15% for 2023.
14. The subsidiary, Jiangxi Luxshare Intelligent Manufacture Co., Ltd. (“Smart Manufacturing Jiangxi”), was identified as a
high-tech enterprise by the Science and Technology Department of Jiangxi Province, Jiangxi Provincial Finance Bureau, and Jiangxi
Provincial Tax Service, State Taxation Administration on November 3, 2021, with the High-tech Enterprise Certificate No.
GR202136000345 valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential
policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
15. The sub-subsidiary, Jiangxi ASAP Electronic Co., Ltd. (“Boshuo Electronics”), was identified as a high-tech enterprise by
the Science and Technology Department of Jiangxi Province, Jiangxi Provincial Finance Bureau, and Jiangxi Provincial Tax Service,
State Taxation Administration on November 3, 2021, with the High-tech Enterprise Certificate No. GR202136000645 valid for three
years. According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it enjoys an
enterprise income tax rate of 15% for 2023.
16. The sub-subsidiary, Suzhou Luxshare Technology Co., Ltd. (“Suzou Luxshare Technology”), was identified as a high-tech
enterprise by the Jiangsu Provincial Department of Science and Technology, Department of Finance of Jiangsu Province, and Jiangsu
Provincial Tax Service, State Taxation Administration on November 30, 2021, with the High-tech Enterprise Certificate No.
GR202132006790 valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential
policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
17. The sub-subsidiary, Suining Luxshare Precision Industry Co., Ltd. (“Luxshare Suining”), is eligible for the tax policy on
enterprise income tax for the western region as stipulated in the Announcement of the Ministry of Finance, the State Administration of
Taxation, and the National Development and Reform Commission on Continuing the Policy of Enterprise Income Tax for the Western
Region Development" From January 1, 2021, to December 31, 2030, encouraged industry enterprises established in the western region
are subject to a reduced enterprise income tax rate of 15%. Suining Luxshare Precision Industry Co., Ltd. is located in Suining City,
Sichuan Province. Following the enterprise income tax policy for the western region, the company enjoys and declares taxes according
to the encouraged industry enterprises in the western region. In the fiscal year 2023, the enterprise income tax is levied at a rate of 15%.
Suining Luxshare was identified as a high-tech enterprise by the Science & Technology Department of Sichuan Province, Sichuan
Provincial Finance Department, and Sichuan Provincial Tax Service, State Taxation Administration on December 15, 2021, with the
High-tech Enterprise Certificate No. GR202151003570 valid for three years.
18. The sub-subsidiary, Luxshare Precision Industry (Baoding) Co., Ltd. (“Luxshare Baoding”), was identified as a high-tech
enterprise by the Hebei Provincial Department of Science and Technology, Hebei Provincial Finance Bureau, and Hebei Provincial
Tax Service, State Taxation Administration on November 22, 2022, with the High-tech Enterprise Certificate No. GR202213002272
valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it
enjoys an enterprise income tax rate of 15% for 2023.
19. The sub-subsidiary, Luxshare Precision Industry (Shanxi) Co., Ltd. (“Luxshare Shanxi”), was identified as a high-tech
enterprise by the Shanxi Science and Technology Department, Shanxi Provincial Department of Finance, and Shanxi Provincial Tax
Service, State Taxation Administration on December 12, 2022, with the High-tech Enterprise Certificate No. GR202214000862 valid
for three years. According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it enjoys
an enterprise income tax rate of 15% for 2023.
20. The sub-subsidiary, Dongguan Xuntao Electronic Co., Ltd. (“Dongguan Xuntao”), was identified as a high-tech enterprise
by the Department of Science and Technology of Guangdong Province, Department of Finance of Guangdong Province, and
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Guangdong Provincial Tax Service, State Taxation Administration on December 22, 2022, with the High-tech Enterprise Certificate
No. GR202244014095 valid for three years. According to relevant provisions of the national high-tech enterprise income tax
preferential policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
21. The subsidiary, Kunshan Luxshare Precision Industry Co., Ltd. (“Luxshare Kunshan”), was identified as a high-tech
enterprise by the Jiangsu Provincial Department of Science and Technology, Department of Finance of Jiangsu Province, and Jiangsu
Provincial Tax Service, State Taxation Administration on November 6, 2023, with the High-tech Enterprise Certificate No.
GR202332000097 valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential
policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
22. The subsidiary, Luxshare iTech (Zhejiang) Co., Ltd. (“iTech Zhejiang”), was identified as a high-tech enterprise by the
Department of Science and Technology of Zhejiang Province, Zhejiang Provincial Department of Finance, and Zhejiang Provincial
Tax Service, State Taxation Administration on December 8, 2023, with the High-tech Enterprise Certificate No. GR202333005916
valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential policies in China, it
enjoys an enterprise income tax rate of 15% for 2023.
23. The subsidiary, Shenzhen Luxshare Acoustics Technology Ltd. (“Luxshare Electroacoustic”), was identified as a high-tech
enterprise by the Science, Technology and Innovation Commission of Shenzhen Municipality, Finance Bureau of Shenzhen
Municipality, and Shenzhen Tax Service, State Taxation Administration on December 12, 2023, with the High-tech Enterprise
Certificate No. GR202344206957 valid for three years. According to relevant provisions of the national high-tech enterprise income
tax preferential policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
24. The subsidiary, Enshi Luxshare Precision Industry Co., Ltd. (“Luxshare Enshi”), was qualified for tax reduction in accordance
with the Announcement on the Continuation of Preferential Enterprise Income Tax Policies in the Western Region of China issued by
the Ministry of Finance, the State Taxation Administration and the National Development and Reform Commission which provided
that enterprise income tax should be levied at a reduced rate of 15% on enterprises engaged in the encouraged industries in the western
region for the period from January 1, 2021 to December 31, 2030. Since it is located at Enshi Tujia and Miao Autonomous Prefecture,
Hubei Province where enterprises can apply the preferential enterprise income tax policies in the Western Region of China, it enjoys
an enterprise income tax rate of 15% for 2023. Enshi Luxshare, on November 29, 2022, was recognized as a high-tech enterprise by
the Hubei Provincial Department of Science and Technology, Hubei Provincial Department of Finance, and the State Taxation Bureau
of Hubei Province. It obtained the certificate number GR202242006527 for high-tech enterprise certification, valid for three years.
25. The sub-subsidiary, Xuancheng Luxshare Precision Industry Co., Ltd. (“Luxshare Xuancheng”), was identified as a high-
tech enterprise by the Anhui Provincial Department of Science and Technology, Department of Finance of Anhui Province, and Anhui
Provincial Tax Service, State Taxation Administration on September 18, 2021, with the High-tech Enterprise Certificate No.
GR202134004975 valid for three years. According to relevant provisions of the national high-tech enterprise income tax preferential
policies in China, it enjoys an enterprise income tax rate of 15% for 2023.
26. According to the Article 6 of Circular No. 151/2014/TT-BTC issued by the Ministry of Finance on October 10, 2014,
Luxshare-ICT (Vietnam) Limited (“Luxshare Vietnam”) will be eligible for exemption from enterprise income tax for the first two
years and 50% reduction for next four years if realizing the investment plan in the industrial park. Among them, Zone E obtained an
Official Reply No. 619/CT-TTHT from the Tax Bureau of Bac Giang Province on February 28, 2018, confirming that Zone E has
obtained the qualifications of enjoying exemption from enterprise income tax for the first two years and 50% reduction for next four
years, and Luxshare Vietnam paid enterprise income tax at a 10% tax rate; and Zones T/U1 obtained an Official Reply No.
6555/CTBGI-TTHT from the Tax Bureau of Bac Giang Province on November 23, 2020, confirming that Zones T and U1 have obtained
the qualifications of enjoying exemption from enterprise income tax for the first two years and 50% reduction for next four years and
Luxshare Vietnam paid the enterprise income tax at a 10% tax rate in 2023.
27. According to the provisions of Article 14.1 of the Decree No. 85/2007/Q-TTg issued on June 11, 2007, any domestic and
foreign organization and individual investing in any project based in the Southeast Economic Zone of Nghe An will enjoy the enterprise
income tax rate of 10% for 15 years from the date when the investment project starts operation, and exemption from enterprise income
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tax for 4 years from the date of taxable income and 50% reduction for next 9 years. Luxshare-ICT (Nghe An) Limited (“Luxshare Nghe
An”) obtained the Official Reply No. 2417/CT-TTHT from the Tax Bureau of Nghe An Province on July 1, 2020, confirming that
Luxshare Nghe An paid the enterprise income tax at a 0% tax rate in 2023.
28. According to the Article 6 of Circular No. 151/2014/TT-BTC issued by the Ministry of Finance on October 10, 2014,
Luxshare-ICT (Van Trung) Company Limited (“Luxshare Van Trung”) is eligible for exemption from enterprise income tax for the first
two years and 50% reduction for next four years if realizing the investment plan in the industrial park, and obtained an Official Reply
No. 5675/CT-TTHT from the Tax Bureau of Bac Giang Province on October 13, 2020, confirming that Luxshare Van Trung paid the
enterprise income tax at a 10% tax rate in 2023.
On March 20, 2023, the company received official document 1534/GXN-BCT from the Industrial and Commercial Bureau
confirming the preferential treatment for auxiliary industry products 4 exempt 9 halved:
2020-2021-2023-2024: Corporate Income Tax (CIT) 0%; 2025-2032: CIT 10% reduced by half
The discount not received is regional: 2 exempt 4 halved.
29. Dongguan Huarong Communications Technology Co., Ltd. was identified as a high-tech enterprise by the Department of
Science and Technology of Guangdong Province, Department of Finance of Guangdong Province, and Guangdong Provincial Tax
Service, State Taxation Administration on December 20, 2021, with the High-tech Enterprise Certificate No. GR202144005374 valid
for three years. As provided for in the Notice by the Ministry of Finance and the State Administration of Taxation on Preferential
Policies for Enterprise Income Taxes Related to Enterprises’ Technological Innovation and the Notice by the State Administration of
Taxation on Issues Concerning the Implementation of Preferential Enterprise Income Taxes for High-tech Enterprises, it paid the
enterprise income tax at a 15% tax rate in 2023.
30. Shenzhen Huarong Technology Co., Ltd. was identified as a high-tech enterprise by the Science, Technology and Innovation
Commission of Shenzhen Municipality, Finance Bureau of Shenzhen Municipality, and Shenzhen Tax Service, State Taxation
Administration on December 23, 2021, with the High-tech Enterprise Certificate No. GR202144200244 valid for three years. As
provided for in the Notice by the Ministry of Finance and the State Administration of Taxation on Preferential Policies for Enterprise
Income Taxes Related to Enterprises’ Technological Innovation and the Notice by the State Administration of Taxation on Issues
Concerning the Implementation of Preferential Enterprise Income Taxes for High-tech Enterprises, it paid the enterprise income tax at
a 15% tax rate in 2023.
31. TIME Interconnect Technology (Huizhou) Limited was identified as a high-tech enterprise by the Department of Science and
Technology of Guangdong Province, Department of Finance of Guangdong Province, and Guangdong Provincial Tax Service, State
Taxation Administration on December 19, 2022, with the High-tech Enterprise Certificate No. GR202244004084 valid for three years.
As provided for in the Notice by the Ministry of Finance and the State Administration of Taxation on Preferential Policies for Enterprise
Income Taxes Related to Enterprises’ Technological Innovation and the Notice by the State Administration of Taxation on Issues
Concerning the Implementation of Preferential Enterprise Income Taxes for High-tech Enterprises, it paid the enterprise income tax at
a 15% tax rate in 2023.
32. Dongguan Luxshare Technology Co., Ltd. was certified as a high-tech enterprise by the Department of Science and Technology of
Guangdong Province, the Department of Finance of Guangdong Province, and the Guangdong Provincial Taxation Bureau of the State
Administration of Taxation on December 22, 2022. It obtained the High-tech Enterprise Certificate with No. GR202244011952, valid
for three years. According to the Notice of the Ministry of Finance and the State Administration of Taxation on Enterprise Income Tax
Preferential Policies for Enterprise Technological Innovation and the Notice of the State Administration of Taxation on Issues
Concerning the Implementation of Preferential Tax Policies for High-tech Enterprises, the company paid enterprise income tax at a rate
of 15% for the year 2023.
33. On November 6, 2023, the subsidiary Luxshare Precision Industry (Jiangsu) Co., Ltd. (hereinafter referred to as "Jiangsu Luxshare")
was certified as a high-tech enterprise by the Department of Science and Technology of Jiangsu Province, the Department of Finance
of Jiangsu Province, and the Jiangsu Provincial Taxation Bureau of the State Administration of Taxation. It obtained Certificate No.
GR202332004181, valid for three years. According to the relevant provisions of the national policy on preferential taxation for high-
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
tech enterprises, Jiangsu Luxshare paid enterprise income tax at a rate of 15% for the year 2023.
34. On December 12, 2023, the subsidiary Luxshare Electronic (Shanghai) Co., Ltd. (hereinafter referred to as "Shanghai Electronic")
was certified as a high-tech enterprise by the Shanghai Municipal Science and Technology Commission, the Shanghai Municipal
Finance Bureau, and the Shanghai Municipal Taxation Bureau of the State Administration of Taxation. It obtained Certificate No.
GR202331006614, valid for three years. According to the relevant provisions of the national policy on preferential taxation for high-
tech enterprises, Shanghai Electric paid enterprise income tax at a rate of 15% for the year 2023.
35. The subsidiary Luxshare Electronic Technology (Kunshan) Co., Ltd. (hereinafter referred to as " Luxshare Technology") was
certified as a high-tech enterprise by the Jiangsu Provincial Science and Technology Department, the Jiangsu Provincial Finance
Department, and the Jiangsu Provincial Taxation Bureau of the State Administration of Taxation on November 6, 2023. It obtained
Certificate No. GR202332006405, valid for three years. According to the relevant provisions of the national policy on preferential
taxation for high-tech enterprises, Lixin Technology paid enterprise income tax at a rate of 15% for the year 2023.
36. The subsidiary Dongguan Huarong Communications Technology Co., Ltd. (hereinafter referred to as "Huarong Communication")
was certified as a high-tech enterprise by the Guangdong Provincial Science and Technology Department, the Guangdong Provincial
Finance Department, and the Guangdong Provincial Taxation Bureau of the State Administration of Taxation on December 20, 2021.
It obtained Certificate No. GR202144005374, valid for three years. According to the relevant provisions of the national policy on
preferential taxation for high-tech enterprises, Huarong Communication paid enterprise income tax at a rate of 15% for the year 2023.
Value-added tax:
1. On September 3, 2023, the Ministry of Finance and the Taxation Bureau issued the Announcement on the Value-added Tax
Incremental Deduction Policy for Advanced Manufacturing Enterprises (Announcement No. 43 of 2023 by the Ministry of Finance
and the State Administration of Taxation). Advanced manufacturing enterprises refer to general taxpayers in the manufacturing industry
among high-tech enterprises (including their non-legal person branch institutions). From January 1, 2023, to December 31, 2027,
advanced manufacturing enterprises are allowed to deduct 5% of the deductible input VAT amount as an additional deduction against
the payable value-added tax amount.
3. Others
Note 1. As per the tax law in Hong Kong, Hong Kong adopts a territorial source principle of taxation, under which only profits
which have a source in Hong Kong are taxable there, while profits sourced elsewhere are not subject to Hong Kong gain tax. Luxshare
Technologies Limited, Luxshare Standard Limited (HK), ICT-LANTOLIMITED (HK), Luxshare Precision Limited, Yunding
Technology Co., Ltd., Luxis Technology Limited, and Luxshare Precision Investment Co., Ltd. are not required to pay income tax in
Hong Kong.
Note 2. LUXSHAREICT (Japan) is entitled to the graded tax rate for the capital amounting to not more than JPY100 million.
Corporate income tax (national tax): at 15% for the portion of taxable income within JPY8 million (inclusive), and at 23.2% for the
portion in excess thereof. Local corporate income tax (national tax): at 10.3% of total corporate taxable income (national tax).
Note 3. The applicable tax rate of LuxshareICT, Inc (USA) is shown as follows:
Applicable tax rate
Income tax (federal) 21%
Local tax (state) 8.84%
Note 4. The applicable tax rate of Korea Luxshare ICT Co., Ltd is shown as follows:
Total profits Corporate tax Local tax
Less than KRW200 million 10% 10% of corporate taxable income
KWR200 million~KWR20 billion 20%
267
Luxshare Precision Industry Co., Ltd. Annual Report 2022
KWR20 billion~KWR300 billion 22%
Above KWR300 billion 25%
VII. Notes to items in consolidated financial statements
1. Cash and bank balances
In RMB
Item Closing balance Opening balance
Cash on hand 376,233.09 1,236,553.93
Bank deposit 29,683,776,087.56 17,311,181,875.58
Other cash and bank balances 3,935,387,136.86 2,054,791,011.90
Total 33,619,539,457.51 19,367,209,441.41
Including: Total amount of funds
4,220,620,462.47 3,147,696,598.47
deposited abroad
Other descriptions:
2. Held-for-trading financial assets
In RMB
Item Closing balance Opening balance
Financial assets at fair value through
1,720,764,175.32 1,353,266,499.91
profit or loss
Including:
Derivative financial assets 92,485,140.01 27,039,649.45
Bank wealth management 1,628,279,035.31 1,326,226,850.46
Including:
Total 1,720,764,175.32 1,353,266,499.91
Other descriptions:
3. Notes receivable
(1) Categorized presentation of notes receivable
In RMB
Item Closing balance Opening balance
Bank acceptance bill 254,212,467.87 853,752,545.27
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
Commercial acceptance bill 6,860,881.19 96,014,475.42
Total 261,073,349.06 949,767,020.69
(2) Classification and Disclosure of Bad Debt Provision Methods
In RMB
Closing balance Opening balance
Book balance Bad-debt provision Book balance Bad-debt provision
Categor Provisio Provisio
y Book Book
Proporti n value Proporti n value
Amount Amount Amount Amount
on proporti on proporti
on on
Includ
ing:
Notes
receivab
le for
which
261,103, 30,254.9 261,073, 950,067, 300,916. 949,767,
bad-debt 100.00% 0.01% 100.00% 0.03%
603.98 2 349.06 937.26 57 020.69
provisio
n is
made by
group
Includ
ing:
Bank
254,212, 254,212, 853,752, 853,752,
Accepta 97.36% 89.86%
467.87 467.87 545.27 545.27
nce Bill
Commer
cial 6,891,13 30,254.9 6,860,88 96,315,3 300,916. 96,014,4
2.64% 0.44% 10.14% 0.31%
Accepta 6.11 2 1.19 91.99 57 75.42
nce Bill
261,103, 30,254.9 261,073, 950,067, 300,916. 949,767,
Total 100.00% 0.01% 100.00% 0.03%
603.98 2 349.06 937.26 57 020.69
Provision for bad debts made by group: 30,254.92
In RMB
Closing balance
Description
Book balance Bad-debt provision Provision proportion
Commercial acceptance bill 6,891,136.11 30,254.92 0.44%
Total 6,891,136.11 30,254.92
Descriptions on basis for determining the group:
If the bad-debt provision of notes receivable is made according to the general model of expected credit loss, please disclose the relevant
information of bad-debt provision with reference to the disclosure method of other receivables:
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
□ Applicable N/A
(3) Bad-debt provision made, recovered or reversed in the current period
Bad-debt provision in the current period:
In RMB
Amount of change in the current period
Opening
Category Recovery or Closing balance
balance Provision Write-off Others
reversal
Commercial
300,916.57 30,254.92 300,916.57 30,254.92
acceptance bill
Total 300,916.57 30,254.92 300,916.57 30,254.92
Including significant amounts recovered or reversed from the current provision for bad debts:
□ Applicable N/A
(4) Notes receivable that have been endorsed or discounted by the Company at the end of the period and have
not yet matured on the balance sheet date
In RMB
Derecognized amount at the end of the Amount not derecognized at the end of
Item
period the period
Bank acceptance bill 225,054,602.71
Total 225,054,602.71
4. Accounts receivable
(1) Disclosure by Aging
In RMB
Aging Closing balance Opening balance
Within 1 year (inclusive) 23,580,290,365.01 26,139,064,957.15
Not overdue 23,209,441,667.74 25,384,591,004.45
1 to 60 days overdue 341,699,208.94 589,079,637.69
61 to 120 days overdue 16,518,539.98 148,720,229.30
121 to 180 days overdue 2,507,628.90 5,157,468.31
181 to 365 days overdue 10,123,319.45 11,516,617.40
1 to 2 years 1,807,300.60 11,327,849.47
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
2 to 3 years 1,834,977.79 2,104,454.48
More than 3 years 32,175,421.76 30,988,680.56
3 to 4 years 1,186,741.20
More than 5 years 30,988,680.56 30,988,680.56
Total 23,616,108,065.16 26,183,485,941.66
(2) Classification and disclosure by bad debt provision method
In RMB
Closing balance Opening balance
Book balance Bad-debt provision Book balance Bad-debt provision
Category Provisio Book Provisio Book
Amoun Proporti n value Proporti n value
Amount Amount Amount
t on proporti on proporti
on on
Accounts
receivable
for which
bad-debt 67,527, 67,527,4 35,692,4 35,692,4
0.29% 100.00% 0.14% 100.00%
provision 487.92 87.92 10.70 10.70
is made
individual
ly
Includi
ng:
Amount
accrued 67,527, 67,527,4 35,692,4 35,692,4
0.29% 100.00% 0.14% 100.00%
individ 487.92 87.92 10.70 10.70
ually
Provision
23,548, 23,504,4 26,147,7 26,043,3
on an 44,098,6 104,438,
580,57 99.71% 0.19% 81,889.0 93,530.9 99.86% 0.40% 54,859.1
individual 88.17 671.77
7.24 7 6 9
basis
Includi
ng:
23,548, 23,504,4 26,147,7 26,043,3
Group by 44,098,6 104,438,
580,57 99.71% 0.19% 81,889.0 93,530.9 99.86% 0.40% 54,859.1
aging 88.17 671.77
7.24 7 6 9
23,616, 23,504,4 26,183,4 26,043,3
111,626, 140,131,
Total 108,06 100.00% 0.47% 81,889.0 85,941.6 100.00% 0.54% 54,859.1
176.09 082.47
5.16 7 6 9
Provision for bad debts made individually: 67,527,487.92
In RMB
Description Opening balance Closing balance
271
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Bad-debt Bad-debt Provision Reason for
Book balance Book balance
provision provision proportion provision
Entity 1 36,297,404.00 36,297,404.00 100.00% Unrecoverable
Entity 2 30,988,680.56 30,988,680.56 30,988,680.56 30,988,680.56 100.00% Unrecoverable
Entity 3 4,367,165.01 4,367,165.01 Unrecoverable
Entity 4 241,403.36 241,403.36 241,403.36 241,403.36 100.00% Unrecoverable
Entity 5 95,161.77 95,161.77
Total 35,692,410.70 35,692,410.70 67,527,487.92 67,527,487.92
Provision for bad debts made by group:
In RMB
Closing balance
Description
Book balance Bad-debt provision Provision proportion
Undue 23,173,144,263.74 11,586,568.27 0.05%
1 to 60 days overdue 341,699,208.94 17,084,960.45 5.00%
61 to 120 days overdue 16,518,539.98 4,955,561.99 30.00%
121 to 180 days overdue 2,507,628.90 1,003,051.56 40.00%
181 to 365 days overdue 10,123,319.45 5,061,659.73 50.00%
1 to 2 years (excluding 1 year)
1,807,300.60 1,626,570.54 90.00%
overdue
Over 2 years overdue 2,780,315.63 2,780,315.63 100.00%
Total 23,548,580,577.24 44,098,688.17
Descriptions on basis for determining the group:
If the bad-debt provision for accounts receivable is made according to the general model of expected credit loss, please refer to the
disclosure method of other receivables to disclose the relevant information of bad debt provision:
□ Applicable N/A
(3) Bad-debt provision made, recovered or reversed in the current period
Bad-debt provision in the current period:
In RMB
Amount of change in the current period
Opening
Category Recovery or Closing balance
balance Provision Write-off Others
reversal
Accounts
140,131,082.47 25,623,112.25 95,161.77 -2,786,632.36 111,626,176.09
receivable
Total 140,131,082.47 25,623,112.25 95,161.77 -2,786,632.36 111,626,176.09
Including significant amounts recovered or reversed from the current provision for bad debts:
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Luxshare Precision Industry Co., Ltd. Annual Report 2022
In RMB
Basis for determining
the provision ratio for
Amount recovered or
Entity name Reason for reversal Recovery method the original bad debt
reversed
reserve and its
reasonableness
(4) Accounts receivable actually written off in the current period
In RMB
Item Write-off amount
Including the write-off of significant accounts receivable:
In RMB
Whether the funds
Nature of accounts Procedures for write- are generated by
Entity name Write-off amount Reasons for write-off
receivable off related-party
transactions
Descriptions on the write-off of accounts receivable:
(5) Accounts receivable with top five closing balance - by debtor
In RMB
Closing balance of
The proportion of accounts
Closing balance of the total closing receivable
Closing balance of
Contractual assets accounts balance of allowance for
Entity name accounts
ending balance receivable and accounts doubtful accounts
receivable
contractual assets receivable and and contractual
contractual assets asset impairment
provision
Entity 1 6,394,834,173.91 6,394,834,173.91 27.08% 3,197,417.09
Entity 2 1,627,167,857.07 1,627,167,857.07 6.89% 813,583.93
Entity 3 1,496,918,767.33 1,496,918,767.33 6.34% 748,459.38
Entity 4 832,460,645.66 832,460,645.66 3.52% 416,230.32
Entity 5 653,347,880.69 653,347,880.69 2.77% 326,673.94
Total 11,004,729,324.66 11,004,729,324.66 46.60% 5,502,364.66
273
Luxshare Precision Industry Co., Ltd. Annual Report 2022
5. Receivables financing
(1) Accounts Receivable Financing Classification Representation
In RMB
Item Closing balance Opening balance
Accounts receivable notes 587,585,009.82
Total 587,585,009.82
(2) End-of-period company pledged accounts receivable financing
In RMB
Item End-of-period pledged amount
Accounts receivable notes 164,567,477.58
Total 164,567,477.58
(3) End-of-period company endorsed or discounted accounts receivable financing not yet due on the balance
sheet date
In RMB
End-of-period terminated recognition End-of-period un-terminated recognition
Item
amount amount
Bank accepted bill 1,897,417,193.06
Total 1,897,417,193.06
(4) The actual write-off situation of accounts receivable financing for the current period
In RMB
Item Write-off amount
Significant Accounts Receivable Financing Write-off Situation
In RMB
Whether the funds
Execution of
are generated from
Unit Name Nature of Funds Write-off Amount Write-off Reason Write-off
related
Procedure
transactions
Write-off description:
(5) Other descriptions
274
Luxshare Precision Industry Co., Ltd. Annual Report 2022
6. Other receivables
In RMB
Item Closing balance Opening balance
Other receivables 322,407,052.71 431,123,451.91
Total 322,407,052.71 431,123,451.91
(1) Other Receivables
1) Classification of Other Receivables by Nature of Funds
Nature of Funds
End-of-period Book Balance Beginning-of-period Book Balance
Petty Cash 823,391.43 1,647,513.92
Deposits, Guarantees 88,785,715.85 99,930,933.45
Receivable Export Tax Refund 104,916,374.47 143,831,836.92
Advances 40,590,467.27 32,488,722.87
Proceeds from Fixed Asset Transfers 66,582.77
Others 92,142,220.12 158,490,656.80
Total 327,258,169.14 436,456,246.73
2) Disclosures by aging
In RMB
Aging End-of-period Book Balance Beginning-of-period Book Balance
1 Year or Less (Including 1 Year) 324,150,839.67 435,419,059.56
Not Overdue 321,911,620.10 413,437,541.79
Overdue 1 to 60 Days 501,138.07 19,869,688.91
Overdue 61 to 120 Days 71,769.00 562,100.70
Overdue 121 to 180 Days 313,632.50 449,021.36
Overdue 181 to 365 Days 1,352,680.00 1,100,706.80
1 to 2 Years 2,529,880.47 425,049.70
2 to 3 Years 100,000.00 140,420.00
Over 3 Years 477,449.00 471,717.47
3 to 4 Years 477,449.00 471,717.47
Total 327,258,169.14 436,456,246.73
3) Classification and disclosure by bad debt provision method
Applicable □N/A
In RMB
275
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Categor Closing balance Opening balance
y Book Balance Bad Debt Provision Book Balance Bad Debt Provision
Book Book
Provisio value Provisio value
Amount Ratio Amount Amount Ratio Amount
n Ratio n Ratio
Provisio
n for
Bad
2,177,34 2,177,34 2,177,34 2,177,34
Debts by 0.67% 100.00% 0.50% 100.00%
0.03 0.03 0.03 0.03
Individu
al Item
Includin
g:
Individu
al Item
2,177,34 2,177,34 2,177,34 2,177,34
Provisio 0.67% 100.00% 0.50% 100.00%
0.03 0.03 0.03 0.03
n
Provisio
n for
Bad 325,080, 2,673,77 322,407, 434,278, 3,155,45 431,123,
99.33% 0.82% 99.50% 0.73%
Debts by 829.11 6.40 052.71 906.70 4.79 451.91
Group
Includin
g:
Ageing
Analysis
325,080, 2,673,77 322,407, 434,278, 3,155,45 431,123,
Combin 99.33% 0.82% 99.50% 0.73%
829.11 6.40 052.71 906.70 4.79 451.91
ation
327,258, 4,851,11 322,407, 436,456, 5,332,79 431,123,
Total 100.00% 1.48% 100.00% 1.22%
169.14 6.43 052.71 246.73 4.82 451.91
Provision for Bad Debts by Individual Item: 2,177,340.03
In RMB
Opening balance Closing balance
Name Bad Debt Bad Debt Provision
Book Balance Book Balance Provision Ratio
Provision Provision Reason
Entity 1 2,177,340.03 2,177,340.03 2,177,340.03 2,177,340.03 100.00% Unrecoverable
Total 2,177,340.03 2,177,340.03 2,177,340.03 2,177,340.03
Provision for Bad Debts by Group: 2,673,776.40
In RMB
Closing balance
Name
Book Balance Bad debt provision Provision ratio
Not Overdue 321,911,620.10 1,609,558.10 0.50%
Overdue 1 to 60 Days 501,138.07 5,011.38 1.00%
Overdue 61 to 120 Days 71,769.00 3,588.45 5.00%
276
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Overdue 121 to 180 Days 313,632.50 31,363.25 10.00%
Overdue 181 to 365 Days 1,352,680.00 270,536.00 20.00%
1 Year Overdue (Excluding) to
352,540.44 176,270.22 50.00%
2 Years
Over 2 Years Overdue 577,449.00 577,449.00 100.00%
Total 325,080,829.11 2,673,776.40
Determination of the Explanation for this Combination:
Provision for Bad Debts is made according to the Expected Credit Loss General Model.
In RMB
Phase I Phase II Phase III
Bad Debt Provision Lifetime Expected Lifetime Expected Total
Expected Credit Loss
Credit Loss (No Credit Credit Loss (Credit
for the Next 12 Months
Impairment Incurred) Impairment Incurred)
Balance as of January
1, 2023 5,332,794.82 5,332,794.82
Balance as of January
1, 2023 in this period
Provision for this
2,619,894.43 2,619,894.43
period
Other changes -3,101,572.82 -3,101,572.82
Balance as of
4,851,116.43 4,851,116.43
December 31, 2023
Criteria for stage classification and the provision ratios for bad debt reserves
Significant changes in the book balance of loss provisions for the current period
□Applicable N/A
4) Provision, Recovery, or Reversal of Bad Debt Provision for the Current Period
Provision for Bad Debt for the Current Period:
In RMB
Amount of Changes for the Current Period
Opening
Category Recovery or Write-off or Closing balance
balance Provision Others
Reversal Write-down
Aging
5,332,794.82 2,619,894.43 -3,101,572.82 4,851,116.43
Combination
Total 5,332,794.82 2,619,894.43 -3,101,572.82 4,851,116.43
Significant Amounts of Bad Debt Provision Reversals or Recoveries for the Current Period:
In RMB
Name of the Entity Amount of Recovery Reason for Reversal Method of Recovery Basis and Rationality
277
Luxshare Precision Industry Co., Ltd. Annual Report 2022
or Reversal for Determining the
Provision Ratio for
Bad Debts
5) Other receivables categorized by the end-of-period balances of the top five debtors.
In RMB
The proportion of
the end-of-period End-of-period
Entity Name Nature of the End-of-period
Aging balance to the total balance of bad
Funds Balance
amount of other debt provision
receivables.
Entity 1 Export tax rebate 104,916,374.47 Not overdue 32.06% 524,581.87
Equity transfer
Entity 2 47,500,000.00 Not overdue 14.51% 237,500.00
payment
Entity 3 Security deposit 21,000,000.00 Not overdue 6.42% 105,000.00
Equity transfer
Entity 4 7,832,244.50 Not overdue 2.39% 39,161.22
payment
Entity 5 Security deposit 7,082,700.00 Not overdue 2.16% 35,413.50
Total 188,331,318.97 57.54% 941,656.59
7. Prepayments
(1) Presentation of prepayments by aging
In RMB
Aging Closing balance Opening balance
Amount Proportion Amount Proportion
Within 1 year 478,716,760.07 98.36% 578,774,779.64 98.67%
1 to 2 years 3,062,960.52 0.63% 5,930,449.93 1.01%
2 to 3 years 3,509,779.84 0.72% 1,250,070.12 0.21%
Over 3 years 1,413,440.93 0.29% 622,565.54 0.11%
Total 486,702,941.36 586,577,865.23
Reasons for untimely settlement of prepayments in significant amount with aging over 1 year:
(2) Prepayments with top five closing balance - by prepayment beneficiary
Prepayment Closing balance Proportion in total closing
receiver balance of prepayments (%)
Entity 1 66,334,219.41 13.63
278
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Prepayment Closing balance Proportion in total closing
receiver balance of prepayments (%)
Entity 2 61,176,743.49 12.57
Entity 3 53,454,012.53 10.98
Entity 4 19,433,795.26 3.99
Entity 5 18,967,120.24 3.90
Total 219,365,890.93 45.07
Other descriptions:
8. Inventories
Whether the Company needs to comply with the disclosure requirements for the real estate industry
No
(1) Classification of inventories
In RMB
Closing balance Opening balance
Provision for Provision for
decline in value decline in value
of inventories of inventories
Item or provision for or provision for
Book balance Book value Book balance Book value
impairment of impairment of
contract contract
performance performance
cost cost
7,122,401,927. 6,650,777,111.2 8,805,902,241. 8,551,410,982.
Raw material 471,624,816.03 254,491,258.28
24 1 24 96
Products in 5,171,213,240. 4,995,113,550. 4,968,545,535. 4,927,092,248.
176,099,689.81 41,453,287.63
process 36 55 84 21
17,873,073,315 17,509,864,475 23,761,428,325 23,297,104,706
Goods on hand 363,208,839.96 464,323,619.78
.30 .34 .93 .15
Revolving
137,193,748.06 137,193,748.06 319,286,571.44 319,286,571.44
materials
Contract
performance 466,878,832.49 116,430,069.76 350,448,762.73 97,678,729.66 97,678,729.66
cost
Goods sold 80,403,021.27 1,180,800.02 79,222,221.25 112,857,920.38 995,408.89 111,862,511.49
Materials in
27,648,149.64 27,648,149.64 38,828,113.69 38,828,113.69
transit
279
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Work in process
7,662,300.57 7,662,300.57 21,425,447.80 1,359,834.74 20,065,613.06
- outsourced
30,886,474,534 1,128,544,215. 29,757,930,319 38,125,952,885 37,363,329,476
Total 762,623,409.32
.93 58 .35 .98 .66
(2) Provision for decline in value of inventories and provision for impairment of contract performance cost
In RMB
Increase in the current period Decrease in the current period
Opening
Item Reversal or Closing balance
balance Provision Others Others
write off
Raw material 254,491,258.28 396,338,296.94 180,397,886.60 -1,193,147.41 471,624,816.03
Products in
41,453,287.63 166,615,905.32 33,614,492.15 -1,644,989.01 176,099,689.81
process
Inventory items
464,323,619.78 446,816,763.79 547,457,325.51 474,218.10 363,208,839.96
Contract
fulfillment
116,430,069.76 116,430,069.76
costs
Shipped goods 995,408.89 185,391.13 1,180,800.02
Work in process
1,359,834.74 1,359,834.74
- outsourced
1,126,386,426. 1,128,544,215.
Total 762,623,409.32 762,829,539.00 -2,363,918.32
94 58
Provision for inventory impairment by group
In RMB
Ending Beginning
Combination Provision ration Provision ration
name Falling price Opening Falling price
Closing balance of falling price of falling price
reserves balance reserves
reserve reserve
Criteria for calculating the reserve for inventory decline price by combination
9. Non-current assets maturing within one year
Item Closing balance Opening balance
Time deposits maturing within one year 1,047,566,017.54
Total 1,047,566,017.54
280
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(1) Debt investments that mature within one year
□Applicable N/A
(2) Other debt investments that mature within one year
□Applicable N/A
10. Other current assets
In RMB
Item Closing balance Opening balance
Input tax to be deducted 2,106,402,441.64 2,019,719,088.95
large-amount deposit note 709,769,171.50 107,450,138.93
Income tax prepaid 61,578,636.66 69,527,937.14
Duty forward 36,279,446.62
Others 6,048,704.65 507,429.07
Total 2,920,078,401.07 2,197,204,594.09
Other descriptions:
11. Debt investments
(1) Situation of debt investment
In RMB
Closing balance Opening balance
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
1,620,000,000. 1,620,000,000.
Principal
00 00
Interest 119,251,540.45 119,251,540.45
1,739,251,540. 1,739,251,540.
Total
45 45
Changes in reserves for impairment of debt investments in the current period
In RMB
Item Opening balance Increase Decrease Closing balance
281
Luxshare Precision Industry Co., Ltd. Annual Report 2022
12. Investments in other equity instruments
In RMB
Reasons
specified as
Gains
Gains Loss Loss measured
accrued to
recognized recognized accrued to at fair
other Dividend
as other in other other value and
comprehen income
Project Closing Opening comprehen comprehen comprehen for which
sive recognized
name balance balance sive sive sive changes are
income at for the
income in income in income at included in
the end of period
the current the current the end of other
the current
period period the period comprehen
period
sive
income
Beijing Not for
XiaoLong 9,049,791.3 10,773,818. 1,724,026.6 short-term
950,208.67
Technology 3 02 9 trading
Co., Ltd. purposes
Beijing Hui Not for
Bo Jin 9,846,904.4 10,783,500. short-term
936,596.30 153,095.59
Technology 1 71 trading
Co., Ltd. purposes
Jingtuo
Not for
Liyin
3,356,343.8 2,983,866.2 short-term
Technology 372,477.62 356,343.85
5 3 trading
(Beijing)
purposes
Co., Ltd.
Zhejiang Not for
Tony 172,691,67 342,379,25 128,502,83 156,725,73 short-term
Electronics 1.36 7.92 9.20 9.38 trading
Co., Ltd. purposes
Shenzhen Not for
Huaxida 28,138,181. 72,480,000. 44,341,818. 21,861,818. short-term
Technology 82 00 18 18 trading
Co., Ltd. purposes
Asia-
Pacific
Not for
Emerging
1,039,358.5 short-term
Industries 706,549.78 332,808.77 307,552.75
5 trading
Venture
purposes
Capital Co.,
Ltd.
Shenzhen
Not for
Shifang
25,000,000. short-term
Sports
00 trading
Technology
purposes
Co., Ltd.
249,122,25 440,106,99 175,505,28 157,389,63 22,965,122.
Total 705,286.39
1.32 2.66 0.37 5.98 44
Termination acknowledgement exists in the current period
In RMB
282
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Cumulative gains transferred Cumulative losses transferred Reasons for termination of
Project name
to retained earnings to retained earnings confirmation
Zhejiang Tony Electronics Disposal of partial stock
37,783,386.82
Co., Ltd. equity
Disclosure of non-trading equity instrument investments for the current period.
In RMB
Reasons
Amount specified as
Other reasons
transferred measured at fair
for transferring
Recognized from other value and for
Cumulative Cumulative comprehensive
Project name dividend comprehensive which changes
gain loss income to
income income to are included in
retained
retained other
earnings
earnings comprehensive
income
Other descriptions:
13. Long-term equity investments
In RMB
Increase and decrease in the current period
Invest Closin
Openi ment Others Closin g
ng Openi profit compr Declar g balanc
Investe balanc ng Additi Reduc or loss ehensi Others ed Provisi balanc e of
e e balanc onal ed recogn ve change cash on for e provisi
Others
(book e invest invest ized incom s in divide impair (book on for
value) ment ment under e equity nds or ment value) impair
equity adjust profits ment
metho ment
d
I. Joint ventures
Riyim
ao 119,06 15,859 - 132,87
Industr 6,960. ,552.5 2,049, 7,500.
ial Co., 41 0 012.90 01
Ltd.
119,06 15,859 - 132,87
Subtot
6,960. ,552.5 2,049, 7,500.
al
41 0 012.90 01
II. Associates
Subtot -
1,915, 34,372 235,00 2,028, - - 4,134, 34,372
al of 35,597
313,29 ,608.4 0,000. 502,05 7,598, 1,182, 436,84 ,608.4
associa ,677.3
0.71 6 00 7.39 398.15 423.15 9.50 6
tes 0
-
1,915, 34,372 235,00 2,028, - - 4,134, 34,372
Subtot 35,597
313,29 ,608.4 0,000. 502,05 7,598, 1,182, 436,84 ,608.4
al ,677.3
0.71 6 00 7.39 398.15 423.15 9.50 6
0
283
Luxshare Precision Industry Co., Ltd. Annual Report 2022
-
2,034, 34,372 235,00 2,044, - - 4,267, 34,372
35,597
Total 380,25 ,608.4 0,000. 361,60 7,598, 3,231, 314,34 ,608.4
,677.3
1.12 6 00 9.89 398.15 436.05 9.51 6
0
Determining the recoverable amount by subtracting the disposal costs from the fair value
□Applicable N/A
Determining the recoverable amount by the present value of expected future cash flows
□Applicable N/A
Reasons for the significant differences between the above information and the information used or external information used in
impairment tests in previous years
Reasons for significant differences between the information used in impairment tests in previous years and the actual situation in the
current year
Other descriptions:
14. Other non-current financial assets
In RMB
Item Closing balance Opening balance
Stock investment 35,700,000.00 35,700,000.00
Total 35,700,000.00 35,700,000.00
Other descriptions:
15. Investment properties
(1) Investment properties measured at cost
Applicable □ N/A
In RMB
Construction in
Item Buildings Land use right Total
progress
I. Original carrying
amount
1. Opening
88,325,184.67 18,216,793.02 106,541,977.69
balance
2. Increase in the
357,334.67 328,822.92 686,157.59
current period
(1) Purchase
(2)
Transferred from
284
Luxshare Precision Industry Co., Ltd. Annual Report 2022
inventories\fixed
assets\construction in
progress
(3) Increase
in business
combination
(4) Others 357,334.67 328,822.92 686,157.59
3. Decrease in the
71,655,597.57 6,472,952.20 78,128,549.77
current period
(1) Disposal 71,655,597.57 6,472,952.20 78,128,549.77
(2) Other
transfer out
4. Closing balance 17,026,921.77 12,072,663.74 29,099,585.51
II. Accumulated
depreciation and
amortization
1. Opening
13,759,567.63 13,759,567.63
balance
2. Increase in the
423,659.58 423,659.58
current period
(1) Provision
327,662.40 327,662.40
or amortization
(2) Increase in business
95,997.18 95,997.18
combination
3. Decrease in the
8,437,577.94 8,437,577.94
current period
(1) Disposal 8,437,577.94 8,437,577.94
(2) Other
transfer out
4. Closing balance 5,745,649.27 5,745,649.27
III. Provision for
impairment
1. Opening
balance
2. Increase in the
current period
(1) Provision
3. Decrease in the
current period
(1) Disposal
(2) Other
transfer out
4. Closing balance
IV. Book value
285
Luxshare Precision Industry Co., Ltd. Annual Report 2022
1. Closing book
11,281,272.50 12,072,663.74 23,353,936.24
value
2. Opening book
74,565,617.04 18,216,793.02 92,782,410.06
value
Determining the recoverable amount by subtracting the disposal costs from the fair value
□Applicable N/A
Determining the recoverable amount by the present value of expected future cash flows
□Applicable N/A
Reasons for the significant differences between the above information and the information used or external information used in
impairment tests in previous years
Reasons for significant differences between the information used in impairment tests in previous years and the actual situation in the
current year
Other descriptions:
16. Fixed assets
In RMB
Item Closing balance Opening balance
Fixed assets 44,560,506,279.62 44,026,022,703.69
Fixed asset clearance
Total 44,560,506,279.62 44,026,022,703.69
(1) Fixed assets
In RMB
Auxiliary
Machiner Transport
Office Computer productio Other Mould
y ation
Item Buildings equipmen equipmen n equipmen equipmen Total
equipmen equipmen
t t equipmen t t
t t
t
I. Original
carrying
amount
1.
13,363,67 348,923,9 32,046,63 378,144,9 2,960,204 94,727,46 9,188,808 5,897,963 64,279,08
Opening
4,979.58 44.21 9,146.51 95.23 ,186.00 1.82 ,043.60 ,482.80 6,239.75
balance
2.
1,436,850 102,497,8 5,172,845 31,094,37 624,906,0 14,749,92 3,535,385 874,213,0 11,792,54
Increase
,613.87 03.68 ,249.69 4.78 54.64 4.56 ,856.71 23.20 2,901.13
in the
286
Luxshare Precision Industry Co., Ltd. Annual Report 2022
current
period
(
237,692,2 95,971,54 4,178,527 30,610,45 513,710,0 12,759,44 2,483,112 380,262,8 7,932,646
1)
62.35 3.92 ,094.77 0.72 51.82 4.67 ,485.85 36.92 ,171.02
Purchase
(
2)
Transferre
1,121,416 974,351,4 217,707.6 74,895,32 1,699,203 1,032,336 490,089,4 3,695,009
d from 4,159.29
,016.74 16.54 6 4.73 .54 ,602.87 54.73 ,886.10
constructi
on in
progress
(
3)
Increase
in
business
combinati
on
77,742,33 6,522,100 19,966,73 266,216.4 36,300,67 291,276.3 19,936,76 3,860,731 164,886,8
(4) Others
4.78 .47 8.38 0 8.09 5 7.99 .55 44.01
3.
Decrease
50,134,68 10,229,69 1,652,955 42,107,56 204,344,2 9,872,532 312,816,5 327,295,4 2,609,756
in the
1.31 2.28 ,339.91 7.15 11.09 .26 84.10 80.89 ,088.99
current
period
(
1) 16,759,48 9,976,074 843,596,3 20,807,71 162,247,5 9,768,706 182,299,4 194,408,2 1,439,863
Disposal 3.13 .27 84.74 2.78 27.53 .00 64.66 80.01 ,633.12
or scrap
33,375,19 253,618.0 809,358,9 21,299,85 42,096,68 103,826.2 130,517,1 132,887,2 1,169,892
(2) Others
8.18 1 55.17 4.37 3.56 6 19.44 00.88 ,455.87
4.
14,750,39 441,192,0 35,566,52 367,131,8 3,380,766 99,604,85 12,411,37 6,444,881 73,461,87
Closing
0,912.14 55.61 9,056.29 02.86 ,029.55 4.12 7,316.21 ,025.11 3,051.89
balance
II.
Accumula
ted
depreciati
on
1.
2,364,415 162,894,2 10,132,12 174,691,0 1,046,642 51,242,56 3,569,014 2,259,730 19,760,75
Opening
,146.93 20.17 7,638.78 15.13 ,736.76 4.18 ,319.36 ,286.23 7,927.54
balance
2.
Increase
732,446,4 70,692,42 4,632,494 53,006,71 648,319,7 12,098,37 2,078,853 1,482,814 9,710,725
in the
72.56 2.21 ,310.12 4.00 06.10 7.43 ,735.38 ,147.87 ,885.67
current
period
(
709,628,5 64,176,49 4,610,848 52,831,48 623,131,5 12,064,26 2,067,302 1,479,296 9,619,279
1)
38.89 8.05 ,476.83 1.56 81.58 2.96 ,007.50 ,748.19 ,595.56
Provision
(2) 22,817,93 6,515,924 21,645,83 175,232.4 25,188,12 11,551,72 3,517,399 91,446,29
34,114.47
Transferre 3.67 .16 3.29 4 4.52 7.88 .68 0.11
287
Luxshare Precision Industry Co., Ltd. Annual Report 2022
d from
investmen
t
properties
(3)
Increase
in
business
combinati
on(1)
Provision
(2)
Transferre
d from 11,399,10 3,995,272 514,617,8 24,167,09 154,903,3 4,865,690 114,310,8 231,592,1 1,059,851
investmen 8.48 .70 90.14 1.50 20.68 .74 93.38 30.31 ,397.93
t
properties
(
1) 8,000,538 3,858,790 325,059,5 4,913,091 137,740,7 3,329,797 65,835,47 132,266,6 681,004,6
Disposal .73 .93 11.62 .38 66.94 .51 0.30 83.76 51.17
or scrap
(2) 3,398,569 136,481.7 189,558,3 19,254,00 17,162,55 1,535,893 48,475,42 99,325,44 378,846,7
Others .75 7 78.52 0.12 3.74 .23 3.08 6.55 46.76
4.
3,085,462 229,591,3 14,250,00 203,530,6 1,540,059 58,475,25 5,533,557 3,510,952 28,411,63
Closing
,511.01 69.68 4,058.76 37.63 ,122.18 0.87 ,161.36 ,303.79 2,415.28
balance
III.
Provision
for
impairme
nt
1.
63,256,92 1,861,367 347,496,0 259,852.8 10,156,49 26,091,49 43,140,89 492,305,6
Opening 42,534.87
3.55 .25 49.28 1 4.51 2.31 3.94 08.52
balance
2.
Increase
149,592,8 1,152,035 17,422,10 27,602,80 2,360,812 198,134,7
in the 4,126.30
37.36 .53 3.12 4.54 .13 18.98
current
period
144,040,4 1,149,231 17,422,10 26,702,57 2,357,938 191,676,4
(1) 4,126.30
65.07 .13 3.12 0.04 .29 33.95
Provision
(2) 5,552,372 900,234.5 6,458,285
2,804.40 2,873.84
Others .29 0 .03
3.
Decrease
1,854,243 146,742,1 19,086,40 9,253,966 23,675,02 200,705,9
in the 94,153.81
.98 74.94 8.06 .26 3.46 70.51
current
period
(
1) 146,740,8 16,979,83 9,253,324 21,122,43 194,248,9
58,288.51 94,153.81
Disposal 70.50 7.45 .43 0.08 04.78
or scrap
288
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(2) 1,795,955 2,106,570 2,552,593 6,457,065
1,304.44 641.83
Others .47 .61 .38 .73
4.
63,256,92 350,346,7 1,317,734 8,492,189 44,440,33 21,826,68 489,734,3
Closing 11,249.57 42,534.87
3.55 11.70 .53 .57 0.59 2.61 56.99
balance
IV. Book
value
1.
Closing 11,601,67 211,589,4 20,966,17 162,283,4 1,832,214 41,087,06 6,833,379 2,912,102 44,560,50
book 1,477.58 36.36 8,285.83 30.70 ,717.80 8.38 ,824.26 ,038.71 6,279.62
value
2.
Opening 10,936,00 184,168,3 21,567,01 203,194,1 1,903,404 43,442,36 5,593,702 3,595,092 44,026,02
book 2,909.10 56.79 5,458.45 27.29 ,954.73 2.77 ,231.93 ,302.63 2,703.69
value
(2) Fixed assets without title certificate
In RMB
Reasons for not obtaining the title
Item Book value
certificate
Plant, office and dormitory buildings of
7,220,008.93 Note 1
Fujian JK
Changshu Luxshare Factory and The certificate is undergoing the
785,432,113.14
Auxiliary Building Project formalities
The certificate is undergoing the
Suzhou Meite Cadre Training Center 955,897.08
formalities
The certificate is undergoing the
The certificate is undergoing the
formalities Plants A and B of Luxshare 50,693,626.67
formalities
Dongguan
Plant and Dormitory of Electronic The certificate is undergoing the
125,169,613.27
Technology formalities
The certificate is undergoing the
Phase VI Plant of ASAP Technology 88,125,876.44
formalities
The certificate is undergoing the
New plant of LuxcaseICT Yancheng 74,915,032.07
formalities
Other descriptions:
Note 1: The land occupied by the staff dormitory is in nature an allotted land, the use right of which was acquired by the Company by
means of transfer through agreement in line with relevant regulations at that time. The property title formed based on the allotted land
use right is not allowed to be transferred unless the allocated land use right is converted to paid land use right. However, the existing
land use right cannot be transferred by agreement, as a result of which the property title to the staff dormitory building has not been
transferred to Fujian JK.
In RMB
289
Luxshare Precision Industry Co., Ltd. Annual Report 2022
17. Construction in progress
In RMB
Item Closing balance Opening balance
Construction in progress 2,226,217,016.31 2,695,377,794.32
Total 2,226,217,016.31 2,695,377,794.32
(1) Construction in progress
In RMB
Item Closing balance Opening balance
Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Plant 1,147,091,150. 1,147,091,150. 1,757,877,949. 1,757,877,949.
construction 13 13 76 76
Equipment
installation 702,303,869.84 702,303,869.84 630,505,432.98 630,505,432.98
project
Mould
178,571,369.63 178,571,369.63 77,734,469.29 77,734,469.29
improvement
Others 198,250,626.71 198,250,626.71 229,259,942.29 229,259,942.29
2,226,217,016. 2,226,217,016. 2,695,377,794. 2,695,377,794.
Total
31 31 32 32
(2) Changes in significant constructions in progress for the current period
In RMB
Amou Propor Includi
Amou
nt tion of ng: Curren
Other nt of
Increas transfe accum Amou t
Openi decrea Closin accum
e in rred to ulated Project nt of interes Source
ng se in g ulated
Item Budget the fixed project progre current t of
balanc the balanc capital
current assets invest ss capital capital funds
e current e ized
period in the ment ized ization
period interes
current in interes rate
t
period budget t
Plant
constr
uction
3,760, 1,189, 760,41 1,390, 559,34
of 62.23 62.00
327,83 282,93 1,746. 352,01 2,664. Others
Luxsh % %
1.39 0.08 25 2.03 30
are
Chang
shu
290
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Equip
ment
installa
tion
1,142, 245,34 37,156 266,10 10,756
project 5,637, 48.00 50.00
834,25 6,465. ,420.9 9,110. ,588.3 Others
of 188.13 % %
1.00 69 8 17 7
Luxsh
are
Chang
shu
Vietna
805,61 11,273 11,273
m 100.00 100.00
8,010. ,342.5 ,342.5 Others
plant % %
28 8 8
project
Yi’an
1,491, 161,98 1,307, 936,71 533,13
project 64.26 64.26
869,00 8,668. 857,45 5,559. 0,563. Others
constr % %
6.92 98 3.99 68 29
uction
7,200, 1,607, 2,105, 2,604, 1,103,
5,637,
Total 649,09 891,40 425,62 450,02 229,81
188.13
9.59 7.33 1.22 4.46 5.96
(3) Impairment test of construction in progress
□Applicable N/A
18. Right-of-use assets
(1) Situations of right-of-use asset
In RMB
Transportation
Item Buildings Machinery equipment Total
equipment
I. Original carrying
amount
1. Opening
1,161,016,114.04 8,954,945.31 140,235.69 1,170,111,295.04
balance
2. Increase in the
170,397,024.42 47,612,973.87 1,078,518.46 219,088,516.75
current period
(1) New leases 160,984,962.16 47,612,973.87 1,075,676.55 209,673,612.58
(2) Others 9,412,062.26 2,841.91 9,414,904.17
3. Decrease in the
450,498,747.31 53,590,996.25 504,089,743.56
current period
(1) Transfer out
35,318,482.08 1,747,953.03 37,066,435.11
to fixed assets
(2) Disposal 415,180,265.23 51,843,043.22 467,023,308.45
291
Luxshare Precision Industry Co., Ltd. Annual Report 2022
4. Closing balance 880,914,391.15 2,976,922.93 1,218,754.15 885,110,068.23
II. Accumulated
depreciation
1. Opening
220,152,500.80 8,168,065.58 40,914.00 228,361,480.38
balance
2. Increase in the
149,802,109.13 32,194,017.60 164,066.57 182,160,193.30
current period
(1) Provision 144,033,638.76 32,194,017.60 163,328.57 176,390,984.93
(2) Others 5,768,470.37 738.00 5,769,208.37
3. Decrease in the
136,396,448.18 37,979,125.36 174,375,573.54
current period
(1) Disposal 129,805,899.01 37,979,125.36 167,785,024.37
(2) Others 6,590,549.17 6,590,549.17
4. Closing balance 233,558,161.75 2,382,957.82 204,980.57 236,146,100.14
III. Provision for
impairment
1. Opening
balance
2. Increase in the
current period
(1) Provision
3. Decrease in the
current period
(1) Disposal
4. Closing balance
IV. Book value
1. Closing book
647,356,229.40 593,965.11 1,013,773.58 648,963,968.09
value
2. Opening book
940,863,613.24 786,879.73 99,321.69 941,749,814.66
value
(2) Situations of impairment test of the right to use assets
□Applicable N/A
Other descriptions:
19. Intangible assets
(1) Intangible assets
In RMB
292
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Non-patent
Item Land use right Patent right Software Other Total
technology
I. Original
carrying
amount
1. Opening 2,433,471,958. 3,207,117,278.
194,363,877.67 94,473,253.38 376,376,284.59 108,431,904.34
balance 29 27
2. Increase
in the current 81,858,575.62 2,151,532.00 38,136,201.23 101,286,460.32 2,217,360.82 225,650,129.99
period
(1)
66,189,101.89 2,145,190.80 36,831,406.85 84,449,943.74 267,160.45 189,882,803.73
Purchase
(2)
Internal R&D
(3)
Increase in
business
combination
(4) Other
15,669,473.73 6,341.20 1,304,794.38 16,836,516.58 1,950,200.37 35,767,326.26
increases
3.
Decrease in the 17,315,931.44 118,150.00 16,327,282.36 41,140,345.27 313,677.50 75,215,386.57
current period
(1)
118,150.00 508,609.61 39,168,200.38 167,798.61 39,962,758.60
Disposal
(2) Others 17,315,931.44 15,818,672.75 1,972,144.89 145,878.89 35,252,627.97
4. Closing 2,498,014,602. 3,357,552,021.
196,397,259.67 116,282,172.25 436,522,399.64 110,335,587.66
balance 47 69
II. Accumulated
amortization
1. Opening
balance2.
Increase in the
current period4.
Closing balance
II. Accumulated
amortization1.
Opening
balance2.
Increase in the 235,085,224.75 32,275,155.70 42,988,312.96 183,727,565.49 17,356,965.70 511,433,224.60
current period4.
Closing balance
II. Accumulated
amortization1.
Opening
balance2.
Increase in the
current period4.
Closing balance
II.
Accumulated 63,004,328.62 42,837,581.49 32,172,371.20 98,256,378.31 10,180,423.12 246,451,082.74
amortization
293
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(1)
62,800,649.59 42,833,973.43 28,908,970.37 88,715,602.53 9,869,974.39 233,129,170.31
Provision
(2) Other
203,679.03 3,608.06 3,263,400.83 9,540,775.78 310,448.73 13,321,912.43
increase
3.
Decrease in the 12,834,394.20 118,150.00 12,411,161.46 37,873,660.89 164,022.96 63,401,389.51
current period
(1)
118,150.00 479,189.99 36,830,306.69 25,169.80 37,452,816.48
Disposal
(3) Other
12,834,394.20 11,931,971.47 1,043,354.20 138,853.16 25,948,573.03
decrease
4. Closing
285,255,159.17 74,994,587.19 62,749,522.70 244,110,282.91 27,373,365.86 694,482,917.83
balance
III. Provision
for impairment
1. Opening
balance
2. Increase
in the current
period
(1)
Provision
3.
Decrease in the
current period
(1)
Disposal
4. Closing
balance
IV. Book value
1. Closing 2,212,759,443. 2,663,069,103.
121,402,672.48 53,532,649.55 192,412,116.73 82,962,221.80
book value 30 86
2. Opening 2,198,386,733. 2,695,684,053.
162,088,721.97 51,484,940.42 192,648,719.10 91,074,938.64
book value 54 67
The proportion of intangible assets formed through internal R&D in the balance of intangible assets at the end of this period is
0.00%.
(2)
Impairment test of intangible assets
□Applicable N/A
294
Luxshare Precision Industry Co., Ltd. Annual Report 2022
20. Goodwill
(1) Original carrying amount of goodwill
In RMB
Increase Decrease
Investee name or
Formed by
event forming Opening balance Closing balance
business Others Disposal Others
goodwill
combination
ASAP 42,325,745.85 42,325,745.85
Technology
(Jiangxi) Co.,
Ltd.
Kunshan Lanto 376,682,429.24 376,682,429.24
Electronic
Limited
Bozhou Lanto 9,564,372.61 9,564,372.61
Electronic
Limited
M&A of 53,174,339.31 53,174,339.31
KERTONG
goodwill
Fujian JK Wiring 17,717,209.29 17,717,209.29
Systems Co., Ltd.
Huzhou Jiuding 1,730,318.45 1,730,318.45
Electronic Co.,
Ltd.
SpeedTech Corp. 26,656,146.69 26,656,146.69
Luxshare 4,582,880.91 4,582,880.91
Electronic
Technology
(Kunshan) Co.,
Ltd.
Suk 9,552,894.63 9,552,894.63
kunststofftechnik
GmbH
Merry Electronics 8,570,588.06 8,570,588.06
(Suzhou) Co.,
Ltd.
Merry Electronics 6,575,713.14 6,575,713.14
(Huizhou) Co.,
295
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Ltd.
Merry Electronics 454,304.97 454,304.97
(Shanghai) Co.,
Ltd.
Castle Rock, Inc. 8,303,254.98 8,303,254.98
Taiqiao 441,595.93 441,595.93
Investment Co.,
Ltd.
Luxcase 814,784,800.96 814,784,800.96
Precision
Technology
(Yancheng) Co.,
Ltd.
Zhejiang Puxing 804,455.51 804,455.51
Electronic
Technology Co.,
Ltd.
Caldigit 41,765,582.41 41,765,582.41
Holding(Cayman)
Taihan Precision 9,972,872.88 9,972,872.88
Co., Ltd.
TIME 175,669,057.02 175,669,057.02
Interconnect
Technology
Limited
Shenzhen 157,013,624.50 157,013,624.50
Huarong
Technology Co.,
Ltd.
Total 1,766,342,187.34 1,766,342,187.34
(2) Provision for impairment of goodwill
In RMB
Investee name or Increase Decrease
event forming Opening balance Closing balance
Provision Other Disposal Other
goodwill
Merry Electronics 8,570,588.06 8,570,588.06
(Suzhou) Co.,
Ltd.
296
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Suk 9,552,894.63 9,552,894.63
kunststofftechnik
GmbH
Merry Electronics 454,304.97 454,304.97
(Shanghai) Co.,
Ltd.
Fujian JK Wiring 17,717,209.29 17,717,209.29
Systems Co.,
Ltd..
Zhejiang Puxing
Electronic
804,455.51 804,455.51
Technology Co.,
Ltd.
Total 36,294,996.95 804,455.51 37,099,452.46
(3) Specific method of determining the recoverable amount
Determining the recoverable amount by subtracting the disposal costs from the fair value
□Applicable N/A
Determining the recoverable amount by the present value of expected future cash flows
□Applicable N/A
Reasons for the significant differences between the above information and the information used or external information used in
impairment tests in previous years
Note 1: The goodwill of the Company is formed by business combinations not involving enterprises under common control in previous
years and this year. On the balance sheet date, the Company conducted impairment tests on goodwill. The recoverable amount of the
asset group involved in goodwill is determined according to the present value of the future cash flow of the asset group and the net
realizable value. The management determines the growth rate and gross margin based on the macro market environment, historical
experience and the development stage forecast of product segments involved in different asset groups. Depending on the different asset
groups involved, the growth rate used in the forecast for the current year is -10.50%-16.24%, the gross margin is 3.00%-45.00%, and
the discount rate is 3.21%-11.01%. The parameters used in goodwill impairment test of major asset groups are as follows:
Asset group name Gross margin Growth rate Discount
rate
Kunshan Lanto Electronic Limited 11.00%- 1.00%-2.10% 10.58%
11.62%
Shenzhen Kertong Industrial Co., Ltd. 24.00%- 14.56%- 10.38%
25.98% 15.76%
Luxcase Precision Technology (Yancheng) 4.55%-4.73% 14.00%- 10.49%
Co., Ltd. 15.20%
Shenzhen Huarong Technology Co., Ltd. 3.00%-3.00% 1.00%-1.30% 11.01%
297
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Explanation 2: Converge Technology Limited is a Hong Kong-listed company. The recoverable amount is
determined by subtracting the disposal costs from the fair value.
Reasons for significant differences between the information used in impairment tests in previous years and the
actual situation in the current year.
None.
21. Long-term deferred expenses
In RMB
Amortization
Increase in the Other reduced
Item Opening balance amount in the Closing balance
current period amount
current period
House decoration
683,275,646.67 136,043,949.17 348,995,154.67 470,324,441.17
fees
Others 127,637,883.05 110,764,591.94 118,460,913.01 119,941,561.98
Total 810,913,529.72 246,808,541.11 467,456,067.68 590,266,003.15
Other descriptions:
22. Deferred tax assets / deferred tax liabilities
(1) Deferred tax assets that are not offset
In RMB
Closing balance Opening balance
Item Deductible temporary Deductible temporary
Deferred tax assets Deferred tax assets
differences differences
Provision for
1,143,132,621.04 224,368,274.81 657,614,145.51 120,807,667.80
impairment of assets
Unrealized profit of
541,695,019.14 96,205,468.40 547,139,157.01 83,055,862.59
internal transaction
Deductible losses 3,129,088,911.68 474,034,583.26 4,720,193,354.02 720,299,236.63
Share-based payment 1,029,585,993.98 163,582,703.34 622,032,254.71 108,660,230.06
Tax and accounting
difference for
642,643,662.15 160,660,915.54 162,109,310.74 40,527,327.69
depreciation of fixed
assets
Government grants 590,824,033.43 94,809,630.59 632,820,537.44 100,039,648.41
Exchange differences
68,848,999.67 13,769,799.93 33,377,229.80 6,675,445.96
of foreign operations
Lease liability 410,088,669.15 71,535,638.48 112,433,079.83 18,929,003.15
298
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Changes in the fair
value of other equity 22,965,122.40 3,444,768.36
instruments
Valuation of derivative
12,795,763.95 3,198,940.99 26,587,015.00 3,988,052.25
financial instruments
Dismissal welfare 2,231,853.00 446,370.60 1,801,352.50 360,270.50
Unused vacation bonus 2,649,530.00 529,906.00 4,402,578.27 660,386.74
Others 122,671,291.67 23,352,718.56 144,569,697.93 21,685,454.69
Total 7,719,221,471.26 1,329,939,718.86 7,665,079,712.76 1,225,688,586.47
(2) Deferred tax liabilities that are not offset
In RMB
Closing balance Opening balance
Item Taxable temporary Taxable temporary
Deferred tax liabilities Deferred tax liabilities
difference difference
Assets valuation
appreciation of
business combination
613,468,097.18 138,602,301.85 1,063,081,733.74 155,352,276.68
not involving
enterprises under
common control
Changes in fair value of
other investments in 156,725,739.33 23,508,860.90 347,049,284.20 52,057,392.63
equity instruments
Accelerated
depreciation of fixed 5,334,807,068.28 821,130,904.46 7,762,570,628.34 1,174,529,672.69
assets
Accumulative
recognition of overseas
1,032,240,690.00 206,448,138.00 852,318,046.60 170,463,609.32
investment interests by
equity method
Valuation of derivative
452,705,163.11 71,282,964.19 274,939,615.85 48,638,903.32
financial instruments
Right-of-use assets 380,058,524.89 65,285,746.10 98,762,595.73 17,106,305.46
Unrealized exchange
64,324,553.60 9,648,683.04
gains
Support funds allocated
13,883,542.73 2,082,531.41 14,271,238.70 2,140,685.81
by the government
Prepaid pension 6,748,781.00 1,349,756.20 6,459,206.85 1,291,841.37
Others 5,895,798.70 1,580,971.04 14,249,026.72 2,170,795.18
Total 8,060,857,958.82 1,340,920,857.19 10,433,701,376.73 1,623,751,482.46
299
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(3) Deferred tax assets or liabilities presented in net amount after offsetting
In RMB
Offset amount between Offset amount between
Closing balance of Opening balance of
deferred tax assets and deferred tax assets and
Item deferred tax assets or deferred tax assets or
liabilities at the end of liabilities at the
liabilities after offset liabilities after offset
the period beginning of the period
Deferred tax assets 456,995,883.46 872,943,835.40 17,106,305.46 1,208,582,281.01
Deferred tax liabilities 456,995,883.46 883,924,973.73 17,106,305.46 1,606,645,177.00
23. Other non-current assets
In RMB
Item Closing balance Opening balance
Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Certificates of
8,363,006,126. 8,363,006,126.
deposit and
99 99
time deposits
Prepayments
1,416,220,632. 1,416,220,632. 1,663,116,059. 1,663,116,059.
for equipment,
39 39 58 58
project and land
Advance equity
purchase 141,654,000.00 141,654,000.00
margin
Prepaid pension 6,748,719.45 6,748,719.45 6,459,206.83 6,459,206.83
Others 4,014,634.09 4,014,634.09 6,684,645.92 6,684,645.92
9,931,644,112. 9,931,644,112. 1,676,259,912. 1,676,259,912.
Total
92 92 33 33
Other descriptions:
24、Assets whose ownership or use is restricted
In RMB
End of the period Beginning of the period
R
e
s
Item t
Book Restricted Book Restricted Restricted
Book value r Book value
balance case balance type case
i
c
t
e
300
Luxshare Precision Industry Co., Ltd. Annual Report 2022
d
t
y
p
e
D
e Limited by Limited by
Monetary p the the
3,935,387,1 2,054,791,0 2,054,791,0
funds 3,935,387,136.86 o issuance of Deposit issuance of
36.86 11.90 11.90
s bills, letters bills, letters
i of credit of credit
t
P
l Notes Notes
Notes
164,567,47 e receivable 469,338,33 469,338,33 receivable
receivable 164,567,477.58 Pledge
7.58 d pledge 1.89 1.89 pledge
g financing financing
e
M
o
r Fixed Fixed
Fixed
635,803,44 t assets 1,596,425,9 1,596,425,9 assets
assets 635,803,443.15 Mortgage
3.15 g mortgage 69.25 69.25 mortgage
a financing financing
g
e
P
l
Intangible Land use Land use
401,674,06 e 547,767,90 547,767,90
assets 401,674,060.39 right pledge Pledge right pledge
0.39 d 2.77 2.77
financing financing
g
e
Accounts
Accounts
1,049,804,1 1,049,804,1 receivable
receivable Pledge
76.80 76.80 pledge
financing
Equity Equity
5,781,943,5 5,781,943,5
investment Pledge pledge
43.70 43.70
financing
Transaction
Trading
al financial
financial 60,000,000. 60,000,000.
Pledge asset
assets 00 00
pledge
financing
P
Limited by
l
Other non- the
2,874,097,7 e
current 2,874,097,749.98 issuance of
49.98 d
assets bills, letters
g
of credit
e
8,011,529,8 11,560,070, 11,560,070,
Total 8,011,529,867.96
67.96 936.31 936.31
Other descriptions:
301
Luxshare Precision Industry Co., Ltd. Annual Report 2022
25. Short-term borrowings
(1) Classification of Short-term borrowings
In RMB
Item Closing balance Opening balance
Pledge loans 4,260,029,345.26 1,284,267,389.38
Mortgage loans 171,321,000.00 294,954,654.15
Guaranteed loans 550,036,618.19 897,638,187.36
Credit loans 15,532,795,277.02 12,435,039,438.04
Total 20,514,182,240.47 14,911,899,668.93
Descriptions on classification of short-term borrowings:
26. Held-for-trading financial liabilities
In RMB
Item Closing balance Opening balance
Held-for-trading financial liabilities 117,942,421.18 44,318,321.50
Including:
Held-for-trading bonds issued 41,436.00
Derivative financial liabilities 117,942,421.18 44,276,885.50
Including:
Total 117,942,421.18 44,318,321.50
Other descriptions:
27. Notes payable
In RMB
Category Closing balance Opening balance
Commercial acceptance draft 168,339.81
Bank acceptance bill 492,417,560.22 515,054,217.52
Total 492,585,900.03 515,054,217.52
The total amount of notes payable due but unpaid at the end of this period is RMB0.00. The reason for the unpaid maturity is.
302
Luxshare Precision Industry Co., Ltd. Annual Report 2022
28. Accounts payable
(1) Presentation of accounts payable
In RMB
Item Closing balance Opening balance
Within 1 year 45,810,846,164.38 49,695,071,669.97
1-2 years 78,664,332.26 74,344,408.63
2-3 years 12,249,724.48 9,178,439.03
More than 3 years 6,755,074.31 7,889,034.91
Total 45,908,515,295.43 49,786,483,552.54
(2) Significant accounts payable with aging over 1 year or overdue
In RMB
Reasons for non-payment or carrying
Item Closing balance
forward
Other descriptions:
29. Other payables
In RMB
Item Closing balance Opening balance
Dividends payable 11,894,022.29 15,089,486.78
Other payables 394,783,918.24 457,790,709.70
Total 406,677,940.53 472,880,196.48
(1) Interest payable
Item Closing balance Opening balance
Common stock dividend 11,894,022.29 15,089,486.78
Total 11,894,022.29 15,089,486.78
Other descriptions, including significant dividends payable that have not been paid for more than 1 year, should disclose the reasons
for non-payment:
303
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(2) Other payables
1) Presentation of other payables by nature
In RMB
Item Closing balance Opening balance
Within 1 year 373,822,808.71 437,302,630.87
1 -2 years 7,536,142.05 3,828,361.57
2 -3 years 2,845,498.74 11,160,503.01
Over 3 years 10,579,468.74 5,499,214.25
Total 394,783,918.24 457,790,709.70
2) Other payables in the top five closing balances aggregated by counterparty
Other descriptions:
30. Contract liabilities
In RMB
Item Closing balance Opening balance
Goods payments received in advance 243,566,923.42 501,765,453.24
Total 243,566,923.42 501,765,453.24
Significant contractual liabilities older than 1 year
In RMB
Reasons for non-repayment or carry-
Item Closing balance
forward
Amount of and reason for significant changes in book value during the reporting period
In RMB
Item Change amount Reason for change
31. Employee benefits payable
(1) Presentation of employee benefits payable
In RMB
Item Opening balance Increase Decrease Closing balance
I. Short-term benefits 2,342,044,143.27 17,938,012,648.19 17,971,644,511.47 2,308,412,279.99
II. Post-employment
26,031,119.21 1,039,587,523.62 1,043,928,351.07 21,690,291.76
benefits - defined
304
Luxshare Precision Industry Co., Ltd. Annual Report 2022
contribution plan
III. Termination
60,500.00 15,963,144.94 15,807,224.94 216,420.00
benefits
Total 2,368,135,762.48 18,993,563,316.75 19,031,380,087.48 2,330,318,991.75
(2) Presentation of short-term benefits
In RMB
Item Opening balance Increase Decrease Closing balance
1. Salary, bonus,
2,303,342,360.89 16,547,791,329.28 16,574,894,848.65 2,276,238,841.52
allowance and subsidy
2. Employee welfare 6,515,232.20 85,664,849.56 85,767,093.55 6,412,988.21
3. Social insurance
21,145,736.14 448,482,748.52 455,407,250.78 14,221,233.88
premium
Including:
Medical insurance 18,863,295.63 383,592,643.71 389,831,076.50 12,624,862.84
premium
Employme
nt injury insurance 1,332,166.31 34,298,511.91 34,387,939.77 1,242,738.45
premium
Maternity
950,274.20 30,591,592.90 31,188,234.51 353,632.59
insurance premium
4. Housing provident
5,026,232.09 309,818,975.91 310,055,560.19 4,789,647.81
fund
5. Trade union funds
and staff education 3,005,344.46 24,697,378.06 25,255,200.10 2,447,522.42
funds
8. Other short-term
3,009,237.49 521,557,366.86 520,264,558.20 4,302,046.15
benefits
Total 2,342,044,143.27 17,938,012,648.19 17,971,644,511.47 2,308,412,279.99
(3) Presentation of defined contribution plan
In RMB
Item Opening balance Increase Decrease Closing balance
1. Basic endowment
25,313,173.90 1,003,732,063.84 1,007,967,001.31 21,078,236.43
insurance premium
2. Unemployment
717,945.31 35,855,459.78 35,961,349.76 612,055.33
insurance premium
Total 26,031,119.21 1,039,587,523.62 1,043,928,351.07 21,690,291.76
305
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Other descriptions:
32. Taxes payable
In RMB
Item Closing balance Opening balance
Value added tax 132,476,622.34 178,562,778.85
Enterprise income tax 561,049,186.85 357,553,487.54
Individual income tax 77,002,005.54 60,744,264.97
Urban maintenance and construction tax 46,681,016.77 54,221,444.33
Property tax 41,139,838.65 26,963,503.04
Education surcharges 28,316,821.64 32,686,140.44
Local education surcharges 18,936,169.14 21,777,325.55
Land use tax 5,206,233.88 2,338,741.28
Stamp duty 50,252,147.37 48,783,498.15
Disability insurance 49,635,583.88 49,582,574.67
Others 10,628,649.12 8,171,415.10
Total 1,021,324,275.18 841,385,173.92
Other descriptions:
33. Non-current liabilities due within one year
In RMB
Item Closing balance Opening balance
Long-term borrowings due within one
2,688,496,752.82 828,839,225.82
year
Bonds payable due within one year 49,591,565.40 224,130,860.43
Lease liabilities due within one year 129,207,552.67 179,282,344.89
Total 2,867,295,870.89 1,232,252,431.14
Other descriptions:
34. Other current liabilities
In RMB
Item Closing balance Opening balance
Short-term bonds payable 802,722,191.78 3,840,115,068.49
Payable for purchase returns 46,968,630.49 38,288,770.18
Entrusted loans 10,417,821.56 68,866,600.31
Unconfirmed instrument 24,834,420.45
306
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Short-term tickets payable 40,012,542.80
Others 7,746,196.22 9,766,686.26
Total 932,701,803.30 3,957,037,125.24
Increase and decrease in short-term bonds payable:
In RMB
Nomi Openi Openi Closin
Bond Amou Bond Amou Defau
Bond Face nal Issue ng Issue ng g
maturi nt of maturi nt of lt or
name value intere date balanc date balanc balanc
ty issue ty issue not
st rate e e e
Short-
term 1,000, 1,012, 4,800, 1,017,
100.0 2022/ 270
bonds 2.40% 000,0 953,4 000.0 753,4 No
0 6/15 days
payab 00.00 24.66 0 24.66
le
Short-
term 1,200, 1,212, 7,305, 1,219,
100.0 2022/ 270
bonds 2.20% 000,0 223,5 205.4 528,7 No
0 7/14 days
payab 00.00 61.64 8 67.12
le
Short-
term 800,0 807,6 5,089, 812,7
100.0 2022/ 270
bonds 2.15% 00,00 33,97 315.0 23,28 No
0 7/21 days
payab 0.00 2.60 7 7.67
le
Short-
term 800,0 807,3 5,419, 812,7
100.0 2022/ 270
bonds 2.15% 00,00 04,10 178.0 23,28 No
0 7/28 days
payab 0.00 9.59 8 7.67
le
Short-
term 1,200, 1,200, 8,173, 1,208,
100.0 2023/ 90
bonds 2.77% 000,0 000,0 770.4 173,7 No
0 4/21 days
payab 00.00 00.00 9 70.49
le
Short-
term 800,0 800,0 9,415, 809,4
100.0 2023/ 178
bonds 2.42% 00,00 00,00 519.1 15,51 No
0 5/23 days
payab 0.00 0.00 3 9.13
le
Short-
term 800,0 800,0 2,722, 802,7
100.0 2023/ 177
bonds 2.70% 00,00 00,00 191.7 22,19 No
0 11/15 days
payab 0.00 0.00 8 1.78
le
6,600, 3,840, 2,800, 42,92 5,880, 802,7
Total 000,0 115,0 000,0 5,180. 318,0 22,19
00.00 68.49 00.00 03 56.74 1.78
307
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Other descriptions:
35. Long-term borrowings
(1) Classification of long-term borrowings
In RMB
Item Closing balance Opening balance
Pledge loans 181,159,890.80 3,163,203,834.77
Mortgage loans 1,605,792,188.08 1,992,850,059.15
Guaranteed loans 72,496,000.00 791,766,506.32
Credit loans 10,179,323,211.04 3,257,492,660.70
Total 12,038,771,289.92 9,205,313,060.94
Descriptions on classification of long-term borrowings:
Other descriptions, including interest rate range:
36. Bonds payable
(1) Bonds payable
In RMB
Item Closing balance Opening balance
Convertible bonds 2,799,499,850.29 2,689,623,546.98
Total 2,799,499,850.29 2,689,623,546.98
(2) Increase and decrease in bonds payable (excluding preferred shares, perpetual bonds and other financial
instruments classified as financial liabilities)
In RMB
Nomi Openi Openi Closin
Bond Amou Bond Amou Defau
Bond Face nal Issue ng Issue ng g
maturi nt of maturi nt of lt or
name value intere date balanc date balanc balanc
ty issue ty issue not
st rate e e e
Conve
rtible
3,000, 2,689, 15,00 104,0 9,000, 2,799,
bonds 100.0 2020/ 6 142,5
000,0 623,5 0,000. 18,90 000.0 499,8 No
of 0 11/3 years 96.76
00.00 46.98 00 0.07 0 50.29
Luxsh
are
3,000, 2,689, 15,00 104,0 9,000, 142,5 2,799,
Total —— ——
000,0 623,5 0,000. 18,90 000.0 96.76 499,8
308
Luxshare Precision Industry Co., Ltd. Annual Report 2022
00.00 46.98 00 0.07 0 50.29
(3) Description of convertible corporate bonds
37. Lease liabilities
In RMB
Item Closing balance Opening balance
Lease payment 600,566,123.03 863,481,119.65
Minus: Unrecognized financing costs -48,077,234.37 -62,742,078.14
Total 552,488,888.66 800,739,041.51
Other descriptions:
38. Provisions
In RMB
Item Closing balance Opening balance Reason
Product quality warranty 642,733.24 682,513.39
Total 642,733.24 682,513.39
Other descriptions, including major assumptions and estimation descriptions related to significant provisions:
39. Deferred income
In RMB
Item Opening balance Increase Decrease Closing balance Reason
Government grants 665,910,095.66 118,233,376.14 188,819,870.75 595,323,601.05
Total 665,910,095.66 118,233,376.14 188,819,870.75 595,323,601.05 --
Other descriptions:
40. Other non-current liabilities
In RMB
Item Closing balance Opening balance
Others 1,471,770.36 324,039.05
Total 1,471,770.36 324,039.05
309
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Other descriptions:
41. Share capital
In RMB
Increase and decrease (+, -)
Opening Shares Closing
balance New shares Stock converted balance
Others Subtotal
issued dividend from capital
reserve
7,099,908,64 48,256,556.0 48,259,566.0 7,148,168,21
Total shares 3,010.00
7.00 0 0 3.00
Other descriptions:
Other descriptions: The Company’s share capital increased by RMB 48,259,566.00 in the current period,
including 48,256,556 shares exercised by the stock option incentive recipients at their sole discretion, and 3,010
shares converted from convertible bonds. After the said exercise and conversion, the Company’s share capital
increased to 7,148,168,213.00 shares.
42. Other equity instruments
(1) Basic information on preferred shares, perpetual bonds and other financial instruments outstanding at
the end of the period
The 10th meeting of the fourth session of the Board of Directors of the Company reviewed and passed the
Proposal on Clarifying the Specific Plan for the Public Issuance of Convertible Corporate Bonds. The Company
received the Approval for the Public Issuance of Convertible Corporate Bonds to Luxshare Precision Industry Co.,
Ltd. issued by the China Securities Regulatory Commission on February 19, 2020 (CSRC Permit [2020] No. 247),
approving the Company to publicly issue convertible corporate bonds with a total face value of RMB 3,000
million, with a term of 6 years. The RMB 3,000 million convertible corporate bonds of the Company were listed
and traded on the Shenzhen Stock Exchange on November 3, 2020, with the bond abbreviation Luxshare
Convertible Bonds" and the bond code "128136".
(2) Changes in preferred shares, perpetual bonds and other financial instruments outstanding at the end of
the period
In RMB
Outstanding Opening Increase Decrease Closing
310
Luxshare Precision Industry Co., Ltd. Annual Report 2022
financial
Quantity Book value Quantity Book value Quantity Book value Quantity Book value
instruments
Convertible 527,319,637. 30,617.60 527,289,020.
bonds 88 28
527,319,637. 30,617.60 527,289,020.
Total
88 28
Descriptions on the increase and decrease in other equity instruments in the current period, the reasons for the changes, and the basis
for relevant accounting treatment:
Other descriptions:
43. Capital reserve
In RMB
Item Opening balance Increase Decrease Closing balance
Capital premium (share
3,422,693,029.12 1,008,533,620.81 4,431,226,649.93
capital premium)
Other capital reserve 229,933,832.62 731,177,177.72 380,393,026.35 580,717,983.99
Total 3,652,626,861.74 1,739,710,798.53 380,393,026.35 5,011,944,633.92
Other descriptions, including those on the increase and decrease for the current period and the reasons for the change:
Capital reserve - share capital premium increased by RMB 1,008,533,620.81 in the current period, including an increase of RMB
498,442,142.52 from stock option exercise, a transfer of RMB 380,393,026.35 from other capital reserve through stock option exercise,
a conversion of RMB 170,204.36 from convertible bonds, and an increase of RMB 129,528,247.58 by other ways;
Capital reserve - the increase in other capital reserve in the current period is due to the cost of share-based payment increased by RMB
731,177,177.72, and the decrease therein is due to the transfer of other capital reserve to share capital premium.
44. Other comprehensive income
In RMB
Amount recognized in the current period
Less: Less:
amount amount
previously previously
included in included in
Amount of
other other Attributabl Attributabl
Opening income Closing
Item comprehen comprehen Less: e to the e to
balance before tax balance
sive sive income tax parent minority
in the
income and income and expenses company shareholder
current
transferred transferred after tax s after tax
period
to profit or to retained
loss for the earnings
current for the
period current
311
Luxshare Precision Industry Co., Ltd. Annual Report 2022
period
I. Other
comprehen
sive income
- - -
that cannot 294,744,93 37,783,386. 114,304,54
174,594,42 31,937,428. 180,440,38
be 3.12 82 9.36
5.38 44 3.76
reclassified
into profit
or loss
Chang
es in fair
value of - - -
294,744,93 37,783,386. 114,304,54
other 174,594,42 31,937,428. 180,440,38
3.12 82 9.36
investment 5.38 44 3.76
s in equity
instruments
II. Other
comprehen
sive income - - -
356,713,38 34,457,627.
to be 348,883,54 322,255,75 26,627,791.
3.13 52
reclassified 7.50 5.61 90
into profit
or loss
Transl
ation
difference - - -
356,713,38 34,457,627.
of foreign 348,883,54 322,255,75 26,627,791.
3.13 52
currency 7.50 5.61 90
financial
statements
Total other - - - -
651,458,31 37,783,386. 148,762,17
comprehen 523,477,97 31,937,428. 502,696,13 26,627,791.
6.25 82 6.88
sive income 2.88 44 9.37 90
Other descriptions, including those on the adjustment for conversion of the effective part of profit or loss of cash flow hedging into
the initial recognition amount of the hedged item:
45. Special reserve
In RMB
Item Opening balance Increase Decrease Closing balance
Safety production
2,094,879.61 32,093,607.36 30,660,117.17 3,528,369.80
expenses
Total 2,094,879.61 32,093,607.36 30,660,117.17 3,528,369.80
Other descriptions, including those on the increase and decrease for the current period and the reasons for the change:
312
Luxshare Precision Industry Co., Ltd. Annual Report 2022
46. Surplus reserve
In RMB
Item Opening balance Increase Decrease Closing balance
Statutory surplus
1,121,072,698.83 322,447,486.64 1,443,520,185.47
reserve
Total 1,121,072,698.83 322,447,486.64 1,443,520,185.47
Description of surplus reserve, including those on increase and decrease for the current period and the reasons for the change:
47. Undistributed profits
In RMB
Item Current Period Prior Period
Undistributed profits at the end of prior
32,288,416,277.22 24,040,637,144.00
period before adjustment
Undistributed profits at the beginning of
32,288,416,277.22 24,040,637,144.00
the period after adjustment
Add: Net profits attributable to the owners
of the parent company in the current 10,952,656,702.16 9,163,104,849.54
period
Less: Apportion to statutory surplus
322,447,486.64 135,911,192.22
reserve
Common stock dividends payable 926,948,678.85 779,270,547.26
Others -35,295,097.36 143,976.84
Undistributed profits at the end of the
42,026,971,911.25 32,288,416,277.22
period
Details of adjustment of undistributed profits at the beginning of the period:
1) The undistributed profits at the beginning of the period affected by the retroactive adjustment as stipulated in the Accounting
Standards for Business Enterprises and new regulations newly promulgated relating thereto amounted to RMB0.00.
2) The undistributed profits at the beginning of the period affected by the changes in accounting policies amounted to RMB0.00.
3) The undistributed profits at the beginning of the period affected by the correction of major accounting errors amounted to RMB0.00.
4) The undistributed profits at the beginning of the period affected by changes in the scope of consolidation due to business combination
involving enterprises under common control amounted to RMB0.00.
5) The undistributed profits at the beginning of the period affected by other adjustments amounted to RMB0.00.
48. Operating income and operating costs
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
313
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Income Cost Income Cost
Principal business 229,308,417,348.68 203,310,851,043.48 211,943,848,653.92 186,111,713,122.60
Other business 2,597,042,481.15 1,730,449,415.11 2,084,545,637.52 1,817,167,162.78
Total 231,905,459,829.83 205,041,300,458.59 214,028,394,291.44 187,928,880,285.38
If the lower of audited nets profits including and excluding non-recurring profit or loss is negative
□ Yes No
Breakdown of operating revenue and operating costs
In RMB
Classificati Segment 1 Segment 2 Total
on of Operating Operating Operating Operating Operating Operating Operating Operating
contract income cost income cost income cost income cost
Business
type
Including:
Merchandis
231,905,45 205,041,30 231,905,45 205,041,30
e sales
9,829.83 0,458.59 9,829.83 0,458.59
revenue
Classified
on by
operating
area
Including:
Type of
market or
customer
Including:
Contract
type
Including:
Classified
by time of
transfer of
goods
Including:
Confirm at
231,905,45 205,041,30 231,905,45 205,041,30
a certain
9,829.83 0,458.59 9,829.83 0,458.59
point
Classified
314
Luxshare Precision Industry Co., Ltd. Annual Report 2022
by contract
term
Including:
Classified
by contract
term
Including:
231,905,45 205,041,30 231,905,45 205,041,30
Total
9,829.83 0,458.59 9,829.83 0,458.59
Information related to performance obligations:
The type of
Amounts quality
Time of Nature of the
Whether they expected to be assurance
performance or Key payment company's
Item are the primary refunded to provided by the
fulfillment of terms commitment to
obligor customers by company and
obligations transfer goods
the company related
obligations
Other descriptions:
Information relating to the transaction price allocated to the remaining performance obligations:
At the end of the reporting period, the incomes corresponding to the contracts signed whose performance has not been commenced or
completed amount to RMB0.00, of which RMB is expected to be recognized in, RMB is expected to be recognized in, and RMB is
expected to be recognized in.
Information related to variable consideration in contracts:
Significant contract amendments or significant adjustments in transaction prices.
In RMB
Item Accounting treatment methods Amount of impact on revenue.
Other descriptions:
49. Taxes and surcharges
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Urban maintenance and construction tax 135,828,066.62 134,237,633.10
Education surcharges 74,879,240.47 82,084,208.17
Property tax 94,893,905.31 75,088,009.87
Land use tax 12,471,189.05 9,681,156.59
Vehicle and vessel use tax 63,832.43 66,685.43
315
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Stamp duty 156,855,629.56 119,933,691.80
Local education surcharges 50,692,853.69 43,726,505.69
Others 9,130,512.93 11,507,549.02
Total 534,815,230.06 476,325,439.67
Other descriptions:
50. Management expenses
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Personnel expenses 2,955,300,979.92 2,752,635,462.67
Depreciation and amortization expenses 1,141,476,216.54 780,606,889.02
Materials and consumables 436,597,420.45 613,926,759.41
Office expenses 241,922,242.64 194,254,096.88
Repair and miscellaneous purchases 157,359,307.86 182,254,970.23
Utilities 65,353,249.13 70,926,413.34
Leasing expenses 116,187,241.86 65,448,985.07
Travel and transportation expenses 42,414,743.05 39,010,434.62
Other expenses 386,245,592.81 376,604,074.11
Total 5,542,856,994.26 5,075,668,085.35
Other descriptions:
51. Selling expenses
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Employee benefits 598,361,422.40 547,517,120.77
Storage and lease expenses 30,444,556.09 36,541,171.64
Consumables and miscellaneous
18,734,939.68 31,804,228.22
purchases
Business entertainment expenses 34,681,627.31 25,994,673.80
Depreciation and amortization 19,007,296.20 14,527,746.62
Travel expenses 23,367,644.53 13,269,371.79
Material expenditure 16,493,491.17 10,789,563.43
Transportation expenses 6,688,139.24 5,306,607.96
Employee benefits 18,527,534.76 7,002,044.68
Storage and lease expenses 1,162,239.79 1,558,957.69
Consumables and miscellaneous
121,555,530.46 137,086,653.00
purchases
Business entertainment expenses 889,024,421.63 831,398,139.60
316
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Other descriptions:
52. R&D expenses
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Personnel benefits 4,474,219,036.60 4,296,689,104.43
Mould and material cost 1,223,716,713.86 1,659,569,732.34
Depreciation and amortization 1,071,507,770.65 894,098,153.77
Consumables and miscellaneous 298,285,961.53 564,831,528.23
Repair and inspection 373,156,578.61 341,779,541.87
Service fees 206,099,670.82 225,595,394.86
Water and electricity 126,487,095.42 132,921,844.25
Transportation and travel expenses 55,143,408.18 35,267,611.83
Commercial insurance 4,193,418.58 3,153,481.73
Lease fee 72,638,748.64 64,081,121.07
Other expenses 283,319,129.96 229,051,431.83
Total 8,188,767,532.85 8,447,038,946.21
Other descriptions:
53. Financial expenses
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Interest expenses 1,376,870,146.38 1,038,070,641.24
Including: interest cost of lease liabilities
-1,005,580,557.62 -504,344,274.59
Less: Interest income
Foreign exchange gains or losses 72,796,425.87 337,513,015.17
Others 38,783,312.39 11,481,756.95
Total 482,869,327.02 882,721,138.77
Other descriptions:
54. Other incomes
In RMB
Sources of other incomes Amount recognized in the current period Amount recognized in the prior period
Government subsidies 791,098,788.52 596,775,248.61
317
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Input tax credit offset 20,559,877.99
Withholding personal income tax
13,530,448.56 5,519,015.29
processing fees
Total 825,189,115.07 602,294,263.90
55. Income from changes in fair value
In RMB
Sources of income from changes in fair
Amount recognized in the current period Amount recognized in the prior period
value
Held-for-trading financial assets 210,346,832.18 13,625,720.11
Including: Income from changes in
fair value of derivative financial 210,346,832.18 13,625,720.11
instruments
Total 210,346,832.18 13,625,720.11
Other descriptions:
56. Investment income
In RMB
Long-term equity investment income
2,044,361,609.89 794,759,492.42
accounted for using the equity method
Investment income from disposal of long-
22,800,675.95
term equity investment
Investment income from disposal of held-
279,341,611.63 525,062,938.11
for-trading financial assets
Dividends from other equity instrument
264,713.32 212,413.30
investments during holding period
Gains from derecognition of financial
-741,342,548.75 -400,156,146.02
assets measured at amortized cost.
Interest income from fixed deposits/large
certificates of deposit/financial 188,657,405.35 55,598,985.01
investments
Total 1,771,282,791.44 998,278,358.77
Other descriptions:
None.
318
Luxshare Precision Industry Co., Ltd. Annual Report 2022
57. Impairment losses of credit
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Bad debt loss of notes receivable 270,661.65 -297,668.79
Bad debt loss of accounts receivable 25,623,112.25 -45,942,584.71
Bad debt loss of other receivables -2,619,894.43 -941,685.43
Total 23,273,879.47 -47,181,938.93
Other descriptions:
58. Impairment losses of assets
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
I. Loss of inventory depreciation and
impairment loss of contract performance -1,126,386,426.94 -613,236,634.12
cost
IV. Impairment loss of fixed assets -191,676,433.95 -233,585,496.93
X. Impairment loss of goodwill -804,455.51
Total -1,318,867,316.40 -846,822,131.05
Other descriptions:
59. Income from disposal of assets
In RMB
Sources of income from asset disposal Amount recognized in the current period Amount recognized in the prior period
Income from disposal of fixed assets 121,555,370.09 44,833,504.83
Income from disposal of intangible assets 53,313.42 -10,551.92
Income from disposal of right-of-use
1,258,494.01 3,108,576.72
assets
Total 122,867,177.52 47,931,529.63
60. Non-operating income
In RMB
319
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Amount included in non-
Amount recognized in the Amount recognized in the
Item recurring profit or loss for the
current period prior period
current period
Income from compensation
70,247,182.56 16,376,930.09 70,247,182.56
for breach of contract
Income from asset retirement 5,791,215.56 5,538,035.76 5,791,215.56
Others 17,420,629.28 12,397,333.89 17,420,629.28
Total 93,459,027.40 34,312,299.74 93,459,027.40
61. Non-operating expenses
In RMB
Amount included in non-
Amount recognized in the Amount recognized in the
Item recurring profit or loss for the
current period prior period
current period
External donation 11,692,180.78 1,279,333.00 11,692,180.78
Asset retirement loss 22,307,439.97 13,071,784.99 22,307,439.97
Compensation, liquidated
14,784,120.05 6,424,974.87 14,784,120.05
damages and fines
Others 19,551,144.99 10,029,281.47 19,551,144.99
Total 68,334,885.79 30,805,374.33 68,334,885.79
Other descriptions:
62. Income tax expenses
(1) Income tax expenses
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Current income tax expense 1,024,939,081.02 657,866,108.46
Deferred income tax expense -383,109,737.84 9,452,096.88
Total 641,829,343.18 667,318,205.34
(2) Reconciliation of income tax expenses to the accounting profit
In RMB
Item Amount recognized in the current period
Total profits 12,885,042,486.31
320
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Income tax expense calculated based on statutory/applicable tax
1,933,491,772.90
rate
Effect of different tax rates of subsidiaries operating in other
-189,779,320.46
jurisdictions
Effect of adjustment on income tax for prior period -13,915,839.15
Effect of non-taxable income -301,762,515.51
Effect of non-deductible cost, expense and loss 57,627,081.37
Effect of utilizing deductible loss not recognized for deferred tax
-434,036,917.84
assets for prior period
Effect of deductible temporary difference or deductible loss not
310,496,195.13
recognized for deferred tax assets for the current period
Change in the balance of opening deferred tax assets/liabilities
244,000.92
caused by tax rate adjustment
Additional deduction of R&D expenses (presented in negative) -633,930,614.80
Difference from exercise of stock option -71,252,929.20
Additional deduction of expenses used for disable persons -6,146,223.87
Others -9,205,346.31
Income tax expenses 641,829,343.18
Other descriptions:
63. Other comprehensive income
Please refer to Note 44.
64. Items in the cash flow statement
(1) Cash related to operating activities
Other cash received related to operating activities
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Special subsidies and grants 730,512,293.94 729,647,415.38
Lease income 86,864,463.17 30,878,939.74
Interest income 1,005,580,557.62 504,344,274.59
Non-operating income 83,854,908.45 28,383,594.53
Recovery of current accounts and
2,344,231,763.48 1,388,046,955.47
disbursements
Total 4,251,043,986.66 2,681,301,179.71
Descriptions on other cash received related to operating activities:
321
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(2) Other cash paid related to operating activities
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Selling expenses 239,741,364.82 263,930,838.26
General and administrative expenses 1,354,873,317.36 1,414,021,613.64
R&D expenses 1,079,345,043.17 984,376,384.20
Inter-company transactions 1,342,835,159.67 1,234,314,047.35
Transferred to restricted funds 2,554,396,002.20 1,000,000,000.00
Non-operating expenses 46,027,445.82 17,733,589.34
Handling charges 38,783,312.39 11,481,756.95
Total 6,656,001,645.43 4,925,858,229.74
Descriptions on other cash paid related to operating activities:
(3) Cash related to investing activities
Other cash received related to investing activities
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Reversal of restricted funds 427,650,270.00 715,017,358.71
Recovery of suppliers’ borrowings 30,000,000.00
Total 427,650,270.00 745,017,358.71
Significant cash receipts related to investing activities
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Descriptions on other cash received related to investing activities:
Other cash paid related to investing activities
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Transferred to restricted funds 427,650,270.00
Payment for acquisition of equity deposits 140,474,000.00
Net cash paid for disposal of subsidiaries 385,253.59
Others
Total 140,474,000.00 428,035,523.59
Significant cash payments related to investing activities
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
322
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Descriptions on other cash paid relating to investing activities:
(3) Cash related to financing activities
Other cash received related to financing activities
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Short-term financing bonds 2,800,000,000.00 6,600,000,000.00
Reversal of restricted funds 701,054,171.58
Taxes withheld from shareholder for
921,511,778.98
reduction of shares
Other 30,370,799.83 5,960,996.25
Total 3,531,424,971.41 7,527,472,775.23
Descriptions on other cash received related to financing activities:
Other cash paid related to financing activities
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Short-term financing bonds 5,800,000,000.00 4,400,000,000.00
Borrowings returned to minority
1,953,239,500.00
shareholders
Taxes prepaid for shareholder for
921,511,778.98
reduction of shares
Transferred to restricted funds 700,123,698.63
Lease fee 203,632,926.89 159,062,113.35
Financing charges 6,203,470.61 4,184,658.23
Total 6,009,836,397.50 8,138,121,749.19
Descriptions on other cash paid related to financing activities:
Changes in liabilities generated from financing activities
Applicable □N/A
In RMB
Opening
Item Increase Decrease Closing balance
balance
323
Luxshare Precision Industry Co., Ltd. Annual Report 2022
65. Supplementary information to cash flow statement
(1) Supplementary information to cash flow statement
In RMB
Supplementary information Current period Prior period
1. Reconciliation of net profit to cash flow
from operating activities:
Net profits 12,243,213,143.13 10,490,676,778.96
Add: Provision for impairment of
1,295,593,436.93 894,004,069.98
assets
Depreciation of fixed assets,
depletion of oil and gas assets, 9,619,607,257.96 7,233,705,585.39
depreciation of bearer biological assets
Depreciation of right of use assets 176,390,984.93 168,866,435.84
Amortization of intangible assets 233,129,170.31 170,869,522.76
Amortization of Long-term
467,456,067.68 395,513,128.13
deferred expenses
Loss from disposal of fixed assets,
intangible assets and other long-term -122,867,177.52 -47,931,529.63
assets (“-” means income)
Loss from fixed assets retirement
16,516,224.41 7,533,749.23
(“-” means income)
Loss from changes in fair value
-210,346,832.18 -13,625,720.11
(“-” means income)
Financial expenses (“-” means
1,376,870,146.38 1,038,070,641.24
income)
Investment loss (“-” means
-1,771,282,791.44 -998,278,358.77
income)
Decrease in deferred income tax
339,083,213.97 -316,866,043.97
assets (“-” means increase)
Increase in deferred tax liabilities
-694,171,671.54 326,646,031.03
(“-” means decrease)
Decrease in inventories (“-”
7,239,478,351.05 -15,791,020,357.63
means increase)
Decrease in operating receivables
2,054,810,808.92 6,415,757,847.29
(“-” means increase)
Increase in operating accounts
-4,658,419,921.83 2,753,688,539.60
payable (“-” means decrease)
Other
Net cash flow from operating
27,605,060,411.16 12,727,610,319.34
activities
2 . Significant investing and financing
activities that do not involve cash receipts
and payments:
Conversion of debt into capital
Convertible bonds due within one year
Fixed assets acquired under finance
324
Luxshare Precision Industry Co., Ltd. Annual Report 2022
leases
3 . Net changes in cash and cash
equivalents:
Closing balance of cash 29,684,152,320.65 17,312,418,429.51
Less: Opening balance of cash 17,312,418,429.51 8,921,536,728.08
Add: Closing balance of cash
equivalents
Less: Opening balance of cash
equivalents
Net increase in cash and cash
12,371,733,891.14 8,390,881,701.43
equivalents
(2) Composition of cash and cash equivalents
In RMB
Item Closing balance Opening balance
I. Cash 29,684,152,320.65 17,312,418,429.51
Including: Cash on hand 376,233.09 1,236,553.93
Bank deposits available for
29,683,776,087.56 17,311,181,875.58
payment at any time
III. Closing balance of cash and cash
29,684,152,320.65 17,312,418,429.51
equivalents
(3) Restricted cash and cash equivalents included in cash and cash equivalents
In RMB
Reasons for still being
Amount recognized in the Amount recognized in the
Item classified as cash and cash
current period prior period
equivalents
(4) Cash and cash equivalents not classified as monetary funds
In RMB
Reasons for not being
Amount recognized in the Amount recognized in the
Item classified as cash and cash
current period prior period
equivalents
Other monetary funds Restricted cash due to opening
3,935,387,136.86 2,054,791,011.90
bills, letters of credit, etc.
Total 3,935,387,136.86 2,054,791,011.90
Other descriptions:
325
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(5) Other significant activity explanations
66. Foreign currency monetary items
(1) Foreign currency monetary items
In RMB
Closing balance in foreign
Item Exchange rate Closing balance in RMB
currency
Cash and bank balances 18,713,530,707.15
Including: USD 2,596,502,767.98 7.0827 18,390,250,154.74
EUR 3,870,452.81 7.8592 30,418,662.73
HKD 72,294,436.24 0.9062 65,514,664.01
JPY 31,612,655.09 0.0502 1,587,366.25
TWD 798,000,181.98 0.2314 184,657,242.11
VND 126,579,190.95 0.0003 36,923.15
KRW 2,082,492,112.80 0.0055 11,482,861.51
GBP 64,783.34 9.0411 585,712.66
INR 306,403,430.86 0.0855 26,191,365.27
SGD 488,609.06 5.3772 2,627,348.62
MXN 426,659.90 0.4181 178,406.10
Accounts receivable 14,254,413,067.37
Including: USD 2,008,564,201.57 7.0827 14,226,057,670.45
EUR 823,666.02 7.8592 6,473,356.01
HKD 19,751,279.30 0.9062 17,899,004.32
TWD 17,212,776.97 0.2314 3,983,036.59
Accounts receivable 392,981,525.32
Including: USD
EUR
HKD 79,999,998.63 0.9062 72,497,598.76
TWD 1,384,978,075.02 0.2314 320,483,926.56
Other receivables 152,513,272.42
Including: USD 18,846,909.45 7.0827 133,487,005.53
EUR 1,129,258.50 7.8592 8,875,068.40
HKD 3,278,527.45 0.9062 2,971,067.15
JPY 35,227,117.28 0.0502 1,768,859.24
TWD 15,032,972.00 0.2314 3,478,629.72
VND 228,072,060.34 0.0003 66,528.62
326
Luxshare Precision Industry Co., Ltd. Annual Report 2022
KRW 149,985,819.73 0.0055 827,021.81
INR 11,996,496.49 0.0855 1,025,460.52
MXN 32,599.54 0.4181 13,631.43
Short-term borrowings 510,175,658.40
Including: USD 60,022,209.58 7.0827 425,119,303.80
HKD 52,443,728.10 0.9062 47,525,555.28
TWD 162,190,143.99 0.2314 37,530,799.32
Accounts payable 27,193,453,315.89
Including: USD 3,833,979,042.12 7.0827 27,154,923,361.62
EUR 1,341,989.97 7.8592 10,546,967.57
HKD 1,766,637.16 0.9062 1,600,961.93
JPY 193,719,449.15 0.0502 9,727,234.70
TWD 53,608,131.98 0.2314 12,404,921.74
GBP 2,731.46 9.0411 24,695.40
INR 49,428,789.54 0.0855 4,225,172.93
Other payables 74,389,437.43
Including: USD 8,044,044.73 7.0827 56,973,555.61
EUR 25,599.96 7.8592 201,195.21
HKD 5,258,795.18 0.9062 4,765,625.37
JPY 7,707,951.13 0.0502 387,039.35
TWD 29,340,615.00 0.2314 6,789,418.31
KRW 147,420,790.71 0.0055 812,878.24
GBP 37,625.57 9.0411 340,176.54
INR 235,179.34 0.0855 20,103.13
MXN 9,803,768.35 0.4181 4,099,445.67
Other descriptions:
(2) Descriptions on overseas business entities, including, with respect to significant overseas business entities,
disclosure of their overseas main business place, functional currency and selection basis, and the reasons for
changes in functional currency (if any).
Applicable □N/A
67. Lease
(1) Company as lessee
Applicable □N/A
327
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Variable lease payments not included in lease liability measurement
□Applicable N/A
Lease expense for short-term leases or low-value assets with simplified treatment
Applicable □N/A
Amount
Amount recognized in the prior
Item recognized in the
period
current period
Interest expense on lease liabilities 27,150,426.74 44,537,265.44
Simplified short-term lease expenses recognized in
the cost of related assets or in current period profit 201,471,466.53 141,495,257.7
or loss
Simplified lease expenses for low-value assets
recognized in the cost of related assets or in current
period profit or loss (excluding short-term lease
expenses for low-value assets)
Variable lease payments not included in lease
liability measurement recognized in the cost of
related assets or in current period profit or loss
Including: Portion generated from sale and
leaseback transactions
Income from subleasing right-of-use assets
acquired
Income from subleasing right-of-use assets
405,104,393.42 300,557,370.62
acquired
Related profit or loss generated from sale and
leaseback transactions
Cash inflows from sale and leaseback
transactions
Cash inflows from sale and leaseback
transactions
Sale and leaseback transactions involved
None.
328
Luxshare Precision Industry Co., Ltd. Annual Report 2022
68. Others
None.
VIII. R&F Expenditures
In RMB
Item Amount recognized in the current Amount recognized in the prior
period period
Personnel benefits 4,474,219,036.60 4,296,689,104.43
Mould and material cost 1,223,716,713.86 1,659,569,732.34
Depreciation and amortization 1,071,507,770.65 894,098,153.77
Consumables and miscellaneous 298,285,961.53 564,831,528.23
Repair and inspection 373,156,578.61 341,779,541.87
Service fees 206,099,670.82 225,595,394.86
Water and electricity 126,487,095.42 132,921,844.25
Transportation and travel expenses 55,143,408.18 35,267,611.83
Commercial insurance 4,193,418.58 3,153,481.73
Lease fee 72,638,748.64 64,081,121.07
Other expenses 283,319,129.96 229,051,431.83
Total 8,188,767,532.85 8,447,038,946.21
Including: Expense research and development costs 8,188,767,532.85 8,447,038,946.21
IX．Changes in scope of consolidation
1. Business combination not involving enterprises under common control
(1) Business combination not involving enterprises under common control in the current period
In RMB
Income of Net profits
the of the
Basis for combined combined Income of Net profits
Proportion constituting Basis for party from party from the of the
Name of of equity the business determining the the combined combined
Combination
combined acquired in combination the beginning beginning party party
date
party the business under the combination of the of the during the during the
combination same date current current comparison comparison
control period to the period to period period
combination the
date combination
329
Luxshare Precision Industry Co., Ltd. Annual Report 2022
date
Other descriptions:
2. Business combination involving enterprises under common control
(1) Business combination involving enterprises under common control in the current period
In RMB
Basis for Income of the Net profit of
business combined the combined Income of the Net profit of
Basis for
Equity ratio combination party from party from combined the combined
Name of determining
obtained in involving Combination the beginning the beginning party during party during
combined the
business enterprises date of the current of the current the the
party combination
combination under period to the period to the comparison comparison
date
common combination combination period period
control date date
Other descriptions:
None.
3. Changes in consolidation scope for other reasons
Descriptions on changes in the scope of consolidation for other reasons (such as the establishment of new subsidiaries, liquidation of
subsidiaries, etc.) and related situations:
The Company’s changes in scope of consolidation caused by newly established subsidiaries in 2023 are stated as follows:
Company Date of establishment
Luxshare Precision Industry (Huzhou), Ltd. 2023/1/1
TIME Interconnect Technology Limited 2023/1/10
Kunshan TIME Interconnect Technology Limited 2023/1/19
Luxshare Technologies International, Inc. 2023/3/24
Linkz Cables Mexico S.DE R.L. DE C.W. 2023/4/14
ICT Legend S. DE R.L. DE C.V. 2023/5/8
Lixin Precision Intelligent Manufacturing (Shantou) 2023/6/19
Co., Ltd.
Luxshare Precision Industry (Anhui) Co., Ltd. 2023/7/21
Luxshare Technologies Mexico S. de. R.L.de c.v. 2023/8/14
Luxshare Technologies (Vietnam)Co., ltd 2023/8/29
Dongguan Luxshare Holdings Co., Ltd. 2023/9/5
Luxcase Precision Technology (Vietnam)Co., Ltd. 2023/11/10
Changes in the scope of consolidation resulting from the subsidiary's dissolution in 2023 are as follows:
330
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Company name Date of cancelation
Kunshan Luxshare Precision Mould Co., Ltd. 2023/2/6
Henan Leader Precision Industry Co., Ltd. 2023/6/21
4. Others
Other changes in the scope of consolidation include the absorption merger of Xuande Technology Co., Ltd. with Taiqiao Investment
Co., Ltd. during the year. Xuande Technology Co., Ltd. assumed its assets and liabilities, and Taiqiao Investment Co., Ltd. was
dissolved.
X. Equity in other entities
1. Equity in subsidiaries
(1) Composition of the enterprise group
In RMB
Luxshare Precision Main place Place of Nature of Shareholding ratio Method of
Registered capital
Technology Co., Ltd. of business registration business Direct Indirect acquisition
USD 9 million and
Luxshare Precision Hong Hong Investment
RMB 100 million 100.00% Establishment
Technology Co., Ltd. Kong Kong consulting
Taiwan Luxshare NT$618.758 million Marketing
Taiwan Taiwan 100.00% Establishment
Precision Limited business
United United Marketing
Luxshare ICT, Inc. USD 2 million 100.00% Establishment
States States business
Luxshare-ICT Europe Marketing
GBP 100 UK UK 100.00% Establishment
Limited business
Luxshare Precision Hong Hong
USD 5 million Trade 100.00% Establishment
Limited Kong Kong
Yunding Technology Co., Hong Hong Investment
USD 7.58853 million 100.00% Establishment
Ltd. Kong Kong consulting
Business
combination
Processing involving
Huzhou Jiuding
RMB 30,800,000 Huzhou Huzhou and 100.00% enterprises
Electronic Co., Ltd.
manufacturing not under
common
control
331
Luxshare Precision Industry Co., Ltd. Annual Report 2022
LUXSHARE-ICT Japan Marketing
JPY 80 million Japan Japan 80.00% Establishment
Ltd. business
Korea LuxshareICT Co., Marketing
KRW 545,750,000 Korea Korea 100.00% Establishment
Ltd business
Processing
Luxshare India Private
NPR557,500,000 India Chennai and 100.00% Establishment
Limited
manufacturing
Luxshare Precision Hong Hong Investment
USD 100 100.00% Establishment
Investment Co., Ltd. Kong Kong consulting
Luxis Technology Hong Hong
USD 1.5 million Trade 100.00% Establishment
Limited Kong Kong
Processing
Luxshare Liantao (India)
INR 1.4 million India India and 100.00% Establishment
Co., Ltd.
manufacturing
Business
combination
involving
TIME Interconnect Hong Hong Investment
HKD 19.45952 million 70.95% enterprises
Technology Limited Kong Kong consulting
not under
common
control
Business
combination
involving
Hong Hong Investment
Huaxun Cable Co., Ltd. HKD 8.39 million 70.95% enterprises
Kong Kong consulting
not under
common
control
Business
combination
involving
Linkz International Hong Hong
HKD 10,000 Trade 70.95% enterprises
Limited Kong Kong
not under
common
control
Business
Processing combination
Huaxun Industrial
USD 30 million Kunshan Kunshan and 70.95% involving
(Suzhou) Co., Ltd.
manufacturing enterprises
not under
332
Luxshare Precision Industry Co., Ltd. Annual Report 2022
common
control
Business
combination
involving
Huaxun Hong Kong Hong Hong Investment
HKD 10 million 70.95% enterprises
Limited Kong Kong consulting
not under
common
control
Business
combination
Processing involving
Lingxun Wire Industry
USD 15 million Shanghai Shanghai and 67.40% enterprises
(Shanghai) Co., Ltd.
manufacturing not under
common
control
Business
combination
involving
Haohe Manufacturing Hong Hong Investment
HKD 8 million 70.95% enterprises
Co., Ltd. Kong Kong consulting
not under
common
control
Business
combination
Haohe (Kunshan) Processing involving
Electronic Material Co., HKD 30 million Kunshan Kunshan and 70.95% enterprises
Ltd. manufacturing not under
common
control
Business
combination
Processing involving
Kunshan Deqin
RMB 10 million Kunshan Kunshan and 70.95% enterprises
Machinery Co., Ltd.
manufacturing not under
common
control
Business
combination
Time Interconnect Hong Hong Investment
HKD 77,934 70.95% involving
Investment Limited Kong Kong consulting
enterprises
not under
333
Luxshare Precision Industry Co., Ltd. Annual Report 2022
common
control
Business
combination
involving
TIME Interconnect (HK) Hong Hong Investment
HKD 10,000 70.95% enterprises
Limited Kong Kong consulting
not under
common
control
Business
combination
TIME Interconnect Processing involving
Technology (Huizhou) USD 28.60286 million Huizhou Huizhou and 70.95% enterprises
Limited manufacturing not under
common
control
Business
combination
involving
TIME Interconnect Hong Hong
HKD 2 million Trade 70.95% enterprises
Industrial Co., Ltd. Kong Kong
not under
common
control
Business
combination
TIME Interconnect involving
HKD 68.935877 Hong Hong
Wiring Technology Co., Trade 70.95% enterprises
million Kong Kong
Ltd. not under
common
control
Business
combination
Processing involving
Huizhou Chuangxiang
RMB 140,525,010 Huizhou Huizhou and 70.95% enterprises
Technology Co., Ltd.
manufacturing not under
common
control
Business
Processing
Huiju Robot Technology combination
RMB 12.939 million Shanghai Shanghai and 70.95%
(Shanghai) Co., Ltd. involving
manufacturing
enterprises
334
Luxshare Precision Industry Co., Ltd. Annual Report 2022
not under
common
control
Business
combination
Huizhi Software involving
Software sales
Technology (Huizhou) RMB 680,389 Huizhou Huizhou 70.95% enterprises
and services
Co., Ltd. not under
common
control
Business
combination
TIME Interconnect Processing involving
Wiring Technology RMB29.9753 million Huizhou Huizhou and 70.95% enterprises
(Huizhou) Co., Ltd. manufacturing not under
common
control
Business
combination
involving
TIME Interconnect Server Hong Hong
HKD 10,000 Trade 70.95% enterprises
Technology Co., Ltd. Kong Kong
not under
common
control
Dachuang Precision Processing
Intelligent Manufacture RMB 200,000,000 Dongguan Dongguan and 70.95% Establishment
(Dongguan) Co., Ltd. manufacturing
Business
combination
Dachuang Precision Processing involving
Intelligent Manufacture Kunshan Kunshan and 70.95% enterprises
RMB 200,000,000
(Kunshan) Co., Ltd. manufacturing not under
common
control
Huiju Dachuang Processing
Information (Shanghai) RMB 50 million Shanghai Shanghai and 70.95% Establishment
Co., Ltd. manufacturing
Processing
TIME Interconnect
RMB 50 million Wan'an Wan'an and 70.95% Establishment
Technology Limited
manufacturing
335
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Kunshan TIME Processing
Interconnect Technology RMB 250,000,000 Kunshan Kunshan and 70.95% Establishment
Limited manufacturing
Processing
Linkz Cables Mexico
MXN 50,000 Mexico Mexico and 70.95% Establishment
S.deR.L. de C.V.
manufacturing
Singapore Luxshare Co.,
USD 700,000 Marketing
Ltd. Singapore Singapore 100.00% Establishment
business
Processing
ICT Legend S. DE R.L. MXN 246,109,367
Mexico Mexico and 100.00% Establishment
DE C.V.
manufacturing
Business
combination
involving
ICT-LANTO USD 153,290,322 Hong Hong
Trade 100.00% enterprises
LIMITED(HK) Kong Kong
not under
common
control
Business
combination
Processing involving
Xuande Technology Co.,
Taiwan Taiwan and 31.15% enterprises
Ltd. NTD 1.719573 billion
manufacturing not under
common
control
Business
combination
Processing involving
Castle Rock, Inc. NTD 104,000,000 Taiwan Taiwan and 12.46% enterprises
manufacturing not under
common
control
Business
combination
involving
Cyber Acoustics, United United
USD 310,400 Trade 21.81% enterprises
LLC(USA) States States
not under
common
control
336
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Business
combination
involving
United Cayman Investment
Caldigit Holding Limited USD 3 million 12.46% enterprises
States Islands consulting
not under
common
control
Business
combination
Processing involving
Taihan Precision Co., Ltd. NTD 1,500,000,000 Taiwan Taiwan and 9.14% enterprises
manufacturing not under
common
control
Processing
Luxshare-ICT (Vietnam)
VND 2.8056336 trillion Vietnam Vietnam and 100.00% Establishment
Limited
manufacturing
Processing
Luxshare-ICT (Van
#N/A Vietnam Vietnam and 100.00% Establishment
Trung) Company Limited
manufacturing
Processing
Luxshare-ICT (Nghe An)
VND 2.663 trillion Vietnam Vietnam and 100.00% Establishment
Limited
manufacturing
Kunshan Luxshare Processing
Precision Industry Co., RMB 508,000,000 Kunshan Kunshan and 100.00% Establishment
Ltd. manufacturing
Luxshare Precision Processing
Industry (Baoding) Co., RMB 70 million Baoding Baoding and 100.00% Establishment
Ltd. manufacturing
Xuancheng Luxshare Processing
Precision Industry Co., RMB 100,000,000 Xuancheng Xuancheng and 100.00% Establishment
Ltd. manufacturing
Processing
Luxshare Electronic
RMB 100,000,000 Shanghai Shanghai and 88.00% Establishment
(Shanghai) Co., Ltd.
manufacturing
Luxshare Precision Processing
Industry (Jiangsu) Co., RMB 50 million Liyang Liyang and 100.00% Establishment
Ltd. manufacturing
Yancheng Luxshare Processing
Precision Industry Co., RMB 50 million Yancheng Yancheng and 100.00% Establishment
Ltd. manufacturing
337
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Processing
Luxshare Precision
RMB 20 million Hefei Hefei and 100.00% Establishment
Industry (Hefei) Co., Ltd.
manufacturing
Processing
Luxshare Precision
RMB 50 million Macheng Macheng and 100.00% Establishment
Industry (Hubei) Co., Ltd.
manufacturing
Luxshare Automotive Processing
Technology (Shanghai) RMB 20 million Shanghai Shanghai and 90.00% Establishment
Co., Ltd. manufacturing
Processing
Luxshare Precision
RMB 20 million Wuhu Wuhu and 100.00% Establishment
Industry (Wuhu) Co., Ltd.
manufacturing
Processing
Luxshare Precision
RMB 50 million Fuyang Fuyang and 100.00% Establishment
Industry (Anhui) Co., Ltd.
manufacturing
Business
combination
Processing involving
Kunshan Lanto Electronic
RMB 2.32 billion Kunshan Kunshan and 100.00% enterprises
Limited
manufacturing not under
common
control
Business
combination
Processing involving
Bozhou Lanto Electronic
RMB 130,000,000 Bozhou Bozhou and 100.00% enterprises
Limited
manufacturing not under
common
control
Processing
Bozhou Xuntao
RMB 2 million Bozhou Bozhou and 100.00% Establishment
Electronic Limited
manufacturing
Suining Luxshare Processing
Precision Industry Co., RMB 20 million Suining Suining and 100.00% Establishment
Ltd. manufacturing
Business
Processing combination
Merry Electronics USD 91.836735 millio
Suzhou Suzhou and 51.00% involving
(Suzhou) Co., Ltd. n
manufacturing enterprises
not under
338
Luxshare Precision Industry Co., Ltd. Annual Report 2022
common
control
Beijing Luxshare Processing
Acoustic Technology Co., RMB 10 million Beijing Beijing and 100.00% Establishment
Ltd. manufacturing
Luxshare Precision Processing
Industry (Shanxi) Co., RMB 90 million Changzhi Changzhi and 100.00% Establishment
Ltd. manufacturing
Changzhi Luxshare Processing
Precision Industry Co., RMB 20 million Changzhi Changzhi and 100.00% Establishment
Ltd. manufacturing
Processing
Suzhou Lanto Electronic
RMB 180,000,000 Suzhou Suzhou and 100.00% Establishment
Co., Ltd.
manufacturing
Processing
Wan’an Xiexun
RMB 40 million Wan'an Wan'an and 100.00% Establishment
Electronic Co., Ltd.
manufacturing
Business
combination
Processing involving
Xiexun Electronic (Ji’an) RMB 114,718,979.44
Ji'an Ji'an and 100.00% enterprises
Co., Ltd.
manufacturing not under
common
control
Business
combination
Processing involving
ASAP Technology RMB 100,924,134
Ji'an Ji'an and 93.90% enterprises
(Jiangxi) Co., Ltd.
manufacturing not under
common
control
Business
combination
Processing involving
Yongxin County Boshuo Yongxin Yongxin
RMB 20 million and 100.00% enterprises
Electronic Co., Ltd. County County
manufacturing not under
common
control
Processing
Xinyu Xiexun Electronic
RMB 11 million Xinyu Xinyu and 100.00% Establishment
Co., Ltd.
manufacturing
339
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Processing
Jiangxi ASAP Electronic
RMB 10 million Ji'an Ji'an and 100.00% Establishment
Co., Ltd.
manufacturing
Business
combination
Processing involving
Fujian JK Wiring Systems
USD 5.6 million Fuzhou Fuzhou and 55.00% enterprises
Co., Ltd..
manufacturing not under
common
control
Processing
Jianou JK Wiring Systems
RMB 4 million Jian'ou Jian'ou and 55.00% Establishment
Co., Ltd.
manufacturing
Business
combination
Luxshare Electronic Processing involving
Technology (Kunshan) RMB 2.2 billion Kunshan Kunshan and 100.00% enterprises
Co., Ltd. manufacturing not under
common
control
Shenzhen Luxshare Processing
Acoustics Technology RMB 28 million Shenzhen Shenzhen and 100.00% Establishment
Ltd. manufacturing
Fengshun Luxshare Processing
Precision Industry Co., RMB 10 million Fengshun Fengshun and 100.00% Establishment
Ltd. manufacturing
Processing
Luxshare Precision
RMB 758,000,000 Chuzhou Chuzhou and 100.00% Establishment
Industry (Chuzhou), Ltd.
manufacturing
Processing
Luxshare New Energy
RMB 180,000,000 Chuzhou Chuzhou and 100.00% Establishment
(Anhui) Co., Ltd.
manufacturing
Luxshare Precision Processing
Industry (Mingguang) RMB 50 million Chuzhou Chuzhou and 100.00% Establishment
Co., Ltd. manufacturing
Business
Processing combination
SuK Kunststofftechnik
ERU 25,564 Germany Germany and 100.00% involving
GmbH
manufacturing enterprises
not under
340
Luxshare Precision Industry Co., Ltd. Annual Report 2022
common
control
Business
combination
Processing involving
Luxshare Automation
RMB 30 million Kunshan Kunshan and 70.00% enterprises
(Jiangsu) Ltd.
manufacturing not under
common
control
Dongguan Luxshare Processing
Precision Industry Co., RMB 1 billion Dongguan Dongguan and 100.00% Establishment
Ltd. manufacturing
Guangdong Luxshare & Processing
Merry Electronics Co., RMB 200,000,000 Dongguan Dongguan and 51.00% Establishment
Ltd. manufacturing
Business
combination
Processing involving
Merry Electronics
RMB 100,000,000 Huizhou Huizhou and 51.00% enterprises
(Huizhou) Co., Ltd.
manufacturing not under
common
control
Business
combination
involving
Merry Electronics
RMB 1.65963 million Shanghai Shanghai Trade 51.00% enterprises
(Shanghai) Co., Ltd.
not under
common
control
Processing
Xingning Luxshare
RMB 8.5 million Xingning Xingning and 100.00% Establishment
Electronic Co., Ltd.
manufacturing
Jiangxi Luxshare Processing
Intelligent Manufacture RMB 1 billion Ji'an Ji'an and 100.00% Establishment
Co., Ltd. manufacturing
Processing
Shenzhen Luxshare
RMB 30 million Shenzhen Shenzhen and 70.00% Establishment
Standard Co., Ltd.
manufacturing
Processing
Luxshare Standard Hong Hong
USD 1.45764 million and 70.00% Establishment
Limited (HK) Kong Kong
manufacturing
341
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Processing
Luxshare Precision
RMB 100,000,000 Enshi Enshi and 100.00% Establishment
Industry (Enshi) Co., Ltd.
manufacturing
Luxshare Precision Processing
Industry (Suzhou) Co., RMB 130,000,000 Suzhou Suzhou and 100.00% Establishment
Ltd. manufacturing
Processing
Luxshare iTech
RMB 730,000,000 Jiashan Jiashan and 100.00% Establishment
(Zhejiang) Co., Ltd.
manufacturing
Luxshare Electronic Processing
Service (Zhejiang) Co., RMB 50 million Jiashan Jiashan and 100.00% Establishment
Ltd. manufacturing
Luxshare Intelligent Processing
Manufacture Technology RMB 1.3 billion Changshu Changshu and 100.00% Establishment
(Changshu) Co., Ltd. manufacturing
Processing
Dongguan Luxshare RMB 571,106,365.50
Dongguan Dongguan and 93.90% Establishment
Technology Co., Ltd.
manufacturing
Processing
Luxshare Technologies Hong Hong
RMB 5 million and 93.90% Establishment
Limited Kong Kong
manufacturing
Business
combination
Processing involving
Donguan Xuntao RMB 539,817,955.50
Dongguan Dongguan and 93.90% enterprises
Electronic Co., Ltd.
manufacturing not under
common
control
Processing
Xingning Luxshare
RMB 5 million Xingning Xingning and 93.90% Establishment
Technology Co., Ltd.
manufacturing
Processing
Suzhou Luxshare
RMB 200,000,000 Kunshan Kunshan and 93.90% Establishment
Technology Co., Ltd.
manufacturing
Processing
Hangzhou Xuntao
RMB 25 million Hangzhou Hangzhou and 93.90% Establishment
Technology Co., Ltd.
manufacturing
Business
Zhejiang Puxing Processing
combination
Electronic Technology RMB 14.6 million Zhejiang Zhejiang and 65.73%
involving
Co., Ltd. manufacturing
enterprises
342
Luxshare Precision Industry Co., Ltd. Annual Report 2022
not under
common
control
Dongguan Luxshare Processing
Smart-Link Electronic RMB 80 million Dongguan Dongguan and 93.90% Establishment
Technology Co., Ltd. manufacturing
Business
combination
Processing involving
Shenzhen Huarong
RMB 12.5 million Shenzhen Shenzhen and 71.39% enterprises
Technology Co., Ltd.
manufacturing not under
common
control
Business
combination
Dongguan Huarong Processing involving
Communications RMB 20 million Dongguan Dongguan and 71.39% enterprises
Technology Co., Ltd. manufacturing not under
common
control
Business
combination
Dongguan Huarong Processing involving
Supply Chain RMB 10 million Dongguan Dongguan and 71.39% enterprises
Management Co., Ltd. manufacturing not under
common
control
Business
combination
Dongguan Changlong Processing involving
Communications RMB 2 million Dongguan Dongguan and 71.39% enterprises
Technology Co., Ltd. manufacturing not under
common
control
Luxshare Rechuan Processing
Technology (Huizhou) RMB 100,000,000 Huizhou Huizhou and 65.73% Establishment
Co., Ltd. manufacturing
Business
Processing combination
Shenzhen Sanhe Rongyu
RMB 1 million Shenzhen Shenzhen and 93.90% involving
Technology Co., Ltd.
manufacturing enterprises
not under
343
Luxshare Precision Industry Co., Ltd. Annual Report 2022
common
control
Processing
Shantou Luxshare
RMB 100,000,000 Shantou Shantou and 93.90% Establishment
Technologies Co., Ltd.
manufacturing
Luxshare Technologies USD 1 million United United Marketing
93.90% Establishment
International, Inc. States States business
Processing
Luxshare Technologies
VND 105.3 billion Vietnam Vietnam and 93.90% Establishment
(Vietnam)Co., ltd
manufacturing
Processing
Luxshare Technologies
MXN 40,000 Mexico Mexico and 93.90% Establishment
Mexico S. de. R.L.de c.v.
manufacturing
Changshu Luxshare
Investment
Industrial Investment RMB 660,000,000 Changshu Changshu 100.00% Establishment
consulting
Management Co., Ltd.
Rugao Luxshare
Corporate Management Investment
RMB 2.2 billion Rugao Rugao 100.00% Establishment
Services Partnership consulting
(Limited Partnership)
Lianxun Intelligent
Equipment
Equipment (Rugao) Co., RMB 2.201 billion Rugao Rugao 100.00% Establishment
rent and sales
Ltd.
Yancheng Luxshare
Corporate Management Investment
RMB 2.2 billion Yancheng Yancheng 9.09% Establishment
Services Partnership consulting
(Limited Partnership)
Luxshare Intelligent
Equipment
Equipment (Yancheng) RMB 2.201 billion Yancheng Yancheng 9.14% Establishment
rent and sales
Co., Ltd.
Jiashan Luxshare
Investment
Business Management RMB 2.2 billion Jiashan Jiashan 9.09% Establishment
consulting
Service Partnership (LP)
Jiashan Luxshare
Equipment
Intelligent Equipment RMB 2.201 billion Jiashan Jiashan 9.14% Establishment
rent and sales
Co., Ltd.
344
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Kunshan Luxshare
Investment
Enterprise Management RMB 200,000,000 Kunshan Kunshan 100.00% Establishment
consulting
Development Co., Ltd.
Kunshan Luxshare
Corporate Management Investment
RMB 2.2 billion Kunshan Kunshan 9.09% Establishment
Services Partnership consulting
(Limited Partnership)
Luxshare Intelligent
Equipment
Equipment (Kunshan) RMB 2.201 billion Kunshan Kunshan 9.14% Establishment
rent and sales
Co., Ltd.
Luxshare Precision Processing
Technology (Xi’an) Co., RMB 50 million Xi'an Xi'an and 93.90% Establishment
Ltd. manufacturing
Luxshare Electronic Processing
RMB 245,000,000
Technology (Enshi) Co., Enshi Enshi and 100.00% Establishment
Ltd. manufacturing
Processing
Luxis Technology RMB 245,000,000
Kunshan Kunshan and 100.00% Establishment
(Kunshan) Co., Ltd.
manufacturing
Business
combination
Luxcase Precision Processing involving
RMB 6.264312296 bil
Technology (Yancheng) Yancheng Yancheng and 49.75% enterprises
lion
Co., Ltd. manufacturing not under
common
control
Business
combination
Ri Pei Computer Processing involving
Accessory (Shanghai) RMB 30.848 million Shanghai Shanghai and 49.75% enterprises
Co., Ltd. manufacturing not under
common
control
Business
combination
Ri Shan Computer Processing involving
Accessory (Jiashan) Co., RMB 1.437684 billion Jiashan Jiashan and 49.75% enterprises
Ltd. manufacturing not under
common
control
345
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Business
combination
Ri Ming Computer Processing involving
Accessory (Shanghai) RMB 638,928,568 Shanghai Shanghai and 49.75% enterprises
Co., Ltd. manufacturing not under
common
control
Business
combination
Sheng-Rui Electronic Processing involving
Technology (Shanghai) RMB 63.603 million Shanghai Shanghai and 49.75% enterprises
Limited manufacturing not under
common
control
Business
combination
Rida Intelligent Processing involving
Manufacture Technology RMB 2.5 billion Rugao Rugao and 49.75% enterprises
(Rugao) Co., Ltd. manufacturing not under
common
control
Business
combination
involving
Caseteck Singapore PTE.
USD 730,000 Singapore Singapore Trade 49.75% enterprises
LTD.
not under
common
control
Luxshare Smart Processing
Manufacturing (Rugao) RMB 100,000,000 Rugao Rugao and 49.75% Establishment
Co., Ltd. manufacturing
Luxcase Precision Processing
Technology (Kunshan) RMB 500,000,000 Kunshan Kunshan and 49.75% Establishment
Co., Ltd. manufacturing
Luxcase Precision Processing
Technology VND 172.8 billion Vietnam Vietnam and 49.75% Establishment
(Vietnam)Co., Ltd. manufacturing
Luxcase Precision Processing
Technology (Kunshan) RMB 300,000,000 Kunshan Kunshan and 100.00% Establishment
Co., Ltd. manufacturing
346
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Luxis Precision
Intelligent Manufacture RMB 100,000,000 Shantou Shantou Trade 100.00% Establishment
(Shantou) Co., Ltd.
Luxshare Intelligent
Processing
Manufacture Electronic
RMB 200,000,000 Kunshan Kunshan and 100.00% Establishment
Service (Kunshan) Co.,
manufacturing
Ltd.
Liding Electronic Processing
Technology (Dongguan) RMB 250,000,000 Dongguan Dongguan and 100.00% Establishment
Co., Ltd. manufacturing
Luxshare Precision Processing
Technology (Nanjing) RMB 50 million Nanjing Nanjing and 100.00% Establishment
Co., Ltd. manufacturing
Fengshun Luxshare Processing
Intelligent Manufacture RMB 250,000,000 Fengshun Fengshun and 100.00% Establishment
Co., Ltd. manufacturing
Lisen Precision Processing
Technology (Kunshan) RMB 170,000,000 Kunshan Kunshan and 76.47% Establishment
Co., Ltd. manufacturing
Processing
Luxshare Precision
RMB 250,000,000 Huzhou Huzhou and 100.00% Establishment
Industry (Huzhou), Ltd.
manufacturing
Dongguan Luxshare Investment
RMB 200,000,000 Dongguan Dongguan 100.00% Establishment
Holdings Co., Ltd. consulting
Descriptions on the difference between the shareholding ratio and the voting right ratio in the subsidiary:
Basis for holding half or less voting rights but still controlling the investee, and holding more than half of the voting rights but not
controlling the investee:
Basis for the control of significant structured entities included in the consolidation scope:
Basis for determining whether a company is an agent or a principal:
Other descriptions:
(2) Significant non-wholly-owned subsidiaries
In RMB
Dividends declared and
Profit or loss attributable Balance of minority
Shareholding ratio of distributed to minority
Name of subsidiary to minority shareholders interest at the end of the
minority shareholders shareholders in the
in the current period period
current period
347
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Luxcase Precision 50.25% 987,343,269.80 7,584,967,985.49
Technology (Yancheng)
Co., Ltd.
Descriptions on the difference between the shareholding ratio of minority shareholders and their voting right ratio in the subsidiary:
Other descriptions:
(3) Main financial information of significant non-wholly-owned subsidiaries
In RMB
Closing balance Opening balance
Name
of Curren Non- Curren Non-
Non- Total Non- Total
subsidi Curren Total t current Curren Total t current
current liabiliti current liabiliti
ary t assets assets liabiliti liabiliti t assets assets liabiliti liabiliti
assets es assets es
es es es es
Luxcas
e
Precisi
on
25,423 10,372 35,795 20,145 541,75 20,687 21,717 10,085 31,803 18,462 299,40 18,762
Techn
,036,0 ,710,9 ,747,0 ,946,8 4,886. ,701,7 ,382,0 ,761,9 ,143,9 ,805,7 3,365. ,209,0
ology
44.85 92.02 36.87 53.72 17 39.89 26.08 27.48 53.56 11.46 43 76.89
(Yanch
eng)
Co.,
Ltd.
In RMB
Amount recognized in the current period Amount recognized in the prior period
Name of Total Cash flow Total Cash flow
subsidiary Operating comprehen from Operating comprehen from
Net profits Net profits
income sive operating income sive operating
incomes activities incomes activities
Luxcase
Precision 79,079,113, 1,965,034,2 2,067,110,4 6,533,472,1 74,186,807, 1,943,749,0 2,044,371,4 5,913,355,5
Technology 772.15 91.16 20.31 94.48 358.22 80.02 35.54 69.06
(Yancheng)
Other descriptions:
Other descriptions:
2. Transactions in which the share of owners’ equity in the subsidiary changes and still controls the subsidiary
(1) Descriptions on changes in the shares of owners’ equity in subsidiaries
(2) Impact of transactions on minority interest and owners’ equity attributable to the parent company
In RMB
348
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Acquisition cost/ disposal consideration
--Cash
-- Fair value of non-cash assets
Total acquisition cost/ disposal consideration
Less: share of subsidiaries’ net assets calculated by the
proportion of acquired/disposed equity shares
Difference
Including: Adjustment to capital reserve
Adjustment to surplus reserve
Adjustment to undistributed profits
Other descriptions:
3. Equity in joint ventures or associates
(1) Summary financial information of insignificant joint ventures and associates
In RMB
Closing balance/Amount recognized in Opening balance/Amount recognized in
the current period the prior period
Joint ventures:
Total book value of investment 132,877,500.01 119,066,960.41
Total amount of the following items
calculated according to shareholding ratio
--Net profit 15,859,552.50 23,777,786.12
--Other comprehensive income 2,113,184.27
--Total comprehensive income 15,859,552.50 25,890,970.39
Associates:
Total book value of investment 4,100,064,241.04 1,880,940,682.25
Total amount of the following items
calculated according to shareholding ratio
--Net profit 2,028,502,057.39 770,981,706.30
--Other comprehensive income -7,598,398.15 -65,915.00
--Total comprehensive income 2,020,903,659.24 770,915,791.30
Other descriptions:
349
Luxshare Precision Industry Co., Ltd. Annual Report 2022
XI. Government Grants
1. Government grants recognized as receivables at the end of the reporting period
□Applicable N/A
Reasons for not receiving government grants as expected at the anticipated timing
□Applicable N/A
2. Liabilities related to government grant
Applicable □N/A
In RMB
Amount of
non- Amount
Amount of
operating transferred to Other
new Related to
Accounting Opening income other income changes for Closing
subsidies for assets/incom
subjects balance recognized for the the current balance
the current e
for the current period
period
current period
period
Deferred 665,910,095. 118,233,376. 188,819,870. 595,323,601. Related to
revenue 66 14 75 05 assets
3. Government grants recognized in the current period's profit or loss
Applicable □N/A
In RMB
Accounting subject Amount recognized in the current period Amount recognized in the prior period
Other income - Directly recorded 602,278,917.77 426,692,467.71
Offset financial expenses - Directly
10,000,000.00
recorded
Other income - Transfer from deferred
188,819,870.75 175,601,796.19
income
Total 801,098,788.52 602,294,263.90
Other descriptions:
XII. Risks associated with financial instruments
1. Types of risks generated by financial instruments
1． Credit risk
Credit risks refer to the risks that one party to a financial instrument suffers financial losses due to the failure of the other party
to perform its obligations. The customer credit risks mainly faced by the Company come from credit sale. Before signing a new contract,
350
Luxshare Precision Industry Co., Ltd. Annual Report 2022
the Company will assess the credit risks generated by new customers from perspectives such as external credit rating and, in some
cases, bank credit certification (when the same is available). The Company has a credit limit, which is the maximum amount without
additional approval, for each customer.
The Company ensures that its overall credit risk is within the controllable range through quarterly monitoring of credit rating of
existing customers and monthly review of aging analysis of accounts receivable. Customers are grouped according to their credit
characteristics when the credit risks from them are monitored. Customers rated as “high risk” will be placed on the restricted customer
list, and only with additional approval can the Company sell them on credit in the future period, otherwise they must be required to pay
the corresponding amount in advance.
2. Liquidity Risk
Liquidity risk refers to the risk of funds shortage when an enterprise is obligated to settle its obligations by delivering cash or
other financial assets.
Our company's policy is to ensure sufficient cash to repay maturing debts. Liquidity risk is centrally controlled by our company's
finance department. The finance department monitors cash balances, marketable securities that can be liquidated at any time, and
rolling forecasts of cash flows for the next 12 months to ensure that the company has sufficient funds to repay debts under all reasonable
forecasts. Simultaneously, it continuously monitors compliance with loan agreements, obtains commitments from major financial
institutions to provide sufficient standby funds to meet short-term and long-term funding needs.
The financial liabilities of our company are listed below based on undiscounted contractual cash flows by maturity date:
351
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Closing balance
Im Total
Ite More
mediate Within 1 1-2 2-5 undiscounted Book
m than 5
repayme year years years contract value
years
nt amount
No 492,585, 492,585, 492,585,
tes 900.03 900.03 900.03
payable
Ac 45,908,5 45,908,5 45,908,5
counts 15,295.43 15,295.43 15,295.43
payable
Ot 406,677, 406,677, 406,677,
her 940.53 940.53 940.53
payable
s
Sh 20,514,1 20,514,1 20,514,1
ort- 82,240.47 82,240.47 82,240.47
term
loan
Sh 2,867,29 2,867,29 2,867,29
ort- 5,870.89 5,870.89 5,870.89
term
loan
Lo 1,905,1 9,770,4 363,14 12,038,7 12,038,7
ng-term 78,810.77 46,879.15 5,600.00 71,289.92 71,289.92
loan
Ot 802,722, 802,722, 802,722,
her 191.78 191.78 191.78
current
liabiliti
es
(short-
term
352
Luxshare Precision Industry Co., Ltd. Annual Report 2022
financi
ng
notes)
Tot 70,991,9 1,905,1 9,770,4 363,14 83,030,7 83,030,7
al 79,439.13 78,810.77 46,879.15 5,600.00 50,729.05 50,729.05
As of the end of this reporting period, the balance of lease liabilities of the company amounted to RMB
681,696,441.33, with an amount due within 1 year of RMB 129,207,552.67.
3. Market risks
Market risks of financial instruments refer to the risks that the fair value or future cash flow of financial instruments will fluctuate
due to market price changes, including exchange rate risk, interest rate risk and other price risks.
(1) Interest rate risk
Interest rate risk refers to the risk of fluctuations in the fair value or future cash flows of financial instruments due to changes in
market interest rates.
Fixed-rate and floating-rate interest-bearing financial instruments expose our company to fair value interest rate risk and cash
flow interest rate risk, respectively. Our company determines the proportion of fixed-rate and floating-rate instruments based on market
conditions and maintains an appropriate mix of fixed and floating-rate instruments through regular reviews and monitoring. When
necessary, our company utilizes interest rate swap instruments to hedge interest rate risk.
(2) Exchange rate risk
Exchange rate risk refers to the risk that the fair value of financial instruments or future cash flow will fluctuate due to the change
in foreign exchange rate.
The company continues to monitor the scale of foreign currency transactions and foreign currency assets and liabilities to
minimize exposure to foreign exchange risk. Additionally, the company may enter into forward foreign exchange contracts or currency
swap agreements to mitigate exchange rate risk. For the current and prior periods, the company has not entered into any forward foreign
exchange contracts or currency swap agreements.
The foreign exchange risk faced by the company primarily stems from financial assets and financial liabilities denominated in
US dollars. The amounts of foreign currency financial assets and foreign currency financial liabilities converted into Renminbi are
detailed in foreign currency monetary items.
(3) Other price risks
Other price risk refers to the risk of fluctuations in the fair value or future cash flows of financial instruments due to market price
changes other than exchange rate risk and interest rate risk.
The other price risk faced by the company primarily arises from investments in various equity instruments, exposing the company
to the risk of fluctuations in equity instrument prices.
Item Closing balance Balance at the end of last
year
Other investments in equity 414,859,257.92
200,829,853.18
instruments
Total 200,829,853.18 414,859,257.92
353
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2. Financial assets
(1) Classification by transfer method
Applicable □N/A
In RMB
Nature of transferred
Amount of transferred Termination Basis for termination
Transfer methods financial assets
financial assets confirmation status confirmation judgment
Transfer of risks and
Sale Accounts receivable 17,945,216,138.03 Termination confirmed
reward
Discounting, Transfer of risks and
Receivables financing 4,579,914,056.32 Termination confirmed
endorsement reward
Discounting,
Notes receivable 337,335,907.43 Not terminated
endorsement
Total 22,862,466,101.78
(2) Financial assets terminated due to transfer
Applicable □N/A
In RMB
Methods of financial asset
Amount of financial assets Gains or losses related to
Item transfer
terminated for recognition termination recognition
Accounts receivable Sale
17,945,216,138.03 -601,291,208.81
Receivables financing Discounting, endorsement 4,579,914,056.32 -140,051,339.94
Total 22,525,130,194.35 -741,342,548.75
(3) Continued involvement in transferred financial assets
Applicable □N/A
In RMB
Asset transfer method Amount of assets formed due Amount of liabilities formed
Item
to continued involvement due to continued involvement
Notes receivable Discounting, endorsement 225,054,602.71 225,054,602.71
Total 225,054,602.71 225,054,602.71
Other descriptions
354
Luxshare Precision Industry Co., Ltd. Annual Report 2022
XIII. Disclosure of fair value
1. Closing fair value of assets and liabilities measured at fair value
In RMB
Closing fair value
Item
Level I Level II Level I Total
I. Continuous fair value
-- -- -- --
measurement
(I) Held-for-trading
92,485,140.01 1,628,279,035.31 1,720,764,175.32
financial assets
1. Financial assets at
fair value through profit 92,485,140.01 1,628,279,035.31 1,720,764,175.32
or loss
(3) Derivative financial
92,485,140.01 92,485,140.01
assets
(4) Others 1,628,279,035.31 1,628,279,035.31
(III) Investment in other
172,691,671.36 76,430,579.96 249,122,251.32
equity instruments
(VI) Receivables
financing 587,585,009.82 587,585,009.82
(VII) Other non-current
35,700,000.00 35,700,000.00
financial assets
1. Total assets
continuously measured 35,700,000.00 35,700,000.00
at fair value
(1) Investment in equity
35,700,000.00 35,700,000.00
instruments
Total assets
continuously measured 172,691,671.36 92,485,140.01 2,327,994,625.09 2,593,171,436.46
at fair value
(VI) Held-for-trading
117,942,421.18 117,942,421.18
financial liabilities
Derivative
117,942,421.18 117,942,421.18
financial liabilities
Total liabilities
continuously measured 117,942,421.18 117,942,421.18
at fair value
II. Non-continuous fair
-- -- -- --
value measurement
2. Basis for determining the market price of the items continuously and not continuously measured at fair
value at level I
Level I inputs are quoted market price (unadjusted) in an active market for an identical asset or liability available at
355
Luxshare Precision Industry Co., Ltd. Annual Report 2022
the date of measurement.
3. Valuation technology and qualitative and quantitative information of important parameters used in the
items continuously and not continuously measured at fair value at level II.
Level II inputs are inputs other than quoted market price (Level I) that are directly or indirectly observable for the
asset or liability.
4. Valuation technology and qualitative and quantitative information of important parameters used in the
items continuously and not continuously measured at fair value at level III
Level III inputs are unobservable inputs for the asset or liability.
5. Adjustment information between the opening book value and the closing book value, and the sensitivity
analysis of unobservable parameters for items continuously measured at fair value at level III
6. For items continuously measured at fair value, if there is conversion between different levels in the current
period, the reasons for the conversion and the policy for determining the conversion time point
7. Changes in valuation technology in the current period and reasons for changes
8. Fair value of financial assets and financial liabilities not measured at fair value
9. Others
XIV. Related parties and related-party transactions
1. The parent company of the Company
Shareholding ratio of Voting rights ratio of
Name of parent
Place of registration Nature of business Registered capital the parent company the parent company
company
in the Company in the Company
Luxshare Limited Hong Kong Industry HKD10,000 38.15% 38.15%
356
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Descriptions on the parent company of the Company
As of December 31, 2023, Luxshare Limited has pledged 39.38% of shares it held.
The ultimate controller of the Company is WANG Laichun and WANG Laisheng.
Other descriptions:
2. Subsidiaries of the Company
Please refer to Note “X. Equity in other entities” for details of the Company’s subsidiaries
3. Joint ventures and associates of the Company
Please refer to Note “X Equity in joint ventures or associates” for details of the Company’s significant joint ventures or associates.
Other joint ventures or associates that have related-party transactions with the Company in the current period or formed a balance due
to related-party transactions with the Company in the prior period are as follows:
Name of joint venture or associate Relationship with the Company
Joint-stock company of a majority-owned sub-subsidiary of the
Riyimao Industrial Co., Ltd.
Company
Joint-stock company of a majority-owned sub-subsidiary of the
Assem Technology Co., Ltd.
Company
Joint-stock company of a majority-owned sub-subsidiary of the
Xuande Energy Co., Ltd.
Company
Lihao Optoelectronics Technology (Nantong) Co., Ltd. Joint-stock company of a majority-owned subsidiary of the
Company
Xinhao Photoelectric Technology (HK) Limited Joint-stock company of a majority-owned subsidiary of the
Company
MERRY & LUXSHARE (VIETNAM) CO., Ltd. Joint-stock company of the Company’s subsidiary
Zhuhai Kinwong Flexible Circuit Co., Ltd. Associates of the Company
Lisheng Automotive Technology (Guangzhou) Co., Ltd. Associates of the Company
Other descriptions:
4. Other related parties
Name of other related parties Relationship between other related parties and the Company
BCS Automotive Technology (Shenzhen) Co., Ltd. An enterprise controlled by the Company’s parent company
BCS Automotive Technology (Suzhou) Co., Ltd. An enterprise controlled by the Company’s parent company
Luxsan Technology (Kunshan) Co., Ltd. An enterprise controlled by the Company’s parent company
Luxsan Precision Intelligent Manufacture (Kunshan) Co., Ltd. An enterprise controlled by the Company’s parent company
Luxsan Investment (Jiangsu) Co., Ltd. An enterprise controlled by the Company’s parent company
Luxsan Intelligent Equipment (Kunshan) Co., Ltd. An enterprise controlled by the Company’s parent company
LUXSAN TECHNOLOGY LIMITED An enterprise controlled by the Company’s parent company
357
Luxshare Precision Industry Co., Ltd. Annual Report 2022
BCS Automotive Interface Solutions GmbH (Germany) An enterprise controlled by the Company’s parent company
BCS Automotive Interface Solutions US, LLC (USA) An enterprise controlled by the Company’s parent company
BCS Automotive Interface Solutions
An enterprise controlled by the Company’s parent company
Romania s.r.l. (Romania)
BCS Automotive Interface Solutions s.r.o. (Czech) An enterprise controlled by the Company’s parent company
BCS-AIS Ensambles Mexico S. de R.L.de
An enterprise controlled by the Company’s parent company
C.V. (Mexico)
Guangzhou Luxvisions Innovation Technology Limited Other related party of the Company
Luxvisions Innovation (Ji’an) Co., Ltd. Other related party of the Company
Luxvisions Innovation Technology Co., Ltd. Other related party of the Company
LUXVISIONS INNOVATION TECHNOLOGY LIMITED Other related party of the Company
Xinguang Energy Technology (Anhui) Co., Ltd. Other related party of the Company
Dongguan Terry Leather Co., Ltd. Other related party of the Company
Terry Smart Manufacturing (Dongguan) Technology Co., Ltd. Other related party of the Company
Teleray (Hong Kong) International Company Limited Other related party of the Company
Dongguan Gaowei Optical Electronics Co., Ltd. Other related party of the Company
Shangrao City Luxvisions Innovation Technology Co., Ltd. Other related party of the Company
Xinhao Photoelectric Technology (HK) Limited Other related party of the Company
COWELL OPTIC ELECTRONICS LTD Other related party of the Company
Chery Automobile Co., Ltd. Other related party of the Company
Chery Automobile Henan Co., Ltd. Other related party of the Company
Chery Commercial Vehicle (Anhui) Co., Ltd. Other related party of the Company
Terry Precision Corporation Other related party of the Company
Terry Smart Manufacturing (Dongguan) Technology Co., Ltd. Other related party of the Company
Xinhao Photoelectric Technology Limited Other related party of the Company
Xunmu Information Technology (Shanghai) Co., Ltd. An enterprise controlled by the Company’s parent company
Lishan Smart Manufacturing Technology (Guangdong) Co., Ltd. An enterprise controlled by the Company’s parent company
Other descriptions:
5. Related-party transactions
(1) Related-party transactions of purchasing and selling goods, rendering and accepting services
Purchasing goods/accepting services
In RMB
Amount Whether the Amount
Related-party Approved
Related party recognized in the transaction limit is recognized in the
transactions transaction limit
current period exceeded prior period
Riyimao Industrial Processing
8,666,666.79 No 19,083,384.89
Co., Ltd. services
Assem Technology Equipment and
517,891.33 No 1,642,783.57
Co., Ltd. appliances
358
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Assem Technology
Other services 25,501,235.88 No 1,015,414.60
Co., Ltd.
Assem Technology
Purchasing goods 443,692.28 No 20,623,798.84
Co., Ltd.
BCS Automotive
Technology Purchasing fixed
221,636.87 No
(Shenzhen) Co., assets
Ltd.
BCS Automotive
Technology Purchasing goods 18,700,732.83 45,000,000.00 No 23,441,183.61
(Suzhou) Co., Ltd.
Guangzhou
Luxvisions
Innovation Purchasing goods No 573,252.39
Technology
Limited
Guangzhou
Luxvisions
Innovation Service fees 3,663,133.48 No 2,365,923.22
Technology
Limited
Guangzhou
Luxvisions
Innovation Equipment 76,318.48 No 9,050.00
Technology
Limited
Luxvisions
Innovation
Service fees 33,849.06 No
Technology (Ji'an)
Limited
Luxvisions
Innovation Equipment and
429,489.75 No
Technology appliances
Limited
Luxvisions
Innovation
Rent and utilities No 844,931.03
Technology
Limited
LUXVISIONS
INNOVATION
Purchasing goods 457,613.05 No
TECHNOLOGY
LIMITED
LUXVISIONS
INNOVATION Equipment and
914,452.98 No
TECHNOLOGY appliances
LIMITED
Luxsan
Technology
Purchasing goods No 311,176,270.99
(Kunshan) Co.,
Ltd.
Luxsan Precision
Intelligent Utilities 9,658,090.82 No 36,498,229.20
Manufacture
359
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(Kunshan) Co.,
Ltd.
Luxsan Investment
Purchasing goods 39,528,673.28 130,000,000.00 No
(Jiangsu) Co., Ltd.
LUXSAN
TECHNOLOGY Purchasing goods 1,189,126,782.26 1,200,000,000.00 No 1,037,899,802.32
LIMITED
MERRY &
LUXSHARE
Purchasing goods 71,739,173.68 No 63,555,616.23
(VIET NAM)
CO.,LTD
BCS Automotive I
nterface Solutions Purchasing goods 36,595,812.14 70,000,000.00 No 33,585,700.71
GmbH (Germany)
BCS Automotive I
nterface Solutions Purchasing goods 92,923.55 100,000,000.00 No
US, LLC (USA)
BCS Automotive
Interface Solutions
Purchasing goods 5,410,212.91 No
Romania s.r.l.
(Romania)
Xinguang Energy
Technology Outsourcing fees 900,429.00 No
(Anhui) Co., Ltd.
Lihao
Optoelectronics
Technology Purchasing goods 4,320,397.20 No 336,203.20
(Nantong) Co.,
Ltd.
Dongguan Terry
Purchasing goods No 802,216.95
Leather Co., Ltd.
Terry Smart
Manufacturing
(Dongguan) Purchasing goods 39,367,448.03 No 1,139,462.18
Technology Co.,
Ltd.
Terry Smart
Manufacturing
(Dongguan) Service fees 890,219.06 No
Technology Co.,
Ltd.
Terry Smart
Manufacturing
Purchasing fixed
(Dongguan) 1,726,385.36 No
assets
Technology Co.,
Ltd.
Teleray (Hong
Kong)
Purchasing goods 2,709,161.11 No 943,970.54
International
Company Limited
Xunmu
Purchasing goods No 9,763,593.17
Information
360
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Technology
(Shanghai) Co.,
Ltd.
Dongguan Gaowei
Optical Electronics Service fees 11,517,032.81 No 2,474,770.49
Co., Ltd.
Lishan Smart
Manufacturing
Technology Rent and utilities 2,389,436.16 No 1,022,581.35
(Guangdong) Co.,
Ltd.
Selling goods/rendering services
In RMB
Amount recognized in the Amount recognized in the
Related party Related-party transactions
current period prior period
Assem Technology Co., Ltd. Other services 2,546,700.11 1,026,668.20
Shangrao City Luxvisions
Innovation Technology Co., Selling goods 122,520.00
Ltd.
Guangzhou Luxvisions
Innovation Technology Equipment and apparatus 534,229.50
Limited
Guangzhou Luxvisions
Innovation Technology Selling goods 132,801,682.91 4,182,806.58
Limited
BCS Automotive Technology
Selling goods 396,983,841.26 394,380,063.81
(Suzhou) Co., Ltd.
Luxvisions Innovation Tech
Service fees 495,622.71
Limited
BCS Automotive Interface So
Selling goods 6,727,835.59 533,646.76
lutions GmbH (Germany)
BCS Automotive Interface
Solutions Selling goods 27,529,559.67
Romania s.r.l. (Romania)
BCS Automotive Interface So
Selling goods 24,226,761.76 1,383,127.79
lutions US, LLC (USA)
BCS Automotive Interface So
Selling goods 94,165.76
lutions s.r.o. (Czech)
Luxsan Technology
Selling goods 78,602,371.08 643,619,515.80
(Kunshan) Co., Ltd.
Luxsan Precision Intelligent
Manufacture (Kunshan) Co., Selling goods 36,934,393.03 55,980,332.83
Ltd.
Luxsan Precision Intelligent
Manufacture (Kunshan) Co., Selling goods 230,417,667.66
Ltd.
LUXSAN TECHNOLOGY Selling fixed assets 8,550,535.36
361
Luxshare Precision Industry Co., Ltd. Annual Report 2022
LIMITED
Luxsan Investment (Jiangsu)
Selling goods 5,047,357.29
Co., Ltd.
LUXSAN TECHNOLOGY
Selling goods and service fees 832,394,772.18 19,117,778.28
LIMITED
Xunmu Information
Technology (Shanghai) Co., Selling goods 3,200.00 14,868,596.51
Ltd.
MERRY &
LUXSHARE(VIET NAM) Selling goods 36,766,791.14 15,844,650.03
CO.,LTD
MERRY &
LUXSHARE(VIET NAM) Service fees 16,173,198.52 15,994,272.36
CO.,LTD
Lihao Optoelectronics
Technology (Nantong) Co., Selling goods 19,675,233.05 3,922,201.00
Ltd.
Xinhao Photoelectric R&D and marketing
258,979.73 4,287,145.58
Technology (HK) Limited consulting fees
BCS Automotive Technology
Selling goods 550.00
(Shenzhen) Co., Ltd.
Xinguang Energy Technology
Selling goods 12,998,999.82
(Anhui) Co., Ltd.
Xinhao Photoelectric
Service fees 195,600.00
Technology Limited
Dongguan Gaowei Optical
Selling goods 8,059,987.00 991,782.45
Electronics Co., Ltd.
Dongguan Gaowei Optical
Service fees 148,944.09
Electronics Co., Ltd.
Lisheng Automotive
Technology (Guangzhou) Co., Selling goods 1,337,518.57
Ltd.
COWELL OPTIC
Selling goods 47,483,807.36 117,926,402.49
ELECTRONICS LTD
Chery Automobile Co., Ltd. Selling goods 102,949,356.35 28,562,202.47
Chery Automobile Co., Ltd. Service fees 404,966.04
Chery Automobile Henan Co.,
Selling goods -479,403.24 559,356.88
Ltd.
Chery Commercial Vehicle
Selling goods 18,196,506.19 220,361.59
(Anhui) Co., Ltd.
Dongguan Terry Leather Co.,
Selling goods 690,004.06
Ltd.
Terry Smart Manufacturing
(Dongguan) Technology Co., Selling goods 11,724.37 10,550.18
Ltd.
Terry Smart Manufacturing
(Dongguan) Technology Co., Selling goods 1,764,651.29 112,247.00
Ltd.
Terry Smart Manufacturing Selling fixed assets 2,000.00
362
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(Dongguan) Technology Co.,
Ltd.
Terry Smart Manufacturing
(Dongguan) Technology Co., Service fees 353,771.00
Ltd.
Descriptions on related-party transactions of purchasing and selling goods, and rendering and accepting services
On February 21, 2023, the Company held the 15th meeting of the fifth session of Board of Directors, deliberating
and approving the Proposal on the Prediction of Increase in Daily Related-party Transactions of the Company in
2023:
to purchase goods from BCS Automotive Technology (Suzhou) Co., Ltd. in the amount of up to RMB
45,000,000.00;
to purchase goods from BCS Automotive Interface Solutions GmbH (Germany) in the amount of up to RMB
70,000,000.00;
to purchase goods from LUXSAN TECHNOLOGY LIMITED in the amount of up to RMB 1,200,000,000.00;
to purchase goods from Luxsan Investment (Jiangsu) Co., Ltd. in the amount of up to RMB 130,000,000.00;
to purchase goods from BCS Automotive Interface Solutions US, LLC (USA) in the amount of up to RMB
100,000,000.00;
to sell goods to BCS Automotive Technology (Suzhou) Co., Ltd. in the amount of up to RMB 850,000,000.00
to sell goods/provide labor to LUXSAN TECHNOLOGY LIMITED in the amount of up to RMB
1,800,000,000.00;
to sell goods to Cowell Optic Electronics Limited in the amount of up to RMB 360,000,000.00;
to sell goods to Luxsan Intelligent Equipment (Kunshan) Co., Ltd. in the amount of up to RMB 350,000,000.00;
to sell goods to Luxsan Investment (Jiangsu) Co., Ltd. in the amount of up to RMB 55,000,000.00;
to sell goods to BCS Automotive Interface Solutions US, LLC (USA) in the amount of up to RMB
40,000,000.00;
(2) Related-party lease
The Company acts as the lessor:
In RMB
Lease income recognized in the Lease income recognized in the
Name of lessee Types of leased assets
current period prior period
The Company acts as the lessee:
In RMB
Categor Expenses related Variable lease Assumed interest
Added right-of-use
Lessor y of to short-term payments through Paid rent expenses of lease
assets
leased leases and low- profit or loss not liabilities
363
Luxshare Precision Industry Co., Ltd. Annual Report 2022
assets value assets leases included in the
subject to measurement of
simplified lease liabilities, if
treatment, if any any
Amoun Amoun Amoun Amoun Amoun Amoun Amoun Amoun Amoun Amoun
t t t t t t t t t t
recogni recogni recogni recogni recogni recogni recogni recogni recogni recogni
zed in zed in zed in zed in zed in zed in zed in zed in zed in zed in
the the the the the the the the the the
current prior current prior current prior current prior current prior
period period period period period period period period period period
Luxsan
Precisio
n
Fixed
Intellig
assets
ent 30,600, 2,615,0
and
Manufa 000.00 51.89
buildin
cture
gs
(Kunsh
an) Co.,
Ltd.
Luxsan
Fixed
Investm
assets
ent 1,984,1
and
(Jiangs 24.96
buildin
u) Co.,
gs
Ltd.
Luxvisi
ons Fixed
Innovat assets
2,415,7 51,827. 170,770 17,685,
ion and
40.00 16 .30 567.07
(Ji’an) buildin
Co., gs
Ltd.
Descriptions on related-party leases
(3) Remuneration of key managers
In RMB
Item Amount recognized in the current period Amount recognized in the prior period
Compensation of key managers 12,830,400.00 13,665,822.35
Share-based payment of key managers 12,019,751.67 3,842,203.80
364
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(4) Other related-party transactions
6. Accounts receivable and payable of related parties
(1) Receivables
In RMB
Closing balance Opening balance
Item Related party
Book balance Bad-debt provision Book balance Bad-debt provision
Accounts
receivables
BCS Automotive
Interface Solutions 1,324,482.00 662.24
GmbH(Germany)
BCS Automotive
Interface Solutions
14,600,815.64 7,300.41
Romania s.r.l.
(Romania)
BCS Automotive
Interface Solutions 20,232,577.86 10,116.29 24,913.91 12.46
US,LLC(USA)
BCS Automotive
Interface Solutions 83,825.90 41.91
s.r.o.(Czech)
COWELL OPTIC
ELECTRONICS 92,216.75 46.11 89,178,452.13 44,589.23
LTD
LUXSAN
TECHNOLOGY 250,986,471.18 125,493.24 3,036,189.27 1,518.09
LIMITED
MERRY &
LUXSHARE(VIE
20,589,657.46 10,294.83 8,503,901.75 4,251.95
T NAM)
CO.,LTD
XINHAO
PHOTOELECTRI
43,319.52 21.66
C TECHNOLOGY
(HK)
Assem Technology
1,412,127.29 706.06 335,321.60 167.66
Co., Ltd.
Dongguan Gaowei
Optical Electronics 8,992,751.31 4,496.38
Co., Ltd.
Guangzhou
Luxvisions
Innovation 137,683,353.53 68,841.68 3,407,360.47 1,703.68
Technology
Limited
Lisheng
1,511,395.99 755.70
Automotive
365
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Technology
(Guangzhou) Co.,
Ltd.
Lihao
Optoelectronics
Technology 1,272,105.69 636.05
(Nantong) Co.,
Ltd.
BCS Automotive
Technology
621.50 0.31
(Shenzhen) Co.,
Ltd.
BCS Automotive
Technology 302,574,007.23 151,287.00 321,616,341.01 160,808.17
(Suzhou) Co., Ltd.
Luxsan Precision
Intelligent
Manufacture 32,616,026.16 16,308.01
(Kunshan) Co.,
Ltd.
Luxsan
Technology
173,086,093.05 86,543.05
(Kunshan) Co.,
Ltd.
Luxsan Investment
2,962,511.55 1,481.26
(Jiangsu) Co., Ltd.
Luxsan Intelligent
Equipment
184,417,695.50 92,208.85
(Kunshan) Co.,
Ltd.
Chery Automobile
50,708,439.08 25,354.22 6,792,611.72 3,396.31
Co., Ltd.
Chery Automobile
408.97 0.20 632,073.27 316.04
Henan Co., Ltd.
Chery Commercial
Vehicle (Anhui) 19,452,711.52 9,726.36 249,008.60 124.50
Co., Ltd.
Shangrao City
Luxvisions
Innovation 118,085.00 59.04
Technology Co.,
Ltd.
Xinhao
Photoelectric
207,336.00 103.67
Technology (HK)
Limited
Terry Smart
Manufacturing
(Dongguan) 2,371,233.21 1,185.62 126,839.11 63.42
Technology Co.,
Ltd.
Xinguang Energy
15,854,406.07 7,927.20
Technology
366
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(Anhui) Co., Ltd.
Xunmu
Information
Technology 2,848,819.77 1,424.41
(Shanghai) Co.,
Ltd.
Other receivables
BCS Automotive
Interface Solutions 4,150,973.34
GmbH(Germany)
BCS Automotive
Interface Solutions 1,835,605.65
US,LLC(USA)
COWELL OPTIC
ELECTRONICS 566,896.90 2,834.48
LTD
MERRY &
LUXSHARE
54,214.88 271.07 83,591.01 417.96
(VIET NAM)
CO.,LTD
Xinhao
Photoelectric
126,709.50 633.55 19,207.53 96.04
Technology (HK)
Limited
Dongguan Gaowei
Optical Electronics 10,121.46 50.61
Co., Ltd.
Guangzhou
Luxvisions
Innovation 6,620,554.60 33,102.77
Technology
Limited
Lihao
Optoelectronics
Technology 3,922,636.50 19,613.18
(Nantong) Co.,
Ltd.
BCS Automotive
Technology 183,851.00 919.26 5,699,756.88 28,498.78
(Suzhou) Co., Ltd.
Luxsan
Technology
9,349.09 46.75
(Kunshan) Co.,
Ltd.
Teleray (Hong
Kong)
373,541.60 1,867.71
International
Company Limited
Xuande Energy
164,996.62 824.98
Co., Ltd.
367
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Prepayments
BCS Automotive
Interface Solutions 16,758.58 10,761,181.73
GmbH(Germany)
BCS Automotive
Interface Solutions
8,626,289.64
Romania s.r.l.
(Romania)
BCS Automotive
Interface Solutions 1,468,031.23
US,LLC(USA)
Notes receivable
Bisaisi Automotive
Technology 12,071,807.98
(Suzhou) Co., Ltd.
(2) Payables
In RMB
Item Related party Closing book balance Opening book balance
Accounts payable
BCS Automotive Interface
Solutions 2,729.66
Romania s.r.l. (Romania)
BCS Automotive Interface
Solutions 10,064,934.58
US,LLC(USA)
BCS Automotive Interface
Solutions 382,381.23
GmbH(Germany)
LUXSAN TECHNOLOGY
338,536,004.32 907,791,605.59
LIMITED
LUXVISIONS
INNOVATION 585,128.90
TECHNOLOGY LIMITED
MERRY & LUXSHARE
43,589,524.60 13,129,894.24
(VIET NAM) CO.,LTD
Assem Technology Co., Ltd. 11,442,488.98 6,958,457.33
Dongguan Gaowei Optical
2,404,063.04
Electronics Co., Ltd.
Guangzhou Luxvisions
Innovation Technology 1,217,397.22 149,969.97
Limited
Xinguang Energy Technology
713,564.13
(Anhui) Co., Ltd.
Lihao Optoelectronics 3,012,052.57 267,949.42
368
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Technology (Nantong) Co.,
Ltd.
Luxvisions Innovation (Ji’an)
4,380.00 1,811,805.00
Co., Ltd.
Luxvisions Innovation
75,514.52
Technology Limited
Lishan Smart Manufacturing
Technology (Guangdong) Co., 892,581.04 1,112,875.90
Ltd.
BCS Automotive Technology
9,829,821.10 7,368,354.63
(Suzhou) Co., Ltd.
Luxsan Precision Intelligent
Manufacture (Kunshan) Co., 80,467,446.67
Ltd.
Luxsan Technology
1,054,198.48
(Kunshan) Co., Ltd.
Luxsan Investment (Jiangsu)
38,169,781.48
Co., Ltd.
Riyimao Industrial Co., Ltd. 5,532,481.51 9,959,460.45
Teleray (Hong Kong)
International Company 2,520,685.43 899,233.35
Limited
Terry Smart Manufacturing
(Dongguan) Technology Co., 14,283,178.83 1,653,291.06
Ltd.
Xunmu Information
Technology (Shanghai) Co., 1,154,129.50
Ltd.
Other payables
Luxsan Investment (Jiangsu)
1,982,319.68
Co., Ltd.
Riyimao Industrial Co., Ltd. 9,196.33
Teleray (Hong Kong)
International Company 166,040.61 44,737.19
Limited
BCS-AIS Ensambles Mexico
S. de R.L.de 563,387.00
C.V. (Mexico)
Contract liabilities
BCS Automotive Interface
Solutions 15,150.91 9,387.26
US,LLC(USA)
Lease liabilities
Luxvisions Innovation (Ji’an)
17,024,178.30
Co., Ltd.
Luxsan Precision Intelligent
65,504,587.32
Manufacture (Kunshan) Co.,
369
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Ltd.
XV. Share-based payment
1. General situation of share-based payment
Applicable □ N/A
In RMB
Categories Grants awarded this
Exercised this period Unlocked this period Expired this period
of period
recipients:
Quantity Amount Quantity Amount Quantity Amount Quantity Amount
Sales
3,788,322.0 34,205,994. 1,044,487.0 9,341,404.8
personnel
0 87 0 3
Administra
tive 29,127,569. 237,593,90 10,144,021. 94,435,598.
personnel 00 3.49 00 93
Research
and
12,279,289. 108,593,12 10,001,181. 99,629,513.
developme
00 7.99 00 39
nt
personnel
45,195,180. 380,393,02 21,189,689. 203,406,51
Total
00 6.35 00 7.15
Outstanding stock options or other equity instruments issued at the end of the period.
Applicable □N/A
Outstanding stock options issued at the end of the Outstanding equity instruments issued at the end
Categories of period. of the period.
recipients: Range of exercise Remaining contract Range of exercise Remaining contract
prices term prices term
Sales personnel 9.93-35.63 1-3 years
Management personnel 9.93-35.63 1-3 years
Research and
9.93-35.63 1-3 years
development personnel
2. Payment situation settled by equity
Applicable □N/A
In RMB
370
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Method for determining the fair value of equity instruments
Black-Scholes module
granted on the grant date
Key parameters for determining the fair value of equity
Historical volatility, risk-free rate
instruments granted on the grant date
The company determines based on factors such as the equity
Basis for determining the number of equity instruments eligible instruments corresponding to the incentive objects in
for exercise employment, and forecasts of the company's future annual
performance
Reasons for significant differences between current period
None
estimates and prior period estimates
Accumulated amount of share-based payments settled in equity
2,173,438,344.17
recognized in capital reserve
Total expenses recognized for share-based payments settled in
equity for the current period 780,664,929.64
Other descriptions:
(1) On September 25, 2018, the Proposal on Granting Stock Options to Grantees under the 2018 Stock Option Incentive Plan of
Luxshare Precision Industry Co., Ltd. was approved upon deliberation at the 5th meeting of the fourth session of Board of Directors of
the Company. Accordingly, the Company granted 97.50 million of stock options to 1,899 eligible grantees at the exercise price of
RMB17.58 per share. After 12 months from the date on which the registration of grants was completed, grantees meeting the exercise
conditions would exercise the options in five periods, with a proportion of 20% for each period, in the following 60 months; According
to the Proposal on Achievement of the Exercise Conditions for the Second Exercise Period under the 2018 Stock Option Incentive Plan
approved upon deliberation at the 27th meeting of the fourth session of Board of Directors of the Company held on December 2, 2020,
given that the exercise condition for the second exercise period under the 2018 Stock Option Incentive Plan had been matured, it was
agreed that 1,718 grantees of the 2018 Stock Option Incentive Plan would independently exercise their options at the exercise price of
RMB10.28 per share, with the estimated stock options to be exercised numbering 31,212,577 (the actual number of stock options to be
exercised shall be subject to registered number by Shenzhen Branch of China Securities Depository and Clearing Co., Ltd.)
(2) On April 22, 2019, the Company held the 9th meeting of the fourth session of Board of Directors, deliberating and approving
the Proposal on Granting Stock Options to Initial Grantees under the 2019 Stock Option Incentive Plan of Luxshare Precision Industry
Co., Ltd., whereby it was determined that 50,076,000 stock options would be granted to 348 eligible grantees and 12, 519,000 stock
options would be reserved for future granting. The stock options initially granted under this incentive plan was RMB 23.36 per share.
(3) On November 27, 2019, the Company held the 13th meeting of the fourth session of Board of Directors, deliberating and
approving the Proposal on Grant of Stock Options to Grantees in Reserved Grant under the 2019 Stock Option Incentive Plan, pursuant
to which the Company granted 16,274,700 stock options to 263 eligible grantees at an exercise price of RMB17.93 per share, and after
12 months from the date on which the registration of grants was completed, grantees meeting the exercise conditions would exercise
the stock options in five periods, with a proportion of 20% for each period, in the following 60 months.
(4) On December 3,2021, the Company held the 6th meeting of the fifth session of Board of Directors, deliberating and approving
the Proposal on Granting Stock Options to Grantees under the 2021 Stock Option Incentive Plan of Luxshare Precision Industry Co.,
Ltd., whereby it was determined that 52,419,000 stock options would be granted to 1,097 eligible grantees on December 3, 2021 as the
grant date of the incentive plan. The exercise price of stock options initially granted under this incentive plan was RMB 35.87 per share.
Since 22 original grantees resigned from the Company and 3 original grantees gave up all stock options to be granted to them for
personal reasons, the number of grantees subject to this stock option incentive was changed from 1,097 to 1,072 and the quantity of
stock options granted was changed from 52,419,000 to 52,092,000.
On September 15, 2022, the Company held the 11th meeting of the fifth session of Board of Directors and the 11th meeting of
the fifth session of Board of Supervisors, deliberating and approving the Proposal on Grant of Stock Options to Grantees in Reserved
371
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Grant under the 2021 Stock Option Incentive Plan, whereby it was determined that 13,101,000 stock options would be granted to 365
eligible grantees on September 15, 2022 as the grant date of the reserved stock options. The exercise price of reserved stock options
under this incentive plan was RMB 35.76 per share. Since 9 original grantees resigned from the Company or gave up all stock options
to be granted to them for personal reasons, the number of grantees subject to this stock option incentive was changed from 365 to 356
and the quantity of stock options granted was changed from 13,101,000 to 12,785,800.
(5) On December 15, 2022, the Company held the 14th meeting of the fifth session of Board of Directors, deliberating and
approving the Proposal on Grant of Stock Options to Grantees under the 2022 Stock Option Incentive Plan of Luxshare Precision
Industry Co., Ltd., whereby it was determined that 172,021,000 stock options would be granted to 3,759 eligible grantees on December
5, 2022 as the grant date of the reserved stock options. The exercise price of stock options initially granted under this incentive plan
was RMB 30.35 per share. Since 254 original grantees resigned from the Company or gave up all stock options to be granted to them
for personal reasons, the number of grantees subject to this stock option incentive was changed from 3,759 to 3,505 and the quantity
of stock options granted was changed from 172,021,000 to 168,513,000.
3. Share-based payment settled in cash
□ Applicable N/A
4. Stock-based compensation expense for the current period
Share-based payment expenses settled by Share-based payment expenses settled in
Categories of recipients:
equity cash
Sales personnel 57,851,529.29
Management personnel 394,024,707.00
Research and development personnel 328,788,693.35
Total 780,664,929.64
Other descriptions:
5. Others
None
XVI. Commitments and contingencies
1. Significant commitments
Significant commitments on the balance sheet date
On December 16, 2023, the company entered into an agreement with Qorvo Semiconductor Limited ("Qorvo Semiconductor") to
acquire 100% equity of Qorvo Semiconductor (Singapore) Limited ("Qorvo Singapore") and Qorvo Semiconductor (Hong Kong)
Limited ("Qorvo Hong Kong"). As of December 31, 2023, the company paid a $20,000,000 equity acquisition deposit to Qorvo
Semiconductor.
372
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2. Contingencies
(1) Significant contingencies on the balance sheet date
The Company has no significant contingencies to be disclosed.
(2) Notes shall be made if the Company has no significant contingencies that need to be disclosed
The Company has no significant contingencies to be disclosed.
3. Others
None.
XVII. Events after the balance sheet date
1. Profit distribution
Dividend to be distributed per 10 shares (RMB) 3.00
Number of dividends per 10 shares declared after deliberation
3.00
and approval (RMB)
According to the resolution of the 24th meeting of the fifth
session of the Board of Directors of the Company, the Company
distributed profits in the current year, based on the total share
capital of 7,178,011,313 shares, and paid cash dividends of RMB
Profit sharing scheme 3 (including tax) for every 10 shares to all shareholders, and paid
a total cash dividend of RMB 2,153,403,393.90 (including tax).
The remaining undistributed profits are carried forward to be
distributed in subsequent years.
2. Description of other events after the balance sheet date
1. According to the resolution of the 23rd meeting of the fifth session of the Board of Directors of the company, the company plans to
apply for a total comprehensive credit line of RMB 42 billion from 8 banks. The final approved credit line by the banks shall prevail,
including RMB loans, bank acceptance bills, letters of credit, guarantees, forward foreign exchange, and other credit varieties in both
domestic and foreign currencies. The credit lines mentioned above all have a term of one year.
In RMB
373
Luxshare Precision Industry Co., Ltd. Annual Report 2022
XVIII. Other significant events
1. Segment information
1) Basis of Segments Determination and Accounting Policies
None.
(2) Financial Information of Segments
In RMB
Item Offset among segments Total
None
(3) If the company has no reporting segments, or is unable to disclose the total assets and liabilities of each
reporting segment, it shall explain the reasons
The Group determines operating segments based on internal organizational structure, management requirements,
and internal reporting systems, and discloses segment information based on operating segments.
Operating segments refer to components of the Group that simultaneously meet the following conditions: (1)
the component generates revenue and incurs expenses in its daily activities; (2) the Group's management can
regularly evaluate the operating results of the component to determine resource allocation and performance
evaluation; (3) the Group can obtain relevant accounting information such as financial condition, operating results,
and cash flows of the component. If two or more operating segments have similar economic characteristics and meet
certain conditions, they are combined into one operating segment.
As over 90% of the Group's revenue and performance originate from the electronics product business, segment
information is not presented.
(4) Other descriptions
None.
374
Luxshare Precision Industry Co., Ltd. Annual Report 2022
XVIX. Notes to key items in financial statements of the parent company
1. Accounts receivable
(1) Disclosure by Aging
In RMB
Aging Closing balance Opening balance
Within 1 year (inclusive) 5,233,442,091.29 6,134,043,494.78
Not overdue 5,227,457,238.25 6,113,655,873.43
1 to 60 days overdue 5,937,121.62 13,695,933.00
61 to 120 days overdue 47,731.42 812,899.90
121 to 180 days overdue 1,603,021.06
181 to 365 days overdue 4,275,767.39
1 to 2 years 670,086.81 11,076,680.31
2 to 3 years 1,832,777.87 925,835.14
More than 3 years 242,560.49 242,560.49
More than 5 years 242,560.49 242,560.49
Total 5,236,187,516.46 6,146,288,570.72
(2) Classification and disclosure by bad debt provision method
Closing balance Opening balance
Book balance Bad-debt provision Book balance Bad-debt provision
Categor Provisio Provisio
y Book Book
Proporti n value Proporti n value
Amount Amount Amount Amount
on proporti on proporti
on on
Account
s
receivab
le for
which
241,403. 241,403. 241,403. 241,403.
bad-debt 0.01% 100.00% 0.01% 100.00%
36 36 36 36
provisio
n is
made
individu
ally
Includ
ing:
241,403. 241,403. 241,403. 241,403.
Entity 1 0.01% 100.00% 0.01% 100.00%
36 36 36 36
Account
s
receivab 5,235,94 3,509,49 5,232,43 6,146,04 15,127,5 6,130,91
99.99% 0.07% 100.00% 0.25%
le for 6,113.10 0.81 6,622.29 7,167.36 87.81 9,579.55
which
bad-debt
375
Luxshare Precision Industry Co., Ltd. Annual Report 2022
provisio
n is
made by
group
Includ
ing:
Group 1,531,09 3,509,49 1,527,58 1,092,89 15,127,5 1,077,76
29.24% 0.23% 17.78% 1.38%
by aging 3,301.52 0.81 3,810.71 7,234.00 87.81 9,646.19
Related
party
group in
3,704,85 3,704,85 5,053,14 5,053,14
the 70.75% 82.21%
2,811.58 2,811.58 9,933.36 9,933.36
scope of
consolid
ation
5,236,18 3,750,89 5,232,43 6,146,28 15,368,9 6,130,91
Total 100.00% 0.07% 100.00% 0.25%
7,516.46 4.17 6,622.29 8,570.72 91.17 9,579.55
Provision for bad debts made individually: 241,403.36
In RMB
Opening balance Closing balance
Description Bad-debt Bad-debt Provision Reason for
Book balance Book balance
provision provision proportion provision
Entity 1 241,403.36 241,403.36 241,403.36 241,403.36 100.00% Unrecoverable
Total 241,403.36 241,403.36 241,403.36 241,403.36
Provision for bad debts on a portfolio basis: 3,509,490.81
In RMB
Closing balance
Description
Book balance Bad-debt provision Provision proportion
Undue 1,522,604,426.67 761,302.17 0.05%
1 to 60 days overdue 5,937,121.62 296,856.08 5.00%
61 to 120 days overdue 47,731.42 14,319.43 30.00%
121 to 180 days overdue
181 to 365 days overdue
1 to 2 years (excluding 1 year)
670,086.81 603,078.13 90.00%
overdue
Over 2 years overdue 1,833,935.00 1,833,935.00 100.00%
Total 1,531,093,301.52 3,509,490.81
Descriptions on basis for determining the group:
If the bad-debt provision for accounts receivable is made according to the general model of expected credit loss, please refer to the
376
Luxshare Precision Industry Co., Ltd. Annual Report 2022
disclosure method of other receivables to disclose the relevant information of bad debt provision:
□ Applicable N/A
(3) Bad-debt provision made, recovered or reversed in the current period
Bad-debt provision in the current period:
In RMB
Amount of change in the current period
Opening
Category Recover or Closing balance
balance Provision Write off Other
reversal
Provision on an
241,403.36 241,403.36
individual basis
Provision on a
15,127,587.81 11,618,097.00 3,509,490.81
group basis
Total 15,368,991.17 11,618,097.00 3,750,894.17
Including significant amounts reversed or recovered from the current provision for bad debts:
In RMB
Basis for determining
the provision ratio for
Amount recovered or
Entity name Reason for reversal Recovery method the original bad debt
reversed
reserve and its
reasonableness
(4) Account receivables and contractual assets in the top five closing balances collected by defaulter
In RMB
Closing balance of
The proportion of accounts
Closing balance of the total closing receivable
Closing balance of
Contractual assets accounts balance of allowance for
Entity name accounts
ending balance receivable and accounts doubtful accounts
receivable
contractual assets receivable and and contractual
contractual assets asset impairment
provision
Entity 1 1,410,537,935.66 1,410,537,935.66 26.94%
Entity 2 1,128,080,418.34 1,128,080,418.34 21.54%
Entity 3 566,349,132.29 566,349,132.29 10.82%
Entity 4 420,454,730.26 420,454,730.26 8.03% 210,227.37
Entity 5 306,627,206.33 306,627,206.33 5.86%
Total 3,832,049,422.88 3,832,049,422.88 73.19% 210,227.37
377
Luxshare Precision Industry Co., Ltd. Annual Report 2022
2. Other receivables
In RMB
Item Closing balance Opening balance
Dividends receivable 522,000,000.00 150,000,000.00
Other receivables 53,065,087.05 100,596,765.44
Total 575,065,087.05 250,596,765.44
(1) Dividends receivable
1) Classification of dividends receivable
In RMB
Item (or Investee) Closing balance Opening balance
Luxshare Precision Industry (Chuzhou),
150,000,000.00
Ltd.
Jiangxi Luxshare Intelligent Manufacture
500,000,000.00
Co., Ltd.
Dongguan Leader Precision Industry Co.,
22,000,000.00
Ltd.
Total 522,000,000.00 150,000,000.00
2) Significant dividends receivable with aging over 1 year
In RMB
Whether there is
Reasons for non-
Item (or Investee) Closing balance Aging impairment and its
recovery
judgment basis
(2) Other receivables
1) Classification of other receivables by nature
In RMB
Nature of receivables Closing book balance Opening book balance
Reserve fund 12,800.00 8,000.00
Security deposit 5,818,945.78 5,692,864.47
Others 47,500,000.00 95,013,902.20
Current account 385,572.60
378
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Total 53,331,745.78 101,100,339.27
2)
2) Disclosures by aging
Aging Closing balance Opening balance
1 Year or Less (Including 1 Year) 53,331,745.78 101,100,339.27
Not Overdue 53,331,745.78 101,100,339.27
Total 53,331,745.78 101,100,339.27
3) Bad-debt provision
In RMB
Closing balance Opening balance
Categor
Book Balance Bad Debt Provision Book Balance Bad Debt Provision
y Book Book
Provisio value Provisio value
Amount Ratio Amount Amount Ratio Amount
n Ratio n Ratio
Includ
ing:
Provisio
n for
Bad
53,331,7 266,658. 53,065,0 101,100, 503,573. 100,596,
Debts by 100.00% 0.50% 100.00% 0.50%
45.78 73 87.05 339.27 83 765.44
Individu
al Item
Includ
ing:
Ageing
Analysis
53,331,7 266,658. 53,065,0 100,714, 503,573. 100,211,
Combin 100.00% 0.50% 99.62% 0.50%
45.78 73 87.05 766.67 83 192.84
ation
Combin
ed
internal
385,572. 385,572.
related 0.38%
60 60
party
combina
tions
53,331,7 266,658. 53,065,0 101,100, 503,573. 100,596,
Total 100.00% 0.50% 100.00% 0.50%
45.78 73 87.05 339.27 83 765.44
Provision for bad debts on a portfolio basis: 266,658.73
379
Luxshare Precision Industry Co., Ltd. Annual Report 2022
In RMB
Closing balance
Name
Book balance Bad debt provision Provision ratio
Aging combination (not
53,331,745.78 266,658.73 0.50%
overdue)
Total 53,331,745.78 266,658.73
Descriptions for determining the basis of the combination:
Provision for doubtful accounts according to the general model of expected credit losses:
In RMB
Stage I Stage II Stage III
Bad-debt provision Lifetime ECL (without Lifetime ECL (with Total
12 -month ECL
credit impaired) credit unimpaired)
Balance as at January 1,
503,573.83 503,573.83
2023
Balance as at January 1,
2023 in the current
period
Reversal 236,915.10 236,915.10
Balance as at December
266,658.73 266,658.73
31, 2023
Criteria for stage classification and the provision ratios for bad debt reserves
Changes in book balance of provision for loss with significant changes in the current period
□ Applicable N/A
4) Bad-debt provision made, recovered or reversed in the current period
Bad-debt provision in the current period:
In RMB
Amount of change in the current period
Opening
Category Recover or Closing balance
balance Provision Write off Other
reversal
Group by aging 503,573.83 236,915.10 266,658.73
Total 503,573.83 236,915.10 266,658.73
Including significant amounts reversed or recovered from the current provision for bad debts:
In RMB
380
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Basis and rationality of
Amount reserved or determining the ratio of
Entity name Reason for reversal Recovery method
recovered the original bad debt
reserve
5) Other receivables with top five closing balance - by debtor
In RMB
Proportion in total
Nature of Closing balance of
Entity name Closing balance Aging closing balance of
receivables bad-debt provision
other receivables
Equity transfer
Entity 1 47,500,000.00 Undue 89.07% 237,500.00
funds
Entity 2 Security deposit 4,216,931.94 Undue 7.91% 21,084.66
Entity 3 Security deposit 412,839.90 Undue 0.77% 2,064.20
Entity 4 Security deposit 298,575.04 Undue 0.56% 1,492.88
Entity 5 Security deposit 228,968.00 Undue 0.43% 1,144.84
Total 52,657,314.88 98.74% 263,286.58
3. Long-term equity investments
In RMB
Closing balance Opening balance
Item Provision for Provision for
Book balance Book value Book balance Book value
impairment impairment
Investment in 23,305,219,310 23,276,659,130 22,124,109,565 22,095,549,386
28,560,179.80 28,560,179.80
subsidiaries .74 .94 .86 .06
Investment in
joint ventures 359,712,752.90 34,372,608.46 325,340,144.44 271,906,254.31 34,372,608.46 237,533,645.85
and associates
23,664,932,063 23,601,999,275 22,396,015,820 22,333,083,031
Total 62,932,788.26 62,932,788.26
.64 .38 .17 .91
(1) Investment in subsidiaries
In RMB
Opening Opening Increase and decrease in the current period Closing Closing
balance balance of balance balance of
Investee Additional Reduced Provision
(book provision Others (book provision
value) investment investment for value)
for for
381
Luxshare Precision Industry Co., Ltd. Annual Report 2022
impairment impairment impairment
BSC
-
Technology 279,587,12 6,423,949.1 287,443,07
1,432,007.4
(Jiangxi) 2.38 2 8.94
4
Co., Ltd.
Xiexun
Electronic 248,697,66 10,598,861. 259,296,52
(Ji’an) Co., 1.66 14 2.80
Ltd.
Suining
Luxshare
2,513,272.4 3,422,369.0
Precision 909,096.64
0 4
Industry
Co., Ltd.
Luxshare
Precision 158,059,93 158,059,93
Technology 5.32 5.32
Co., Ltd.
ICT-
987,362,50 987,362,50
LANTO
0.26 0.26
LIMITED
Luxshare
32,423,829. 2,487,457.9 34,911,287.
Precision
90 8 88
Limited
Kunshan
Liantao 3,396,010,9 285,641,45 3,681,652,4
Electronics 70.46 0.74 21.20
Co., Ltd.
Dongguan
Leader
65,586,759. 3,489,441.4 69,076,201.
Precision
64 7 11
Industry
Co., Ltd.
Kunshan
Luxshare
519,241,90 4,353,678.5 523,595,58
Precision
9.62 6 8.18
Industry
Co., Ltd.
Wan’an
Xiexun 40,503,741. 41,110,509.
606,767.70
Electronic 58 28
Co., Ltd.
Fujian JK
Wiring 97,148,970. 97,584,243.
435,273.64
Systems 19 83
Co., Ltd..
Xingning
Luxshare
1,094,800.6
Technology 672,878.18 421,922.46
4
Co., Ltd.
Luxshare 785,589,53 4,327,691.2 789,917,22
Precision 2.99 9 4.28
382
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Industry
(Chuzhou),
Ltd.
SuK
Kunststofft 33,746,516. 33,746,516.
echnik 14 14
GmbH
Fengshun
Luxshare
Precision 10,162,220. 10,241,740.
79,519.73
Industry 53 26
Co., Ltd.
Shenzhen
Luxshare
Acoustics 7,210,499.8 28,560,179. 2,982,440.7 10,192,940. 28,560,179.
Technology 4 80 9 63 80
Ltd.
Dongguan
Luxshare
1,034,817,3 10,205,393. 1,045,022,7
Precision
64.24 26 57.50
Industry
Co., Ltd.
Luxshare
Automatio 65,015,912. 25,437,925. 90,453,837.
n (Jiangsu) 05 54 59
Ltd.
Shenzhen
Luxshare 21,000,000. 21,000,000.
Smart Life 00 00
Co., Ltd.
Jiangxi
Luxshare
1,117,959,1 13,745,772. 25,392,558. 1,106,312,3
Intelligent
48.52 05 04 62.53
Manufactur
e Co., Ltd.
Dongguan
- -
Xuntao 4,449,330.6
10,363,501. 5,914,170.8
Electronic 6
49 3
Co., Ltd.
Luxshare
Electronic
2,270,465,7 74,967,684. 2,345,433,4
Technology
89.36 18 73.54
(Kunshan)
Co., Ltd.
Luxshare
Precision
Component 106,126,86 106,425,64
298,782.09
s 0.87 2.96
(Kunshan)
Co., Ltd.
383
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Luxshare
Precision
102,776,30 1,929,129.8 104,705,43
Industry
6.15 3 5.98
(Enshi)
Co., Ltd.
Yongxin
County
1,107,331.7 1,795,120.0
Boshuo 687,788.37
0 7
Electronics
Co., Ltd.
LUXSHAR
3,140,913.4 2,893,330.2
E-ICT 247,583.13
2 9
Japan Ltd.
Taiwan
Luxshare
173,086,77 44,276,251. 217,363,02
Precision
6.55 37 7.92
Limited
Luxshare- 46,596,940. 19,607,273. 66,204,214.
ICT,inc. 81 66 47
Korea
Luxshare- 5,836,242.6 6,274,220.9
437,978.32
ICT 2 4
Co.,Ltd.
LUXSHAR
E-ICT
182,206.32 182,206.32
EUROPE
LIMITED
Mette
Electronics 11,737,053. 11,240,385. 22,977,439.
(Suzhou) 90 59 49
Co., Ltd.
Kunshan-
Luxshare
30,888,796. 9,190,613.0 40,079,409.
RF
67 4 71
Technology
Co., Ltd.
Merry
Electronics
3,255,101.8 1,700,194.5 4,955,296.4
(Huizhou)
6 4 0
Co., Ltd.
Jiangxi
Boshuo 1,972,318.7 1,935,963.5
36,355.14
Electronic 2 8
Co., Ltd.
Luxshare
Precision 1,409,585.3 1,598,662.5 3,008,247.8
Industry 2 6 8
(Baoding)
384
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Co., Ltd.
Luxshare
Precision
Industry 2,532,431.6 2,723,066.4 5,255,498.0
(Shanxi) 1 3 4
Co., Ltd.
Dongguan
Luxshare
Smart-Link 1,084,393.7
611,892.33 472,501.45
Electronic 8
Technology
Co., Ltd.
Guangdong
Luxshare &
1,058,103.7 1,058,103.7
Merry
3 3
Electronics
Co., Ltd.
Bozhou
Lanto 6,317,324.9 4,337,125.9 10,654,450.
Electronic 2 3 85
Limited
Yancheng
Luxshare
Precision 331,513.63 331,513.63
Industry
Co., Ltd.
Huzhou
Jiuding 2,111,090.4 1,655,777.9 3,766,868.3
Electronic 7 1 8
Co., Ltd.
Xinyu
Xiexun 4,339,715.1 5,054,587.7
714,872.61
Electronic 3 4
Co., Ltd.
Luxshare
Precision
130,000,00 130,000,00
Industry
0.00 0.00
(Suzhou)
Co., Ltd.
Luxshare
iTech 802,931,68 53,822,543. 856,754,22
(Zhejiang) 2.14 71 5.85
Co., LTD.
Bozhou
Xuntao
Electronic 260,249.46 18,013.92 278,263.38
Limited
Dongguan 906,784,68 317,637,34 1,224,422,0
385
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Luxshare 9.18 4.82 34.00
Technology
Co., Ltd.
Xuancheng
Luxshare
Precision 20,548,360. 11,779,871. 32,328,232.
Industry 76 40 16
Co., Ltd.
Beijing
Luxshare
Acoustic 7,510,289.7 10,221,477. 17,731,767.
Technology 2 29 01
Co., Ltd.
Luxshare
Intelligent
Manufactur
e 1,441,333,1 28,828,248. 1,412,504,8
Technology 31.87 87 83.00
(Changshu)
Co., Ltd.
Xingning
Luxshare
Electronic 221,447.92 192,933.60 414,381.52
Co., Ltd.
Xuande
2,291,092.9 2,372,391.9 4,663,484.8
Technology
2 0 2
Co., Ltd.
Luxshare
Technolo 4,288,174.7 1,966,491.9 2,321,682.8
gy Co., 7 7 0
Ltd.
Changshu
Luxshare
Industrial
161,667,00 1,700,000.0 163,367,00
Investment
0.00 0 0.00
Manageme
nt Co., Ltd.
Kunshan
Luxshare
Enterprise
Manageme 200,000,00 200,000,00
nt 0.00 0.00
Developme
nt Co., Ltd.
Luxshare
184,220.25 475,778.69 659,998.94
Precision
386
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Industry
(Jiangsu)
Co., Ltd.
Rida
Intelligent
Manufactur
12,642,132. 17,514,816. 30,156,949.
e
79 85 64
Technology
(Rugao)
Co., Ltd.
Luxcase
Precision
5,770,757,3 6,031,638.1 5,776,788,9
Technology
06.69 4 44.83
(Yancheng)
Co., Ltd.
Luxis
Technology
246,946,03 1,123,661.6 248,069,69
(Kunshan)
0.99 0 2.59
Co., Ltd.
Luxshare
Electronic
Technology 35,000,000. 10,000,000. 45,000,000.
(Enshi) 00 00 00
Co., Ltd.
Liding
Electronic
251,575,97 1,369,961.4 252,945,93
Technology
3.77 0 5.17
(Dongguan
) Co., Ltd.
Luxshare
Technology 28,601,994. 24,305,561. 52,296,326.
611,229.41
(Xi'an) Co., 98 29 86
Ltd.
Lixin
Precision
Intelligent
305,165,60 17,736,147. 322,901,74
Manufactur
0.10 75 7.85
ing
(Kunshan)
Co., Ltd.
Luxshare
Precision
24,775,706. 27,703,274. 52,478,980.
Technology
44 00 44
(Nanjing)
Co., Ltd.
Luxshare
Electronic 4,480,333.8 3,727,250.6 8,207,584.5
(Shanghai) 7 3 0
Co., Ltd.
Ri Ming
21,156,714. 18,154,296. 39,311,010.
Computer
387
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Accessory 43 25 68
(Shanghai)
Co., Ltd.
Ri Pei
Computer
Accessory 575,113.62 575,113.61 0.01
(Shanghai)
Co., Ltd.
Shengrui
Electronic
Technology 47,348.33 552,405.00 599,753.33
(Shanghai)
Co., Ltd.
Ri Shan
Computer
12,158,105. 7,922,152.1 20,080,258.
Accessory
97 9 16
(Jiashan)
Co., Ltd.
LUXSHAR
E-ICT
1,438,993.3 2,011,240.8
(VIETNA 572,247.51
2 3
M)
LIMITED
Hangzhou
Xuntao 6,075,602.4 8,557,832.0 14,633,434.
Technology 7 0 47
Co., Ltd.
Dachuang
Precision
Intelligent
15,703,722. 6,938,871.6 22,642,594.
Manufactur
77 4 41
e
(Kunshan)
Co., Ltd.
Fengshun
Luxshare
2,104,000.0 247,896,00 250,000,00
Intelligent
0 0.00 0.00
Manufactur
e Co., Ltd.
Luxshare
Electronic
5,000,000.0 30,500,000. 35,500,000.
Technology
0 00 00
(Kunshan)
Co., Ltd.
Suzhou
Luxshare 2,454,628.8 2,499,509.7 4,954,138.6
Technology 8 5 3
Co., Ltd.
Yancheng
Luxshare
Corporate
47,147.95 47,147.95
Manageme
nt Services
Partnership
388
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(Limited
Partnership
)
Luxshare
Precision
1,714,980.7 1,859,235.3
Industry 144,254.59
4 3
(Wuhu)
Co., Ltd.
Dongguan
Huarong
Communic
31,881.21 589,722.54 621,603.75
ations
Technology
Co., Ltd.
Luxshare
Precision
Component 7,994,737.6 8,316,551.1
321,813.49
s 9 8
(Kunshan)
Co., Ltd.
Zhejiang
Puxing
Electronic 66,287.67 773,367.00 839,654.67
Technology
Co., Ltd.
Luxshare
Thermal
1,699,063.3 3,029,427.7 4,728,491.0
Technology
5 1 6
(Huizhou)
Co., Ltd.
Luxshare
Automotiv
e
4,103.52 560,482.19 564,585.71
Technology
(Shanghai)
Co., Ltd.
Luxshare
Precision
Industry 299,659.78 519,665.42 819,325.20
(Huzhou),
Ltd.
Luxshare
Precision 1,368,220.5 1,899,556.7
531,336.23
(Yunzhong) 3 6
Co., Ltd.
Shenzhen
Huarong 1,060,617.6 1,151,526.4
90,908.80
Technology 0 0
Co., Ltd.
Dongguan
Luxshare 131,800,00 131,800,00
Holdings 0.00 0.00
Co., Ltd.
Shantou 7,332.16 7,332.16
389
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Luxshare
Technologi
es Co., Ltd.
TIME
Interconnec
t 956,470.98 956,470.98
Technology
Limited
Kunshan
TIME
Interconnec
680,207.74 680,207.74
t
Technology
Limited
Luxshare
Precision
Industry 69,312.21 69,312.21
(Anhui)
Co., Ltd.
Luxshare
Precision
39,550,000. 39,550,000.
Industry
00 00
(Huzhou),
Ltd.
CASETEK
SINGAPO 1,289,759.7 1,289,759.7
RE 2 2
PTE.LTD.
Luxcase
Precision
Technology 559,415.27 559,415.27
(Kunshan)
Co., Ltd.
Luxshare
Precision
Industry 460,628.47 460,628.47
(Mingguan
g) Co., Ltd.
22,095,549, 28,560,179. 1,577,942,6 396,832,90 23,276,659, 28,560,179.
Total
386.06 80 49.39 4.51 130.94 80
(2) Investment in joint ventures and associates
In RMB
Openi Openi Increase and decrease in the current period Closin Closin
ng ng Invest Other Declar g g
Investe balanc Additi Reduc Other Provisi balanc
balanc ment compr ed balanc
e e onal ed change on for e
e of profit ehensi cash Others e of
(book invest invest s in impair (book
provisi or loss ve divide provisi
value) ment ment equity ment value)
on for recogn incom nds or on for
390
Luxshare Precision Industry Co., Ltd. Annual Report 2022
impair ized e profits impair
ment under adjust ment
equity ment
metho
d
I. Joint ventures
II. Associates
21,778 23,958
Silicon 2,180,
,148.7 ,950.9
ch 802.19
6 5
Zhuhai
Kinwo
ng -
215,75 34,372 189,27 34,372
Flexibl 26,477
5,497. ,608.4 8,315. ,608.4
e ,181.9
09 6 16 6
Circuit 3
Co.,
Ltd.
Lishen
g
Autom
otive
112,50 - 112,10
Techn
0,000. 397,12 2,878.
ology
00 1.67 33
(Guan
gzhou)
Co.,
Ltd.
-
237,53 34,372 112,50 325,34 34,372
Subtot 24,693
3,645. ,608.4 0,000. 0,144. ,608.4
al ,501.4
85 6 00 44 6
1
-
237,53 34,372 112,50 325,34 34,372
24,693
Total 3,645. ,608.4 0,000. 0,144. ,608.4
,501.4
85 6 00 44 6
1
The recoverable amount is determined based on the present value of estimated future cash flows.
Applicable □N/A
In RMB
Method of
Criteria for
Recoverable Impairment determining
Item Book value Key parameters determining
amount amount fair value and
key parameters
disposal costs
The recoverable amount is determined based on the present value of estimated future cash flows.
Applicable □N/A
In RMB
Key Key Criteria for
Forecast
Recoverable Impairment parameters parameters determining
Item Book value period
amount amount for the for the stable key
duration
forecast period parameters
391
Luxshare Precision Industry Co., Ltd. Annual Report 2022
period for the stable
period
Reasons for differences between the aforementioned information and the information used in previous years' impairment tests or
external information:
None.
Reasons for significant discrepancies between the information used in previous years' impairment tests and the actual situation in the
current year:
(3) Other descriptions
4. Operating income and operating costs
In RMB
Amount recognized in the current period Amount recognized in the prior period
Item
Income Cost Income Cost
Principal business 10,632,214,770.04 10,025,885,162.48 12,732,437,422.46 11,987,063,338.40
Other business 145,744,213.41 64,294,879.18 220,376,313.08 64,760,595.99
Total 10,777,958,983.45 10,090,180,041.66 12,952,813,735.54 12,051,823,934.39
Income related information:
In RMB
Contract Segment 1 Segment 2 Total
classificati
on Operating Operating Operating Operating Operating Operating Operating Operating
By product revenue costs revenue costs revenue costs revenue costs
types
Including:
Contract
classificati
on
By
geographic
al areas of
operations
Including:
By markets
or
customers
Including:
By contract
392
Luxshare Precision Industry Co., Ltd. Annual Report 2022
types
Including:
By the
period of
transferring
products
Including:
By contract
term
Including:
By sales
channel
Including:
Total
In RMB
In RMB
Information related to performance obligations:
The type of
Amounts quality
Time of Nature of the
Whether they expected to be assurance
performance or Key payment company's
Item are the primary refunded to provided by the
fulfillment of terms commitment to
obligor customers by company and
obligations transfer goods
the company related
obligations
Other descriptions
Information relating to the transaction price allocated to the remaining performance obligations:
At the end of the reporting period, the incomes corresponding to the contracts signed whose performance has not been commenced or
completed amount to RMB0.00, of which RMB is expected to be recognized in , RMB is expected to be recognized in , and RMB is
expected to be recognized in .
Significant contract amendments or significant adjustments in transaction prices.
In RMB
Item Accounting treatment methods Amount of impact on revenue.
Other descriptions:
5. Investment income
In RMB
393
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Item Amount recognized in the current period Amount recognized in the prior period
Long-term equity investment income
3,436,245,988.83 1,300,000,000.00
accounted for using the cost method
Long-term equity investment income
-24,693,501.41 16,056,804.17
accounted for using the equity method
Investment income from disposal of held-
-48,976,370.39
for-trading financing assets
Long-term equity investment income
93,809,534.50 77,056,640.91
accounted for using the cost method
Dividend income earned during the
holding period of other equity 264,713.32 212,413.30
instruments.
Income from wealth management
879,726.47 11,308,785.90
products
Gains from derecognition of financial
-39,618,411.95 -43,522,172.22
assets measured at amortized cost.
Total 3,417,911,679.37 1,361,112,472.06
6. Others
XX. Supplementary information
1. Breakdown of non-recurring profit and loss for the current period
Applicable □ N/A
In RMB
Item Amount Remarks
Profit or loss from disposal of non-current
106,350,953.11
assets
Government grants recognized in the
current profit or loss (except for the
government grants which are closely
related to the company’s normal business 791,098,788.52
operations and gained at a fixed amount
or quantity according to national uniform
standards)
Except for effective hedging business
related to the company’s normal business
operations, profit or loss from changes in
fair value arising from the holding of
held-for-trading financial assets and 488,375,997.34
liabilities, and investment income from
disposal of held-for-trading financial
assets and liabilities, and available-for-
sale financial assets
Profit or loss on assets under entrusted
189,969,851.82
investment or management
394
Luxshare Precision Industry Co., Ltd. Annual Report 2022
Other non-operating income and expenses
41,640,366.02
except the above items
Other profit and loss items satisfying the
-601,026,495.49
definition of non-recurring profit and loss
Less: Affected quantum of income tax 158,749,222.86
Affected quantum of minority
90,557,090.29
interest
Total 767,103,148.17 --
Details of other profit and loss satisfying the definition of non-recurring profit and loss
Applicable □N/A
The early termination recognition of investment income primarily pertains to financial assets.
Description of classifying non-recurring profit and loss items enumerated in the Explanatory Announcement No.1 for Public Company
Information Disclosures – Non-recurring Profits and Losses as recurring profit and loss items
□ Applicable N/A
2. Return on equity and earnings per share
Earnings per share
Profit in the reporting period Weighted average return on equity Basic earnings per share Diluted earnings per
(RMB/share) share (RMB/share)
Net profit attributable to ordinary
21.61% 1.54 1.53
shareholders of the Company
Net profit after deduction of non-
recurring profit and loss attributable
20.25% 1.43 1.42
to ordinary shareholders of the
Company
3. Accounting data differences under domestic and foreign accounting standards
(1) Differences of net profit and net assets in financial reports disclosed according to International
Accounting Standards and Chinese Accounting Standards at the same time
□ Applicable N/A
(2) Difference of net profit and net asset in financial reports disclosed according to overseas accounting
standards and Chinese Accounting Standards at the same time
□ Applicable N/A
395
Luxshare Precision Industry Co., Ltd. Annual Report 2022
(3) Descriptions on the reasons for the differences of accounting data under the accounting standards at home
and abroad, and the name of the overseas institution if difference adjustment is made to the data audited by
an overseas audit institution
None
4. Others
None
396
